In a bid to attract $1.5bn in external funding for the mining sector, the Federal Government has said it will invest $500m in the sector through the Solid Mineral Development Fund.

The Executive Secretary of the Solid Mineral Development Fund, Fatima Shinkafi, said this at the Federal Ministry of Mines and Steel’s joint webinar with the Securities and Exchange Commission.

Shinkafi explained that lack of access to capital was crippling players across the mining value chain, saying, “Financiers view the sector as a high-risk area with limited options for recovery of capital.”

She noted that the investments from the SMDF would be in targeted exploration and formalisation projects to attract private investments and increase sector productivity.

The Minister of Finance, Zainab Ahmed, said at the event that the mining sector was strategic to the diversification goals of Federal Government.

She said the Nigerian commodities trading ecosystem would serve as a core point to ensure proper regulation, generate long-term capital and enhance the competitiveness of the non-oil commodities.

The Minister of State for Mines and Steel Development, Uchechukwu Ogah, said, “We are requesting the facilitation of necessary infrastructure needed for proper and timely delivery of products; to mobilise private sector funding at comparative rates through the capital market, like moving bonds, derivatives, futures, created to support the mining system.”