INTRODUCTION
Despite abundant solid mineral resources, which include gold, lead, zinc, coal, bitumen, iron ore, limestone and barite, the Nigeria mining industry only contributes 0.15 percent to the nation's GDP. The contribution, projected to hit 0.34 percent in 2025, is far from the three percent target set out in the country's mining roadmap1. The Federal Government, in a bid to attract investment, generate revenues and develop the local mining industry, has begun legal, regulatory, institutional, and fiscal reforms for the mining sector, some of which include the digitalizing (upgrade and automation) of the mining cadastral oce, the national electronic geo-databank which would assist in quick and eective information management and investment decisions, amongst others.
While there has been a year-in-year-out steady growth in the mining sector for some time now, the industry is still plagued by certain challenges that have become seemingly unsurmountable. In this Report, we have briefly discussed some of the major challenges and our recommendations whilst focusing on current developments in the sector as well as future outlook even as the world transitions to cleaner energy.
CHALLENGES IN THE MINING SECTOR
Insecurity & Illegal Mining
Insecurity can be said to be the most prominent challenge encountered in the mining sector and this spans through illegal mining, rural banditry and smuggling.
Illegal mining refers to mining activities that are undertaken without State permission, land rights, mining licences, and exploration or mineral transportation permits. It can take the form of a subsistence activity such as artisanal mining, or it can manifest in large-scale organised crime spearheaded by illegal mining syndicates.
Rural banditry refers to armed violence driven principally by the criminal intent to steal and plunder. It is motivated by the quest for economic accumulation. The victims are individuals and communities with material valuables. Security analysts and practitioners have identified four dierent dimensions of rural banditry in the North-West, namely village raids, especially of mining communities; highway robbery; kidnapping; and cattle rustling. Village raids are the invasion of rural communities, especially at night, with the principal purpose of material plundering.
The prevailing theory is that due to the cash-based nature of transactions especially in gold mining, rural bandits have been drawn to the region by illicit and artisanal mining, raiding mining sites for gold and cash, which led to the death of over 150 people in the north western part of Zamfara State between mid-2016 and mid-2019.2
The intersection of illegal mining, rural banditry and violent local conflicts in the North-West, especially in Kaduna, Katsina and Zamfara States, seems evident and some locals in Zamfara State agree that rural banditry is a fallout of illegal mining. A typical example is the incidence report of 7th November 2016, when gunmen on motorcycles killed at least 40 miners at a site in Bindin village in the Maru Local Government Area (LGA) of Zamfara State, stealing all the mined gold and a large amount of cash.3
According to Enhancing Africa's Response to Transnational Organised Crime (ENACT) report, ENACT was told by locals from Zamfara, that those who sponsor illegal mining also sponsor rural banditry and cattle rustling in mining communities in order to create conflict situations for local cattle breeders. Such conflicts lead to the sacking of villages and the displacement of local populations, which creates opportunities for illegal miners to operate.4
According to an analyst,5 because Zamfara State is mostly surrounded by forests (with little or no government presence), the Rugu, Kamara, Kunduma, and Sububu forests have become major hideouts for criminals from where bandits launch their attacks on outlying towns, highways and villages. The plague of insecurity led to the ban on mining activities in Zamfara State by former Head of State, President Mohammadu Buhari in 2021, when he declared a no-fly zone in the State.6
According to an FDI Intelligence Report,7 in November 2022, a local terror group threatened to attack a gold mine in the Bukuyum local government area of Zamfara after miners refused to pay a 10% levy. These sort of reports on banditry and insurgencies across several mining States have discouraged foreign investors from participating in the Nigeria mining sector.
Former Minister of State Mines and Steel Development, Uchechukwu Ogah, disclosed that Nigeria has in the past six years lost revenue estimated at $5 billion to the smuggling of gold. The spike in gold smuggling in the country has once again highlighted the socio-institutional and structural problems in our governance system.
To view the full article, click here.
Footnotes
2. Ibid
3. International Crisis Group, Violence in Nigeria's North West: Rolling back the mayhem, Africa Report N°288, 18 May 2020, 11.
4. 2020-11-19-illegal-mining-policy-brief.pdf(enact-africa.s3.amazonaws.com)
5. See for instance, S Suleiman, Rural banditry in Zamfara state, northwest Nigeria, Kujenga Amani, 13 June 2019, Rural Banditry in Zamfara state, Northwest Nigeria - Kujenga Amani (ssrc.org)
6. Ibid
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
