Senate’s Bill For Gold Reserve Passes Second Reading

The Nigerian Senate has taken a significant step towards harnessing the country’s gold reserves by passing a bill for an Act to establish a framework for the gold reserve industry.

The bill, sponsored by Senator Natasha Akpoti-Uduaghan (PDP/Kogi Central), aims to create a robust framework for the harnessing, exploitation, and marketing of gold in Nigeria.

In her lead debate, Senator Akpoti-Uduaghan emphasized the importance of gold reserves in maintaining economic stability, citing the example of central banks globally increasing their gold reserves as a hedge against currency volatility and geopolitical risks.

She noted that Nigeria’s gold reserves have the potential to act as a reliable store of value, particularly during financial uncertainties.

The bill seeks to establish the Nigeria Gold Authority (NGA), which will be responsible for administering the Nigerian Mining Act with regards to gold resources, creating a robust gold reserve industry, and ensuring responsible and sustainable practices that benefit the economy and communities.

The NGA will also be responsible for the exploitation and sales of gold within Nigeria, enhancing the engagement and earning power of artisanal local miners and maintaining a strong Gold Reserve Ratio.

The bill aims to diversify Nigeria’s reserve base by broadening the nation’s gold reserve ratio, currently less than 2% of the total foreign reserve.

By establishing a local gold exploitation, harnessing, and marketing industry, the bill seeks to assist in hedging the Naira against depreciation and the economy against inflation, given the intrinsic value of gold as a store of value.

The bill also incorporates stringent regulations to minimize the ecological footprint of gold mining and processing activities, emphasizing reclamation and rehabilitation efforts to ensure the long-term health of natural ecosystems.

Additionally, it focuses on fostering positive relationships with local communities through transparent consultation processes, community benefits agreements, and the establishment of community development funds.

The bill received widespread support from senators, who recognized its potential to contribute to Nigeria’s economic growth and development.

Senator Adetokunbo Abiru described the bill as “timely and important,” while Senator Adeola Olamilekan commended Senator Akpoti-Uduaghan for her efforts to address illegal gold mining. Senator Sanni Musa noted that the bill would create job opportunities and help end illegal mining. Senator Isah Jibril Echocho commended Senator Akpoti-Uduaghan for her initiative, stating that the bill would enhance gold reserves utilization and strengthen the Naira.

The passage of this bill presents a significant opportunity to drive economic growth and diversification by creating a conducive environment for investment in the gold sector, attracting both domestic and foreign investors, stimulating job creation, and boosting revenue streams for the government.

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