Odimmegwa Johnpeter/Abuja
Calls to unlock financing for small-scale mining took centre stage as stakeholders in the mining sector meet during a panel session at the 10th edition of Nigeria’s Mining Week on Wednesday in Abuja.
According to Amina Sijuwade, director of Iron Ore Mining Limited, SSML operators face difficulties in accessing finance, noting that stronger collaboration would improve their ability to secure funding.
Ms. Sijuwade explained that holders of SSML often access funding through cluster financing models. She, however, emphasised the need for catalytic funding, which involved initial financial support from the government or investors to strengthen SSML operations and attract additional investment into the sector.
According to her, relevant government agencies should harmonise policies that reduce mining risks, a critical requirement in strengthening lenders’ confidence in financing the sector.
She noted that many financial institutions lacked an understanding of how the mining sector operated, making it difficult for them to design suitable funding provisions.
Abubakar Bello, managing director of the Nigerian Export-Import Bank, noted that the sector was considered high-risk, which has made financial institutions hesitant to extend credit facilities.
Mr Bello added that policy consistency and sector regulatory clarity were key to attracting funding to the sector through investments.
“Investors have to see the future, which they can predict in their investments. Nobody is going to put money where there is high risk,“ he said.
He said the challenges confronting the sector had been established, and the next steps were de-risking the sector through policy consistency.
Akinrogunde Akintunde, director of the Department of Artisanal and Small-Scale Mining at the Ministry of Solid Minerals Development, said that while the sector had policies in place, more strategies were needed to improve access to funding.
Mr Akintunde identified the lack of information exchange between financiers and miners as one of the major factors limiting access to funding.
He advised miners to specialise in specific areas of the mining value chain, noting that such a focus could enhance their eligibility for financing opportunities.
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