Overview
Nigeria is endowed with vast reserves of natural resources such as energy minerals like coal and lithium, metallic minerals like gold and lead-zinc and industrial minerals like limestone and barite. The country was a major exporter of tin, columbite and coal in the 1960s to early 1970s. However, activities in this sector nose-dived considerably by the mid-1970s due to several political and economic factors, especially following the discovery of crude oil in Oloibiri, Bayelsa State. This discovery brought about a transformative era for Nigeria’s economy and crude oil export become a major source of foreign exchange earnings for the country.
The significant export earnings from crude oil led to the neglect of the mining sector and the country became a mono-product economy, vulnerable to international oil politics and attendant uncertainty of export earnings.
Successive Governments at the Federal level have demonstrated some level of commitment to revamping the sector, with minimal successes recorded. For example, in 1999, a new national focus and strategy on mining evolved and this culminated in the enactment of the Nigerian Minerals and Mining Act (the Act or NMMA) in 2007, amongst other policy efforts. However, these efforts only led to a stunted growth in the sector; with the sector’s contributions to the nation’s Gross Domestic Product (GDP) remaining at less than 1% as at 20231.
To demonstrate Government’s commitment to enhancing the sector’s contribution to the GDP and facilitating the diversification of the economy, the erstwhile Ministry of Mines and Steel Development (MMSD or the Ministry) issued a revised sector growth and development roadmap (Roadmap for the Growth and Development of the Nigerian Mining Industry – the “Roadmap”) in 2016, with the objective of addressing the key challenges identified in the sector and outlining strategies for rapid development and utilization of key minerals and metals.
One of the targets of the roadmap is the growth of the sectors’ total contribution (direct and indirect) to Nigeria’s GDP to about 10% by 2026. Pursuant to this target, the Government launched a N30 billion intervention fund to open up the sector to multinational companies. The fund was to be used to promote exploration and research.
Despite these significant efforts, only little traction was achieved across the mining value chain, as the sector only contributed 0.77% to the GDP in 2023 according to the National Bureau of Statistics (NBS)!
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1 Based on the Nigerian Gross Domestic Product Report for Q4 2023, published by the National Bureau of Statistics, the total contribution of the Mining sector (i.e., coal mining, metal ores and quarrying and other minerals) to the 2023 GDP is about 0.77%.
