Why Disbursement Of N5bn Mining Fund Is Stalled, By Minister

The Minister of Mines and Steel Development, Olamilekan Adegbite, on Tuesday said the disbursement of the N5bn Artisanal and Small-Scale Miners (ASM) Financing Support Fund to operators had been stalled as applicants failed to meet the necessary requirements stipulated by the Bank of Industry.

The minister who spoke at ASM Mining Support Fund Workshop in Abuja explained that of the N5bn made available by the government, only N311m had been disbursed as of September.

Adegbite explained, “This is largely because applicants have failed to meet the necessary but stringent requirements stipulated by the bank.

“The ministry made available N2.5bn, while the BoI matched it with another N2.5bn counterpart funding, making a total of N5bn.

“As of September 30, 2020, a total of 138 applications totaling N14.59bn was received by the Fund and are at various stages of processing. So far, 13 loan applications totaling N1.08bn have been approved under the fund. Out of this, the sum of N311m has been disbursed as of September 30, 2020.

“We are working assiduously to ensure that the difficulties inherent in accessing the funds are removed. In this regard, we are developing a unique and favourable template for the disbursement of the fund.

“This include equipment-leasing and hire-purchase loan facility. We are of the belief that the new template when fully operational would spur enormous growth in the sector.”

The minister who was represented by his Senior Special Assistant, Olu Adedayo, said that mining in Nigeria was still largely artisanal based.

He said the Ministry had created the Artisanal and Small-scale Mining department to provide institutional support for artisanal miners who form the bulk of the operators and manpower in the sector.

The ASM formalisation policy, according to him, is an instrument of poverty alleviation, empowerment and job creation which have transformed the operations of the artisanal miners into small-scale mining firms operating with valid mineral titles.

He said, “The reform achievements notched under our ASM department includes formalisation of artisanal miners by organising and transforming informal income-earning activities into formal sector through legal, regulatory and policy frameworks, registration of private mineral buying centres to promote standardisation in mineral commodity trade.

“Others include deployment of ASM Remote Sensing Monitoring system to regulate and support ASM activities and provision of Extension Services to registered ASM operators.”

He said that one of the core pillars of President Muhammadu Buhari’s economic policy was the repositioning of the mining sector as a way of diversifying the economy to create wealth and jobs, to increase contribution to GDP, and expand the range of economic opportunities available to Nigerians.

According to him, the ministry has registered about 1,495 mining cooperatives with each having over 10 members. Out of the 1,495 registered mining cooperatives, 140 are gold mining cooperatives.

The Minister of State for Mines and Steel Development, Uchechukwu Sampson Ogah, said the strategic intervention by the government was initiated in recognition of the contributions of the ASM subsector to the economy and its potential to contribute more, given the conducive business environment for expansion and growth.

According to him, implementing the initiative is a deliberate step in advancing the Federal Government policy objectives for diversification of the nation’s economic from overdependence on oil and gas to non-oil sectors as minerals sector has been identified as one of the key drivers of the policy.

He said, “The present administration under the visionary leadership of President Muhammadu Buhari, in tackling the specific challenge of lack of adequate funding headlong, has set aside the sum of N5bn interest yielding loan account in the Bank of Industry to mitigate the medium and long-term funding needs of the ASM operators.

“However, the disbursement of the fund has been slow due to operator’s inability to meet up with the requirements set for accessing the fund. The requirements were carefully set to ensure that beneficiaries pay back as the facility is a loan and not grant.”

The Representative from the Bank of Industry, Olayinka Mubarak, decried the illegal practice of operators in accessing the fund, stating that many presented fake licences in attempt to register for the fund.

“The operators have not been able to meet up the requirements we stated out. That is why we have not made as much disbursement as expected. The bank is opened to assist everyone in accessing the fund,” he explained.

The Managing Director of Jakura Marble Industry Limited, Ojile Anthony, commended the efforts of the government.

He added that operators lacked the required resources to create a significant achievement in the sector.