Falling cost of raw materials affects tax revenues

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Falling cost of raw materials affects tax revenues

1:56 CAT | 14 Dec 2015

Jornal Notícias

The fall in commodity prices in international markets is undermining tax revenues and thousands of jobs in Mozambique, according to the fifth report of the Extractive Industry Transparency Initiative (EITI). It goes on to say that the increasing volume of exports will not make up for the fall in prices.

Nampula province has minerals and gems across almost its entire territorial expanse. Their exploitation is undertaken by the Irish Kenmare Resources and Chinese Haiyu Mozambique Mining Limited companies.

The head of the Mineral Resources Department of the Provincial Directorate of Mineral Resources and Energy in Nampula, Celestino Sousa, said at the report’s launch meeting that the industrial production of minerals increased from 689,000 tons in 2011 to one million tons in 2014.

He went on to say, that revenues had however not registered the upward trend that increasing production volumes might have suggested.

For example, the market price of zircon, which is mined in Topuito, Larde district of Nampula province, dropped from US$1,700 a ton in 2013 to the current US$700, while that of ilmenite, used in the production of high quality paints, fell to US$100-150 a ton from about US$300 two years ago.

Source: Folha de Maputo