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EDITORIAL

Senate’s Proposal On Foreign Fabrics

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The Senate, during the week, urged the federal government to ban importation of foreign garments into the country for five years. According to the upper legislative chamber, the measure would ensure the viability of local textile companies almost all of which are currently moribund. The Senate was particularly concerned that the textile industry had witnessed massive decline in the last two decades with many textile companies such as the Kaduna Textile Mills, Kano Textile, Aba Textile, United Nigeria Textile and First Spinners, amongst others, closing shop and inevitably throwing millions of workers into the already congested job market.

The legislators lamented that the discovery of oil in Nigeria had adversely affected the textile industry leading to a decline in the production of cotton, which is the major source of raw materials for the sector. This newspaper agrees with the lawmakers on the need to restrict the avalanche of textile importation into the country even as we recommend a measured process in that direction.

We recall that in the 70s and 80s, Nigeria had over 180 textile companies with close to half a million workers and the sector was one of the major employers of labour outside the public sector, contributing over 25 per cent of the workforce in the manufacturing sector. The industry was supported by the production of cotton by 600,000 local farmers across 30 of Nigeria’s 36 states. It supported the clothing needs of the Nigerian populace, as the local markets were filled with home-made textile materials. Sadly, almost all those industries have closed shop no thanks to the dearth of infrastructure, poor funding, smuggling and importation of highly subsidised and cheap textile materials into the country. Today, only about 25 textile factories are operating and at below 20 per cent of their production and installed capacities, and the workforce in the sector stands at less than 20,000.

The Central Bank of Nigeria (CBN) governor, Mr Godwin Emefiele, recently painted a grimmer picture when he disclosed that Nigeria currently spends about $4 billion annually on imported textiles and ready-made clothing while local textile manufacturers are struggling for survival. Also, the apex bank chief disclosed that Nigeria loses over N790 billion ($2.2 billion) to smuggling of textile goods annually. To remedy the situation, he listed some policy measures to revive the sector, which include refinancing so as to support the industry. This financing policy towards textile manufacturers will entail the provision of funds at single digit interest rate. The apex bank also plans to refit, retool and upgrade textile factories in order to produce high-quality textile materials for the local and export market. It is our view, therefore, that these steps by CBN are recommended at this time because it holds the promise of having a more positive impact as well as being more effective in the long run.

In a period when the economy is hemorrhaging and resources limited, the government needs to increase its revenue by every legitimate means. This newspaper believes that reviving the textile industry is one guaranteed way of stimulating the economy and providing millions of jobs.

A report by the National Bureau of Statistics (NBS) indicates that about 20 million Nigerians are currently unemployed. We strongly recommend agriculture and the revival of the textile industry as a means of reducing the unemployment rate.

We truly understand and appreciate the thinking behind the recommendation for a total ban on foreign textile materials by the National Assembly. However, we are of the opinion that such a drastic measure will adversely affect the economy and inflict even more hardship on the citizens who are already experiencing tough times.

But should the lawmakers insist on an outright ban, it is our view that it should be in phases spread over a period of five years. This suggestion becomes expressly compelling when the reality is considered – which is that of the few textile industries still alive, most of them operating below 20 per cent, are not enough to take care of local consumption. With a population of 200 million, the Nigerian market is huge and ready for expansion.

Consequently, we call on the federal government to back the move by the CBN to encourage public officials, especially the military and paramilitary outfits as well as the NYSC, to source their fabrics locally. As we mentioned earlier, part of the contributory factor to the downturn in the textile sector is poor infrastructure. If the government can apply more urgency in the improvement of this critical input, it will not only ease the cost of doing business but also serve as an incentive to entrepreneurs presently almost collapsing under the weight of huge capital tied down to infrastructure that are taken for granted in other more developed economies.

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