Alliance Report Alleges Mineral Cartel Behind Violence in Resource-rich States

• Says economy loses $9 billion annually to banditry, illegal mining, others

• Says rising food inflation not influenced by market forces alone but economic costs of conflict, displacement, illegal exploitation of natural resources
• Dele Oye slams foreign trips as costly waste, says millions squanders with little to showJames Emejo in Abuja

An investigative report has alleged that the country’s worsening insecurity in several mineral-rich states is being driven by powerful economic interests seeking control of the country’s vast solid mineral deposits.

The report, titled “The Shadow Owners”, and published by the Alliance for Economic Research and Ethics Limited (AERE), also warned that the development is costing the economy about $9 billion annually in illegal mining and gold smuggling while worsening food inflation.

Alliance further stated that armed bandits are merely “expendable foot soldiers”, while the real beneficiaries allegedly conceal their identities through offshore shell companies.

This is as Chairman of the Alliance for Economic Research and Ethics, Dr. Dele Oye, yesterday condemned the country’s frequent foreign investment and diplomatic trips, describing them as a costly national embarrassment that continues to drain public funds without delivering meaningful economic returns.

Oye, in a policy document titled “The Cultural Key: Why Nigerian Businesses and Government Delegations Fail Abroad – and How to Master Cross-Cultural Commerce,” said successive government delegations have repeatedly returned from overseas engagements with little more than photographs, ceremonial handshakes and memoranda of understanding (MOUs) that rarely translate into real investments.

However, the Alliance report, pointed out that the persistent violence across states including Zamfara, Kaduna, Plateau, Niger, Nasarawa and Benue follows the same geographical pattern as the country’s richest deposits of gold, lithium and uranium, suggesting that the conflict is increasingly tied to the struggle for control of strategic mineral resources.

It challenged long-held narratives that attribute the violence solely to ethnic divisions, religious extremism or farmer-herder clashes, contending instead that such explanations may be obscuring a much larger economic enterprise built around resource exploitation.

The report noted that by early 2025, over 1.3 million Internally Displaced Persons (IDPs) had been recorded across the North-Central and North-West, arguing that the widespread displacement has created conditions that allegedly favour illegal extraction activities in affected communities.

Drawing parallels with the Democratic Republic of Congo, the report warned that Nigeria risks replicating a model in which armed groups seize control of mining areas, minerals are smuggled across borders and proceeds ultimately flow into foreign tax havens rather than national development.

It further questioned how communities are expected to exercise their legal right to free, prior and informed consent for mining projects under the Nigerian Minerals and Mining Act after many residents have been displaced by violence.

According to the report, terror had effectively become a tool for clearing communities from resource-rich lands, creating a vacuum allegedly exploited by those with commercial interests in the country’s mineral wealth.

The report estimated that Nigeria loses about $9 billion every year through illegal mining and gold smuggling, alleging that unregistered private aircraft operate through regional airstrips while unrefined gold is moved abroad, including to Dubai.

Beyond the direct revenue losses, the report warned that the economic consequences are spreading across the broader economy as agricultural production continues to decline in conflict-hit areas.

It said the Middle Belt, long regarded as Nigeria’s food basket, had suffered widespread displacement of farming communities, with farmlands increasingly giving way to militarised extraction activities.

The resulting collapse in food production, the report argued, has compounded inflationary pressures, insisting that rising food prices are no longer merely the result of market forces but reflected the broader economic costs of conflict, displacement and the illegal exploitation of the country’s natural resources.

Nonetheless, Oye in his policy statement maintained that despite the enormous public resources committed to such international missions, the country has continued to record negligible economic gains because many of the trips lack strategic planning, cultural understanding and effective implementation.

According to him, Nigerian delegations often embark on foreign missions driven by optimism and ceremonial ambitions rather than clear economic objectives.

Oye said, “The results are predictable – handshake photographs with foreign officials; MOUs signed in glittering hotel ballrooms that collapse within months; investment roadshows that consume hundreds of millions of naira and return with nothing but jet lag and duty-free shopping.”

He explained that the policy paper was intended as more than a criticism of government practice, describing it as a practical intervention designed to help Nigeria improve its international commercial engagements.

The former President of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) identified poor understanding of foreign business cultures as one of the biggest obstacles preventing Nigeria from securing lasting investment partnerships.

According to him, countries including Japan, Germany, China, Türkiye, Canada and the United States operate with distinct business traditions built on trust, hierarchy and structured decision-making, requiring careful preparation before negotiations.

He warned that treating the global marketplace as though every country conducts business the same way has cost Nigeria valuable investment opportunities, damaged partnerships and wasted scarce public resources.

He said, “The assumption that Nigerian charm, enthusiasm and a well-crafted PowerPoint are universally transferable is perhaps the costliest delusion in our international economic engagement.”

Oye also criticised what he described as bloated government delegations, arguing that oversized entourages consume resources that should instead be invested in technical preparation and post-trip implementation.

To reverse the trend, he called for sweeping reforms, including compulsory cross-cultural training for all official delegations, stronger collaboration with the Nigerian diaspora, strict monitoring of all MOUs signed abroad and the establishment of cultural advisory units across government institutions.

He said such measures would improve the country’s negotiating capacity, strengthen the country’s international credibility and ensure foreign engagements produce measurable economic outcomes rather than ceremonial successes.