‘Over concentration on crude oil hindering growth of solid mineral sector’
The National President of Miners Association of Nigeria (MAN), Kabiru Mohammed, told KEHINDE OLATUNJI that crude oil has overshadowed every other natural resource. Consequently, the country has lost out on significant revenue that would have accrued to it from the sub-sector as obtained in other African countries.
Artisanal mining has robbed Nigeria of a lot of revenue over the years, why is it difficult to streamline things in the mining sector?
It is true that artisanal mining has robbed the country of a lot of revenue. However, the fault is not wholly that of the artisanal miners, rather the government is largely to blame for the complete neglect on the sector, which reduced mining to artisanal level, where people with little or no knowledge of mining just go with small tools, or with bare hands to scavenge for any minerals available on the surface of the earth so as to sell it to illegal dealers at giving away prices just to feed themselves, or take care of their immediate needs and that of their family members.
This neglect of the sector by government, which relied solely on oil as its major source of revenue over the years, has now made it difficult for it to streamline how mining should be best practiced. And because mining is highly capital intensive, and the country today is financially incapacitated and almost bankrupt, streamlining this sector to the desired position will be Herculean, but not impossible.
The contribution of the mining sector to the country’s GDP has been insignificant considering the country’s level of natural endowment. Is this a policy issue or government’s fixation with oil revenue?
I spoke briefly on this issue in the earlier question. But let me add that in the late 1950s and early 1960s, the country’s major source of revenue was solid minerals and agricultural products. We had tin ore, lead, zinc, coal, columbite, iron ore as our major revenue earners. But when oil was discovered leading to the oil boom of the 1970s, attention effectively shifted to it to the detriment of mineral resources. Since no plan was made to further harness what the sector still has in abundance in preparation for the rainy day, that is why we have found ourselves where we are. So, I can say that the government’s policies of the past regimes have contributed mainly to where the sector has found itself today.
As the watchdog of the mining industry, not many believe that the Mining Association of Nigeria has discharged its role effectively, especially considering the level of illegal mining. What are the constraints that are weighing the association down?
Miners Association of Nigeria (MAN) is not just a watchdog of the mining industry, it is more of a partner and promoter of the sector, and our major interest is to raise the standards of miners, improve their lot and earnings, and also to act as a linkage and bridge through, which mutual understanding, collaboration and synergy can coexist between with the government and the business community, within which they showcase these our natural endowments for the world to see. Therefore, the association alone cannot stop the so-called illegal mining, rather the relevant government agencies and regulatory bodies should collaborate with us to achieve this goal.
Law enforcement agencies and other government bodies must work closely with us to end illegal mining. There’s also the issue of formalisation and capacity building of artisanal miners that could help in streamlining their activities and get them to conform with the world’s best practices.
The association should also be adequately funded in order for it to have the financial strength to bring sanity into to sector. Presently, we’re not funded by anybody or organisation. Being funded would either by a government or private outfit would give us the capacity to act effectively, especially since our activities take place mostly in the bushes, where there are serious challenges of insecurity, lack of access road, and other infrastructures that contribute to making mining a lot easier and more friendly.
Mining constitutes a money-spinner to South Africa and some other African nations, but Nigeria is still a mining nation with latent potential. Why are we still at this level?
Yes, we can’t compare our country with other African countries like South Africa and Ghana in terms of revenue earned from mining. This is because mining is taken very seriously in these African countries, and it is also their a major revenue source to them unlike in Nigeria, where oil has virtually overshadowed every other natural resource as a revenue source for the country. So, it’s the mistake of concentrating on oil alone that has made mining insignificant in terms of revenue generation to the country.
The stark absence of infrastructure, skills and funding has made mining remain at this state in the country. Why is it such a big deal to have in place accelerated development of the sector?
Yes, lack of infrastructure, poor funding are the key factors behind the stagnation of mining activities and the inability of mining moving to higher levels in the country. Unfortunately, now that the country has decided to diversify her economy and prioritise the minerals’ sector, it is difficult to have accelerated development of the sector because of dearth of resources.
Indeed, the sector needs billions of naira to be resuscitated. A lot of equipment, human and technological capital are also seriously needed. So, the government should provide a very conducive, and enabling environment for foreign investors to come in and help in accelerating the development of the sector.
What will it take for the mining industry to provide massive job creation, raw materials for our industries and income for the government?
As we are all aware, there are virtually none of the 774 local councils in the country that is not endowed with one mineral or another. So, there are enough avenues for the sector to provide massive jobs and employment opportunities, and be a major source of raw materials for our local industries, especially in the power sector, transportation, pharmaceuticals, and even in the agricultural sector.
All that’s needed is for the government to collaborate with the sector, by funding assisting miners to acquire more equipment and improved technologies, ease their means of doing business with the foreign partners, and investors, as well as provide a more friendly regulatory framework for miners to operate within with as minimal stress and bottlenecks as possible. If this is done, the mining sector will bounce back and generate maximum revenue, huge employment opportunities, and engender industrial growth and fast-track Nigeria’s entrance into the league of the world’s big economies.
How has government’s renewed interest in mining development as indicated by incentives such as tax holidays, removal of export duty for mining equipment and readiness of indigenous operators to partner with foreign investors helped the mining sector?
The Federal Government’s renewed interest in the mining sector is very encouraging, but not much has really been put in place for the industry to bounce back fully. There is still a serious lack of funding to the operators, that is, we the miners. Government is not doing enough like it’s doing in the agriculture sector because without enough funds nobody can think of importing equipment and attracting improved technology and benefitting from the duty-free imposed on imports or exports. Therefore, the government should encourage both government and private financial institutions to support the sector with enough funds and interventions, equipment leasing, and all other forms of incentives to accelerate the resuscitation of the sector.
Ever since Kayode Fayemi left office as Minister of Solid Minerals, all efforts aimed at revitalising the sector have been in abeyance. What is responsible for the lull?
I don’t think there’s any difference between when Kayode Fayemi was the minister and what obtains today. When the two new ministers came onboard, they raised our hopes high as far as making the sector more active and more rewarding, both to miners and the government. We’re still waiting to see if their promises and readiness to resuscitate the sector, by helping miners would come to fruition. The intervention funds (about N5b) provided by the Federal Government, through the Bank of Industry has not been made available to any miner three years after.
Also, palliative gave by the Ministry of Finance, the CBN and other government agencies are yet to have an impact on miners. The anchor borrowers scheme enjoyed by farmers has not been extended to miners. So, they (miners) are still crying out loud, and are calling on the Federal Government to come to the rescue of the sector.
Lastly, I must confess that the Nigerian government today has no option but to accept the mineral sub-sector as the only option that can rescue the economy from the global financial crisis. Oil is now becoming history, while renewable/green energy is the focus of the industrial world, and solid minerals are the key ingredients to the new world’s technological drive.
Also, the government must urgently find a solution to the issue of connivance with foreigners, especially Chinese nationals by some unscrupulous local miners to carry out illegal mining. At the end of the day, these indigenous miners sell the dug up minerals to their foreign collaborators for a pittance because they are not following the proper channels of international trade. The government consequently loses the much-desired revenue, and in most cases, these foreigners are protected by some powerful Nigerians.
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