Human rights lawyer Femi Falana has challenged President Bola Ahmed Tinubu’s government to tackle the bottlenecks in the mining sector as he lamented the N6.9 trillion ($9 billion) worth of gold being taken away from Nigeria annually.
Falana made the comment while appearing on Channels Television’s Sunrise Daily on Friday, August 17, 2023.
The lawyer who also criticised the Central Bank of Nigeria (CBN) over the free flow of the naira after allowing the floating of the naira against the dollar and other international currencies, said the CBN Act made it compulsory for the apex bank to fix the exchange rate.
Recall in December 2020, a debate highlighted the severe economic problem that illegal mining poses for the country. Estimates suggest that the country stops entering its offers at about 9 billion dollars annually due to the smuggling of illegally extracted gold in its deposits.
The Nigerian Senate requested the government to investigate the alleged loss of profits equivalent to about 9 billion dollars annually, due to the illegal extraction and smuggling of gold.
The Senate of Nigeria required the Nigerian Executive to increase actions to reduce the impact of illegal gold mining. In turn, causing the loss of income derived from these practices. Additionally, it recommended the creation of mining farms aimed at supporting miners and artisans.
The Committee on Solid Metals, Steel Development, and Metallurgy of the Senate itself plan to carry out the investigation on illegal gold mining and its impact on mining profits.
The decision stemmed from a proposal by Senator Orji Uzor Kalu. Sources revealed Nigeria lost nearly $54 billion due to illegal gold mining and smuggling between 2012 and 2018.
Illegal gold mining is one of the main problems facing the gold industry on a global scale. The uncontrolled extraction of gold by illegal miners causes enormous economic damage. This is due to intermediaries who smuggle gold to be refined and sell it in other countries.
According to Kalu, combating illegal mining in Nigeria would create up to 250,000 new jobs and generate revenue for the government, worth more than 500 million dollars annually. The current gold reserves level is estimated at 200 million ounces (6,220 MT); most of them are unexploited. It is vital to develop sustainable programs that attract more and more investment in extraction areas.
The studies carried out to confirm the existence of important gold reserves in many states of the country.
In June 2023, former President Muhammadu Buhari pointed out that his government aimed to earn some 500 million dollars annually thanks to gold mining. It would allow diversifying the income of a country that mainly depends on exports of oil. However, the price of the commodity fell significantly in April due to the pandemic.
But revisiting the amount of dollars Nigeria is losing to illegal mining, Falana commended Tinubu for appointing a capable hand – Femi Alake to man the solid minerals development.
He also asked the Tinubu’s led government to ensure tackling bottlenecks in the mining sector, including the challenge of illegal mining.