Nigeria has a vibrant gemstone industry that is unfortunately dominated by artisanal miners.

Original article found here in Ventures Africa

The Nigerian extractive industry has diverse minerals in substantial deposits, particularly in its solid mineral sector. About 31 solid minerals are found in substantial quantities, spread across the entire country. They include limestone, laterite, gold, coal, bitumen, iron ore, tantalite/columbite, lead/zinc sulfides, barytes, cassiterite, gemstones, talc, feldspar, and marble. Some of these minerals are in commercial deposits, meaning the country can generate revenue from them via export. However, the extractive industry has been dominated for decades by the oil and gas sector, Nigeria’s top foreign earner – which has taken the spotlight for years.

The oil sector boasts of 40 billion barrels of proven oil reserves, holding 29 per cent of Africa’s overall oil deposit, while the gas reserves are 160 trillion cubic meters. Nigeria’s dependence on the oil and gas sector has limited it from harnessing the potential embedded in its solid mineral selector. It is estimated that the level of exploitation of these solid minerals. so far, is nothing compared to what has been discovered. 

Solid mineral deposits in Nigeria are located across the 36 states of the federation, including the capital, Abuja. Nigeria has over 40 million tonnes of deposits of talc, an ingredient in baby powder, ceramics, paint, and roofing materials. It also has 3 billion metric tonnes of iron ore, 42 billion tonnes of bitumen, 3 billion tonnes of kaolin and 3 billion tonnes of coal.

The gemstone sector

Nigeria has a vibrant gemstone industry that is unfortunately dominated by artisanal miners. Over decades, the country has recorded an increase in the illegal mining of gemstones like sapphire, ruby, gold, aquamarine, emerald, tourmaline, topaz, garnet, amethyst, zircon and fluorspar in northern Nigeria. The government cannot effectively track the activities of these artisanal miners given that they mine unspecified amounts of precious stones and sell them to middlemen who smuggle them to foreigners. 

Key problems in the gemstone sector are poor government participation and the dominance of artisanal miners. In 2021, a local report revealed that Nigeria lost an estimated $3 billion worth of gemstone to illegal mining perpetuated by artisans who do not benefit much from the sector due to illiteracy and poverty. These factors account for why artisan miners are exploited by middlemen who underprice their finds or dupe them. While illiteracy makes it hard for them to introduce innovative systems into mining, artisanal miners would rather invest money in the basic things they need to survive daily than on saving to acquire mechanized equipment or a license from the government.

The way forward

The Nigerian government should create policies tailored toward encouraging public-private partnership in its extractive industry while monitoring and controlling the activities of artisanal miners. Consequently, the country will generate more foreign earnings from its extractive industry, and miners would be better organized to benefit from the industry. In addition, this would create more jobs for its teeming youth populations in the extractive industry and its value chain. It would also clamp down on the illegal activities of middlemen who falsify mining reports and illegally sell off its precious gems to foreign buyers.