Economy
AN investment expert, Mr Fife Banks, has urged Nigeria to leverage growing global demand for critical minerals to secure greater domestic value from its minerals partnership with the United States.
Banks, Chief Executive Officer of Brave Investment Global (BIG), made the call in an interview with the News Agency of Nigeria (NAN) on Sunday.
He spoke against the backdrop of the signing of a framework agreement on solid minerals development between Nigeria and the U.S.
NAN reports that the agreement was signed by the Minister of Solid Minerals Development, Mr Dele Alake, and the U.S. Deputy Secretary of State, Mr Christopher Landau, in New York on Wednesday.
The agreement is aimed at attracting American investment into Nigeria’s estimated 700 billion-dollar mineral sector and strengthening economic cooperation between both countries.
It is also expected to facilitate business-to-business transactions and strengthen Nigeria’s value-addition-driven mineral value chain.
Banks said the framework could create opportunities for private capital, but stressed that it should ultimately deliver mineral processing, technology transfer, jobs and increased participation by Nigerian enterprises.
He described the agreement as an enabling framework rather than an investment outcome, saying its significance would depend on how effectively Nigeria converted it into bankable projects.
According to him, the framework could catalyse investment in geological data and exploration, mineral development and processing, infrastructure and technical capacity.
He said Nigeria’s challenge had not simply been the existence of mineral resources but the conversion of its resource potential into credible, investment-ready and transaction-capable projects.
Banks said the government needed to identify viable projects, mobilise investment and build commercial partnerships capable of moving the sector from geological potential to actual production.
He urged Nigeria to ensure that foreign investment generated wider economic benefits through domestic processing and beneficiation, technology transfer, skills development, quality employment and Nigerian enterprise participation.
“Nigeria’s objective should be broader: attracting capital, certainly, but also retaining substantially more economic value through domestic processing and beneficiation, technology transfer, skills development, quality employment, Nigerian enterprise participation and downstream industrialisation,” he said.
Banks said Nigeria and the U.S. had interests that could be mutually beneficial if the partnership was properly structured and implemented.
He, however, cautioned that Nigeria could attract foreign investment into mineral extraction without securing sufficient economic benefits if the necessary institutional and commercial structures were lacking.
He said it was too early to determine how benefits would ultimately be distributed because the available information described a framework rather than detailed project-level commercial agreements.
“I will not yet describe the relationship as inherently skewed but describe it as structurally capable of becoming skewed if Nigeria negotiates and implements it poorly,” Banks said.
He identified ownership and control of geological data, allocation of mineral rights, processing and refining locations, local procurement and Nigerian enterprise participation as key issues requiring attention.
He also cited technology transfer, infrastructure development, environmental and community obligations, as well as the distribution of economic rents across the mineral value chain.
“Policy intent must now be translated into bankable projects, contractual obligations, investment incentives and measurable outcomes,” he said.
Banks said growing global competition for critical minerals could strengthen Nigeria’s negotiating position because of the resources’ importance to energy, advanced manufacturing and supply-chain security.
He urged the country to use competition among global capital providers, technology companies and markets to secure better long-term development outcomes.
According to him, the ultimate test will be whether the framework moves Nigeria from geological potential to investment-ready projects, capital commitments, operating assets and sustained domestic value creation. (NAN)
M.P
Tags: Growing global demand for Nigeria’s mineral partnership