Buhari must ur­gently es­tab­lish Min­er­als De­vel­op­ment Bank – Prof Opa­funso

Daily Trust - - BUSINESS -

There has been so much talk about the wide avail­abil­ity of solid min­er­als in Nige­ria, but lit­tle or­ga­nized ef­fort by its lead­ers to earn huge in­come from them. What can Pres­i­dent Muham­madu Buhari do to re­verse the sit­u­a­tion?

I will start by briefly defin­ing that gem­stone or gem (also called a fine gem, jewel, or a pre­cious or semi­precious stone) is a piece of min­eral crys­tal, which, in cut and pol­ished form, is used to make jew­elry or other adorn­ments. How­ever, cer­tain rocks (such as lapis lazuli) or or­ganic ma­te­ri­als that are not min­er­als (such as am­ber or jet), are also used for jew­elry, and are, there­fore, of­ten con­sid­ered gem­stones as well. Most gem­stones are hard, but some soft min­er­als are used in jew­elry be­cause of their lus­tre or other phys­i­cal prop­er­ties that have aes­thetic value.

Nige­ria hap­pens to be blessed with many di­verse min­eral re­sources, be it solid min­er­als or oil and gas, but the coun­try re­mains at the level of a “de­vel­op­ing” econ­omy due to its fail­ure to har­ness the full po­ten­tial of the sec­tor. Oil and gas have been the ma­jor source of ser­vic­ing the coun­try’s econ­omy but might as well be its doom con­sid­er­ing the re­cent chal­lenges faced by the sec­tor at both lo­cal and in­ter­na­tional lev­els.

Gem­stone min­ing has boomed in var­i­ous parts of Plateau, Kaduna, and Bauchi states for years. These stones in­clude sap­phire, ruby, aqua­ma­rine, emer­ald, tour­ma­line, topaz, zir­con and fluorspar, which are among the world’s best. Good prospects ex­ist in these ar­eas for vi­able in­vest­ments. How­ever, the avail­abil­ity and dis­tri­bu­tion of these min­er­als are not re­ally the is­sue; what is is a seem­ingly lack of in­for­ma­tion on the in­vest­ment op­por­tu­ni­ties avail­able in the sec­tor.

Nige­ria has abun­dant gem­stones. This was known through a base­line study car­ried out by the Nige­rian Ge­o­log­i­cal Sur­vey Agency in both the north­ern and south­ern parts of the coun­try which re­vealed that the na­tion has sev­eral gem­stones of the right qual­ity and quan­tity to at­tract in­vest­ments to the coun­try. The states sur­veyed in­cluded Borno, Ek­iti, Gombe, Kaduna, Kogi, Kwara, Nasarawa, Ondo, Osun, Oyo and Plateau. The study team vis­ited 30 min­eral de­posit lo­ca­tions across the coun­try out of which 17 were ac­tive, with all but one at crude ar­ti­sanal level.

To what ex­tent has the coun­try been able to ex­ploit the gem­stones sub-sec­tor?

Nige­ria has failed

to Ex­perts say Nige­ria’s raw gem­stones are worth mil­lions of dol­lars if prop­erly har­nessed. In this ex­clu­sive in­ter­view, Pro­fes­sor of Min­ing En­gi­neer­ing at the Fed­eral Univer­sity of Tech­nol­ogy Akure (FUTA), Zacheus Opa­funso spoke on the worth and com­mer­cial value of Nige­ria’s gem­stones and ways through which they could be an eco­nomic main­stay har­ness the full po­ten­tial of the avail­able gem­stones due to the overde­pen­dence on crude oil. The ex­ploita­tion of the gem­stones in Nige­ria is ma­jorly in the hands of illegal ar­ti­sanal min­ers scat­tered across the gem­stones lo­ca­tions in the coun­try. The gem­stones sec­tor in Nige­ria is se­verely con­strained, with most oper­a­tions un­guided and un­reg­u­lated. Poli­cies in place are in­ad­e­quate, and gen­er­ally, gem­stones min­ers are un­trained and con­trib­ute hugely to en­vi­ron­men­tal degra­da­tion, poor qual­ity op­er­a­tional tech­niques and loss of min­er­als. This has caused sub­stan­tial losses in rev­enue to the coun­try by way of ex­ports, as well as through roy­al­ties and taxes. These ar­ti­sanal min­ers are be­ing spon­sored by some higher deal­ers who buy the raw gem­stones at cheaper rates and sell them at high cost to for­eign­ers. Some­times last year, the then Min­is­ter of Mines and Steel De­vel­op­ment, Mr Musa Sada dis­closed that 80 per cent of gem­stones in Nige­ria was smug­gled out of the coun­try an­nu­ally. That is a huge loss.

So how can the coun­try har­ness the full po­ten­tial of its abun­dant gem­stones?

Full po­ten­tial of gem­stones for the eco­nomic de­vel­op­ment of Nige­ria can be achieved through diver­si­fi­ca­tion from crude oil to the gem­stones sec­tor. This will en­hance the de­vel­op­ment of the sec­tor. Min­ing leg­is­la­tions reg­u­lat­ing the ti­tles and li­censes for min­ing op­er­a­tors should be over­hauled. With im­prove­ment on, and ad­e­quacy of such a le­gal frame­work, illegal min­ing will be phased out and full po­ten­tial of the gem­stones would be achieved.

Pro­vi­sions for short and long-term loans with low in­ter­est rates will help the peo­ple to di­ver­sify into the gem­stones sec­tor, which in turn will lead to the full po­ten­tial of the gem­stones sec­tor to be har­nessed across the coun­try. The long talk about es­tab­lish­ment of a Min­eral De­vel­op­ment Bank should be given ur­gent at­ten­tion by the Buhari ad­min­is­tra­tion. Gov­ern­ment should set up a pres­i­den­tial ad­vi­sory com­mit­tee on the de­vel­op­ment of the solid min­eral sec­tor, com­pris­ing sea­soned fi­nan­cial ad­min­is­tra­tors, le­gal ex­perts and aca­demic pro­fes­sion­als who are knowl­edge­able on the sec­tor.

Also, univer­si­ties like the Fed­eral Univer­sity of Tech­nol­ogy, Akure, the only univer­sity in Nige­ria run­ning de­gree pro­gramnes in Min­ing En­gi­neer­ing, Ap­plied Geo­physics, Ap­plied Ge­ol­ogy and Met­al­lur­gi­cal En­gi­neer­ing un­der the same roof, should be in­volved in this pres­i­den­tial com­mit­tee on solid min­eral de­vel­op­ment. As well, pro­vi­sion of mod­ern tech­nol­ogy for safe and ef­fec­tive min­ing will guar­an­tee the har­ness­ing of gem­stones po­ten­tial in the coun­try.

How much are Nige­ria’s gem­stones worth?

Nige­ria’s gem­stones are abun­dantly avail­able and of good qual­ity. The pres­ence and lo­ca­tions of these stones across the coun­try prove their abun­dance, while the char­ac­ter­is­tics of the gem­stones, in terms of re­frac­tive in­dex, dis­per­sion, spe­cific grav­ity, hard­ness, cleav­age, frac­ture, and luster, cou­pled with their high de­mand across the world, de­pict the good qual­i­ties of those gem­stones.

Due to the scarcity of gem­stones, their non­avail­abil­ity in so many coun­tries and their di­verse uses, they are costly across the world. The worth of Nige­rian gem­stones can­not be easily quan­ti­fied as a re­sult of their large de­posits across the coun­try and their var­i­ous types. In re­spect of these, the ac­tual worth of Nige­rian gem­stones can­not be es­ti­mated. The eco­nomic im­por­tance of a gem­stone in­dus­try to a coun­try like Nige­ria with a mo­noe­con­omy can­not be overem­pha­sised. For ex­am­ple, it was pro­jected in 2010 that Nige­ria would have to ex­port one mil­lion tonnes of coal to earn $3m. Within the same pe­riod, it needed to ex­port less than five tonnes of top qual­ity gem­stones to earn about $200m. Ac­cord­ing to a re­port by Wenk and Bu­lakh in 2004, it was re­ported that Nige­ria’s gem­stone de­posits are worth bil­lions of dol­lars. Ac­cord­ing to the re­port, a carat (0.2g) of gem qual­ity un­cut diamond, for in­stance, then cost $5,000, same quan­tity of sap­phire cost $1600 and ruby sold for $4200. So it’s a gold­mine of sort if only proper at­ten­tion would be given to the solid min­er­als sec­tor.

The Ex­ec­u­tive Di­rec­tor and Chief Ex­ec­u­tive Of­fi­cer of the Nige­rian Ex­port Pro­mo­tion Coun­cil (NEPC), Mr. Oluse­gun Awolowo once con­firmed that gem­stones were ca­pa­ble of earn­ing more for­eign ex­change than agri­cul­tural prod­ucts like co­coa, rub­ber and bulk in­dus­trial min­er­als such as gymp­sium, kaolin, coal, tin and columbite, hence the need for the author­i­ties to ex­pe­dite ac­tion and con­clude ar­range­ments on the es­tab­lish­ment of the gem­stone cen­tres planned for Ibadan and Jos. That should be the thrust of re­vamp­ing the sec­tor.

Prof. Z.O Opa­funso

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