Nigeria’s New Policy Sparks Shift in Mining Industry

Nigeria is embarking on a bold initiative to overhaul its mining sector by exclusively granting new mining licenses to companies committed to processing minerals within the country. This marks a significant departure from the nation’s previous approach of exporting raw materials without adding value.

The primary objective of this new policy is to ensure that Nigeria reaps greater benefits from its abundant solid mineral deposits. Despite being a leading energy producer in Africa, Nigeria has historically failed to fully exploit its mineral resources. The mining sector’s contribution to the nation’s gross domestic product has consistently remained below 1%, largely due to insufficient incentives and attention.

To attract more investment in the mining industry, the Nigerian government has announced the release of additional licenses. Additionally, the government has established a state-owned solid minerals corporation, offering investors a 75% stake. Furthermore, a dedicated security unit has been formed to clamp down on illegal mining activities.

Efforts are also underway to regulate the artisanal miners who currently dominate the sector. The government’s strategy is to organize these miners into cooperatives in order to introduce more structure and efficiency to the industry.

In line with its efforts to incentivize investment, the government intends to provide tax waivers on mining equipment imports and streamline the process of obtaining electricity generation licenses. It also aims to facilitate the complete repatriation of profits for investors.

Segun Tomori, a spokesperson for Nigeria’s minister of solid minerals development, has confirmed the implementation of these measures. The government is also eager to review the proposals of companies applying for mining licenses. These companies will be required to establish processing plants and demonstrate how they will add value to the Nigerian economy.

While the specific timeline for the implementation of these guidelines has not been specified, the government’s dedication to enhancing the mining sector is evident. Last September, plans were reported to establish a state-backed minerals corporation, known as the Nigerian Solid Minerals Corporation, which will focus on the extraction of valuable resources such as gold, coal, iron ore, bitumen, lead, limestone, and baryte.

As Nigeria takes these proactive measures to rejuvenate its mining industry, it is apparent that the country aims to attract more investment and ensure that valuable minerals are processed locally to bolster the nation’s economic growth and development.