Nigeria and South Africa’s Mutual Bond of Prosperity

Just back from an investment trip to South Africa, Kayode Fayemi writes that Nigeria and South Africa have begun to forge a common bond of prosperity in mining

The recent state visit to Nigeria by President Jacob Zuma marked the beginning of a new chapter in relations between Nigeria and South Africa. Both countries have shared a sometimes turbulent history; we have also at different times reveled in the joy of aligned moral purpose – at some point towards the dismantling of apartheid, at some other point in the struggle to enthrone democracy.

During the visit, both President Zuma and his host, President Muhammadu Buhari made it a point of duty to strengthen the historical bonds of friendship between the peoples of Africa’s two largest economies.

The rapprochement between both countries is one of the results of President Buhari’s economic diplomacy, which has focused on rebuilding Nigeria’s image and relationships in the comity of nations. This development can only result in positive outcomes for both economies, and also ensure alignment on the strategic future that we believe offers Africa its full potential.

The visit also offered the opportunity for Nigeria and South Africa to renew the pledge of partnership on a number of key issues including Mining. An existing 2013 MoU outlining areas of partnership in the fields of Geology, Mining, Mineral Processing and Metallurgy which had not been implemented, was resuscitated. President Buhari thus mandated the Ministry of Solid Minerals Development to work with our South African counterparts to pursue the full implementation of the Agreement.

Having identified South Africa as one of our strategic partners towards growing our mining sector, and on the back of improved diplomatic relations, I recently led a small delegation on a 2-day working visit to South Africa, during which I met with my counterpart, the Minister of Mineral Resources, Hon. Mosebenzi Joseph Zwane, as well as the leadership of mining-related government entities, mining industry leaders and experts.

Our delegation gained a lot of insights from the knowledge sharing sessions with the leadership of the Department of Mineral Resources, Council of Geosciences, MINTEK and other government entities, and the progressive discussions on opportunities of collaboration with some of South Africa’s finance institutions – especially the Industrial Development Corporation (IDC).

Accordingly, the Ministry of Solid Minerals Development has outlined details of the implementation plan for the 2013 MoU on Mining which provides details of the priority areas Nigeria wishes to benefit from the South African mining industry’s competitive advantage.

These include: Advanced Geological Surveys – detailed geo-sciences data generation; data interpretation analysis and application; assistance in the accreditation of the Geosciences Analytical Metallurgical Laboratories in Kaduna; exploration data reporting standards, e.t.c; Mining Governance – the review of existing legal and legislative framework; improved mines inspectorate operations and technologies; upgrading and management of cadastral processes and operations e.t.c.; Mineral Processing and Development – processing of industrial Minerals; Beneficiation processes and technologies; value addition, quality assurance and standards in mineral development, e.t.c.

Other areas include Metallurgy – improvement of metallurgical inspectorate operations and technologies; indigenous professional skill acquisition and technology transfer; metallurgical processes; steel making technologies e.t.c; Artisanal & Small Scale Mining Operation – production/supply of small and medium sized plants and machinery for small and mid-tier mining and processing e.g. the Igoli gold processing mill; development of Industrial Clusters in downstream mineral fabrication and manufacturing; Environmental Safety and Sustainability – enforcement of environmental safety and compliance regulations; review of sustainability frameworks and regulations; remediation processes e.t.c.

Nigeria is also looking to benefit from the wealth of Human Capital Resource in South Africa’s mining industry in areas such as – capacity building in global best practices along the value chain of the mining industry – occupational, health, safety and environment (OHSE), mines inspectorate and revenue collection, mineral production assessment, ASM management, steel and metallurgical inspectorate technology and regulation, etc.; as well as benefiting from technical assistance in the development of coal-to-power projects in Nigeria as part of our objectives to achieve a vibrant energy mix and realize our target of 10,000 mw of energy by 2019. The ministry also seeks to learn from the optimal organization of private sector players in the South African mining space.

Conversely as South Africa’s putative oil industry gets off the ground, Nigeria should share the lessons that our experience affords us. Nigeria’s Oil history, while it has a number of prominent missteps, still contains critical lessons which should be shared, together with our expertise in the Oil and Gas industry built over the years.
Invariably, both our countries need to implement a departure from the perception and treatment of resource-rich locales as extractive farms, and move towards encouraging the establishment of value-added economic activities within them. This administration is particularly focused on creating a broad spectrum of value-added activities by fully maximising the abundant opportunities for mineral beneficiation, exploiting the possibilities inherent in support services and support industries that will be nurtured around core mining activities.

For the new resource economy to benefit both local and global stakeholders, we are taking an activist posture towards issues of developing local content and ensuring a transfer of skills and technology that will be to our nation’s advantage in the medium and long term. While we are committed to maintaining a liberal business environment, we are also mindful that the new resource economy results in a win-win situation for all stakeholders.
This is why we intend to see to it that host communities are directly and positively impacted by the activities that will be undertaken in their domains. The historic restiveness in the Niger Delta and labour related uprisings in the South African mining industry can be put permanently in the past with this new approach to governance of the extractives industries.

Today, the continent’s fortunes appear partially stalled. Pundits wonder if our work of reform is entirely hostage to shrinking commodities demand from China and India. The decline the Naira and the Rand have suffered in the past year is partially linked to the commodities narrative. Nonetheless, the truth is that Africa’s narrative of prosperity has deeper roots, and is firmly in our control. Nigeria has our eyes set on a rebound in the global commodities market, hopefully sooner than later, and we are doing everything possible in the interim to ensure we position our industry for market dominance when that time comes.

We will work towards stoking aggregate demand and restructuring entire swathes of our societies to prepare them for the next generation of jobs, and delivering a joined up locomotive of growth. Hopefully, other African countries will take a cue from the renewed commitment of our countries to partner towards building the capabilities to create jobs and broaden the economic opportunities available to young Nigerians and South Africans. The aggressive integration of our economies will also create new corridors of growth for our neighbors and partners in both the ECOWAS and SADC regions.

We will find smart mechanisms for leveraging each other’s key strengths and easing the modalities for engagement between businesses in both countries e.g. visa liberalization for skilled mining and petroleum workers to help speed transitions as well as maintain growth momentum. We will also push our citizens to interact more intensively, whether it is in vacationing in each other’s countries or forming new personal networks. A shared experience and prosperity is the key to a new wave of African economic growth, and our Presidents are determined to deliver on that pledge.

As we welcome South Africa’s delegates to Abuja on a follow-up technical visit next week, and as momentum gathers towards the Nigeria – South Africa Bi-National Commission holding in August this year, we will continue to explore means of creatively building bridges between our countries towards modeling the possibilities that African integration offers for shared growth and prosperity. While we may have started at different points as independent, proud nations, our commitment to improving the living conditions of our citizens continues to pull us along a familiar pathway. Neither republic is perfect; we have our flaws, but we also have our strengths, and we are constrained by our responsibility to history and to our fellow Africans, to leverage them for the common good.

We look forward to welcoming more South African investors to Nigeria, just as we know that South Africa is extending an equally warm embrace to Nigerians. Nelson Mandela’s historic admonishment that Nigeria and South Africa must work together to transform Africa rings louder at this time than ever before. This is the least we can do in fulfilling the African Mining Vision (AMV). Indeed, as Madiba’s spirit smiles on this partnership he so treasured, let us his followers and friends ennoble his legacy with a renewed pledge of progressive brotherhood, towards shared prosperity in mining.
-Fayemi is Minister of Solid Minerals Development

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The rapprochement between both countries is one of the results of President Buhari’s economic diplomacy, which has focused on rebuilding Nigeria’s image and relationships in the comity of nations. This development can only result in positive outcomes for both economies, and also ensure alignment on the strategic future that we believe offers Africa its full potential