Private Equity Financing, Capital Markets, and the Future of Mining Project Development in Tanzania
Private equity financing is no longer a peripheral consideration in the development of mining projects in Tanzania. It has become one of the most important—and misunderstood—sources of capital shaping the next phase of the country’s mineral economy. I say this not as an observer, but as someone who has spent well over a decade structuring investments, advising governments, negotiating with investors, and sitting at the intersection where law, capital, and natural resources meet. Mining, more than any other sector, exposes whether a country truly understands development finance or whether it is still applying corporate financing logic to project-based realities.
Tanzania’s mining sector has grown into a cornerstone of the national economy, contributing roughly ten percent of GDP and accounting for a significant share of export revenues. Gold has long dominated the sector, but graphite, nickel, rare earths, coal, gemstones, and industrial minerals are increasingly central to Tanzania’s strategic relevance in global supply chains. This prominence is explicitly recognized in Tanzania’s Vision 2050, which places natural resources and industrial development at the heart of the country’s long-term economic transformation, as well as in the Ministry of Minerals Vision 2030, which emphasizes value addition, sustainability, and stronger institutional governance. Yet while the policy vision is clear, the financing architecture required to translate that vision into operating mines remains incomplete.
This gap became very clear to me about six years ago, when I was advising a mining company seeking to raise financing in Tanzania’s domestic debt market. The project itself was not speculative. The geology was strong, the mineralization was well understood, and the company had invested heavily in surveys, studies, and compliance. What ultimately made the transaction impossible was not the project’s quality but the structure of the capital market itself. At the time, the regulatory requirements demanded that a company demonstrate at least three consecutive years of audited profitability before it could access debt financing. For a mining project, this requirement was not merely unrealistic; it fundamentally misunderstood how mines are developed.
Mining is a long-cycle, capital-intensive activity. Exploration, feasibility studies, environmental approvals, mine construction, and commissioning all require substantial upfront investment long before a single dollar of revenue is generated. Expecting profitability before financing is available effectively locks mining companies out of domestic capital markets during the very phase when capital is most needed. That experience confirmed what I had been observing across several African jurisdictions: Tanzania’s capital markets, like many on the continent, were designed for mature operating companies, not for project development. In other words, the system was not yet aligned with the realities of extractive industries.
And yet, it is precisely here that Tanzania has one of its greatest untapped opportunities. Around the world, and increasingly across Africa, private equity has stepped into this gap, not because public markets are irrelevant, but because they are often ill-suited to early-stage and development-phase mining projects. Private equity understands that in mining, bankability is not defined solely by historical financial statements. It is defined by geological certainty, regulatory clarity, fiscal stability, and credible development plans.
In minerals such as gold, once a definitive feasibility study has been completed and supported by internationally recognized resource and reserve classifications, the certainty of the asset is often more reliable than the early financial performance of many operating companies. A DFS, combined with transparent permitting, stable fiscal terms, and a credible management team, can provide a clearer picture of long-term value than three years of thin or volatile profitability. This is a reality that private equity investors understand well, but one that has yet to be fully reflected in Tanzania’s domestic financing frameworks.
Over the past decade, I have seen a steady increase in private equity interest in mineral projects across Tanzania and the wider region. This is not speculative capital chasing headlines. It is disciplined, structured capital that is carefully negotiated, heavily governed, and explicitly aligned with exit strategies from the outset. These investors are willing to take early development risk, but they do so in exchange for strong governance rights, staged capital deployment, and clear legal protections. In many cases, private equity investments are paired with offtake agreements, strategic partnerships, or future public listings, creating hybrid financing pathways that bridge the gap between project development and long-term market participation.
This shift is particularly important for Tanzania in the context of Vision 2050. The ambition to transform the mining sector into a driver of industrialization, value addition, and national wealth cannot be achieved through exploration-stage capital alone, nor can it rely indefinitely on foreign junior mining companies raising funds offshore. At some point, Tanzania must build financing systems that recognize mining as a project-based sector and that allow domestic and international capital to flow into projects at the right stage of their development.
The current legal and fiscal frameworks, while significantly reformed over the past decade, still reflect a cautious approach shaped by historical concerns over sovereignty, revenue leakage, and investor behavior. These concerns are valid and have justified stronger state participation, tighter regulation, and enhanced oversight. However, there is a difference between safeguarding national interests and unintentionally constraining capital formation. From my experience, the most successful resource jurisdictions are those that understand how to align state participation with commercial reality, particularly during the early stages of mine development when capital risk is highest and returns are uncertain.
Tanzania’s Vision 2050 and the Ministry of Minerals Vision 2030 both recognize the need for sustainable, well-governed mining that delivers long-term national value. To achieve this, financing frameworks must evolve to recognize alternative indicators of bankability. Geological certainty, when properly verified, should be treated as a legitimate foundation for financing, especially for strategic minerals. Capital markets and regulators must become more comfortable with project-based risk assessment rather than relying exclusively on backward-looking financial metrics.
Private equity, in this context, should not be viewed as a threat or a substitute for public markets. It should be seen as a bridge. In many jurisdictions, private equity has played a critical role in taking projects from feasibility to production, after which they become suitable for listing, refinancing, or broader institutional participation. Tanzania has the opportunity to follow a similar path, using private capital to unlock projects that are currently stranded between exploration and operation.
What is required is not radical reform but intelligent alignment. Company law must continue to accommodate complex shareholder arrangements and exit mechanisms that are standard in private equity transactions. Tax and fiscal rules must prioritize certainty and predictability, particularly in relation to capital gains, profit repatriation, and the treatment of shareholder financing. Most importantly, policymakers and regulators must engage deeply with the realities of mining finance rather than applying generic corporate templates to a fundamentally different sector.
After years of working at the highest levels of investment structuring, legal advisory, and policy engagement, I am convinced that Tanzania stands at an inflection point. The minerals are there. The vision is there. The global demand is there. Private equity is already demonstrating that capital is available for well-structured, well-governed projects. The remaining question is whether Tanzania’s financing architecture will evolve quickly enough to fully harness this opportunity.
If it does, the next generation of mining projects will not only be financed more efficiently, they will be developed in a way that aligns capital, sovereignty, and long-term national prosperity. That, ultimately, is what Vision 2050 demands—not just ambition, but execution grounded in a deep understanding of how capital truly works.
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