Despite concerted government efforts to enhance its performance, the Nigerian solid minerals sector has posted a Gross Domestic Product (GDP) contribution of ₦1.39 trillion for 2024, according to the National Bureau of Statistics (NBS). While this figure represents a year-on-year increase in the sector’s proportional contribution to the overall GDP, the raw monetary value reveals a concerning decline. The sector’s contribution, which stood at ₦1.76 trillion in 2023, has been reduced by about ₦370 billion, or 21 percent, a sharp decline in the anticipated growth following the implementation of new policies and revised charges.
This paints a picture of a sector struggling to fully capitalise on its potential despite the government’s attempts to invigorate it. The NBS report highlights the varying performances within the sector’s subdivisions. While the metal ores sub-sector demonstrated a remarkable surge, doubling its contribution, other crucial areas, notably coal Mining and quarrying, experienced notable downturns. Coal mining, which once contributed nearly ₦25 billion, dropped to just ₦9.29 billion, dramatically reflecting diminished investor interest. Similarly, the quarrying and other minerals sub-sector, a significant contributor, saw a substantial drop, losing over ₦400 billion in value.
Quarterly analysis shows solid minerals’ impact on Nigeria’s 2024 GDP.
However, this low performance underscores the challenges of promoting consistent growth across the diverse facets of the solid minerals industry. Further, going deeper into the quarterly figures, the fourth quarter of 2024 saw the mining and quarrying sector contribute 6.33 percent to the overall GDP, a figure higher than the corresponding period in 2023. However, this increase in proportion masks the underlying reality of a declining total value. The real-term growth of the sector in the fourth quarter was 2.23 percent, a decrease compared to the previous quarter and the same period in the preceding year.
Therefore, this suggests that while the sector’s relative importance within the Economy may have increased, its actual output has not kept pace. While positive, the overall growth for 2024, at 4.85 percent, falls short of the expectations generated by the government’s policy initiatives. The government’s efforts to increase revenue, including the 50 percent upward revision of mining rates and charges, have not translated into the anticipated financial gains. The ₦38.19 billion remitted to government coffers in 2024, while a substantial sum, does not reflect the hoped-for surge in revenue.
Non-oil sector saw an increase of 3.96 percent in the report.
The decline in the quarrying and other minerals sub-sector, which contributed the largest share of the sector’s Revenue in the fourth quarter, is particularly concerning. This sub-sector’s significant drop in contribution from ₦1.69 trillion in 2023 to ₦1.28 trillion in 2024 points to potential systemic issues that need addressing. Furthermore, the overall GDP growth of Nigeria, at 3.84 percent in the fourth quarter, while positive, indicates that the solid minerals sector is not pulling its weight as effectively as it could.
On the other hand, the broader economic context reveals that the non-oil sector grew by 3.96 percent, outperforming the oil sector, which saw a growth of 1.48 percent. This underscores the importance of diversifying the economy and reducing reliance on oil. However, the solid minerals sector, a key component of the non-oil economy, is not yet fulfilling its potential. The decline in capital importation, as reported by the NBS, further complicates the picture, suggesting a broader economic environment that may impact Investment in the solid minerals sector.
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Lastly, the disparity between the growth of other services, which saw a 9.33 percent increase, and the Manufacturing sector, which experienced a decline, highlights the irregular nature of economic recovery. The inconsistencies in the solid minerals sector, with its pockets of growth alongside significant declines, mirror these broader economic challenges. However, the National Bureau of Statistics (NBS) is the primary government agency in Nigeria responsible for collecting, analysing, and disseminating statistical data. It serves as the apex statistical agency for all levels of government and coordinates the National Statistical System, ensuring the production of official statistics across various government ministries, departments, and agencies.