LAGOS, Nigeria (VOICE OF NAIJA)- The Lagos Chamber of Commerce and Industry (LCCI) has described as scandalous the seemingly poor performance of the Nigerian solid mineral sector, noting that it has recorded low performance in the last two quarters.
LCCI Director General, Dr. Chinyere Almona quoting the National Bureau of Statistics (NBS), frowned that the Mining & Quarrying sector contributed 4.47 percent to the overall GDP in the fourth quarter of 2023, lower than the contributions recorded in 2022 fourth quarter at 4.51percent and lower than the previous quarter at 8.32 percent.
She lamented that in spite of its immense potential, the mining sector has been hampered by many obstacles such as inadequate infrastructure, regulatory inconsistencies, limited access to financing, and security concerns in mining locations.
“These challenges have collectively contributed to stifling growth, deterring investments, and impeding the sector’s ability to fulfill its role as a catalyst for industrialisation.”
She recalled that in the National Development Plan 2021-2025, Nigeria planned to have laid a solid foundation for the minerals sector to begin catalysing growth and industrialisation in an environmentally sustainable manner by 2025, a year from now.
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The LCCI chief stated that in response to the sector’s poor performance, the Government launched a new mining roadmap in 2016 with the objective of building a world-class minerals and mining ecosystem designed to serve a targeted domestic and export market.
She said: “All of these were planned to position the sector to contribute 3.0 percent to GDP by 2025. Reaching this goal would lead to Nigeria’s global competitiveness and industrialisation aligned with the African Mining Vision. Unfortunately with just a year away, little has been achieved regarding the sector.”
Almona lamented that despite Nigeria’s enormous mineral resources, the minerals sector is not a major engine of economic growth and receives little investment as the sector produces less than 0.5 percent of GDP with limited value chain in the economy.
On regulatory and legal challenges she said they include inconsistent policies, unclear land tenures, and issues between Federal and State Governments, particularly in the collection of royalties and taxes from licensed miners operating in their domains.
She urged the government to review the mining industry strategy to attract mineral exploration investments, reignite mining project development, accelerate new mineral discoveries.
According to her this will encourage optimal utilisation of Nigerian mineral resources in line with the Environmental, Social, and Corporate Governance (ESG) principles for sustainable growth.
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She however appealed to government to address the sector’s funding issues and enable enhanced access to finance for processing value-added minerals based products by establishing seed funds and special incentives to attract foreign and domestic investors.
She advised government to seek innovative ways of revitalising the Ajaokuta Steel Company Limited (ASCL) and the Nigerian Iron Ore and Mining Company (NIOMCO).
She said: “We have consistently advised that the model of the NLNG management can be adopted for this purpose. To ramp up investments in this sector, we need to deploy more relevant research and technology to trace more mineral deposits, and make more relevant data available to interested investors.”
Also, she urged government to learn from the hindrances presently experienced in the Niger Delta for it’s failure to allow small scale crude refineries to operate under set supervision and standards.
“For the solid minerals sector, we should adopt an inclusive strategy on Artisanal and Small-Scale Mining (ASM) aligned with development plans at all levels of government and linked to other national rural sector strategies.
“This will make the solid minerals sector more integrated with other activities that generate more jobs in rural areas. We need to support the mining ecosystem with amenities like electricity, good roads, and water.
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“Mining companies should be engaged to sign Community Development MOUs with the host communities that will help to create a sustainable operating environment.”
She maintained that if effectively implemented, the proposed measures can revitalise Nigeria’s mining sector and position it as a critical driver of economic growth and development.
However, she argued that their successful execution requires concerted efforts and collaboration among government agencies, private sector entities, civil society organisations, and local communities.