Senate Investigates Drop in Revenue from Solid Minerals
The Senate has resolved to initiate an inquiry into the decline in revenue generated from the development of solid minerals in the nation. This decision was reached following the consideration and adoption of a motion entitled “Comprehensively Review the Input and Output Values of the Nigerian Mining Industry in Light of its Central Role to Economic Diversification, Foreign Exchange Earnings and Social Inclusion,” which was put forward by Senator Osita Ngwu (PDP- Enugu).
Senator Ngwu highlighted that the contribution of the solid minerals sector to the nation’s gross domestic product has remained low due to several decades of policy incoherence and weak institutional dis-alignment. Quarrying stands as the dominant activity in the mining sector, accounting for nearly 90 per cent of the output and demonstrating an escalating growth rate driven by products such as granite, gravel, marble, and other construction materials in high demand in the housing sector.
However, the government has not reaped substantial benefits in the form of royalties. The Nigeria Extractive Industries Transparency Initiative (NEITI) Solid Mineral Industry Report, 2020 has revealed that the five-year trend of solid minerals’ contribution to GDP from 2016 to 2020 has been erratic, with Nigeria receiving less than 0.45 per cent from the sector, while other African countries make meaningful contributions to their GDP.
Despite the ongoing efforts of the Bureau of Public Enterprises (BPE) to sell and finalize the privatization and commercialization of publicly funded facilities related to the Nigerian mining and mineral sector, there has been no clear evidence of positive impact on the mining industry. Concerns have been raised about the sector’s failure to contribute to job creation, infrastructure development, and the overall GDP of the country.
Senator Victor Umeh (LP-Anambra) has pointed out that individuals responsible for driving revenue through the mining sector have been doing so for personal gain, leading to the sector’s suboptimal contribution to the nation’s GDP. Senator Ahmad Lawan (APC Yobe) has emphasized the need for the Senate to prioritize solid minerals development as a major legislative agenda, advocating for interventions from the federal government to make the sector viable.
Senate President Godswill Akpabio has expressed concerns about the neglect of the sector and the illicit activities of foreign entities within the sector. He has stressed the importance of the Senate making recommendations to the government regarding the sector and has urged the committee to conclude the investigations within three weeks.
In addition to launching an investigation, the Senate has also called for a review of the activities of policy administrators, executors, and industry players in policy formulation and execution at all levels of operations within the sector. The upper chamber has also urged the committee to evaluate the extent and impact of illegal mining activities and the complicity of local and expatriate industry players.
Furthermore, the Senate has called for a review of all the BPE privatization or commercialization programs of all mining and mineral resources-related programs from 1999 to date, and has called for a halt to further privatization of mining assets until the Senate concludes the investigation.
The decision of the Senate to initiate an investigation into the dwindling revenue from solid minerals underscores a commitment to ensure transparency and accountability in the sector. It also underscores the significance of harnessing the economic potential of solid minerals for the overall development of the country.
