The Nigeria Extractive Industries Transparency Initiative (NEITI) has lifted the lid on the scale of illicit financial flows ravaging Nigeria’s mining sector and warned that weak regulation, opaque ownership structures, illegal mining and criminal infiltration were undermining the country’s economic diversification drive.
In a new policy brief released Thursday in Abuja, NEITI described illicit financial flows (IFFs) in the solid minerals sector as systemic and deeply entrenched, stressing that the problem has continued to deprive the nation of critical revenues despite Nigeria’s vast deposits of gold, lithium, limestone and gemstones.
The report, titled “Stemming the Scourge of Illicit Financial Flows in Nigeria’s Mining Sector,” revealed that the sector generated just N401 billion in revenue and contributed only 0.72 per cent to Nigeria’s Gross Domestic Product in 2023, a performance NEITI said falls far below the sector’s enormous potential.
According to the agency, the underperformance is being driven by revenue leakages, tax evasion, illegal mining, smuggling, corruption, weak institutional oversight and money laundering linked to organised criminal networks.
NEITI stated that the enablers of illicit financial flows are “systemic rather than incidental,” noting that they are embedded across institutional arrangements, market structures, data systems and security environments.
