Nigeria’s solid minerals sector, encompassing mining and quarrying activities, presented a mixed performance in 2024. While contributing a substantial N1.39 trillion to the nation’s Gross Domestic Product (GDP), this figure represents a significant 21% decline compared to the N1.76 trillion contribution recorded in 2023. This decline occurred despite the implementation of various reforms and policy adjustments aimed at revitalizing the sector, raising questions about the effectiveness of these interventions and the underlying challenges facing the industry. The sector’s contribution to the overall GDP fluctuated throughout the year, reaching 6.33% in the fourth quarter of 2024, surpassing the 4.47% contribution in the same quarter of 2023 but falling short of the 7.72% contribution in the third quarter of 2024. This volatility reflects the dynamic nature of the sector and the influence of both internal and external factors on its performance.
A closer examination of the sector’s performance reveals a nuanced picture. While the overall contribution to GDP declined, the sector experienced growth in real terms, expanding by 2.23% year-on-year in the fourth quarter of 2024. However, this growth rate was considerably lower than the corresponding quarter in 2023 and the preceding quarter, indicating a slowdown in momentum. Furthermore, the sector achieved an overall growth rate of 4.85% in 2024, a significant improvement compared to the -2.84% contraction experienced in 2023. This rebound suggests a degree of resilience within the sector, but the overall decline in GDP contribution emphasizes the need for further analysis and strategic interventions to unlock its full potential.
The performance of individual sub-sectors within the solid minerals industry varied significantly. The coal mining sub-sector experienced a dramatic decline, contributing a mere N9.29 billion in 2024, a sharp 62.8% drop from the N24.95 billion contributed in 2023. This significant contraction points to challenges specific to the coal mining industry, potentially stemming from factors such as declining global demand, competition from alternative energy sources, or operational difficulties. The quarrying and other minerals sub-sector also witnessed a decline, contributing N1.28 trillion in 2024 compared to N1.69 trillion in 2023, representing a substantial decrease of N410 billion or 24.26%. This widespread decline across multiple sub-sectors underscores the need for a comprehensive approach to address the underlying issues affecting the industry.
In contrast to the declining performance of coal mining and quarrying, the metal ores sub-sector demonstrated remarkable growth, with its contribution surging from N44.22 billion in 2023 to N103.51 billion in 2024. This substantial increase of N52.29 billion, equivalent to a growth rate of 134.07%, highlights the potential for growth within specific segments of the solid minerals sector. This positive performance suggests that targeted investments and policy support can yield significant returns and contribute to the overall development of the industry. The contrasting performance of these sub-sectors emphasizes the importance of a differentiated approach to policy formulation and implementation, recognizing the unique challenges and opportunities within each segment.
The government’s efforts to bolster the sector’s revenue generation through policy adjustments, such as the 50% upward review of rates and charges for 268 mining items, have yet to translate into significant improvements in overall performance. The decline in GDP contribution despite these measures suggests that deeper structural issues may be at play, requiring more comprehensive and targeted interventions. Furthermore, the sector remitted N38.19 billion to government coffers in 2024 for distribution to the three tiers of government. While this represents a substantial contribution to government revenue, it also underscores the importance of ensuring transparent and efficient revenue management to maximize the benefits for national development.
The mixed performance of Nigeria’s solid minerals sector in 2024 presents both challenges and opportunities. While the overall decline in GDP contribution is a cause for concern, the growth witnessed in the metal ores sub-sector and the sector’s overall positive growth rate in real terms offer a glimmer of hope. Addressing the challenges facing the coal mining and quarrying sub-sectors, along with further developing the potential of the metal ores segment, will be crucial for unlocking the sector’s full potential and maximizing its contribution to the Nigerian economy. A comprehensive review of existing policies, coupled with targeted investments and strategic partnerships, will be essential for achieving sustainable growth and transforming the solid minerals sector into a key driver of economic diversification and development.
