How Foreigners Hijack Mining Sector To Detriment Of Nigerians
• Yearly Loss Of $ 10 Billion To Illegal Mining Worries Stakeholders • Senate Beams Searchlight On Mining Sector Woes
AHEARING conducted by the Senate on challenges facing the mining sector in Nigeria has thrown up more issues than contemplated.
Illegality, insecurity, policy, as well as the domination of the sector by foreigners to the detriment of Nigerians, were among several other matters that came up at the three day hearing. The Senate was also briefed on the refusal of manufacturers in to pay accumulated amount of royalties running into trillions of Naira.
The hearing, which held three months after the Economic Community of West African States ( ECOWAS) Parliament alerted that Nigeria was losing 91 per cent of its revenue to illegal miners, was an eye opener to the the drive for economic diversification in the country.
At a summit organised by the Parliament on ' Illegal mining and its implications in the ECOWAS Region', the Speaker of the Economic Community of West African States Parliament, Mohamed Tunis, disclosed that Nigeria loses 91 per cent of its revenue from the mining sector to illegal miners.
Tunis said a staggering 80 per cent of mining in the country’s northwest region is conducted illegally, costing the nation 91 per cent of potential mining revenue.
“The mining sector has the potential to contribute 7.5 per cent to Ghana’s GDP, 10.2 per cent to the GDP of Burkina Faso, 4 per cent to the GDP of Cote d’ivoire while Nigeria receives only 9 per cent from the sector with 80 per cent of the mining in the country’s North West region carried out illegally,” he said.
This confirmed earlier report by the House of Representatives, which put yearly revenue losses in the mining sector at about $ 9 billion.
Submissions at Senate's public hearing last week showed that the figures of yearly revenue losses in the sector has risen to about $ 10 billion.
House of Representatives' deputy leader, Ibrahim Abdullahi Halims, who sponsored the motion for that investigation, had expressed worry about, “the loss of revenue from unregulated and illicit mining operations, costing the government $ 9 billion yearly with only three per cent royalties paid by a few licensed miners, hindering the country’s mineral resource utilisation."
A major revelation that shook the Senate hearing venue was when President of the Senate, Godswill Akpabio, said foreigners are earning more from mining the nation’s solid minerals than Nigerians.
Akpabio made this assertion in his speech before declaring open the hearing:
“The need to comprehensively review the input and output values of the Nigeria mining industry in the light of its general role to economic diversification, foreign exchange earnings and social inclusion” in Abuja.
The public hearing was organised by the Senate Committee on Solid Minerals Development chaired by Senator Sampson Ekong ( PDP - Akwa Ibom South).
Akpabio further said the foreigners, after exploitating the solid minerals and benefiting from them maximally, often leave behind a tale of woes, including insecurity.
He said time has come for the country to benefit from the mining sector while challenging stakeholders at the event to discuss the challenges that have hindered the growth of the mining sector and come up with a way forward.
Akpabio said: “The resolution of the Senate that led to this investigative hearing underscore the pivotal role that the mining industry play in our quest for this economic diversification. We can no longer overlook the immense potential of the mining sector in this country.
“The mining sector should by now become a major cornerstone to enable the country earn foreign exchange.
“It will even be a catalyst for social inclusion and empowerment of the populace.
“As usual, just like fishing, more foreigners are earning from the mining sector more than Nigerians. At the end of the day what they leave us with are stories of woes, and tales of killings in order to enter mine fields and in the process compounding the security situation of our country.
“This country is very blessed with abundant solid mineral resources. It has the potential to become a global power house in the mining sector.
"This investigative hearing presents us with an opportunity to ask the tough questions, identify these challenges, and develop effective strategies to overcome them."
Akpabio implored all the stakeholders present at the event to actively engage in the deliberations of the hearing.
"Your expertise, concerns, perspectives, insights, and recommendations are invaluable in shaping the future of the Nigeria Mining Industry and propelling our economy towards new horizons.
"Let us engage in constructive dialogue, share best practices, and explore innovative solutions that will infuse the mining sector into the very bloodstream of our economy," Akpabio said.
In his welcome address, the Chairman of the Senate Committee on Solid Minerals Development, Senator Sampson Ekong, said the investigation was aimed at identifying bottlenecks and opportunities in the mining value chain, develop strategies to increase local content and value addition as well as enhance the sector’s contribution to foreign exchange earnings and economic growth.
He added that other objectives include to ensure social inclusion and community development and promote sustainable mining practices and environmental stewardship.
“It is disturbing that as a country, we have not been able to adequately maximize the advantage of our huge endowments. The nation loses so much daily, to illegal, unaccounted for and undocumented mining.
“There have also been mounting concerns over misuse of our natural endowments to fuel insecurity. All these have to be checked through our collective effort.”
In his presentation, the Minister of Solid Minerals Development, Dr Dele Alake, said while solid minerals sector is steadily making profit in terms of revenue, the revenue is not enough to meet the developmental needs of the country.
Alake said: “Now the reason that the problem remains till tomorrow, that is the nation being dependent solely on oil is because there was a free flow of petrol dollars.
“So, we closed our eyes as a society to other critical sectors that could have stabilised and improved the infrastructural and technological development of Nigeria.
“So, we had free flow of oil and we became quite indulgent and partisan. But like the Senate President said, that's history now. We are being compelled by a global trend to now shift our focus to the solid mineral sector in this country because we don't really have a choice than for us to open up the sector and of course give it the much needed life, that is, inject life into that sector because there are so many other countries in the world that don't have oil, that have no options, but solely rely on their solid minerals. And they are thriving and they are moving ahead and they are developed more than us.
“So, what has been the clog in the wheel of Nigeria's economic progress, especially in the solid mineral sector? Again it is because we decided to shift our attention away. Now that we have been compelled by the trend in the world of shifting away from fossil fuel, from oil, into minerals and the global warming conditions have also compelled the world to shift attention away from global warming- inducing industrialisation.
“Green energy is a watchword in the world today. And what are those things that ginger and sustain green energy? It's the minerals. And this critical metals we have in abundance.
“So, if the world is shifting attention away from fossil fuels and of course because of global warming going towards green energy, it then means this is a time for Nigeria’s resurgence, what I call Nigeria’s resurgimento is here.”
He added: “With due respect, the idea of ‘ dwindled revenue’ derivable from the solid minerals sector is not reflective of the actual fact…
“This is far from the reality of revenue performance as reported by several credible research organizations, including Nigerian Bureau of Statistics in the last five years. “With the above facts, I believe you will agree with our Ministry that the idea of dwindling revenue is alien to the revenue performance of the Solid Minerals Sector, particularly in the last fiveyears.
“The issue therefore, is not that the revenue is dwindling but that this increasing revenue is still too low compared to the economic potential of the Solid Minerals Sector and the level of economic activities in the sector.
“We agree with the conclusion of NEITI and other stakeholders that although the sector contributed 0.63 per cent to GDP in 2021, from 0.45% in 2020 and 0.26% in 2019, ‘ the sector has not yet reached its full potential in making a significant impact on the overall Nigerian economy.’ “As at now, the reality of the Solid Minerals sector and its contribution to the national economy is seriously underinvestigated and under- reported. This is one of the reasons why the Ministry is partnering with the BS to improve the quality of its research and consequently, the credibility of its data.
“On our part, as the regulatory body, we are increasing our data gathering capacity, technological sophistication and visibility of the system.
“Three weeks ago, I issued a directive for monthly data turns towards our policy of disseminating Monthly Digest of Mining statistics to give every Nigerian access to data on the facts and figures of the progress we are achieving in transforming the sector.
“Very soon, we shall deploy advanced satellite technology that will use geo- spatial tools to capture each and every mining activity on Nigerian soil.
“We have also penalized truancy in the sector by revoking 1,663 licences of operators that contravened the law on payment of Annual Service Fee and 924 dormant licences. Although, in response to public appeals, financial penalties for restitution were issued, one message is that enforcement of the laws shall thence forth be the rule and not the exception.”