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Buhari Launches First Ever PAGMI That Allows CBN Save Money In Gold

by on July 16, 2020
 

In view of the Federal Government’s commitment to diversify the nations economy and boost her foreign reserves, President Muhammadu Buhari has launched its first ever artisanal gold locally mined gold bars by Presidential  Artisanal Gold Mining Development Initiative,  PAGMDI.

This artisanally-mined gold that has been processed and refined according to the London Bullion Market Association, LBMA, standards required for the use of gold as a reserve instrument by the Central Bank of Nigeria.

During the presentation Buhari pledged his commitment to establish gold refineries in Nigeria which according to  him would support efforts at creation of jobs for Nigerians, diversifying the revenue base, and improving foreign exchange reserves.

He said, “With the implementation of the PAGDMI scheme which will result in the set-up of accredited gold buying centres across key mining areas, artisanal miners and SMEs engaged in mining will be able to capture the value of their work.

‘‘These operations will help in diversifying our revenue base. The sale of gold by artisanal miners and SMEs at accredited centers will help the government in realizing royalties and taxes from the sale of these assets.

‘‘These developments will also help in improving our foreign reserves by enabling the Central Bank of Nigeria to increase the amount of gold in its reserves.

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‘‘These gold assets which will be purchased in Naira, will not only help to bolster our international reserves, it will also provide a hedge against inflation and other economic volatilities associated with foreign currencies that are held in our reserves,’’ he said.

CBN has now purchased the 12.5kg bar of gold at the rate of N268 million for use as part of Nigeria’s external reserves, with a cheque presented a Cheque for that amount to the Presidential Artisanal Gold Mining Development Initiative.

This milestone is the culmination of 24 months of intense efforts between the Solid Minerals Development Fund, Kebbi and Osun States Government, Ministry of Mines and Steel Development, and the Ministry of Finance, Budget, and National Planning under a Steering Committee led by the Chief of Staff to the President, Professor Ibrahim Gambari.

WHAT THIS MEANS FOR NIGERIA

This means that the Central Bank will be purchasing gold that has been mined, processed and refined under the Presidential Artisanal Gold Mining Development Initiative for use as part of Nigeria’s external reserves.

The first batch of artisanally-mined gold bars to be purchased by the Central Bank has been unveiled today at a presentation ceremony to President Buhari. This milestone is a demonstration of President Muhammadu Buhari’s commitment to diversifying Nigeria’s economy and foreign reserves.

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WHAT IS PAGMDI? 

The Presidential Artisanal Gold Mining Development Initiative (“PAGMI”) is a comprehensive artisanal and small-scale gold mining development programme, launched in 2019 to foster the formalization and integration of artisanal gold mining activities into Nigeria’s legal, economic, and institutional framework.

PAGMI has been designed to integrate social, environmental, health and safety, economic, commercial, and technical considerations, into its implementation.

PAGMI is designed as a broader strategy to address the structural and institutional factors such as rural poverty, lack of alternative livelihoods, and difficulties in meeting legal and regulatory requirements that tend to push artisanal gold mining operators deeper into the informal economy. 

How WILL PAGMI WORK?

The catalyst for the integration is the provision of access to markets for the artisanal miners through a National Gold Purchase Program and the deployment of enhanced mining methods at artisanal and small-scale mining sites.

Providing better access to markets through the National Gold Purchase Programme is only the first step in a comprehensive artisanal and small-scale gold mining development strategy integrating social, environmental, health and safety, economic, commercial, and technical considerations.

PAGMI will deploy safer and more efficient mining and processing technologies across artisanal mining locations across the country, starting with Kebbi and Osun States as the Pilot States with intervention in Kaduna, Zamfara and Niger States to commence immediately after the Pilot.

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Using a Centralized Offtake and Supply System supported by a Decentralized Aggregation and Production Network, PAGMI will buy all the gold produced by artisanal and small-scale miners and aggregated by licensed buying centers and aggregators for supply to the Central Bank of Nigeria.

WHICH STATES ARE BENEFITING FROM PAGMI PAGMI?

The main gold producing belt with history of artisanal workings and exploration activities in Nigeria will benefit from PAGMI. Intervention at artisanal mining sites will take place Kebbi, Kaduna, Zamfara, Niger and Osun States with Kebbi and Osun States serving as Pilot States. PAGMI will also be setting up gold aggregation centers in addition to supporting licensed buying centers and aggregators with access to financing options, responsible sourcing mechanisms, management and technical expertise including improved testing and processing equipment.

WHAT PAGMI WILL ACHIEVE

When fully implemented the PAGDMI will achieve the following;  more jobs, wealth creation, identity management for legal miners, productivity and capacity building in the gold mining sector, Revenues,  reserves, security of gold miners amongst others. 

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