The decrease in performance of Nigeria’s solid minerals mining sector is a cause for concern, as highlighted in a recent statement from the Lagos Chamber of Commerce and Industry (LCCI). According to the National Bureau of Statistics (NBS), the mining and quarrying sector’s contribution to the overall GDP dropped to 4.47% in the fourth quarter of 2023, compared to 4.51% in the same period the previous year and 8.32% in the previous quarter. This downward trend in performance can be attributed to a number of obstacles, including inadequate infrastructure, regulatory inconsistencies, limited access to financing, and security concerns in mining locations.
Nigeria had set ambitious targets for the minerals sector as part of the National Development Plan 2021-2025, aiming to position the sector to contribute 3.0 percent to GDP by 2025. However, the current state of the mining sector suggests that these goals may not be met. Despite its vast mineral resources, the sector currently accounts for less than 0.5% of the country’s GDP, with a limited value chain in the economy. Solid minerals are exported with little or no value added, and Nigeria faces numerous challenges in mineral beneficiation and value addition due to regulatory and legal issues.
In light of these challenges, the LCCI urges the government to explore strategies to attract mineral exploration investments, accelerate new mineral discoveries, and address funding issues. The revitalization of the Ajaokuta Steel Company Limited (ASCL) and the Nigerian Iron Ore and Mining Company (NIOMCO) is also recommended, with the suggestion of adopting a model similar to the NLNG management. Additionally, it is important for the government to focus on promoting artisanal and small-scale mining (ASM) and implementing inclusive strategies aligned with development plans at all levels of government.
The effective implementation of these proposed measures has the potential to revitalize Nigeria’s mining sector and position it as a critical driver of economic growth and development. However, achieving this goal will require collaboration among government agencies, private sector entities, civil society organizations, and local communities. As stakeholders committed to advancing Nigeria’s mining industry, the LCCI stands ready to collaborate with all relevant parties to overcome the existing challenges and unleash the sector’s latent potential.
Dr. Chinyere Almona, FCA, Director-General of the Lagos Chamber of Commerce & Industry, emphasized the need for concerted efforts and collaboration in driving the revitalization of Nigeria’s mining sector. The potential of the sector to drive economic growth and development is evident, and by addressing the current challenges, Nigeria can tap into this latent potential for the benefit of the nation’s development.