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Acacia injects US$712 million into Tanzania’s economy

Approximate reading time: 3 minutes

Despite facing several challenges during the year, in 2017 Acacia contributed US$712 million (TZS1.61 trillion) to the national economy, which represents around 1.5% of Tanzania’s total gross domestic product (GDP).  This, the study shows, compares with a total contribution of US$724 million (TZS1.64 trillion) the previous year.

A recently released report has indicated that Acacia has so far contributed of US$712 million (TZS1.61 trillion) to the Tanzanian economy.

The study, by Ernst and Young (EY) Study shows that Acacia’s three mines – North Mara, Bulyanhulu and Buzwagi – continue to make to Tanzania’s economy as well as the country’s broader social development.

Dubbed “Acacia Mining plc Total Economic and Tax Contributions in Tanzania, 2017,” notes that during the year Acacia’s businesses purchased US$434 million (TZS984 billion) of goods and services from suppliers located in Tanzania.

“This represented 67% of our total spend on goods and services in 2017. Of this amount, approximately US$120 million (TZS271 billion) of goods and services were purchased from businesses in the direct locality of the three mines in the country’s Lake Zone.” A statement from Acacia reads in part.

Despite facing several challenges during the year, in 2017 Acacia contributed US$712 million (TZS1.61 trillion) to the national economy, which represents around 1.5% of Tanzania’s total gross domestic product (GDP).  This, the study shows, compares with a total contribution of US$724 million (TZS1.64 trillion) the previous year.

In 2017, Acacia employed nearly 2,800 workers in Tanzania and paid wages and benefits totaling more than US$111 million. On average, each employee received over US$40,000 in wages and benefits.

The 2017 contribution is comprised of US$200 million (TZS453 billion) by the businesses, an indirect contribution via suppliers of US$304 million (TZS689 billion) and induced contributions of US$208 million (TZS471 billion). Meanwhile Acacia’s three mines made a total tax contribution to the Tanzanian Treasury of US$186 million (TZS421 billion), comprising US$101 million (TZS229 billion) by the company, US$42 million (TZS95 billion) by its employees, and a further US$42 million (TZS95 billion) in indirect or induced taxes.

Acacia’s Maendeleo Fund supports a wide variety of projects in Tanzania. Some of these projects have short-term, one time impacts. The fund was established in 2011 as part of commitment to promoting sustainable development in Tanzania. : Education was the largest area of Maendeleo Fund spending in Tanzania in 2017, at US$1.0 million.

“This report further reiterates our commitment to continue conducting our business in a way that benefits the Country and host communities in which we operate,” Asa Mwaipopo, Managing Director, Tanzania, said. “It is encouraging to see that our contribution stretches from our zone of influence to a national level as we continue to support efforts towards Tanzania’s socio-economic growth and the attainment of the Country’s Development Vision 2025.”

The EY report also highlighted that during the year Acacia’s businesses employed nearly 2,800 workers in Tanzania, over 96% of whom are Tanzanian and paid wages and benefits totalling more than US$111 million (TZS251 billion).  Acacia’s total direct, indirect and induced economic contribution in Tanzania in 2017 included over 33,500 jobs and approximately US$345 million (TZS782 billion) of labour income.  The company’s supply chain spending alone supported nearly 19,000 indirect wage-earning jobs in Tanzania.

Besides its economic contribution, in 2017 all three of Acacia’s mines spent significantly on their social investment programmes which seek to support the Government of Tanzania’s development agenda and Vision 2025.  During the year the three mines invested over US$8 million (TZS18 billion) in social projects in Tanzania, including over US$3.5 million (TZS8 billion) on initiatives in education, health, infrastructure, and water and sanitation.

Source: The Exchange

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