CSOs endorse action-plan on mining, recommend robust fiscal regime

Global Rights in partnership with Civil Society Legislative Advocacy Centre (CISLAC) and the Nigeria Extractive Industries and Transparency Initiative (NEITI) hosted a two-day workshop tagged “Promoting Transparency, Fiscal Accountability and National Development in Nigeria’s Extractive Industry Governance” through transparency, accountability and the adaptation of international best practices, including EITI processes and the implementation of the African Mining Vision (AMV).

The workshop, which is part of a series of dialogues aimed at strengthening and increasing engagements between civil society actors and the government, engaged oversight institutions tasked with fostering transparency and fiscal justice in Nigeria’s extractive industry, in particular – the Nigerian Extractive Industries and Transparency Initiative (NEITI). It also appraised the Nigerian Mining Industry Roadmap against the backdrop and aspirations of the AMV, and the ECOWAS Mining Directive, with the aim of creating essential linkages for advocacy by civil society actors.

The Meeting considered:

  • Is the mining Road Map leading the country in the direction of growth and development for the sector?
  • Does the industry’s framework engender transparency, accountability and participatory governance?
  • Does it protect and promote the rights of mining host communities?
  • How strong are its governing institutions?
  • What roles should each of the stakeholders play in strengthening these institutions?
  • Why does Nigeria capture the high grounds of commodity prices in the international markets?
  • How best can Nigeria align national policies with regional and continental policies?

Stakeholders and participants at the workshop observed that:

  • With more than 50 minerals in commercial quantities strewn across Nigeria, paradoxically the solid minerals sector contributes less than 1% to the national GDP.
  • More than 80% of mining activities (in particular artisanal mining) are unregulated and their revenue unaccounted for.
  • Mining host communities inordinately bear the burden of the resource curse with seemingly little or no benefits from the wealth that is exploited from their vicinity.
  • The fact that Nigeria’s mining sector is in its nascent stage presents an excellent opportunity to strengthen its governance framework and adopt best practices in order to avoid a repeat of the mistakes Nigeria made in the Oil and Gas industry.
  • There is inadequate geo-data making strategic planning and the efficacious governance of Nigeria’s solid minerals sector difficult.
  • While the NEITI Act and the EITI protocol clearly encourage and provide for CSO participation in the implementation of its extractives mandate generally, there is still a gap in its level of CSO engagements on solid minerals.
  • Sustainable growth and socio-economic development of the nation through mining is dependent on transparent, equitable and optimal exploitation of mineral resources .There is currently an insufficient level of transparency in the activities and governance of Nigeria’s mining sector to meet its developmental aspirations through mining.
  • The implementation of the AMV is hampered by lack of political will by government, and lack of familiarity with its pillars by other stakeholders.
  • Contrary to long held beliefs, tax holidays have not incentivized investments in the mining sector but rather have deprived the nation of essential revenues.
  • There is a dearth of technological innovation in Nigeria’s mining operations, which has stagnated its growth and development.

Participants at the meeting recommended that:

  • The government should implement a more efficient fiscal and regulatory regime to govern the extractive sector’s value chain.
  • Given the size of unregulated artisanal mining activities within the country and the inherent loss of revenue, government must urgently embark on and incentivize their immediate mobilization into mining cooperatives, provide extension services and ensure adequate oversight of their activities
  • Government must increase the number of mineral buying centers across the country to avoid continued revenue loss through illegal trade
  • Government must equip and empower the Nigeria Customs Authority to ensure porous borders for illegal mineral exports are tightened.
  • It is imperative for government to strengthen the framework for the protection and promotion of the rights of mining host communities; in particular, clearly articulate the requisite protocol for community development agreements between mining companies and their host communities.
  • There is a need for government to undertake a detailed inventory of the quantum and spread of mineral resources in Nigeria in order to foster strategic planning and determine parameters for their effective management.
  • Government needs to massively invest in the development of essential infrastructure, alongside the regulatory and administrative institutions for solid minerals in order to situate Nigeria as one of the top ten mining destinations in the world
  • Nigeria must also invest in the systemic adoption of cutting-edge technologies for the advancement of operations in the mining sector and to improve revenue generation.
  • Civil society and the media must both commit to playing a more vested role in promoting transparency and accountability in the solid mineral sector.
  • Nigeria must locally adopt and integrate the African Mining Vision and the ECOWAS Mining Directive in its national framework for mineral development in order to attain its aspirations.
  • In the interest of maximizing revenue and expanding the value chain of minerals harnessed in Nigeria, it is imperative that government policies and laws insist on their beneficiation
  • Government should scrap its tax holiday incentives which has led to the loss of essential revenue, and instead strengthen the framework for ensuring the ease of doing business by investors.
  • Nigeria must recognize the importance of public/private partnership for the growth of the sector and to promote the shared aspirations of all stakeholders.
  • Local content for the sector must of necessity be harnessed and developed.
  • Given the recent renaissance of the mining as a strategic economic activity with a fledgling governance framework, it is imperative for NEITI to improve its focus on the sector, particularly its audit reports and engagement with civil society actors.

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