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The new face of informality in the Tanzanian mineral economy: Transforming artisanal mining through foreign investment?

Artisanal and small-scale mining (ASM) has long been a mainstay of Tanzania’s rural economy, contributing to the livelihoods of more than three million Tanzanians. ASM is nonetheless yet to realise its full development potential, with the sub-sector continuing to be beset by social, environmental and economic underperformance issues as a result of structural resource and capacity constraints.

Like countries such as Ghana, Cameroon and Zimbabwe, foreign investors, often of Chinese origin, are increasingly participating in Tanzania’s ASM chains, which bring in much-needed capital, technologies and know-how. Such investments have the potential to contribute to resolving ASM barriers to upgrading, but could also pose a threat if not properly regulated.

This paper aims to offer new insights into the opportunities and risks associated with leveraging foreign private capital in support of ASM development. It does this by examining:
1. The nature and scope of investor participation in Tanzania’s ASM,
2. How (well) this participation is regulated, and
3. The attendant sustainable and sector development implications.

Our analysis reveals how investor participation in Tanzania’s ASM sector has evolved in recent years and how such investments have contributed to fulfilling basic livelihoods needs of rural populations.

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Schoneveld, G et al. (2018) The new face of informality in the Tanzanian mineral economy: Transforming artisanal mining through foreign investment? IIED Research Report, London.
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By improving evidence, building capacity and fostering joint actions for sustainable investment in Africa's natural resources, we promote China-Africa relations that benefit the economy, poor communities and the environment.

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