President John Magufuli has directed the energy and minerals ministry to revoke the license of UK-based nickel firm African Eagle Resources (AER). A decision indicative of the priorities of the current government and associated investment risk.
Tanzania has considerable resource wealth e.g. 100 million tons in estimated nickel deposits. Nevertheless, there are signs that the pace and tenor of policy is impacting confidence. For example, at least six top foreign investors (in sectors including mining) told Reuters last November that they were considering downsizing their investments in the country.
Written by Analyst Adedayo Ademuwagun (Lagos) with input from East Africa Director (Nairobi) and Managing Partner (London).
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