Nigeria is in the process of developing new standards that will require companies seeking new mining licenses to submit a plan outlining how they would process minerals locally, the Western media reported on Thursday, citing a government spokesperson.
The country will incentivize investors to import mining equipment by waiving taxes, facilitating the process of obtaining electricity generation licenses, permitting complete repatriation of profits, and enhancing security, Segun Tomori, a spokesperson for Nigeria's minister of solid minerals development reportedly said.
"In exchange, we have to review their plans for setting up a plant and how they would add value to the Nigerian economy," Tomori was quoted as saying.
However, he did not provide the timeline for the finalization or implementation of the guidelines, the report said.
Last week, Dele Alake, announced that it is now a government policy to require value addition as a prerequisite for acquiring licenses. This policy aims to generate employment opportunities and support local communities.
According to official statistics, in the fourth quarter of 2023, the entire value of solid minerals goods traded was 94.79 billion naira (more than $71.7 million), accounting for 0.35% of the overall commerce during that period of which solid minerals exports were valued at 35.87 billion naira (about $27 million). This signifies a decline of 13.79% in comparison to the amount documented in Q3, 2023, but it demonstrates a growth of 70.58% when compared to the same quarter of 2022. Nigeria exported primarily tin ore and concentrates mainly to China and Malaysia.
Nigerian government intends to attract additional investment into the sector by granting a greater number of licenses. It has reportedly established a state-owned corporation in the solid minerals sector, which allows investors to acquire a 75% ownership stake. Additionally, a dedicated security unit has been created to combat unlawful mining activities.
The current administration, led by President Bola Tinubu, has consistently emphasized its focus on diversifying away from hydrocarbons and towards the development of other minerals. The nation has reserves of lithium, gold, bitumen, and iron ore.
Its goal is to follow Indonesia's approach and strengthen its commodity value chain and job prospects. By imposing a requirement for buyers to establish refineries within its borders, the Asian country witnessed a remarkable tenfold surge in its nickel exports within just five years.