• Saturday, April 20, 2024
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Botswana, Ghana, South Africa show what Nigeria is missing

Nigeria is a rich country!

In the 1970s, Nigeria was a recognised global mining destination, with significant production of coal, tin and columbite. However, with the discovery of crude oil in the Niger Delta region, the nation became a major producer of oil and neglected the development of the mining sector.

Some other African countries such as Botswana, Ghana and South Africa have been able to push ahead with the development of their mineral resources since then, leaving Nigeria behind.


A small economy with abundant diamond resources, Botswana has gained a reputation for its remarkable economic growth and prudent macroeconomic management. The country’s good governance has enabled the resources to be put to growth-enhancing and development uses.

The mining sector accounts for about 35 percent of the country’s GDP, with diamonds contributing about 94 per cent of the total mining share in GDP. Botswana produces the world’s largest gem
diamonds, with an output that represents about 40 percent of the total world output.

The modern era of mining in Botswana began one year after Independence in 1965, when De Beers
discovered the first kimberlite pipe after decades of fruitless exploration activity.

In 1971, the first diamonds were produced at Orapa, followed by copper-nickel production at the Bamangwato Concessions Ltd at Selibe-Phikwe several years later. Debswana Diamond Company, a 50/50 joint venture between De Beers Consolidated Mines and the Government of the Republic of Botswana, is the largest contributor to the national treasury.

Botswana’s GDP has been growing at about seven percent since diamonds were produced and has been one of the fastest-growing economies in the world. Without the diamond trade, Botswana would lose approximately $500 million in export revenue per year.

The mining industry as a whole has provided the greatest contribution of all industrial sectors to GDP since the early 1980s, ranging from 30 percent to 50 percent. The industry contributes significantly to the country’s financial reserves, and provides 3.2 percent of formal employment.

A 2016 World Bank review of the sector showed, among other things, that performance across the minerals value chain was better in the latter stages and the country’s mining policy and legal framework were largely sound.

In addition, the review noted that “the environmental protection legislation is quite current and mostly based on ‘good practice’ except in areas where greater efforts needed to be made to ensure that Environmental Impact Assessments (EIAs) are accessible and interactive throughout the mining lifecycle.”


The mining sector contributes 37 percent of export revenues and 19 percent of all direct tax payments in Ghana. Gold is the most commercially exploited mineral in Ghana, accounting for about 95 percent of the country’s mineral revenue.

Ghana’s mining and quarrying sectors contribution to domestic tax receipts increased from 14.2 percent in 2018 to 18.3 percent in 2019. Gold mining accounts for 10 percent of national GDP.

The country is one of the top 10 gold producers, accounting for around three percent of global gold output.

The country’s gold mining sector is one of the oldest in Africa, and retains a crucial role in the Ghanaian economy. In 2019, gold exports were valued at $10.8 billion, comprising 50 percent of all merchandise exports.

A data firm, Statista, noted that in 2020, Ghana’s receipts from minerals represented 48.4 percent of the country’s total exports. In the previous year, 43 percent of the export receipts were from minerals.

Read also: Mining sector’s contribution to GDP remains low despite potentials – Minister

Gold generated the highest income in Ghana, compared to other minerals. The mineral fetched the country over $7.1 billion that year. “Moreover, revenue accumulated from manganese and bauxite added up to around $142 million and $38 million, respectively. Overall, Ghana’s receipts from minerals covered 48.4 percent of its total exports in 2020,” it added.

Ghana’s gold mining sector scored 69 out of 100 points in the 2021 Resource Governance Index (RGI), improving by 13 points since the 2017 RGI. Stronger resource governance was driven by improvements across both the index’s value realisation and revenue management components, with notable increases in governance of local impacts and national budgeting.

The RGI report showed that while governance of taxation and local impacts had improved, contract and beneficial ownership disclosures required attention. The report found that while management of mining revenues had improved with the adoption of new fiscal laws, revenue sharing mechanisms remained poor, with the country having poor scores in open data in the extractive sector.

South Africa

The mining industry has been a driving force of the South African economy for the last 150 years. Since the discovery of diamonds in 1867 and subsequently of gold, the mineral sector has contributed to making South Africa the most advanced economy in Africa.

Today, despite growing economic challenges, South Africa is a well-established global player, both in the value of its mineral endowments, and in terms of industries and suppliers.

Statistics from the South African

Department of Mineral Resources and the US Geological Survey indicate that South Africa possesses ore reserves amounting to over $2.5 trillion, with 16 commodities ranked in the top 10 internationally.

South Africa has the largest known reserves of platinum-group metals (PGMs, 88 percent), manganese (80 percent), chromite (72 percent) and gold (13 percent) in the world. It is ranked second in titanium minerals (10 percent), zirconium (25 percent), vanadium (32 percent), vermiculite (40 percent) and fluorspar (17 percent). In addition, the country is home to 17 percent of the world’s antimony reserves.

South Africa is currently ranked 5th internationally in terms of mining contribution to GDP and the country is ranked in the top three globally in terms of production of PGMs (59 percent), vanadium (25 percent), ferrochrome (39 percent), alumino-silicates (60 percent), vermiculite (35 percent), zirconium (32 percent), titanium minerals (19 percent), manganese ore (17 percent) and antimony (two percent), with its gold (eight percent), coal (four percent), iron ore (four percent), ferro-silicon, silicon metal and fluorspar ranked in the top 10 globally. PGMs, Gold, Iron ore and Coal alone account for 82% of sales and 38% (R282 billion) of exports.

The relative share of the mining sector has declined in the last 20 years for a number of reasons. First, the South African economy is well diversified and the growth of secondary and tertiary industries have, over time, dwarfed the contribution of the mining sector to the overall economy.

Data from Statista show that in 2019, the mining sector in South Africa contributed with an added value of approximately 226.2 billion South African Rand (roughly $13.5 billion) to the country’s GDP. The amount decreased by roughly two percent in comparison to the previous year.

As of 2018, the mining industry added approximately 230.5 billion Rand (around $13.7 billion) to the GDP.

As of 2021, the distribution of the market capitalisation of mineral commodities in South Africa, by mineral, showed that platinum accounted for a 65 percent share of the market capitalisation of mineral commodities in South Africa.

Yet illegal mining is prevalent and thriving in the country. A 2020 Voice of America investigation showed that illegal mining in South Africa was among the most lucrative on the continent, pushing miners to risk health and safety in mostly abandoned shafts. But the chance to strike it rich drives the miners, who are often armed to defend their illegal claims.