Reviving Nigeria’s Mining Sector: A Key to Attracting Investments
Nigeria is currently undertaking a concerted effort to reinvigorate its mining sector through the revocation of 924 inactive mining licenses and the invitation for investors to apply for the newly available licenses on a first-come, first-served basis. The Lagos Chamber of Commerce and Industry (LCCI) is advocating for the reassessment of the nation’s mining industry strategy in order to attract investments in mineral exploration, reignite mining project development, and accelerate the discovery of new mineral deposits. Seun Olatunji, the Chairman of the Mining Sector Group at LCCI, recently shared his insights on this matter with CNBC Africa.
The mining industry in Nigeria is confronted with a multitude of challenges, with one of the primary obstacles being regulatory inconsistencies and government policies. Olatunji has underscored the necessity for a clear delineation of authority between the federal and state governments to ensure seamless operations for investors. State government interference in mining activities, which runs contrary to the Mining Act, has been sending negative signals to potential investors. Addressing these regulatory challenges is imperative in order to instill investor confidence and propel industry growth.
Security concerns also present a significant challenge to Nigeria’s mining industry, as criminal elements pose a threat to business operations. Olatunji emphasized the government’s role in supporting the armed forces to safeguard businesses and cultivate a conducive environment for investment.
Aside from regulatory and security challenges, the industry also needs to concentrate on infrastructure and resuscitating dormant industry players such as the Ajaokuta Steel Company and Nigerian Iron Ore Company. Olatunji highlighted the importance of adopting a diversified approach and incentivizing smaller investors to develop iron ore assets and reduce steel imports. By promoting private sector involvement and prioritizing value addition, Nigeria can bolster its self-sufficiency in steel production and generate more employment opportunities.
Looking ahead, the burgeoning global demand for lithium and battery technology presents a substantial opportunity for Nigeria’s mining industry. With lithium deposits located in various states across the country, there is considerable potential to access this market and drive economic growth. Olatunji underscored the significance of value addition and local processing in order to maximize the benefits of natural resources.
In summary, the revitalization of Nigeria’s mining industry hinges not only on attracting investment, but also on establishing a sustainable and competitive sector. By addressing regulatory challenges, enhancing security measures, promoting private sector participation, and prioritizing value addition, Nigeria can unlock the full potential of its mineral resources and propel economic growth. The government and industry stakeholders must collaborate to enact strategic reforms and create a conducive environment for mining investments in the country.
