Between Miners And CBN’s $200m SME Fund

A major challenge to the development of mining in Nigeria is the issue of funding. The need to assuage this led to the call to include artisanal and small scale miners (ASM) in the Central Bank of Nigeria (CBN) existing fund for small and medium enterprises. Ruth Tene Natsa writes on the need to capture the sector in the funding.  

Funding remains a major challenge to the development of the mineral and mining sector due to the huge long term investments required in both exploration and actual mining activities.

The need to address this challenge led to the 2013 stakeholders’ workshop to suggest and agree on new reform policies towards the development of the sector. One of the suggestions was that the $200 million existing fund for small and medium enterprises (SMEs) from the Central Bank of Nigeria (CBN) be made accessible to artisanal and small scale miners (ASMs).

But as at date, not much has been heard about the fund and stakeholders continue to blame the bureaucracy in government. ASMs, also known as informal miners, constitute the majority of practicing miners in Nigeria. This is because mining requires long time financing which is not readily provided by the nation’s financial institutions. So it is much easier and cheaper for miners to practice on a small scale and in many cases at very little or no cost. However, their output require lots of hard labour, this is particularly so in quarry mining.

The funding, according, to stakeholders will provide funding for various exploration and exploitation of mining activities, provide training and capacity building to miners and also provide various mining equipment and resources.

To this effect, the Emir of Zazzau, Alhaji Shehu Idris, pledged to assist the miners to interface with the federal government and, particularly, the CBN to capture the mining industry in the provision of funding facilities for the growth of the industry. The emir, who is a life patron of the Miners Association of Nigeria, made the commitment when he received a delegation of the association, led by its president, Alhaji Sani Shehu, in the emirate on Wednesday.

A statement to LEADERSHIP revealed that the emir, while welcoming the delegation commended the miners for providing employment for the populace and further pledged his assistance for the growth of the industry which is now the focus of the nation as an alternative base for the Nigerian economy. In his remarks, leader of the delegation, Alhaji Sani Shehu, commended the emir for his support and also gave a summary of the challenges facing the leadership of the association as including “lack of adequate attention by government which has resulted in the non capture of industry in government funding assisted policies.”

Other challenges, he said, included “the issues of multiple taxation by all level s of government and agencies, influx of foreign mineral traders who buy minerals at the detriment of indigenous miners and the outrageous demands by mining communities which the emir promised to take up with the appropriate authorities.Also in the struggle for economic relevance, Shehu called on the federal government to capture mining operators in its transformation agenda. This according to him “is because any sector captured under the federal government transformation agenda is promoted and enjoys speedy development as enjoyed by the entertainment industry and the agriculture sector.”

During the stakeholders meeting in 2013, stakeholders advocated other actionable plans to include sourcing for funds from the Solid Minerals Development Fund (SMDF); Natural Resources Fund, coordination of long time project financing with the support of Stanbic IBTC for post exploration, financing and mining, long time financing, project financing, off-take arrangements, securitisation, development of finance institutions to provide long time financing among other issues. Stakeholders also advocated for the enforcement of the principle of the “Use it or Lose it” in the minerals title administration of the 2007 Minerals and Mining Act by the Mining Cadastre Office (MCO) of the Ministry of Mines and Steel Development to discourage people from holding dormant mineral titles.

It was agreed that the legal and regulatory frameworks in the Solid Minerals Sector, the Nigerian Constitution, was robust, formidable and comprehensive to address the challenges and problems associated with the sector. Meanwhile, the minister of mines and steel development, Musa Mohammed Sada, has stressed the need for more attention to be paid to the nation’s mineral sector, saying that the sector needs to find a space in the new development plan of government.

He said, “The government is launching an industrial revolution plan that relies on creating value chains and there is no sector that creates more value chain than the minerals sector.”


Source : Leadership

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