Dele Alake, Nigeria’s Minister for Solid Minerals Development, has lauded a new $1 billion iron ore-to-steel initiative planned for Kogi State as a pivotal development in the Federal Government’s strategy to enhance local value addition within the mineral sector. During a recent visit by President Bola Ahmed Tinubu to China, Alake assured the project’s backers—Chart and Capstone Integrated Limited of Nigeria and China’s Sinomach-He—of full government support to expedite its completion.
Alake highlighted a significant policy shift from the traditional raw mineral export approach to one emphasizing domestic processing. This change aims to generate employment, facilitate skill acquisition, and improve the trade balance. New regulations now mandate that mining license applicants outline their plans for mineral processing as a prerequisite for approval.
Alake explained that Nigeria’s current trade deficit with China, exceeding $1 billion, results from exporting unprocessed minerals. Transitioning to exporting processed or semi-processed mineral products is expected to enhance Nigeria’s trade balance, boost foreign exchange earnings, and potentially reduce the national debt.
The Memorandum of Understanding (MOU) between Chart and Capstone and Sinomach-He was presented to Alake, with Chart and Capstone’s CEO, Abel Edijala, praising the streamlined and transparent licensing process under Alake’s leadership. He noted that the project, which will integrate iron ore mining with steel production, will necessitate tax incentives and holidays to navigate economic fluctuations during its initial phase.
