Digging for the Future: Tanzania’s Critical Minerals Ambition

For years, Tanzania’s mining industry focused mainly on gold: its exports, reserves, and earnings. But now, as demand for electric vehicles, renewable energy, and advanced manufacturing grows, Tanzania is beginning to consider whether its future will rely on minerals that are now vital worldwide. 

That question is shaping policy, investment strategy, and national ambition. From a proposed TZS 174.98 billion Ministry of Minerals budget for the 2026/27 financial year to an ambitious TZS 1.41 trillion revenue target, Tanzania is positioning mining not simply as an extractive sector but as a pillar of industrial transformation. At the centre of this transition is a growing push into critical minerals, particularly projects such as the Panda Hill niobium development, which could place Tanzania on a very short list of globally strategic mineral producers.  

Beyond Gold: The Evolving Mineral Strategy   

Mining is now one of the strongest sectors in Tanzania’s economy. Its share of GDP rose from 9.1 per cent in 2023 to 10.1 per cent in 2024, and averaged nearly 12 per cent in the first three quarters of 2025, according to sector reports and government updates. Mineral exports now account for more than half of Tanzania’s non-traditional exports and bring in billions in foreign currency. 

But what is increasingly notable is not the growth itself, but the type of minerals Tanzania is prioritising. The country is actively pursuing minerals tied to the global energy transition, including graphite, nickel, lithium, rare earths, and niobium. These materials power electric batteries, aerospace alloys, data infrastructure, defence systems, and renewable energy technologies. 

In other words, Tanzania is trying to position itself within the industries that will define the next global economy.  

The Panda Hill Bet  

Perhaps no project captures this ambition more clearly than Panda Hill. Located in the Songwe region, the Panda Hill project is expected to become one of the few major niobium operations globally once production begins. Niobium is a relatively little-known mineral outside industrial circles, yet it plays a critical role in strengthening steel, improving battery performance, and enabling advanced engineering applications. 

When it begins operating, Panda Hill is expected to produce 4,000 to 5,000 tonnes of niobium each year, which could make Tanzania the world’s fourth-largest producer. The project has about US$250 million in investment and plans to build a ferroniobium smelting plant. This marks a significant shift from the usual practice of exporting raw minerals without processing them in Africa.  

For a long time, African mining countries have been criticised for exporting raw materials and then buying back finished products at much higher prices. Tanzania’s new approach aims to move up the value chain. As Minerals Minister Anthony Mavunde recently said, “This is more than a mine; it’s our doorway to industrialisation.”  

Jobs, Local Equity, and the Politics of Ownership  

Mining projects can spark national excitement but also create local tensions. Tanzania seems keenly aware of this challenge. 

The Panda Hill project should create hundreds of direct jobs and thousands more indirect opportunities across logistics, construction, services, and supply chains. Mining policies now include greater local participation, community investment, and domestic procurement rules. 

There is also growing emphasis on equity participation and royalty structures designed to ensure the state captures greater value from large-scale mining operations. 

This reflects a broader continental trend. Across Africa, governments are no longer content to host mining projects. They want stronger fiscal returns, industrial spillovers, technology transfer, and local ownership. 

Tanzania faces a delicate balancing act. Investors want stability and clear rules, while citizens expect to see tangible development from the country’s natural resources. 

How well Tanzania manages both sets of expectations will affect the mining sector’s long-term credibility.  

The Rise of Value-Addition Hubs  

One of the most consequential aspects of Tanzania’s mining strategy may be processing rather than extraction itself. 

The government is building infrastructure to add value to minerals, including refineries, processing plants, and specialised industrial hubs. Dodoma is becoming a key centre for mineral-processing investment. Several facilities for gold, graphite, nickel, and other important minerals are already operating or under construction. 

This shift reflects a growing understanding that much of mining’s real economic value lies after extraction. Processing creates industrial jobs, strengthens supply chains, supports manufacturing, and helps countries retain more mineral wealth at home. 

In many ways, Tanzania is seeking to reposition mining from an export sector into an industrial policy tool.  

The Urge to Join the Global Race  

Around the world, countries are scrambling to secure critical mineral supply chains. The United States, China, and the European Union are investing heavily in access to strategic minerals amid rising geopolitical competition and growing demand for clean energy technologies. 

Africa is now at the centre of this global discussion. Tanzania’s mineral resources, relatively stable politics, and rising investor interest give it a strong position. In recent years, major investments have flowed into graphite, nickel, and rare-earth projects across the country. 

The risk is that global demand could trigger another rush for raw materials without sufficient local development. That’s why Tanzania’s focus on value addition, local involvement, and industrialisation is important. The country wants to avoid being merely a supplier of raw materials for other nations’ industries.  

The Bottom Line  

Tanzania’s mining goals are now about more than just extracting minerals. The country wants to be part of the industries that will shape the world’s future economy. 

Critical minerals are now seen as geopolitical assets. Countries that control, process, and use them in their industries will become more influential over the next twenty years. 

The key question is whether Tanzania can act fast enough to seize this chance before the next shift in global markets. Behind the policy goals and big investment figures lies a broader aim: ensuring the country’s mineral wealth yields more than just exports this time.