With the prices of crude oil currently at a 10-year low in the international market, there is no better time than now to start exploring the option offered by solid minerals as a major revenue earner for Nigeria. This is even more compelling as a lack of government interest in this vital sector has created a void, which is being exploited by illegal miners to the detriment of the country. It is an inexplicable contradiction that, at a time when the revenues coming into government’s coffers have fallen short by more than 60 per cent, the country’s vital mineral resources are being despoiled, with the government looking on helplessly.
This is why the interest shown by the Senate in the matter recently is very appropriate and timely. The lawmakers, while debating a motion on illegal mining, were able to quantify the loss to the country as nothing less than N4 trillion yearly. Interestingly, this amount tallies with the claim made two years ago by Linus Awute, the then Permanent Secretary, Ministry of Mines and Power, that the country lost N8 trillion to illegal mining in two years.
What should, however, be a surprise is why it has taken the Senate, and by extension the Nigerian state, this long to realise the fortune inherent in appropriate management of the solid minerals sector. It is even more perplexing that this neglect persists after a comprehensive study has shown that there exist about 34 commercially viable types of solid minerals in the country. They include iron ore, gold, bitumen, limestone, tin, coal, gypsum, limestone, kaolin and lead/zinc. And the good news is that every state in the country is blessed with one or more of such minerals.
Yet, for years, this important sector which sustains the economies of successful countries such as Australia, Canada and South Africa has been left in the hands of some shadowy elements, who exploit these minerals without even paying the requisite royalties to the government. Regrettably, some of the countries that have developed their solid minerals sector to support their economy are not even as blessed as Nigeria in terms of the diversity and quality of available resources.
In Canada, the sector contributed $52.6 billion and $54 billion to national Gross Domestic Product in 2012 and 2013 respectively. Apart from offering employment to about 363,000 people in 2007, mining contributed $8 billion in taxes to Canada’s provincial and federal governments. Figures from the Mining Association of Canada also show that export from that sector was responsible for two per cent of the country’s total export between 2012 and 2013. Also, in South Africa, famous for its large deposits of gold, among other minerals, mining contributed about nine per cent to its GDP, while providing employment for one million people.
With the variety of solid minerals available in Nigeria, there is no reason whatsoever to become so slavishly reliant on oil. Yet, this is a sector that was once vibrant, with the mining of coal in Enugu and tin in Jos contributing substantially to the Nigerian economy before the mid-1970s. Things, however, started taking a turn for the worse when the country started making much money from crude oil. The fate that befell agricultural cash crops, such as cocoa, groundnut, cotton and palm produce caught up with the solid minerals sector. For years, the government ignored calls for the diversification of the economy, thus laying the foundation for today’s quagmire.
Worse still is the fact that many of the actors engaged in the illegal mining activities are foreigners, who dare not attempt such banditry in their own countries. But a good number of locals also engage in mining in an unregulated manner. They have exploited the loose legal environment, especially the laxity of enforcement, to create economic and environmental havoc, with far-reaching consequences to the health of other citizens, especially children.
A few years ago, it was reported that over 400 Nigerian children died prematurely because of lead poisoning in Zamfara State. These were the unfortunate victims of the activities of illegal miners, who, in the course of searching for gold, crack rock ore, which releases poisonous lead dust into the atmosphere. Sources of water are also contaminated and once ingested or breathed in, could also result in permanent damage to the nervous system, kidney failure, lowered IQ and loss of developmental skills. Described as “the worst lead poisoning outbreak in modern history” by Jane Cohen, an environmental researcher for the Human Rights Watch, lead poisoning in Zamfara was said to have claimed 163 lives in a matter of months in 2010.
Since mining comes under the exclusive legislative list in the constitution and is, therefore, controlled by the Federal Government, it is the duty of the state governments who have suffered more from the dwindling flow of oil resources, to nudge the former into action so as to increase available for sharing in the common pool. There is also the additional incentive of 13 per cent of the revenues that accrue to the solid mineral producing states, just as is the case now with the oil-producing states.
Alternatively, the states could also work with the federal lawmakers to amend the constitution to deny the Federal Government the exclusive right over mineral resources. By placing mining on the concurrent legislature list, states could go ahead to exploit minerals in their domain to ease their present financial squeeze rather than continue with the habit of going to the centre with begging bowls all the time. In that case, the entitlement of the Federal government will be the tax from the states.
