Although Nigeria is richly endowed with a variety of solid minerals, mining contributes very little to the national economy; the sector accounted for only 0.18% of GDP in 2018. The Government of Nigeria has decided to place a strategic focus on solid minerals to diversify the economy away from oil and gas. To this end, the government instituted the Solid Minerals Development Fund (SMDF), an intervention fund tasked with catalyzing growth in the solid minerals sector. An important need is to address the existence of a large informal artisanal mining sector, which has substantial negative effects on the attractiveness of the mining sector and is associated with many negative externalities, including environmental degradation, health risks, and crime.
The Capstone team analyzed how the SMDF can plan for the formalization, in a sustainable way, of artisanal miners by the government, with a focus on how to get miners to register their activities. Drawing on in-person interviews with key governmental stakeholders and mining experts conducted during the team’s travel to Nigeria, best practices established across the world, lessons learned from case studies of Mongolia and Ghana, and interviews with non-profit and multilateral organizations, artisanal mining experts, and academics, the team formulated context- and institution-specific recommendations to the SMDF. As no single best model for how a country should formalize artisanal mining exists, the report’s targeted recommendations and analysis of opportunities and challenges for Nigeria can add great value to the SMDF’s efforts to grow the mining sector.