Nigeria loses US$3 billion in seven years through gold smuggling
Gold smuggling has long been rampant in Nigeria and has cost the West African nation billions of dollars in royalties and taxes
President Muhammadu Buhari of Nigeria has disclosed that the country has lost US$3 billion in the past seven years through gold smuggling.
He said this during the presentation of gold bars produced thanks to a government initiative to assist small-scale miners.
He said it is estimated that about 97 tonnes of gold was smuggled out of the West African country between 2011 and 2018.
President Buhari said Nigeria stood to gain over $500 million annually in royalties and taxes if gold mining operations are improved.
The federal government could also create over 250,000 jobs if smuggling is halted, he said.
Reforms
Last year, the Nigerian government launched the Presidential Artisanal Gold Mining Development Initiative (PAGMI) to help small-scale miners.
The initiative aims to diversify Nigeria’s revenue base and improve foreign exchange reserves.
In a statement, Buhari said the PAGMI schemes will help set up accredited gold buying centres across major mining areas.
This, he said, will in turn help to ensure that the value of work by artisanal miners and small/medium-sized enterprises involved in mining are duly captured.
“These operations will help in diversifying our revenue base. The sale of gold by artisanal miners and SMEs at accredited centres will help the government in realising royalties and taxes from the sale of these assets,” the president’s statement said.
Gold purchases to boost naira
President Buhari also announced plans to ensure that gold assets are purchased in naira to bolster Nigeria’s international reserves.
He said a move of this sort will help to provide a hedge against inflation, saving the country from the volatilities of foreign currencies.
“These developments will also help in improving our foreign reserves by enabling the Central Bank of Nigeria to increase the amount of gold in its reserves,” the president said.
“These gold assets which will be purchased in naira, will not only help to bolster our international reserves, it will also provide a hedge against inflation and other economic volatilities associated with foreign currencies that are held in our reserves,” Buhari said.
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