The revitalization of the mining sector is part of the government’s long-running efforts to rectify massive imbalances in the economy, with the solid minerals sector seen as crucial to overcoming historical dependence on oil and gas. Mining activities suffered greatly from official neglect during more than three decades of political turmoil and civil war that wrecked Nigeria’s economy. The richly endowed nation boasts vast reserves of iron ore and coal, as well as significant deposits of gold, uranium, gypsum, barite, and tantalum. For many years, a sharp drop in the production of coal, tin and columbite weakened the mining sector and reduced its contribution to GDP to 0.5%. Coupled with a determined drop in world oil prices and a decline in crude oil production due to increased violence in the Niger Delta region, it caused a catastrophe in Nigeria’s foreign exchange reserves.

The focus on the non-oil sector returned only after a peaceful transition to civilian rule at the end of the last century. The democratic government of former President O Obsanjo successfully negotiated a $120 million World Bank assistance package in 2004 to revive the solid minerals sector. The six-year project ending in 2010 has been the most serious attempt yet at the sustainable management of Nigeria’s mineral resources. To Abuja’s credit, the renewed focus on solid minerals was not motivated solely by immediate compulsions.

Shortly after his election to office, the Obsanjo dispensation adopted a sweeping plan aimed at establishing Nigeria as a major economic and political entity on the African continent, as well as internationally. The specific objective of the Vision 2020 document was to confirm the country’s position among the twenty largest economies in the world for that year. The document identifies 29 focus areas, from agriculture and food security to judicial and political reform, as crucial for sustained and rapid growth. One of the unspoken goals of this comprehensive policy was the eradication of poverty, which remains a fundamental challenge for inclusive growth in Nigeria.

The regressive policies applied by successive civilian and military governments in the last century devastated most of the country’s traditional livelihood systems. The hegemony of oil prevented economic diversification and deepened social gaps by concentrating employment and income in select urban populations. Administrative failure was outweighed by massive corruption and together they sealed the trickle down effects of Abuja’s significant petrodollar revenues. The inadequacy and failure of welfare schemes engulfed much of rural Nigeria in increasingly degrading levels of food shortages, unemployment and poverty. The state of affairs in Nigeria is accurately gauged from a World Bank estimate that says 80% of the country’s oil profits benefit just 1% of the population. As a result, more than half of Nigeria’s 148 million people continue to live in abject poverty. It also explains why the GDP per capita of $1,418 is among the lowest in the world despite the country posting substantial economic growth over the past decade.

Achieving Nigeria’s 2020 goals critically depends on loosening the overwhelming grip of poverty on its people. Rapid business development is crucial to the renewal of both rural and urban economies. Given its ambitious goals and the time frame involved, a revolution in business growth is the only viable answer to Abuja’s quest for economic glory. This is where mining, along with other important non-oil sectors with potential, come to the fore.

In the years since 1999, Abuja has deployed significant incentives for existing and potential investors in the mining sector. The tax adjustments include lowering taxes on capital gains and company profits, increasing capital allowances, along with a three-year tax holiday for new mining companies. Additional tax exemptions were introduced to boost exports and encourage more exploration and prospecting for solid minerals. The country saw the establishment of its first diamond cutting and polishing center in 2002. To reinforce the importance of mining as a poverty alleviation strategy, the Sustainable Mineral Resources Management Project was initiated in 2004 with the assistance of the World Bank to provide long-term, low-interest loans to the sector. Through extensive disbursement of easy credit repayable over 35-year periods, Nigeria hopes to reduce poverty in mining communities and achieve a diversified economy.

The current government under President UM Yar’Adua is actively pursuing a microgrant program for the mining sector and has been successful, at least in part, in attracting commercial banks to provide seed funding and loans to small and medium-sized mining companies. scale. While the impact of such measures is still being tabulated, SMD announced earlier this year that it expected to achieve a significant revenue stream from mining operations in the next 5 years. The Minister for the Development of Mines and Steel went further by saying that the sector would begin to contribute 20% of the total GDP within ten years.

Tin mining is a sector that has enormous potential for expansion, in that scheme of things. Nigeria has known reserves of the ore in excess of 31,000 tons, most of it concentrated in the central Jos Plateau, and was a major exporter before the oil boom of the 1970s. However, annual production fell sharply from 11,000 tons in 1975. to only about 2,000 tons today. So far only a very small portion of the Jos deposits have been mined, some estimates put the total area of ​​mining operation at just 4% of the total potential. Official neglect of the sector has resulted in elaborate smuggling operations being run in unregulated mines. Considering the fact that Nigerian tin is considered one of the best grades in the world, there is room for massive development of the sector. Stronger regulation and incentives for entrepreneurial ventures in tin mining can significantly boost export earnings, as well as create jobs and support extensive ancillary industries. The revival of the sector is central to Nigeria’s rapid development goals.

There are four essential challenges to Nigeria’s mining aspirations, in general:

I. Increase productivity in artisanal and small-scale mining operations through socially and environmentally sound processes; diversify the economy by empowering and consolidating dispersed mining communities.

II. Develop public mining institutions that function efficiently in a transparent and modernized environment, restructured to handle administrative gaps and promote the development of institutional capacities through international best practices.

third Facilitate better public-private sector cooperation to strengthen mining infrastructure; develop databases and information systems for geological mapping and mineral evaluation specifically designed to promote investment and exports.

IV. Design effective monitoring and evaluation systems that can track multiple programs simultaneously and detail needed interventions, policy redirections, and corrective actions in a comprehensive and timely manner.

More than 80% of Nigeria’s tin deposits today lie at a depth of 36 meters below ground, double that of twenty years ago. Although the ore accounts for only a small fraction of the country’s foreign exchange, it aptly indicates the seriousness of the obstacles facing the country’s mining sector as a whole. In the years to come, Nigeria’s high hopes for a more impressive position in world affairs will surely be determined in part, at least, by how deep it manages to dig!