Mining in Tanzania
Although mining in Tanzania initially focused around gold, today the biggest
projects include various minerals such as magnetite, chlorite, ilmenite, and
pyrite – with some of these mining projects, such as the Liganga Mining Project,
valued at up to ZAR6, 8 billion.
|Gold mining in Tanzania is dominated mainly by mining companies Resolute Ltd, Ashanti Goldfields, AngloGold, Barrick Gold Corp, and Placer Dome Inc.The diverse resources for future mining in Tanzania appear to still be abundant, as data collected by MiningIQ shows there are five new mining plants being commissioned for gold mining , nickel mining, coal mining , iron ore mining , and uranium mining and processing – all of which are lucrative projects valued between ZAR1 billion and ZAR5 billion.|
MiningIQ collects detailed data on all mining projects involved with mining in Tanzania – such as the Buzwagi Open Pit Mine, east of Kahama, which became fully operational in 2009. The data collected describes this entire operation – from the grassroots stage through to the operational stage – helping industry managers keep on track with all developments around mining in Tanzania.
For businesses and entrepreneurs looking for a growth opportunity, Africa represents a compelling and underserved market with a population of more than 1 billion people. In a slow growth environment, Africa has grown at 5% a year during the past decade. But political risk, poverty, staffing shortages, lack of infrastructure and cultural differences abound, making it difficult to secure a foothold there. Furthermore, turning a profit in Africa is not considered to be good enough, with businesses facing pressure to give back to their communities in order to help the region prosper.
Kenyan business tycoon Manu Chandaria is chairman and CEO of the multi-billion dollar privately held Comcraft Group. The global conglomerate, founded by Chandaria’s father more than 80 years ago, is a leader in the steel, plastics and aluminum markets in Africa. It employs some 40,000 workers and operates on other continents such as Europe, North America and Australia. In addition to leading a massive business group, Chandaria is focused on giving back to the African community through philanthropic work in health care and education. Focused on fostering entrepreneurship in Africa, he recently established the Chandaria Business Innovation and Incubation Centre at Kenyatta University in Kenya.
An edited version of the conversation appears below:
Question: There’s a lot of talk right now about Africa and all the ripe opportunities on the continent. I wanted to ask you, as one of Africa’s foremost business leaders, how does the rest of the world participate in Africa’s growth today?
Manu Chandaria: The people who want to make a difference and want to make an impact are going to Africa without asking. This includes specifically companies from China, but also India, Malaysia, Indonesia and Korea. They’re all coming very fast, and they want to make an impression. Africa is growing: Out of the top 10 most important investment destinations today, six are in Africa. [Among those are] Kenya, Angola, South Africa and Nigeria. There is huge potential right now. Everybody is rushing towards it because Africa now has a more stable political climate than ever before. Furthermore, nearly all developed countries are finding it extremely difficult to grow, but Africa is expected to grow probably at 6% in the coming years.
Question: If you were going to start working on the continent today, which sectors or which country would you look at first?
Chandaria: If I have an appetite that is big enough, I’d go to Nigeria. It has a population of 140 million, and it supports surrounding countries, which have another 50 million people. That’s almost a quarter of Africa. So I would go there if I had the capacity to handle that large market. If my capacity was smaller, then I would go to East Africa, because in East Africa there are 180 million people from countries such as Kenya, Uganda, Tanzania and Rwanda.
Question: Which specific sectors would you look at?
Chandaria: I’m currently working in the housing and shelter sectors, which are growing rapidly. I wouldn’t leave these sectors. I’m not as familiar with software or telephones, but our business has specialized in aluminum and steel over the last 70 to 80 years, and I think that there is a great need for both of these products.
Question: You have built major conglomerates in Africa and then invested in other parts of the world, including India, China, the U.S. and Europe. How would you compare managing your investments inside and outside of Africa? You have the perspective of being able to compare the two different business environments. What can you tell us?
Chandaria: We understand how to run and manage businesses in Africa because we’ve been there for so many years. But specifically, with the downturn in the economy, we are finding that managing businesses in the United States, Canada and Europe is more difficult than ever before. India is also a very difficult environment. We cannot manage a very strong, sound business in India because it is very competitive. Meanwhile, managing businesses in Australia, New Zealand and China is far easier. But since most of the people in my businesses have come from Africa, we understand the pulse of Africa, which makes it easier to do business.
Question: What type of mindset does it take to succeed in business in Africa?
Chandaria: First, you’ve got to accept that it’s a third world country. It’s not a first world country. If you are thinking about the comforts of the first world, they are not there. But once you get past that, you will realize that each country in Africa has its own specialty, and if you can capitalize on those specialties then you will do well.
As an example, let’s look at the telephone and telecommunications sector. Recently the company Airtel from India decided that they wanted to enter in Africa. They have been thinking about it for the last five years. All of a sudden, they came back and said, “All right, we’ll buy a whole company.”
Another example of a specialty is textiles in China. They don’t have a textile business anymore in the U.K., Europe or the U.S. It’s all Chinese. They’re supplying about 22% of the world’s garments, and the goal is to get to 33%. If you think about one country … providing one-third of the world’s garments, there’s huge potential in that market.
Question: There has been quite a big debate about China’s involvement in Africa. There seems to be a negative undertone when talking about China, with people saying that China is trying to replace the West in Africa. There is concern that this will not benefit Africans. What do you think?
Chandaria: There are two ways of looking at it. First of all, I think that the West had for the last 10 years not really pushed what are known as social amenities — they supported political parties. In contrast, when the Chinese come into an African country, the first thing they do is build a stadium. Second, they build a road. Third, they build an airport. Fourth, they build a hospital. You know, these things are very much near to the hearts of the people. China has its own style of doing things, and they know what they want from Africa — specifically oil, copper, aluminum, etc.
Question: There are major funds such as Carlyle Group and KKR that are now investing in Africa. I’ve heard that the level of fundraising for investment in Africa is at a record high. How do these investors partner with African entrepreneurs? What would you tell them?
Chandaria: These investors should first ensure that they have a business model that will work. They must also be very sure that they work with African management and cultivate better management practices with Africans. If you bring outside management to oversee a project, you’re not transferring the know-how. At some point down the road, these big projects will be taken over by locals and, therefore, working with locals is very important to ensure that the business is run well.
Question: Taking a step back from the opportunities in Africa, you have lived through some of Africa’s darkest moments. What would you tell people about managing uncertainty and risk in Africa?
Chandaria: If I had my way, I would bring in more education to help people understand what is good for them. This is not being done. For example, 50 years ago Kenya gained its independence, but things are no different now compared to how they were. The older people are bitter about this, and the younger people are bitter because they do not have jobs. So I think that the West must be very careful about coming in and putting in the proper standards of governance and democracy in all fields, including education, government, banking, industry, etc. Having good governance structures will allow people to start taking ownership of their work, and I think that’s the only way that we will see change for the better.
Question: You mentioned the need to provide jobs and education. I think the business sector has a role to play here. Related to that point, your family started The Chandaria Foundation back in the 1950s. From your experience, what can businesses do to be more reconciled with society?
Chandaria: If any business wants to succeed, they must remember that they have a social responsibility. For the last few years, we have been pushing the importance of corporate social responsibility. We feel that if you get something out of Africa in terms of profit and growth, it should be your responsibility to invest back in the continent, specifically in education and health. When you’re operating a profitable business in Africa, you must ensure that all stakeholders benefit.
Question: But how do we make that happen?
Chandaria: Back in the 1950s in Kenya, I told my father that we should start a foundation. He told me I was stupid, but I kept saying that we need a focal point where the family can work to help the community. We are now pushing as hard as possible for other businesses to follow our lead and create foundations that will commit to putting a certain amount of money back into areas where they can make a difference. This is working, but it’s certainly difficult. Ask me how many local Africans and local businesses are doing this? That’s what we’ve got to crack. We have to figure out how to make them appreciate this idea. We have to ensure that business leaders and foundations with experience in corporate social responsibility will help guide the way for others. We want them to hold their hands along this journey. Doing something good has to come from your heart; it’s not just writing checks.
Question: Entrepreneurship is a big topic in Africa. As one of Africa’s top entrepreneurs, what can you tell other people who want to be entrepreneurs? How do we create wealth?
Chandaria: Well, the first thing you must do is take a risk and say, ‘Yes, I will move forward with my plan.’ You have to take the plunge. I’ve said this many times, if you want to go to heaven, you’ve got to die first. Essentially, entrepreneurship is all about taking risks, and sometimes failing, if necessary. But failure always opens up another opportunity. But this entrepreneurial mindset is not only for business; this is applicable for running clinics and councils, too. You have to figure out the best way to run these operations. Entrepreneurship is in every endeavor, but the question first is, are you prepared to take the risk? There is a tremendous need for people to become a little bit more daring and say yes.
Looking back to my younger years, I was an engineer and we had goods we couldn’t sell. I was asked to sell them in another country, so I went to Uganda. I didn’t know how to sell anything but I went to every shop and spoke with all my potential customers. In a year, I made each one of them feel comfortable with me, and so I became the first one to get orders instead of my competitors. But it took me eight or nine months to establish myself. I think that the question is, do you have time to build relationships and do you have the patience to grow these relationships? And now I’ve built up a reputation where I’m known as an investor who is not only interested in profits, but I’m also known for helping others as well. It’s all about having a mutually beneficial relationship.
Question: What is the biggest leadership challenge you have faced and how did you deal with it? What did you learn from this?
Chandaria: I used to have a lot of conflicts with my older brother about managing our businesses. We always had conflicting ideas. I had to ask myself and decide, ‘Am I going to win this man over, or am I going to fight him?’ So I decided that I would win him over. And that involved following through on his orders and executing his ideas, but I would do it better than what he had imagined. He started realizing, ‘My God, he’s doing exactly what I wanted him to do but even better.’ That was the way to move forward. Many people will have this crisis, and they can choose to step into the mold and break it — but if you don’t get inside that mold, you won’t break it. The point is that when a challenge is thrown down, you must take it. Otherwise, you won’t accomplish anything. Action is necessary.
Question: Any message you want to leave potential investors, Africans and leaders with as we close this interview?
Chandaria: Look, my only message to them is very simple: Your destiny is in your hands. Don’t expect somebody else to do it for you. In 25 years, my business was in 25 countries. How did we do this? It’s all doable. Number one: You must believe in yourself. Number two: You must take risks. Number three: You must get truly involved. If you’re not involved, nothing happens. Don’t let others decide your destiny for you. In Africa, we are sitting on a huge amount of land with water, minerals, resources, etc. But we must have the determination to move forward and execute sound plans.
Q: Where are you originally from?
A: Chennai, India
Q: Where are you living now?
A: Chennai, India
Q: How long did you live in Johannesburg?
A: Two years
Q: Did you move with a spouse/ children?
Q: Why did you move; what do you do?
A: I had come to Johannesburg on a deputation for a couple of years.
About your city
Q: What did you enjoy most about Johannesburg, how was the quality of life?
A: The most enjoyable thing about Joburg is it is cosmopolitan in nature. In particular, people from India would find lot of Indian flavours spread through the city.
Q: How did you meet other Indian expats?
A: I lived in an area where most of my colleagues who came on deputation lived. It was not an Indian area, however. Indian expats can mainly be found in Fordsburg and Indian Hindu temples (in Marlboro, Melrose, Benoni and Midrand ). Midrand is a place where many people from Andhra (a provincial state) in India live.
Q: What exactly are the Indian flavours you’re talking about?
A: There are quite a few Indian restaurants located around Joburg. These include Swad in Melrose, Thava and Shahi Khana in Norwood and Delhi Darbar in Parkmore – to name a few.
Q: Any negatives? What did you miss most about home?
A: Lack of safe public transport. One needs to own a car in Johannesburg to travel safely.
Q: Is the city safe?
A: It is kind of safe. One needs to follow the Dos and Dont’s.
Q: What are those?
- Withdraw cash only from well-lit ATMs and where you feel safe.
- Try to obtain chip-based cards from bank, as financial fraudulent activities are quite rampant.
- Keep your car windows up at all times, but especially when stopping at traffic signals (traffic signals are referred as robots in South Africa).
- Keep doors locked at all times. It is advisable to install a security gate at your front door.
- Always be aware of what is happening around you and be alert.
- Keep your luggage/purse/laptop near the driver seat or on the rear seats of the car where it is visible from outside.
- Count cash in public.
- Walk on the streets while using your mobile phone.
About living in Johannesburg
Q: Which are the best places/suburbs to live in Johannesburg as an expat?
A: Sandton, Morningside, Rivonia, Sunninghill, Parkmore, Roodeport, Weltevreden Park and Fourways.
Q: How do you rate the standard of accommodation?
A: Very good.
Q: What’s the cost of living compared to home? What is cheap or expensive in particular?
A: It is worth the money one pays for it.
Q: What are the locals like; did you mix mainly with other expats?
A: Locals are really hospitable. I lived with many Indians, so moved mainly in Indian expat circles.
Q: Was it easy meeting people and making friends? Did you make expat friends you wouldn’t have otherwise?
A: Yes, it was easy – South Africans are generally friendly, and making friends with locals is not a problem at all. Indian expats get connected very easily. On the flipside, especially in Joburg, there are a lot of Indian expats and you might feel overwhelmed by looking at the Indian expat population – you might be tempted to stick to little Indian groups living nearby or those you work with. Joburg has got a mix of Indian, European and African styles. A Indian expat would easily strike a balance between Indian and overseas living. Yes, I made few Indian connections here, whom I wouldn’t have met if I was working from India.
About working here
Q: Did you have a problem getting a work visa/permit?
A: Not really, my company had applied for my work permit, so I didn’t have difficulty getting a work permit or visa.
Q: What’s the economic climate like in Johannesburg, is there plenty of work?
A: When it comes to IT, there is lack of local skilled people. The economy is pretty decent and economically South Africa performed OK, although there were some retrenchments here and there. An Indian expat coming to South Africa would definitely feel that the infrastructure is really good and better than India. But I doubt an expat from Europe/ America would share the same feeling as I do.
Q: Are there other types of jobs that there are more of do you think? What jobs would you recommend other Indian expats come here to look for?
A: Information Technology is one of the areas where Indian expats can look for work. Like I said earlier, South Africa does not have enough skilled techies. Banking, shipping and mining would be next on the list.
Q: How does the work culture differ from home?
A: There isn’t really a competitive work culture due to the lack of a skilled work force. Knowledge and technological exposures are little low.
Q: Is there any other advice you’d like to offer new expat arrivals?
A: Carry enough medicines back from home, as medicines are quite expensive and not easily available. Indian expats must bring electrical converters – 15 Amperes to 5 Amperes, pressure cooker, mixer/kitchen grinder to prepare masalas. Enough clothing should be taken, as it seems to be more expensive than India.
This blog was started in May 2012, one month before the United Nations Rio+20 ‘Earth Summit’ where the green economy was the main theme. The blog so far has had three specific objectives.
In the run-up to the Rio+20 Summit the initial objective was to raise awareness of Africa’s huge green growth potential and role in rebalancing the global economy. Eight posts were published before the Summit and were sent to as many African environment ministries as possible. One post was published in August 2012 appraising the summit and Africa’s position: Africa, Rio+20 and the Green Road Ahead.
The second objective was to examine the case of Ethiopia, following the death of prime minister Meles Zenawi on 21 August 2012. At the time of his death Mr Meles was recognised as ‘the voice of Africa’ at international summits and conferences and a leader in Africa’s green thinking. Four posts on Ethiopia were published between late August and early November 2012 exploring the paradoxical nature of his leadership with a focus on raising awareness of his green legacy and 21st century vision for Ethiopia and Africa.
The third and current objective is to raise awareness of the importance of the green economy in Africa’s growth story. 2013 started with unprecedented optimism for Africa’s growth prospects. Summits, conferences, articles, books, blogs, films and other media now proclaim that ‘Africa’s Moment’ has arrived. But very few even mention the green economy as an essential tool in the process to achieve sustainability and resilience. For this reason the current focus of this blog is a call to action to ‘put the green economy into Africa’s growth story’.
Part of this call to action is writing letters to the Financial Times. Not only does the FT have excellent coverage of Africa but it is also seen by many as the ‘world’s most influential newspaper’.
According to the African Development Bank(AfDB)’s 2013 “African Economic Outlook” report, Zambia‘s growth GDP has grown since 2011, and the country is expected to continue as the International Monetary Fund(IMF) estimates an increase in economic growth from 6 percent this year to 6.5 percent in 2014. The changing business environment and thriving agriculture sectors are presenting opportunities for foreign companies to invest in Zambia.
As the country celebrates 49 years of independence from Britain today, we highlight Zambia’s gradual rise in investment. We also reflect on the milestones ahead for the country as it approaches its golden years. Specifically, the challenge of reducing a poverty level — which currently sits at 60 percent and creating job opportunities for a population with a median age of 16 years old. Zambia is accelerating development, and in the process hoping to address these issue with funding of education and social services.
Located in the horn of Africa Africa, Ethiopia is home to more than 91 million people, and less than 30 percent of the population has access to electricity. Under the Growth and Transformation Plan, the country’s government aims to boost energy potential through recent construction projects.
Thanks to an investment partnership between a French firm and the government, Ashegoda Wind Farm was opened at the end of October 2013. The 52 MegaWatt farm is estimated to cost slightly over 200 million euros.
Have you heard of the Grand Renaissance Dam?
Though the structure’s estimated year of completion is 2017, it hasn’t stopped the $4.7 billion project from making headlines. Announced in 2012, Grand Renaissance will be Africa’s largest. It will rest along the Nile River and run between Egypt and Ethiopia. If executed, this could be two milestones marked for the East African country’s development, but debate about the dam’s potential effect on the water supply of neighboring Egypt has halted construction.
The Nigerian government is adjusting the way it measures GDP to account for the true size of the economy. Expected to be completed at the end of 2013, Nigeria will become the largest economy in Africa, surpassing South Africa. This will undoubtedly have an impact on the opportunity for MNCs and foreign investors seeking high growth rates in Africa. I cover the rebase and its implications for MNCs in my latest podcast with FSG’s CEO, Richard Leggett, following the publication of our recent
As it currently stands, Nigeria’s GDP is based on figures from the 1990s which excludes the emergence of new industries such as the booming film industry, Nollywood, and the emergence of the telecommunications and services sectors. Nigeria’s economy is heavily driven by private consumption, and the GDP rebase will not affect this, but the rebase will fundamentally change the makeup of industries. The services sector is expected to comprise a much larger share of GDP as current figures indicate, as will wholesale and retail trade. The natural resource sector instead will decrease in terms of its share in GDP. Once the GDP is adjusted to reflect new realities, FSG expects the size of the economy to increase anywhere from 40% to 60%. Though the exact timing for the rebase remains unknown, Nigeria is expected to release preliminary numbers by the end of November 2013. Skeptics can rest assured; the fickle timeline for the rebase is likely caused by the complexity of collecting statistics and not an indication of the data’s reliability. Ghana’s GDP rebase in 2010, an exercise that increased the size of the economy by 60% overnight, took 8 years to be completed.
The imminent rebase is expected to also lead to an increase in government spending as improved debt ratios are likely to make Nigeria one of the leastleveraged countries in the world. The spending is expected to go into the government’s priority sectors including infrastructure, housing, education, and healthcare. MNCs should monitor where new funds will be allocated to and take advantage of Nigeria’s improving economic indicators to make the case for resources and stay ahead of the competition as Nigeria becomes too large for companies around the world to ignore.
Five years after the global financial system came perilously close to collapse, the global economic outlook is still uncertain. In Europe, GDP is still below pre-crisis levels and unemployment is at a record high. Recovery in the United States, although stronger, remains weak by historic standards, and even China, which has done so much to drive global growth, is slowing down.
Africa now has the chance, as never before, to shape its own economic future through industrialization. This will help to spread prosperity throughout the continent. An industrialized Africa will also provide a much-needed new driver of global growth. It is in everyone’s interest that Africa succeeds.
Lately many observers have been avidly discussing the recent high rates of economic growth in Africa. Speaking in Washington earlier this year, Donald Kaberuka, the president of the African Development Bank offered some cautionary words. While the good economic news from the continent may well represent a turning point from a past characterized by hopelessness, he said, Africa nevertheless remains far from a tipping point. To reach such a threshold, Africa requires major investments in three “I’s”: institutions, integration, and infrastructure. Even with the recent robust growth experienced over the past decade, Africa still suffers a major infrastructure deficit. Most of the countries have relatively weak institutions. And the regional integration project has been slow and marred by compliance and commitment deficits. Thus, as Kaberuka noted, although Africa has reached a turning point, progress to a tipping point is not an easy journey.
One of the regions in Africa that is making remarkable progress in all these “I’s” is the East African Community. The EAC’s original members — Kenya, Uganda, and Tanzania — have recently been joined by Rwanda and Burundi. South Sudan is expected to join the community soon. The region has fast-tracked regional integration and has seen considerable progress in institutional reforms. Moreover, East Africa boasts much greater political stability than it has at any time in its recent past, and peace has been restored in most of the countries. The region has also seen major investments in both national and regional infrastructure; many more projects have been planned and are scheduled to commence shortly.
Looking at statistics and at the precedents set by China and India, Robertson brings this idea to a full boil, saying that economists haven’t been nearly optimistic enough in their predictions for the continent. While Africa is currently a $2 trillion economy, by 2050 it will be a $29 trillion economy, he says — bigger than Europe and America combined.full of inspiring graphs all pointing up, up, up.
Africa has, for a long time, conjured up images of famine, disease, poverty and war. But increasingly, entrepreneurship, technological innovation and investment in education are becoming part of the outsider’s mental picture