Nigeria Earns $5 Million from Gold, Highlights Mining Sector Challenges and Opportunities.
In a significant milestone for Nigeria’s mining sector, the Minister of Solid Minerals Development, Dele Alake, proudly presented gold bars produced by the country’s artisanal and small-scale miners to President Bola Tinubu. The Solid Minerals Development Fund (SMDF) refined the gold, demonstrating the potential within Nigeria’s mining industry that has long remained untapped.
Traditionally, the first pour of molten gold into the shape of a bar is a moment of celebration in the mining world. For Alake, presenting these gold bars symbolized the materialization of the government’s inventive strategies and initiatives. He emphasized that maximizing the benefits of Nigeria’s extractive industry requires a fresh approach, different from the previous models marked by policy incoherence and lack of focus.
Alake highlighted the essential role of good management and leadership in the mining sector. He pointed out that effective legal and operational frameworks recognizing the rights of small-scale miners could have significantly advanced the sector. Established in 2017 with an initial fund of N30 billion, the SMDF has finally started yielding tangible results. However, questions remain as to why it took so long for these results to manifest.
Artisanal miners have dominated Nigeria’s mining landscape, often resulting in environmental degradation and health issues without substantial economic benefits. An effective mechanism linking miners to financial and operational support structures has been lacking. Successful mining nations have addressed similar challenges by turning them into opportunities, as detailed in the World Bank’s 2023 report on the artisanal and small-scale mining sector.
The report, referencing a 2014 study by G. Hilson and J. McQuilken, highlights that many mining sector policies have historically overlooked artisanal and small-scale mining (ASM). This is changing as countries learn from past mistakes and implement inclusive policies.
The report also discusses the vital role of women in ASM, contributing to Sustainable Development Goal 5, which aims to achieve gender equality and empower women and girls. Countries like South Africa and Sierra Leone have established frameworks to formalize and support women in mining.
Nigeria is making strides in this direction with initiatives like Women in Mining in Nigeria and the Women in Mining Training Institute (WIMTI). These groups require sustained efforts to replicate the success seen in other countries. The World Bank report also highlights a Ghanaian project that provided access to finance for women gold miners, demonstrating how structured support can transform the ASM sector.
Reflecting on Ghana’s experience in the late 1990s, when artisanal mining posed significant challenges, Alake noted that over time, the government found solutions to regulate and support artisanal miners. This scenario underscores the broader message that Nigeria’s economy must be well-organized and managed to achieve desired outcomes across all sectors. An unplanned economy will inevitably face stunted growth and underdevelopment.
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Alake’s presentation of gold bars to President Tinubu is a testament to the potential for economic diversification in Nigeria. For too long, the country has relied heavily on oil, becoming a nation of rent collectors. The recent success in the mining sector suggests that economic diversification is not only possible but imperative. It requires a new perspective and a commitment to harnessing Nigeria’s untapped resources effectively.
The government’s renewed focus on the mining sector exemplifies the need for national economic policies that are organized and meticulously managed. This approach will pave the way for sustained growth and development, moving Nigeria closer to realizing its economic potential beyond oil dependency.
