Investors’ Interest Growing In Nigeria’s Gold Value Chain — PAGMI
To earn $150m from taxes, $25m from royalties annually.
In this April 16, 2020, file photo, a customer puts gold bars on basket for sell to a gold shop in Bangkok, Thailand. The price of gold surged more than $30 on Monday, July 27, 2020 to over $1,926 per ounce.
The Secretary of the Presidential Artisanal Gold Mining Initiative, PAGMI, Hajiya Fatima Shinkafi, has disclosed that more investors are indicating interest in Nigeria’s gold value chain. She further projected that one of the key programmes implemented by the PAGMI, the integration of artisanal gold mining, would on an annual basis, grow Nigeria’s tax income by an average of $150 million, attract royalties of $25 million, and boost the country’s foreign reserves by $500 million annually.
Shinkafi said PAGMI is set to galvanise the nation’s gold industry by transforming it into a major player in the global market, because PAGMI serves as a catalyst in the industry to rapidly develop the nation’s gold reserves and to give artisanal gold miners a sense of belonging with improved way of mining. According to her, artisanal miners who mine gold will be having increased profit, because they get better compensation for their wins, thereby encouraging others to come on board in order to boost production and availability of the commodity.
She further explained that PAGMI is a presidential initiative to kick-start the gold sector in Nigeria, because it is a private sector issue. “Normally, for this kind of business, which the Ministry of Mines and Steel Development and others are the regulators, PAGMI is a proof that kick-starting the gold sector is a possible concept,” Shinkafi stated. In addition, she said: “The government is not in business as such. We have some investors already, who have shown interest and have undergone some licensing, and of course, room is still open for more people to come into the business.
“Come to the Ministry, you can be part of the process as a buying centre licensed by the Ministry once you fulfill the obligations and of course the responsible resourcing is very important. “A lot of people are putting their money in gold. What this does for Nigeria is that the Central Bank of Nigeria, CBN, acquires the London Bullion Market Association’s bullion in Naira, and of course it adds to our foreign reserves.
So we do not have to sell crude oil to add to our reserves, we can add to our foreign reserves from our gold that is mined in Nigeria. “That is fulfilling our mandate, diversifying from oil and gas, creating employment for people and at the same time generating revenue for government. This is the major mandate for the Ministry. “On a large scale, PAGMI estimates that the Federal Government of Nigeria could realize an annual average of $150 million in taxes, $25 million in royalties, and $500 million accretion to foreign reserves from the integration of artisanal gold mining activities implemented by PAGMI.
“PAGMI will result in the creation of over 500,000 new mining and formalized jobs, leading to poverty alleviation for more than one million households.” According to her, PAGMI targets scaling up across the entire gold mining belt of the country as agreements have been reached with Thermofisher and Metler Toledo, leading producers of gold testing and weight equipment, to equip up to 50 buying centers in the country. “This should be taken over by private sector initiative. Government has proven that is possible and chosen some state as in the pilot.
We encourage individuals and want to get Nigerians interested in mining, and we can put our money in mining and of course reap bountiful rewards from this,” Shinkafi maintained. She also expressed optimism that the two licensed gold refineries in the country, when completed, would drastically reduce the stress of taking raw gold out of the country for refining. “We have two refineries that are completing the refining process they are building. We have one in Ogun State and Abuja, and there is room for more. These two refineries are private sector owned and driven and it has nothing to do with government”, she added.