Buhari: Nigeria lost $3bn in 6 years to gold smuggling

... FG targets 250,000 jobs, $500m annual taxes from mining

…plans building of gold refineries

TRACKING ___President Muhammadu Buhari has disclosed that Nige-ria lost about $3 billion to illegal gold smuggling between 2012 and 2018. The President made this disclosure yesterday at the official presentation of locally mined gold bars by the Presidential Artisanal Gold Mining Development Initiative (PAGMDI), where he also reaffirmed his administration’s commitment to establish gold refineries in Nigeria. He, however, raised the hope that improved gold mining operations in the country would generate no fewer than 250,000 jobs and over $500 million annually in royalties and taxes to the Federal Government.

The President noted that the laudable initiative would support efforts at creation of jobs for Nigerians, diversifying the revenue base, and improving foreign exchange reserves. His words: “With the implementation of the PAGDMI scheme 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 realizing 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.”

Buhari noted that in addition to the potential revenue gains that will occur from mining operations, efforts were being made to enable the setting up of gold refineries in Nigeria. He expressed optimism that these measures would lead to the creation of additional job opportunities across the gold value chain and also help the nation capture the additional value created from the gold refining process. On environmental degradation, the President pledged that government would pay close attention to safety and environmental measures to protect workers and the environment.

The Nigerian leader also used the occasion to commend all stakeholders involved in the PAGMI for their painstaking efforts in developing a programme aimed at improved sourcing and refining of highquality gold bars, derived from minefields in Nigeria. He recalled that the PAGMI, which was launched in 2019, was well timed, considering the impact of COVID-19 on the global economy and indeed on the Nigerian economy.

He said the impact of COVID-19 and the containment measures designed to slow the spread of the virus, had led to a slowdown in global growth, which was projected to decline into negative territory for the first time since the Great Depression.

“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 said. Emphasizing the benefits of the PAGMDI, the President explained that it would support job creation efforts, particularly for artisanal miners, by providing them with a guaranteed off-take by the CBN. According to him, the initiative will enable the deployment of financing schemes that will help miners improve on the quality of their mining operations.

“The gold buying programme by the Central Bank will ensure that artisanal miners are no longer subjected to the volatility in gold prices that occurs in the absence of credible offtakers, which has often led to a significant loss in the value of gold sold by miners, as well as in encouraging illegal smuggling,” he said.

The CBN Governor, Godwin Emefiele, in his contributions, said the initiative was a big step in the direction of the diversification of the nation’s economy. According to him, incomes from the sale of gold will serve as buffer to support that from sale of crude oil, especially given its volatility at the global market. Kebbi State governor, Atiku Bagudu, also told newsmen that the formalization of the activities of the gold miners would impact positively on the security situation the country. He said with the PAGMDI programme, those hitherto into illegal mining activities would legitimize their trade.