Nigeria eyes $500m annually from Gold

With the dwindling revenue from crude oil sales due to the effects of Covid-19 pandemic, the Nigerian government is now…

With the dwindling revenue from crude oil sales due to the effects of Covid-19 pandemic, the Nigerian government is now eyeing revenue from improved gold mining operations.President Muhammadu Buhari, who disclosed this new drive when he received locally mined gold bars from the Presidential Artisanal Gold Mining Development Initiative (PAGDMI) in Abuja on Thursday, lamented Nigeria lost about $3 billion to the smuggling of the product between 2012 and 2018.

A statement by the Special Adviser to the president on Media and Publicty, Mr. Femi Adesina, on Friday in Abuja said that Buhari stated that improved gold mining operations will earn over $500m annually in royalties and taxes to the Federal Government, while generating 250,000 jobs, annually.

Buhari, according to the statement, reiterated the commitment of the government to the establishment of gold refineries in Nigeria.

He said that the initiative would support efforts at the creation of jobs for Nigerians, diversifying the revenue base, and improving foreign exchange reserves.

‘‘With the implementation of the PAGDMI schemes which will result in the set-up of accredited gold buying centres across key mining areas, artisanal miners and SMEs engaged in mining will be able to capture the value of their work.

‘‘These operations will help in diversifying our revenue base. The sale of gold by artisanal miners and SMEs at accredited centres will help the government in realising royalties and taxes from the sale of these assets.

‘‘These developments will also help in improving our foreign reserves by enabling the Central Bank of Nigeria to increase the amount of gold in its reserves.

‘‘These gold assets which will be purchased in Naira, will not only help to bolster our international reserves, it will also provide a hedge against inflation and other economic volatilities associated with foreign currencies that are held in our reserves,” he said.Buhari disclosed that efforts were being made to enable the setting up of gold refineries in Nigeria since it has the potential for additional revenue gains that will occur from mining operations.

He noted that the pandemic has led to a 40 percent drop in crude oil prices and that “in Nigeria, the drop in crude oil prices has had a significant impact on government revenue, as well as on our foreign exchange earnings.

‘‘In responding to this challenge, it is therefore paramount that we strengthen our efforts at implementing policies and programmes that will enable greater diversification of the Nigerian economy.

‘‘Given our current estimated gold reserves of over 200m ounces, most of which have not been exploited, developing sustainable programmes that will catalyse increased investment in the extraction and refining of gold sourced from mines in Nigeria is indeed vital,” he added.