The Miners Association of Nigeria has strongly criticized the federal government’s recent increase in mining rates and royalties for solid minerals, warning that it could drive local miners out of business.
MAN’s National President, Dele Ayankele, expressed these concerns in response to the hike reported by the News Agency of Nigeria. He emphasized that stakeholders were deeply dissatisfied with the new rates, highlighting that the announcement was made without prior consultation.
Ayankele also raised alarms about the sector’s overall challenges, including excessive taxation imposed by state governments on operators.
Ayankele urged the Federal Government to collaborate closely with state authorities to address widespread illegalities in the sector’s regulatory framework.
He pointed out that such issues were hindering mining operations and frustrating stakeholders. He emphasized the importance of resolving these issues before embarking on any further revenue optimization efforts or harnessing the sector’s wealth creation potential.
“The new rates are not just high; they are unrealistic,” Ayankele stated. “With state governments imposing unconstitutional regulations and charges indiscriminately, and the Federal Government unable to assert its authority over a matter under the exclusive list, these exorbitant rate hikes seem designed to push indigenous operators out of the mining business.”
Similarly, Prof. Akinade Olatunji, President of the Nigerian Mining and Geosciences Society, expressed concerns not only about the rate hike itself but also about the lack of adequate consultation preceding its implementation. He criticized the Ministry for setting fixed rates based on current mineral prices without involving relevant stakeholders.
Olatunji warned that the high costs associated with these new rates, compounded by economic challenges, could severely impact operators and potentially force many out of business.
He proposed that the government should strengthen the Mines Inspectorate Division by increasing the number of qualified personnel, providing adequate resources for mobility and operational costs, and empowering them to enforce regulations effectively.
The background to this controversy dates back to July 5, when Minister of Solid Minerals Development, Dr. Dele Alake, announced the upward review of rates and charges across the mining sector. Dr. Alake justified this move as necessary for positioning the sector for economic consolidation and implementing quality measures.
He expressed concerns about some operators’ failure to remit profits to the Federal Government despite substantial earnings, particularly from minerals like lithium, kunzite, and gold.
The ongoing debate underscores the challenges facing Nigeria’s mining industry, where balancing regulatory measures, economic viability, and stakeholder interests remains a delicate task for policymakers.
