Ministerial Committee Lists Indexes for Devt of Mining Sector

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Raheem Akingbolu

A 17-man Roadmap Committee, set up by the Ministry of Mineral Resources to develop a roadmap for the sustainable development of the mining and metals sector in Nigeria, has identified undue interference by communities and state governments in exploration process as one of the major challenges crippling investments and the development of the mining sector. The committee was co-chaired by Professors Ibrahim Garba and Siyan Malomo.

In a report submitted by the committee to the ministry, it was stated that the Nigeria’s minerals and mining sector is still largely underdeveloped despite its glorious past and abundance of mineral resources for development, including high value metallic minerals1, industrial minerals2, and energy minerals.

The committee disclosed that the sector contributed approximately 0.33% to the gross domestic product of the country in 2015, adding that this contribution is a reversal from the historically higher percentages (about 4-5% in the 1960s-70s).
The committee reckons that the sector is capable of contributing substantially to the economy if issues related to uncertainty and inconsistency in state and federal laws, interpretation and enforcement are resolved.

The road map committee said Nigeria’s ambition should be to create a globally competitive sector capable of contributing to wealth creation, providing jobs and advancing social and human security.

According to the report, “Nigeria can achieve this by focusing on using its mining assets to drive domestic industrialisation initially, and then migrate to winning in global markets. Government should pursue this strategy through a value chain based growth plan. Also, building a competitive mining value chain means firms operating in Nigeria must compete on quality and cost versus global peers,”

Among other recommendation, the committee wants Federal Government to build a world class minerals and mining ecosystem designed to serve a targeted domestic and export market for minerals and ores. It also wants a rebuild of Nigeria’s minerals, mining and related processing industry in 3 phases, which includes; rebuilding of market confidence in its minerals and mining sector and wining over domestic users of industrial minerals that are currently imported.
At such level, the country is also tasked by the committee to expand use of its energy minerals, while also expanding domestic ore and mineral asset processing industry.

On policy stability, the report states that; “The perception of a change of regime affecting laws also stalls investment and partnership. Fiscal policies that remain stable and predictable in the face of changing regimes improve transparency and foster good governance within the sector. We address the need for strong communication strategies between the nation and the international community and between all stakeholders as one of the solutions towards benefits sharing, agreeable and accountable development of the minerals and mining sector.
Based on an evaluation of the long-term opportunities that can be unlocked if additional transformation is embarked upon, the Committee believes that mining can deliver the jobs, prosperity and additional revenue for the country.

The Minister and Minister of State of the Ministry of Solid Minerals Development had set up the committee early this year, to develop a roadmap for the sustainable development of the mining and metals sector in Nigeria.
The Nigerian Minerals and Mining Act (2007), with globally competitive sector incentives has been in place since 2007, however, the sector’s growth and contributions to GDP have remained less than ideal, accounting for only about N400 billion in GDP (about 0.33%) in 2015. To address this, the ministry, under Dr. Kayode Fayemi as minister, began a process to deepen reforms, attract new investors and collaborate with a wide network of partners and stakeholders to build an attractive mining ecosystem.

Meanwhile, the minister has stated that to ensure that the perspective represented by the roadmap is integrative of the many stakeholders around Nigeria; the ministry shared the roadmap with state governors, the National Economic Council and other key stakeholders.

He also pointed out that the ministry participated in a May 2016 National Consultative Meeting hosted by Governor Nasir El-Rufai of Kaduna State, which was used to validate the roadmap.
He said the ministry has now completed incorporating the feedback from Kaduna as well as many written submissions received from mining companies, state governments, civil society groups, and other stakeholders.

“The input has been used to enrich the roadmap, and we now will move forward to implementation. In this regard, the Ministry has established an implementation team that will coordinate the work of delivering the roadmap’s short, medium and long-term action items. We expect that the Roadmap Committee – ably co-chaired by Professors Ibrahim Garba and Siyan Malomo, and duly served by their esteemed members – will continue to provide the critical advisory support we need going forward,” Fayemi said.