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Poor banks’ support threatens FG’s diversification policy on mining

By Gabriel Ewepu

ABUJA—AS miners groan under lack of access to finance, poor bank support now threatens Federal Government’s effort to diversify the economy through the mining sector.

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Banking hall
Banking hall

This was disclosed in an address by Minister of State for Mines and Steel Development, Abubakar Bwari, at the breakfast dialogue meeting with chief executives of Nigerian banks and UNDP Country Director for Nigeria, Samuel Bwalya, with theme, ‘Financial Institutions as Critical Stakeholders in the Development of Mining in Nigeria’ in Lagos, weekend.

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Abubakar said a key constraint identified in the mining roadmap was the underdeveloped financing and business environment for the mining sector, which has made it “difficult to catalyze investments in the sector.

“Access to credit either from banks or capital markets has also been low to meet the sector’s financing needs. Institutional investors are also wary of investing in projects along the life cycle.”

“The absence of a formal financing system is affecting the mining sector potentials to contribute to national development. We need a shift in mindset among the financial institutions about the mining sector in general.

“Since we are here to unlock opportunities in the development minerals sub-sector, the first challenge we must tackle is for the financial institutions to recognize the value chain potentials of the development minerals sub-sector.”

 

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