The potential impacts of contract review on foreign direct investments in mining resources: case study of Tanzania and Democratic Republic of Congo

Abstract

This work deals with the potential impacts of contract review on foreign direct investments in mining resources. The research has cited Tanzania and the Democratic Republic of Congo as the case study because the two countries have experienced the problems generated from mining contracts review programmes. Indeed, there are some variations on the nature of the environments in which the reviews were made. While in the DRC the reviews were done amid civil wars (whose root cause was wealth emanating from mineral resources), in Tanzania the reviews were done without such pressure. However, the situation seems to have not been fully solved neither in Tanzania where the reviews were done under “peaceful” environment nor in the DRC where at least the past experience could have taught them a lesson. The mini thesis is divided into four chapters each covering a distinct topic for discussion. Chapter one serves as an introduction highlighting on the mission and vision of the research. It also spotlights the scope and limitation of the research. Chapter two is a discussion on the mining sector and foreign direct investments in Tanzania and the concept of mining contracts review based on the Bomani Commission report. In fact this chapter together with chapter three are the core of the research. In chapter two facts are laid bare of how the mining operations are done in Tanzania and how the management is undertaken. While in the subsequent chapter to wit chapter three, the same is observed but now targeting the Democratic Republic of Congo. The researcher has used these two chapters to demonstrate how inefficient the African governments are in running and maintaining the mineral resources by which they are endowed plentifully. Chapter four is also formal in the sense that the researcher provides his point of view on how matters could be rectified. It is a firm view of the researcher that if the governments take heed to what is recommended, there will much improvements in the mining sector which can be recorded in shorter span of production.