Gold value chain in Nigeria needs to be built and integrated – Emiko

Can you talk about what led you to develop SanuCoin technology and travel in the gold mining industry?

Kian Smith started in 2011. We started as a gold exploration company and slowly moved into mining. We accidentally entered the space of organizing artisanal mining and working with them, as well as optimizing our small-scale mining and gold trading. So, as a result, we designed an Organization for Economic Co-operation and Development (OECD)-compliant gold purchasing program that dealt with responsible sourcing, and that production became the feedstock for our refinery that we launched.

We have started refining gold medallions, bars and cubes which we call savings products popular with women; one, two and five gram cubes. These products were launched in 2020 and 2021. We launched them with the West African market gold durbar in Kano in August 2020, Ouagadougou in October 2020, Dakar in December 2020 and Lagos Love Gold in February 2021.

We also launched and announced our Kian Smith Dubai expansion at the recent Dubai World Expo where our gold medallions and products were showcased in the Nigeria pavilion. With all the feedback, market responses and full value chain integration, we are finally launching “Sanu”, our gold buying app.

The truth is that this is the second version. SanuCoin v.1 was released during the 2020 lockdown. Our vision then was to have this gold buying app that lets you buy gold in very small fractions. To allow people to buy gold and silver on the blockchain because the blockchain is what really gives credibility to a one-to-one match for physical gold because with that you know that we really have what we say we have. You can match your tokens in an audit on the blockchain, matching it with the audits of our partners who have custody of the gold. This was our project for 2020.

Our pride was to have a product made in Nigeria for the world because there was and still is nothing like it. BitMama was the only one brave enough to take on the project. However, the Securities and Exchange Commission (SEC) issued regulations for crypto, blockchain and tokenization, as well as the CBN blocked cryptocurrencies, so we had to redesign Sanu to remove a lot of the innovation .

So now we finally release version 2.0 of Sanu, which allows you to buy gold or silver and you can collect it from Union Bank, our partner and Custodial Bank.

Sanu also gives you the opportunity to collect gold in Dubai and London. With Sanu, you can own a fraction of gold or silver with as little as N100 Naira, and you can keep buying gold until you are able to buy a commodity that you can recover at the bank.

We are very happy to launch it, there is no product like it in the world. This now gives not just Nigerians, but all Africans, the opportunity to access London Bullion Market Association (LBMA) gold that they would usually never have been able to access without FX. We have accomplished this in partnership with StoneX Group, a world leader in precious metals trading. Now, LBMA gold is accessible in Nigeria with the naira.

What impact do you think this would have on people who want to buy gold in Nigeria?

The Nigerian and West African gold value chain needs to be built and integrated. Part of building a value chain and establishing Nigeria as a gold market is ultimately getting people to buy gold.

Pre-COVID Kano Sabon gari market statistics in 2019 showed an average of 20,000 unique buyers coming to buy gold from across West Africa. Despite this great potential, the gold value chain and market dynamics in Nigeria are disjointed. Unless you are in the mining or trading space, access to gold is difficult. Goldsmiths, jewelers and retailers who want gold cannot safely access small volumes of gold.

One of the things we are trying to establish is the ability of Nigerians to buy gold. Nigerians are well known in the gold markets of Dubai, Italy, India and Singapore but because we don’t have an organized retail market. Currency restrictions imposed by the current restrictive monetary policy and adherence to responsible sourcing compliance add complications to the gold market. All of these things make it difficult to quantify Nigeria’s potential to become a reputable gold market.

However, we have always known that part of the key to strengthening the value chain and really developing gold investments is to bring out retail Nigerian gold markets, to get Nigerians to buy the gold and to get the gold to the people.

Once Nigeria starts compiling data on household gold consumption, whether in the form of bullion, coins or jewelry, the purchasing power of the gold in Nigeria will become clear to the World Gold Council, the Nigerian Bureau of Statistics and other trade data analysts.

We will now see the volume of gold that Nigerians are buying and see that Nigeria has the potential of, say, 10 years from now, we can start to be recognized as a gold market in Africa and slowly count with countries such as Southeast Asia and Dubai. in the purchasing power of gold.

Another discovery in our gold markets in recent years has been the realization that many people would really like to access gold to save, not just for jewelry. So, with Sanu, you have the option of storing your gold with Union Bank as a custodian bank or with our storage partners outside of Nigeria. So Sanu just takes all these problems that people have had and why it was risky to buy gold. Bottlenecks to access gold have now been removed.

We truly believe that we have the product that gives people gold. Everywhere we’ve been for the past few years, people keep asking and saying that this gold that you say you’re refining and selling, where is it? The same goes for Burkina Faso, number two in West Africa after Ghana for gold production. Believe it or not, most people in Burkina Faso had never seen gold. However, Burkina Faso has several airstrips dedicated to the daily evacuation of gold.

So a lot of what you find happening in our area is that there’s mineral wealth and resources that we’re producing, but we can’t access it and that’s a way of giving now to the Nigerians, West Africans and Africa the opportunity to access gold.

Apart from jewellery, it is almost impossible to access refined gold to international standards in our local currencies. We have done all the hard work to now give people the access to gold in small retail quantities that they want, empowering women and giving gold to the people.

Is gold an option for Nigeria and what exactly should the federal government do to capitalize on gold’s valuation gains?

There are so many ways gold can work for Nigeria’s economy. If you look at Dubai, London, Singapore and Mumbai, they have deep gold economies, but they don’t produce gold. They just unlocked gold as part of the economy, which is pretty much what we’re trying to do here for West Africa.

The Central Bank of Zimbabwe has just released a gold coin which it retails at local banks and beyond for its citizens. Not only do they fight inflation, but the train effect of the ancillary services it creates and the financial products the banks can create all lead to a gold economy from which the whole nation benefits.

It would be a real game-changer for Nigeria if we developed the gold value chain. It’s not just about mining, because if you mine it like Burkina Faso, your economy doesn’t have all the economic benefits. Dubai doesn’t exploit it, they don’t need to exploit it, and they don’t deal with environmental factors, but I assure you Dubai’s economy is bigger and stronger, and more powerful than the economy of Burkina Faso, the people who are producing the gold. How much more potential for Nigeria which mines gold and is one of the largest economies in Africa.

It is possible that gold will provide some relaxation in the demand for currencies for those looking for a way to save their money and avoid currency inflation. If people could buy gold, they might not need to hunt for foreign currency and there would not be such pressure on foreign currency reserves. Now that SANU is giving access to retail gold, let’s test this theory.

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