…as World Bank Partners Australia, Canada To Boost Nigeria’s Mining Sector
The Minister of Mines and Steel Development, Mr. Musa Mohammed Sada, has put financial inflows from the mining sector into Federation Accounts from 2007-2010 at N54.56billion.
The Minister who was speaking at the launch of the Externally Financed Output programe for the mining sector in Nigeria said that the amount represented a 100 percent increase in taxes and royalties.
The EFO programme is expected to contribute to improved employment, livelihoods, economic diversification, and the development of small to medium scale exploitation of quarry materials, gemstones, gold and industrial minerals in Nigeria.
The programme is a collaboration between Australia, Canada, and the World Bank is expected to last for 2-year and it would support the Mines and Steel Development Ministry in developing Nigeria’s mineral sector in an economically, environmentally, and socially sustainable way.
According to the EFO agreement the World Bank would provided the design while the governments of Australia and Canada would provide $940,000 and $950,000, respectively.
It will also build upon earlier reforms implemented by the Federal Government with the support of the World Bank assisted $120 million Sustainable Management of Mineral Resources Project (SMMRP) from 2004 till 2012.
The assistance responds to a request from, and needs identified by, the Ministry of Mines and Steel Development to sustain the process of mining sector reform into the next phase.
The Minister who also noted that the sector is already booming due to the activities of firms which has led to the creation of over 250, 000 jobs in the sector.
Mr. Sada assured that government would continue to create the atmosphere for those businesses in the sector to thrive.
“Local production of minerals for the manufacturing and the construction firms has increased, limestone for cement manufacture, clays for the ceramics industry and aggregates for construction are dominant. The recent commissioning of the Wempco Steel plant commissioned at Ibato, Ogun State by Mr. President is a testimony of government’s effort at creating the necessary environment in the sector.”
“My Ministry is committed to the implementation of the government approved Road Map for the Development of Solid Minerals and Metals Sector,” he insisted.
Also, Nigeria’s World Bank Country Director, Marie Francoise Nelly said the contribution of the sector to the country’s Gross Domestic Product (GDP) is still low, pointing out that investment in the sector will improve the sector’s contribution.
“Contributions from mining as a percentage of GDP in mining rich countries are usually between two and eight percent. In Nigeria, the contributions are still low at 0.15 percent but Nigeria has done well to reinvigorate the sector following the first five years of its SMMRP supported reform”.
“The mining reform cycle normally has a long timeframe of over ten years to bring its full benefit to the economy and GDP. It is important for the Government to sustain the reforms and continue to place emphasis on institutional strengthening, transparency, accountability, and governance improvements in the mining sector. ” she added.
For his part, Australian High Commissioner to Nigeria, Mr. Jonathan Richardson, noted the new project would support Nigeria’s efforts to diversify the economy, create employment, generate revenue, and boost the socio-economic development of the country”
“The aim is to develop a plan consistent with the Africa Union’s African Mining Vision 2050 and ECOWAS’s mineral development strategy.”
“The mining sector in Nigeria is just beginning to take shape and we are pleased to work with our partners in the sector to help improve economic development in Nigeria, according to Canadian High Commissioner, Mr. Chris Cooter.
"The reform of the mining sector promises to be of enormous benefit to Nigeria in the future,” he added.
The Australian Government’s support will help identify mineral resource corridors; improve education and training for mining sector employment; update the fiscal regime for mining; formulate an Artisanal and Small-scale Mining strategy; and review the strategy for Mid-Tier Mine Operators. While In addition to supporting the mining infrastructure planning, the Canadian Government’s support is expected to contribute to strengthen the consolidated strategy for sustained mineral sector development in Nigeria, finalize sector specific environmental and social regulations, upgrade the geosciences research laboratory to serve the industry, and increase the opportunities for gender equality in the mining sector.
According to documents, Important achievements registered from the extensive legal, regulatory, and institutional reforms carried out following enactment of the Minerals and Mining Act (2007) and the Minerals Regulations (2011) include: strengthening of the Nigerian Geological Survey Agency to provide reliable geophysical and geological data; establishing the Mining Cadastre Office to regularize the sector’s licensing procedures, and extensive mineral and mining promotions.
Due to the reforms, the estimated production value increased from around US$35 million in 2005 to around US$135 million in 2009, and the number of mineral exploration activities by international mining companies increased from 0 to 50 over the same period.
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