Nigeria’s shift in mining policy marks a significant transformation from decades of raw material exportation to a focus on local processing and value addition. Under new guidelines, Nigeria will grant mining licenses only to companies with plans for local mineral processing. This move aligns with broader African goals to enhance the value derived from mineral deposits and create jobs within local communities. According to Segun Tomori, a spokesperson for Nigeria’s minister of solid minerals development, investors will benefit from incentives like tax waivers on mining equipment, easier access to electricity generation licenses, full repatriation of profits, and improved security. The aim is to review and ensure that mining plans contribute significantly to the Nigerian economy. However, a specific timeline for implementation hasn’t been announced yet.
Nigeria Mining Investment Strategy
To attract foreign and domestic investment, Nigeria has also established a state-owned solid minerals corporation, providing a 75% stake to investors, and a special security unit to combat illegal mining activities. The government’s strategy includes regulating artisanal miners by organizing them into cooperatives. Despite its vast mineral resources, Nigeria’s mining sector, which contributes less than 1% to the GDP, has struggled with poor incentives and neglect. Noteworthy foreign investments include Canada’s Thor Explorations in Gold, China’s Xiang Hui International Mining, and India’s African Natural Resources and Mines, which is constructing a $600 million Iron Ore processing plant.
Conclusion
To sum up, Nigeria is making a significant shift in its mining sector by implementing new guidelines that will only grant mining licenses to companies that present a plan for local mineral processing. This strategy marks the beginning from Nigeria’s long-standing policy of exporting raw materials and aligns with broader efforts across Africa to extract more value from solid mineral deposits. This change aims to boost the local economy, create jobs, and enhance the overall development of Nigeria’s underdeveloped mining sector.
