Nigeria: Current Lending Rate Not Making Mining Operations Profitable

The current bank-lending rate of 20-27 per cent will not make mining operations profitable in Nigeria. The Zonal Chairman, Nigerian Society of Mining Engineers, Engr. Markus Pwajok, stated this when he addressed the 56th Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) AGM/Conference in Jigawa State.

Pwajok said the mining companies and their investment funds would only go to those countries where the enabling environment would allow the private sector to flourish without hindrance. “Since mining is a capital intensive venture with long gestation period, there should be a Minerals Development Fund, which will enable miners to access loans at low interest rate but the current bank lending rate will not make mining operations profitable.

“In the past, the government had paid lip service to the development of this sector of the economy, but now that it is a very favorable alternative to the oil sector, NACCIMA should take advantage of this development and encourage its members in the mining sector to go into mining and mineral based industries,” he said.

Minister of Industry, Trade and Investment, Okechukwu Enelamah, noted that every state in Nigeria is blessed with abundant solid mineral resources and current estimates suggest that there are no less than 44 mineral resources available in commercial quantities across Nigeria. The most prominent ones include bitumen, coal, iron ore, limestone, gold and tin.

“Let me paint for you a picture of what we can do if we pay attention to our solid minerals sector. First we will create jobs, in a country that has such large pools of unemployed labour, and needs to create millions of jobs annually just to keep up with population growth.

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