Barrick Gold Corp. is facing criticism from a prominent Tanzanian politician for not doing enough to free three employees of its Tanzanian operations who were jailed 20 months ago and allegedly used as pawns in a multiyear tax dispute between Barrick and the Tanzanian government.
In 2017, Tanzania banned former Barrick subsidiary Acacia Mining PLC from exporting gold concentrate and demanded it pay US$200-billion in back taxes. In October, 2018, Acacia executives Deo Mwanyika, Alex Lugendo and Asa Mwaipopo were charged with money-laundering offences and imprisoned without chance of bail. At the time, Barrick owned 63.9 per cent of Acacia.
Speaking to media earlier this week, Zitto Kabwe, leader of the Alliance for Change and Transparency, one of Tanzania’s leading opposition politicians, said the Acacia employees were held hostage as a bargaining chip, “to put pressure on Barrick to reach an agreement.”
In late January, Toronto-based Barrick finalized a pact to end the dispute, agreeing to pay Tanzania a US$300-million fine and splitting future profits on the mine 50/50. Despite the resolution, the Acacia employees have not been released from jail.
“They were supposed to be released under the agreement between the government and Barrick,” Mr. Kabwe said.
“They are still languishing in jail. The government took them as ransom. These people have a right to be out and with their families,” he added.
Mr. Kabwe has been a member of parliament for 15 years in Tanzania and at times has faced the wrath of authoritarian President John Magufuli. In 2018, Mr. Kabwe was charged with incitement, after claiming that 100 people were killed in clashes between herders and police. On Friday, a Tanzanian court ruled that he was guilty of incitement and sedition – conduct that incites people to rebel against the government. Mr. Kabwe, who is appealing the decision, was freed on condition that he not say anything that could be considered sedition.
In April, Barrick resumed shipments of gold concentrate from the gold mines in Tanzania, and has paid US$100-million to the government as part of the outstanding fine. The remaining US$200-million will be paid in annual installments of US$40-million for five years. Barrick now fully owns the properties again. Last year, it bought back the 36.1-per-cent share of Acacia it didn’t already own, after the Tanzanian government made it clear an agreement to end the tax dispute would be impossible under the former ownership and management structure.
While Barrick’s chief executive officer Mark Bristow has been lauded for ending the tax spat and drastically improving relations with Tanzania, he hasn’t commented at length about the fate of the jailed men. In an interview with The Globe and Mail in February he characterized the situation as “delicate.”
Mr. Bristow did not respond to a request for comment for this story.
The three individuals are reportedly been held in the Segerea maximum security prison on the outskirts of Dar es Salaam, Tanzania’s biggest city.
Mr. Kabwe said he visited the trio before the COVID-19 outbreak and while they were in good spirits, one of the individuals, Mr. Mwanyika, was suffering from heart problems. He also said that the prison is overcrowded.
“The prison is very congested. The conditions are not very good. It was built for 400 inmates but there are more than 1,500 inmates,” he wrote in an e-mail to The Globe.
“It appears that Barrick has settled with the government but has abandoned the former Acacia people.”
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