Keynote Address By The Honourable Minister of Mines and Steel Development, Architect Olamilekan Adegbite, at The Nigerian-British Chamber of Commerce (NBCC) Webinar on Unlocking Nigeria's Economic Potentials June 18, 2020

Keynote Address By The Honourable Minister of Mines and Steel Development, Architect Olamilekan Adegbite, at The Nigerian-British Chamber of Commerce (NBCC) Webinar on Unlocking Nigeria's Economic Potentials June 18, 2020

The
                                 Nigerian-British
                                 Chamber of Commerce - Keynote Address By The Honourable Minister of Mines and Steel Development, Architect Olamilekan Adegbite, at The Nigerian-British Chamber of Commerce (NBCC) Webinar on Unlocking Nigeria's Economic Potentials June 18, 2020
Latest News & Updates June 22, 2020

Good afternoon Ladies and Gentlemen.

1. I wish to start by commending the Nigerian-British Chambers of Commerce, NBCC, for your continuous efforts in promoting trade and investment between Nigeria and the UK, and I would also like to thank you for having me as a speaker at this webinar.

2. This webinar with the theme ‘Unlocking Nigeria’s Economic Potential’ is apt but quite broad. Nigeria is endowed with boundless opportunities and with the current macroeconmic environment and shift away from Nigeria’s traditional revenue sources, the role of the mining sector is more important than ever.

3. The double-ended shock of the Covid-19 pandemic and consequent sharp decline in oil prices has led to a revenue shortfall for the country, hence bringing the mining sector to the forefront. The administration of President Muhammadu Buhari has been making efforts to diversify the economy away from oil through the development of the mining and agricultural sectors. These efforts are now being fast tracked.

4. Mining offers robust economic potential to diversify the economy, create jobs and increase government revenue which is our core mandate.

5. Nigeria is endowed with over 44 different mineral types occurring in over 500 locations across the 36 States and the Federal Capital territory. Seven of these minerals have been designated strategic to unlock the enormous potential in the sector. They are coal, iron ore, bitumen, gold, limestone, lead-zinc and barite.

6. Alongside the seven strategic minerals, the Ministry is also looking into key minerals to fuel the future. These include metals such as titanium, tungsten, lithium and cobalt, which have various applications in futuristic industries such as aerospace, telecoms and electric vehicle manufacturing.

7. The Nigerian Mining Industry Roadmap formulated in 2016 highlights clear policy direction on how to develop the sector, which we continue to improve upon to unlock the potential in the sector.

8. The structural reforms we have embarked upon in the industry are geared towards supporting the emergence of a vibrant private sector and to stimulate resource-based industrialization. It is predicated on the principle that government serves as a regulator, providing an enabling environment for businesses to thrive.

9. Let me quickly highlight some of our reform achievements which have helped de-risked the sector thus making it investor friendly .

  • We have operationalised an Artisanal and Small Scale Mining (ASM) Remote Sensing Monitoring System to regulate and support ASM activities.
  • We are on the verge of completing the automation of the Mining Cadastre System to meet international standards for online mineral title and license applications. This eliminates administrative bureaucracy, whilst improving the ease of doing business in Nigeria’s mining sector.
  • We, in partnership with the British Geological Survey, are establishing a Nigeria Geo-Data Centre at the Nigerian Geological Survey Agency (NGSA) to ease online access to geological maps and datasets for use in academia, investment decisions and general research purposes.

10. The recent establishment of the Investment Promotion and Mineral Trade Department demonstrates our zeal and preparedness to welcome global investment partners. We have put in place incredible incentives to support investors and to unlock the sector.

The incentives include:

  1. Customs and import duties waiver for plant, machinery and equipment imported for mining operations
  2. Tax holidays of between three to five years as applicable;
  3. Free transferability of capital and permission to retain and use earned foreign exchange
  4. Capital allowances of up to 95% of qualifying capital expenditure
  5. 100% ownership of mineral properties.

11. At this juncture, I equally wish to point out some ongoing initiatives we have designed to support the sector. One of which is the optimisation of our mineral value chain. The ultimate objective is to minimise the export of raw materials, creating value along the chain that would increase industrial and manufacturing activities, create employment and foster skills development.

12. Presently, our priority is anchored in the gold sector. We are creating a gold ecosystem to minimize the high rate of illegal gold mining and smuggling, increase government’s revenue from the resource, create jobs, and improve environmental and social stewardship.

13. Through the ongoing Presidential Artisanal Gold Mining Initiative (PAGMI) we are organising, formalising, and equipping Artisanal and Small Scale Gold Miners (ASGMs) in Kaduna, Kebbi, Osun, Niger and Zamfara states.

14. Miners of precious, metallic and industrial minerals will be linked to formal markets through licensed private mineral buying centres. One of such initiatives is the recently launched Dukia-Heritage Bank Buying Centre.

15. Two companies (Kian Smith and Dukia Gold Limited), located in Ogun state and the FCT, have been granted licenses to refine gold and are in the process of building their refineries.

16. We are trying to stimulate mineral processing across the country using a cluster or hub approach. Each cluster will be provided with road and power infrastructure to encourage investors in processing and refining equipment to support a network of miners and processors.

17. In the longer term, the upgrade, completion, and operation of the Ajaokuta Steel plant operations would enhance jobs and revenue generation. The project is based on a bilateral agreement between Nigeria and Russia, with funding from the Afrexim bank and the Russian Export Centre.

18. Other ongoing initiatives to stimulate the growth of the industry include the following:

  1. Working with several stakeholders to design mining specific credit enhancement instruments. Miners will be able to access long-term finance at concessionary rates through these instruments.
  2. Generating integrated geoscience information that will help in derisking the mining sector. This is through the ongoing National Integrated Mining Exploration Project (NIMEP). Target minerals include gold, platinum group metals (PGM), nickel, chromium, lead/zinc, barite, iron ore, copper etc.
  3. Developing a mineral economic corridor to address infrastructure gaps in the mining value chain. Transport networks connecting mines to ports and end-users will be to enhance the competitiveness of the Nigerian mining industry, since the infrastructure will be shared with other sectors.

19. With support from the administration of president Muhammadu Buhari and his ethos on diversification, job creation and sustainable revenue generation, I am confident that Nigeria’s Mining Industry is on track to reach our goal of 5% GDP contribution in the next 5 years.

 

Arc. Olamilekan Adegbite

Honourable Minister of Mines and Steel Development

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