A joint report by Nigeria’s extractive industries watchdog NEITI and the Africa Network for Environment and Economic Justice has exposed how foreign buyers, shell companies and armed criminal groups dominate Nigeria’s illegal mineral trade, with Chinese-linked actors identified as exerting disproportionate influence over pricing, purchasing and export channels.
The report, released last month, found that Nigeria loses vast mineral revenues to illicit financial flows through commercial manipulation, illegal mining, corruption among officials and cross-border smuggling. Despite being endowed with at least 44 commercially viable minerals, Nigeria’s mining sector contributed just 0.72% of GDP, 0.28% of revenue and 0.75% of exports in 2023. Nigeria’s Financial Intelligence Unit has identified illegal mining as an emerging threat to the economy and national security.
Foreign buyers, particularly Chinese actors, were accused of negotiating directly at mine sites and enabling systematic undervaluation of minerals, manipulation of grades and weights, and informal payment arrangements. The report alleged that foreign companies often obscure ownership through shell firms registered under Nigerian law, using local proxies to access licences and permits, a practice it said enables trade misinvoicing and money laundering.
An estimated 80% of mining in North-West Nigeria is illegal, with activity surging between 2022 and 2024 in areas affected by banditry and terrorism. The report flagged a growing overlap between some Chinese-linked commercial interests and local conflicts in the region. Good Governance Africa’s March 2026 report on Zamfara’s criminal gold economy argued that gold has become “a strategic resource for violent actors,” not merely a law-and-order problem.
Investigations by Nigerian and international outlets have reported cases where Chinese-linked miners allegedly paid armed groups to access mining sites. A study by SBM Intelligence shared with The Times revealed videos of militant leaders boasting how Chinese miners working in their strongholds had to pay “rent”. An investigation by WikkiTimes also revealed how Chinese-affiliated miners bribed the terror faction of Dogo Gide to gain access to mining sites in Shiroro Local Government Area of Niger State.
The insecurity has become a business calculation for illegal operators. Engineer Adamu Garba Musa, Director of Mining in the Niger State Ministry of Solid and Mineral Resources, asked: “If bandits are disturbing people, how come the company is working successfully?” The answer, according to analysis, is that “The insecurity that is tragedy for villagers is business cost for illegal miners. They simply add bandit bribes to operating expenses. The villager pays with blood. The miner pays with cash. The terrorist collects from both.”
Five US lawmakers introduced a bill in February 2026 linking Chinese illegal mining operations in Nigeria to terrorism financing, stating that “The Secretary of State should work with the Government of Nigeria to counteract the hostile foreign exploitation of Chinese illegal mining operations and their destabilising practice of paying protection money to Fulani militias”.
China has rejected the allegations as false and baseless. The Chinese Embassy in Nigeria said a bill introduced by certain US congressmen had “groundlessly accused China of engaging in illegal mining operations in Nigeria and paying protection money to specific militia groups”. The embassy insisted that “Chinese companies and citizens overseas to strictly abide by the laws and regulations of the host country, to operate lawfully and compliantly, and to show zero tolerance toward any enterprise involved in illegal or criminal activities”.
The China Mining Federation of Nigeria also dismissed the claims as “completely unfounded”, stressing that Chinese mining companies in Nigeria have always strictly complied with Nigerian laws and regulations. The federation said Chinese firms have been victims of terrorist attacks and have supported the Federal Government’s efforts to safeguard national security.
The May 2025 conviction of four Chinese nationals in Plateau State, each jailed for 20 years with asset forfeiture, remains an exception, the NEITI/ANEEJ report said.
