More than at any other time in Nigeria’s history, there is now evidently, a renewed commitment to diversify the country’s economy away from its perpetual reliance on oil.
The Government of President Muhammadu Buhari has begun to give pride of place in the country’s budgeting and planning processes to other viable sectors like agriculture, culture, tourism, transport and solid minerals, with the aim to extract their value for national income generation.
Implementing the economy diversification policy could not have come at a better time, considering the perennially dwindling price of crude oil in the international market and the inherent huge potentials in each of the non-oil sectors.
Nigeria is one of the countries endowed with various mineral resources in commercial qualities. These have been largely untapped for years and harnessing them now will potentially add huge resources to the country’s revenue base, enhance economic development and generate employment opportunities for its teeming youths.
Upon his assumption of office, President Buhari declared a commitment to invest energy in and thrust government’s policies towards effectively harnessing the massive potentials in the country’s solid minerals sector in particular, to serve as an alternative source of revenue for Nigeria. The President stressed that the country can no longer afford to depend on revenues from only oil and gas and pledged to revamp the mining sector as part of deliberate measures to diversify the nation’s economy.
At a recent briefing, Minister of Mines and Steel Development, Dr Kayode Fayemi, identified some 34 mineral resources already mapped by the Nigerian Geological Survey Agency to be in commercial quantity in Nigeria. They include barite, bitumen, coal, copper, gold, gypsum, iron ore, kaolin, lead, limestone, tantalite and zinc, to mention but a few.
Indeed, all across Nigeria, every local government boasts of one mineral or the other. Yet the contribution of solid minerals to the country’s GDP is as low as 0.34 percent.
Exploring these abundant minerals to fast track development necessarily requires total collaboration between all tiers of government at the federal, state and local levels. Nigeria also needs expertise, experience and support of other mining countries such as Australia, Canada, France, South Africa and the United States, to generate accurate data, acquire appropriate technology and attract foreign direct investments.
Given the highly capital intensive nature of the sector, the skills and technology required, the federal government has ramped up activities to encourage investors. New policies are being articulated and existing policies updated and approved for implementation, to stimulate growth and foster competition.
Significantly, one of the largest steel projects in Africa, Nigeria’s Ajaokuta Steel Rolling Company is also being revived and revitalised. The aim is to make Nigeria the go-to destination for countries seeking quality metals like aluminium, steel and iron rods.
Metal is one of the most important materials used for domestic, industrial and medical purposes and the Ajaokuta Steel Rolling Company has the potential to produce an abundant array of metals. When fully revamped and harnessed, Nigeria’s steel sector alone will not only infuse huge capital into the economy but will be a catalyst for full scale industrialisation and job creation.
It is for this reason that calls have been made for the removal of solid minerals from the Exclusive Legislative List. The argument is hinged on the premise that allowing only the federal government to mine minerals will leave the 36 states and the Federal Capital Territory without a say in their own mineral resources, which could hamper efforts to maximally harness the minerals.
This posture notwithstanding, the approval by the Revenue Mobilisation Allocation and Fiscal Commission of 13 per cent derivation to states endowed with mineral resources, as is the case for states with oil and gas deposits, has been hailed as a step in the right direction.
Analysts believe the move will encourage such states to maximally explore and exploit their endowed resources to the benefit of the entire nation.
Government’s move to discourage artisanal mining by individuals, groups and mercenaries without prior exploration permits, has also been praised. Such artisans should rather be encouraged to incorporate as enterprises and be granted rights to mine in specific areas, so they too can contribute their quota to the development of the sector and employment generation.
In addition, precautionary and safety measures must be enforced to ensure full compliance with international best practices. Exposure to and contraction of poisonings by miners must be treated with utmost care and dispatch, to avoid repeats of past experiences and fatal disasters such as were recorded in Niger and Zamfara states.
Large scale mining as envisaged in Nigeria, often comes with attendant consequences. Probabilities of acid rains, deforestation, land degradation, mine drainage and water contamination, as well as soil erosions, must all be carefully considered and plans put in place to protect both man and habitat, in order to avert possible environmental disasters.
To achieve all of these, governments at all levels must work in concert to not only ensure safe processes for public and private sector participation but also articulate effective measures to revamp and resuscitate the solid minerals sector as a whole. As is the case in all profitable investments, analysis and considerations must remain focused on the ultimate goal of the unquantifiable returns in the long term, not the initial intensive capital.
Nigerians are expectant that government will fast track the processes by strategically leveraging on other equally important sectoral linkages and their capacity to support and stimulate economic growth and development.