Tanzania Case Study Harvard Case Solution & Analysis

QUESTION 1.

Despite Barrick’s efforts in the Lake Victoria Zone, protests, tension and violence had not abated by early 2009. What are the major alternatives for Barrick?

            There are many alternatives available to Barrick. The most significant of these are:

Alternative 1

            As the prices of the minerals are increasing which are resulting in huge profits, then as a result of that Barrick can consider to use funds, trusts and foundations for sharing all sorts of the benefits with the major mining corporations. The funds could be considered as an individual entity and they can easily bring value to all the communities. The use of the government payments and community investment programs can also be easily facilitated by these funds or FTFs.

            Along with this the FTFs could also be used to support the long term nature of these development projects despite being constrained by the budget cycles of the companies, the participation of the wide variety of stakeholders and the shareholders can also be promoted through the community investment programs, the company risk could be also minimized through separate legal liability, independent financial support could also be provided and bridges could also be made between he shareholders of the company and other stakeholders through a neutral facilitator.

Alternative 2

            The second alternative for Barrick is that he should support and foster the development of the Tanzania government through the social and the environmental impacts of the activities. If the social and the environmental issues associated with the businesses are controlled then the most important business drivers such as the reputation of the projects and the companies and the access to the labor can be controlled in a much better way. Therefore, Barrick needs to identify the most important areas with the social and the environmental field so that all the risks could be mitigated which are significantly linked to competitiveness. The corporations need to be more transparent and proactive in their efforts so that violence and tension could be eliminated in the Lake Victoria Region from all the local communities.

Alternative 3

            The last but not the least alternative available to Barrick is that he can consider to manage the environmental pollution and its hazardous impact upon the local communities. He should also manage the climate changes, tailing and the use of the water. These resources have huge impact upon the regulatory and the political environment of the businesses. Furthermore, proper management of these results in the enhancement of the reputation of the company and operational efficiency.

QUESTION 2

What are the challenges faced by extr active mining corporations in their attempt to establish subsidiary operations in developing nations?

            Most of the extra active mining corporations are continuing to expand their businesses and as a result they also have to establish their operations in the most socially responsible way so that they can easily achieve the added advantages associated with sustainable growth and businesses. These companies have to establish corporate social responsibility for all the range of stakeholders such as the customers, employees, businesses and the wide community in which they operate in order to establish subsidiary operations in these developing nations. In order to expand their businesses most of the companies operate in those countries where they get their desired resources and where the corporate mechanisms in place are quite weak.Tanzania Case Study Case Solution

            However, there is a huge benefit gap that exists between the mining corporations and the communities and these extra active mining corporations have done little contribution to the social and the economic development of these countries. It was in the year 1997 that the Mineral Sector Policy had set the goal that the GDP of Tanzania would increase by 10% with the contribution of mining by the end of the year 2015. However, the contribution of mining corporations to the GDP has only been 2.3% by the end of the year 2010. Corruption and poverty on the other hand has also increased (Pegg, 2006). Forced displacement and human right abuses have occurred as a result of the weak governance for the rule of the law along with large scale mining. There are a range of practical policy challenges faced by these extra active mining corporations which hinder their ability to practice the right governance structures in these developing countries..................

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