Nigeria targets $500m foreign reserves boost, moves to regulate illegal Gold sales

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Nigeria plans to stem illegal gold exports worth hundreds of millions of dollars a year to boost the country’s foreign reserves.

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The program will regulate production by informal miners that currently provides no income to the state, said Fatima Shinkafi, executive secretary of the Presidential Artisanal Gold Mining Development Initiative.

As much as 18 tons of gold leaves Nigeria illegally every year and is shipped to Dubai, Shinkafi said in an interview. PAGMI’s plan is to shift most of that production, which is extracted by so-called artisanal miners and sold to middlemen, into a supervised supply chain that ends with bullion in a central-bank vault.

Regulating artisanal gold will help diversify Nigeria’s economy at a time when lower crude prices are adding pressure on President Muhammadu Buhari’s government to reduce Nigeria’s dependence on oil.

Persuading the informal gold-mining industry to come within the orbit of state oversight would not only generate much-needed tax revenue. It would also allow the central bank to stockpile the metal, according to the presidency.

Oil sales are Nigeria’s main provider of hard currency, accounting for about half of government revenue and 90% of export earnings. Although the price of crude has rebounded and stabilized since a sharp plunge in March, the collapse has forced Buhari’s administration to devalue the naira as a decline in revenue sapped external reserves.

Nigeria’s gross reserves currently stand at $35.9 billion.

The price of gold has soared in recent months, reaching a record $1,988.40 an ounce on Monday. At current prices, the PAGMI program could add about $500 million to foreign reserves annually, as well as contribute $150 million in taxes, according to Shinkafi.

“That’s a hell of an incentive for a country that is earning mostly from oil and agriculture,” she said.

With additional reports from Bloomberg

Godwin Okafor
Godwin Okaforhttps://naija247news.com
Godwin Okafor is a veteran Financial Journalist, Internet Social Entrepreneur, and the visionary Founder of Naija247news Media Limited. With an extensive career spanning over 16 years in financial journalism, Godwin possesses a wealth of experience that seamlessly bridges both traditional and digital media landscapes. His journey in journalism commenced at Business Day, Nigeria, where he laid the foundation for his prolific career. In 2010, Godwin took a bold step by founding Naija247news Media, a platform that has since become a prominent player in delivering timely and accurate news. Educationally, Godwin Okafor holds a Bachelor's degree in Industrial Relations and Personnel Management from the prestigious Lagos State University, Ojo, Lagos. His commitment to continuous learning led him to the Lagos Business School, where he further honed his skills. Additionally, he is recognized as a Fellow of the University of Pennsylvania, having successfully completed the Wharton Seminar for Business Journalists. Throughout his illustrious career, Godwin has earned acclaim by winning numerous journalism awards, a testament to his dedication to excellence in reporting. Beyond his role as a Financial Journalist, Godwin Okafor wears the hat of the Chairman at Emmerich Resources Limited, the publishing entity behind Naija247news. His visionary leadership has played a pivotal role in shaping the media landscape and establishing Naija247news as a trusted source of information. Godwin Okafor's multifaceted expertise, commitment to journalistic integrity, and leadership in the realm of business journalism underscore his influential presence in both the media and entrepreneurial spheres.

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