FG Launches Gold Purchase Scheme

 …set up accredited gold buying centres across key mining areas, CBN serves as off-takers of the refined gold bars

 Nigeria, in June 2020 produced, for the first time, artisanally-mined gold that has been processed and refined for use as a reserve instrument by the Central Bank of Nigeria.


This first batch of artisanally-mined gold bars, to be purchased by the Central Bank, was unveiled at a presentation ceremony to President Muhammadu Buhari in July 2020.

This milestone was achieved under the Presidential Artisanal Gold Mining Development Initiative (PAGMDI), a comprehensive artisanal and small-scale gold mining development programme, launched in 2019 to foster the formalization and integration of artisanal gold mining activities into Nigeria’s legal, economic, and institutional framework.

Speaking at the presentation, President Muhammadu Buhari noted that improved gold mining operations in the country will generate no fewer than 250,000 jobs and over $500m annually in royalties and taxes to the Federal Government.

He expressed optimism in the development to improve the country’s 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,’’ the President stated. 

President Buhari, while commending the PAGMDI as a laudable one that would support efforts at jobs creation for Nigerians and diversify the revenue base said “accredited gold buying centres would be set up across key mining areas to enable the engaged artisanal miners and SMEs in mining capture the value of their work while the enterprise would help the government in realizing royalties and taxes from the sale of these assets”.

‘‘The gold buying program 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 off-takers, 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 further.

The President assured that government will continue to strengthen efforts at implementing policies and programs that will enable greater diversification of the Nigerian economy andenabling investment in the Solid Mineral sector is a key part of the government’s economic diversification program.

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

PAGDMI seeks to tackle and resolve these longstanding issues, while also contributing to President Buhari’s vision to lift 100 million Nigerians out of poverty within a decade. It was designed to integrate social, economic, commercial, and technical consideration into its implementation.

The Nigeria Extractive Industries Transparency Initiative (NEITI), through its audit reports of the solid minerals sector, has consistently drew attention of government to the potentials the sector holds for Nigeria’s economic growth and diversification.