Nigeria earns N43.2b from solid minerals as government, others share N9.9b

• Loses ports’ patronage to Ghana, Cote D’Ivoire
The Nigeria Extractive Industries Transparency Initiative (NEITI) yesterday in Abuja said Nigeria’s solid minerals sector contributed a total of N43.22billion to government revenue in 2016.

According to a new report by the agency, the figure shows that taxes collected by the Federal Inland Revenue Service (FIRS) accounted for N40.38 billion or 93.43 per cent, while fees collected by the Mining Cadastral Office stood at N1.15 billion or 2.66 per cent.

The report, a highlight of the 2016 audit report of the solid minerals sector revealed that N9.923 billion was shared by the three tiers of government in 2016, being accumulated revenues from 2007 to 2014 from the solid minerals sector.

The Mining Inspectorate Department (MID) recorded N1.64 billion as royalty payments, an increase of 30.15 per cent over the N1.27 billion reported as royalty payments in 2015.

From the report, total minerals production for 2016 was 41.87 million tons valued at N34.09 billion, representing 33 per cent increase on the N25.56 billion reported in 2015.

Meanwhile, tax collection and payment of other fees for 2016 reduced by 32 per cent when compared to the figure of N63.98 billion for 2015. According to the document, while 651 extractive companies made royalty payments in 2016, only 56 companies that met the materiality threshold of N3 million and above were considered for reconciliation. The companies that met this threshold accounted for 86.87 per cent of the total royalties paid.

On state-by-state minerals production, Ogun State contributed 33.49 per cent to the total production to top the table, followed by Kogi State with a contribution of 19.7 per cent, while the FCT came third with 6.20 per cent.

Similarly, minerals production by companies shows that three companies – Dangote Cement Plc, West African Portland Cement Plc and United Cement Company of Nigeria Limited (UNICEM) contributed 70 per cent of total production in 2016. This shows that the cement sub-sector is still dominant in solid minerals production activities.

Further analysis of production by minerals types shows that limestone was the most produced mineral and accounted for 49.35 per cent of the total solid minerals production in 2016, followed by granite with 31.32 per cent. The least contributions were made by gypsum, iron, talc and amethyst with 0.1 per cent each.

The report also revealed that the solid minerals sector’s contribution to exports in 2016 stood at N11.16 billion, representing 3.38 per cent of the N330.01 billion for non-oil exports and 0.13 per cent of total export of N8.53 trillion.

From the report, China was a major destination of Nigeria’s solid minerals in 2016, accounting for 53.63 per cent, followed by Spain and India, which accounted for 26.48 per cent and 8.90 per cent.

The report put the Free on Board (FOB) value of the solid minerals exported in 2016 at $40.934 million while the overall contribution of the sector to the country’s GDP was put at N87.61 billion representing 0.13 per cent of the total GDP of N67.9 trillion.

Notwithstanding, Nigeria has continued to suffer loses due to inefficiency and corruption at its ports, especially in Lagos. Already, landlocked neighbouring countries have shunned the facilities, preferring to do business elsewhere.

The executive secretary, Nigerian Shippers Council (NSC), Hassan Bello, recently confirmed that the Shippers Council of Niger jettisoned a Memorandum of Understanding it entered into with the NSC to ship transit cargo through Nigeria. According to him, operators from Niger found it easier to move their cargoes through ports in Ghana and Benin.

The operators’ complaints include poor road infrastructure, security challenges on waterways, non-automation of processes and delay in handling of documents. The deplorable state of access roads has been particularly frustrating, with vehicles taking about two weeks to enter the ports. As a result, the cost of transportation has soared by over 400 per cent.

Describing the scenario, executive vice chairman, ENL Consortium Limited and the chairman, Sea Ports Terminal Operators Association of Nigeria (STOAN), Princess Vicky Haastrup, said: “It is not easy doing business here. People are sweating, getting depressed. It is a lot of stress carrying out any form of business in Tin Can Island and Apapa port, so what will they come to do here. They will look for other efficient ports.”

Also, president, National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), Lucky Amiwero, told The Guardian: “Nigeria is being deleted as a transit nation. We are not doing any transit. Niger, Chad and Burkina Faso are close to us here, but importers are going to Ghana, Benin Republic and Cote D’Ivoire because of their good procedures.

“We are not doing anything. Our procedures are archaic and not functional and we have not reformed our import and export regime. They are still analogue and not digital. So, there are lots of things that must be looked into.”

He therefore suggested that some of the eastern ports be upgraded to handle specific cargoes.