Beyond Chinese Dominance: Creating Space for Nigerian Entrepreneurs in the Solid Minerals Value Chain
In the shadow of Nigeria’s towering oil rigs lies a quiet revolution waiting to unfold. The solid minerals sector long overlooked and undervalued holds the key to a diversified economy that many have spoken about, but few have successfully unlocked.
The numbers tell a startling story: Nigeria has issued over 7,000 mining licenses across its mineral-rich landscape, yet the sector contributes a mere 1.7% to the national GDP. This statistical contradiction reveals the first untold secret an abundance of paper permissions but a scarcity of productive operations. Like farmers who have planted seeds but never returned to harvest, thousands of license holders sit on potential wealth without the capacity or capital to extract it.
Meanwhile, Chinese mining companies have methodically expanded their footprint across Nigeria’s mineral belt, bringing much-needed capital and technical expertise but often creating closed loops of value that flow outward rather than inward. They arrive with their own equipment, their own technical teams, and their own export channels—creating mineral extraction enclaves that operate adjacent to, rather than integrated with, the Nigerian economy.
The Chinese have mastered the art of vertical integration in Nigeria’s mining sector, explains an industry expert. “From exploration to export, they control every step, leaving Nigerian entrepreneurs scrambling for crumbs from their own resource table.
This dynamic has created a peculiar situation where Nigeria possesses world-class mineral deposits from gold in Zamfara to tin in Plateau, lithium in Nasarawa, Kaolin in Ogun and coal in Enugu yet lacks the domestic capacity to transform these resources into engines of economic growth and job creation.
The PwC insight captures this paradox perfectly: “significant progress has been made in regulatory frameworks and geological data, but the journey toward a thriving mining industry remains frustratingly incomplete“. The road is paved with potential, but the vehicles to travel it remain largely foreign-owned and operated
The PwC insight captures this paradox perfectly: significant progress has been made in regulatory frameworks and geological data, but the journey toward a thriving mining industry remains frustratingly incomplete. The road is paved with potential, but the vehicles to travel it remain largely foreign-owned and operated
However, within this challenge lies tremendous opportunity for Nigerian entrepreneurs willing to look beyond the obvious. The value chain in mining extends far beyond extraction environmental services, and community relations, it includes specialized logistics, equipment financing, renting and maintenance, Semi- finished goods for industrial usage and workforce development represent entry points where local knowledge creates competitive advantage
According to recent KPMG’s analysis points to promising developments: recent amendments to the Nigerian Minerals and Mining Act, establishment of the Mining Cadastre Office, and Nigeria’s first National Minerals Policy are creating a more structured environment where prepared Nigerian entrepreneurs can compete effectively.
The most successful Nigerian mining entrepreneurs have found their niche not in competing directly with Chinese operators but in becoming their indispensable partners. Like the small fish that clean the teeth of sharks, these entrepreneurs provide specialized services that foreign companies find difficult to replicate navigating community relationships, securing local and national permits, extracting and selling these mineral resources to companies.
“The Chinese mining companies aren’t going anywhere,” notes a mining consultant based in Ogun. “The question isn’t how to remove them but how to build Nigerian capacity alongside them creating space for complementary rather than competitive relationships.”
For investors looking at Nigeria’s mining sector, this evolving dynamic creates unique opportunities. Joint ventures between Chinese technical expertise and Nigerian market knowledge have proven particularly successful, combining the best of both worlds to overcome the capital and technical barriers that have historically limited domestic participation
The government’s renewed focus on the sector, including the Ministry of Solid Minerals’ recent initiatives to revoke inactive licenses and promote value addition through processing, signals a shift toward more productive utilization of Nigeria’s mineral endowment. The establishment of the Presidential Artisanal Gold Mining Development Initiative (PAGMI) further demonstrates commitment to formalizing previously marginalized segments of the industry.
For Nigerian entrepreneurs, the path forward requires strategic positioning identifying specific segments of the value chain where local knowledge creates competitive advantage while leveraging partnerships to overcome technical and capital constraints. The most promising opportunities lie not in challenging Chinese dominance directly but in building complementary businesses that make the entire ecosystem more productive.
As Nigeria continues its journey toward economic diversification, the solid minerals sector represents not just untapped wealth beneath the soil but untapped opportunity for a new generation of Nigerian entrepreneurs willing to look beyond the conventional narrative. The country that once relied almost exclusively on oil can indeed build a more resilient economy—one mineral deposit at a time.
