The Federal Government is looking at the possibilities of raising $600million investment fund for the mining sector from the Nigerian Stock Exchange, NSE, and other sources.
The initiative is to provide technical assistance for the restructuring and cooperationalization of the Solid Minerals Development Fund (SMDF), which will make finance available to the antesinal and small mining operators through micro finance and leasing institutions.
Acting President, Prof. Yemi Osinbajo who confirmed this on Tuesday in Abuja, at the National Mining Summit with the theme ‘unearthing Nigeria’s mining sector’ stated that the long term goal of the administration was to grow the contribution of the mining sector to GDP by $27b in 2025 which is roughly 3% of the current GDP.
He added that the government was addressing the lack of geological data in the country and that the Nigerian Geological Survey Agency was undertaking the additional ground investigation nationwide to upgrade the national minerals data base.
“The mining sector is a priority for the Nigerian government because it forms a crusial part of our economic growth and diversification agenda. The argument for diversification is straight forward, we are all witnesses to the impact on our revenue and economic issue of the recent decline in oil prices, he said.
“The Federal Government is determined to achieve growth for the mining sector, in spite of the many legacies that we inherited including low funding, lack of geological data, weak institutional capacity in the supervising ministry, limited infrastructure, limited cooperative federalism, low productivity, illegal mining, weak framework for managing host communities, difficulty in doing business and protracted litigation on legacy assets.
We have started tackling these issues head on and I am pleased to note that the substantial successes we have achieved through the combined efforts of the Federal Ministry of mines and Steel Development and other ministries and agencies of government, development partners and other stakeholders.
“We have secured funding from both domestic and international sources for investment in the solid minerals sector, the ministry has been granted access to the mining sector components of our natural resources development fund for the sum of N30b an intervention fund from the Federal Government, this is partly to help provide cheap loans and grants to industry participants as well as for directly investing in foundational infrastructure.
“We are currently working with the Nigerian Sovereign Investment Authority, the Nigerian Stock Exchange and others to assemble a $600m investment fund for the sector.”
Internationally we have secured $150m in funding from the World Bank for the Mineral Sector Support for Economic Diversification (MSSED). This will provide technical assistance for the restructuring and cooperationalisation of the Solid Minerals Development Fund (SMDF), which will make finance available to the antesinal and small mining operators through micro finance and leasing institutions.
Osinbajo added that the long term goal is to grow the contribution of the mining sector to GDP by $27b in 2025 which is roughly about 3% of our current GDP, this plan is to be realized by creating an enabling environment, targeting investors to institutionalize world class production standards in the country’s solid minerals sector.
