As part of its efforts to revive the textiles industry, the Central Bank of Nigeria (CBN) recently unveiled fresh incentives for cotton farmers. The same goes for other critical stakeholders in agriculture sector where the apex bank is mobilizing resources for 1.6 million farmers in the 2020 wet season across the country. As a newspaper, we are particularly delighted by the disclosure by the CBN that cotton farmers have been benefiting and will still get more attention this year. In line with this resolve, the apex bank has distributed farm inputs to cotton farmers for 2020 planting season in Kwali, Abuja.
Last year, the apex bank distributed cotton seedlings and other inputs to farmers which enabled textile industries to source the vital raw material locally. For this year, the CBN said that it would finance the farmers under its 10 focal commodities’ policy which would cut across the value chain to guarantee food security in the country. To achieve this, it has already engaged 256,000 farmers in cotton production for 2020 planting season through its Anchor Borrowers’ programme (ABP).
To the delight of the farmers and other stakeholders, the CBN is out to bring back the glory of the textiles sector which in its hey days employed 10 million people in the country. The country, however, in the 80s, lost that glory because of smuggling and concentration on the oil sector as well as policy inconsistencies that led to Nigeria being turned to a dumping ground for highly subsidized textiles materials and other foreign goods especially from Asia. As an incentive, the beneficiaries from the facility will repay the loan at five per cent interest rste instead of the earlier 9 percent because of the COVID – 19 pandemic. We commend the CBN for this well thoughtout measure and appeal to the farmers to reciprocate the gesture by ensuring that their farms are well taken care of while at the same time working out how to repay their loans as scheduled. The significance of this policy is not lost to the farmers and to Nigerians as a whole. The impact of the resuscitation of the sector on the economy is enormous. That sub sector as part of the larger agricultural sector was the highest employer of labour in the country.
Beyond that is also the foreign exchange earning capability of the cotton industry with its ripple effect on the Gross Domestic Product (GDP) of the nation and its foreign reserve potentials. The CBN started demonstrating its commitment to massive cotton production in 2018, which paid off last year when the textile industries became self-sufficient as cottons used during the period were sourced from within. To fix the cotton value chain, which starts with planting, the CBN in partnership with some state governments, distributed inputs to 100,000 cotton farmers, who cultivate 100,000 hectares in 23 states of the federation. Figures from the apex bank indicates that about $5 billion was spent annually on the importastion of textiles durimg the period the the nation’s textile industry was in comatose.
One important development in this CBN/Cotton farmers partnership is a noticeable change of attitude on the part of the beneficiaries who are demonstrating a desire to play straight as far as their commitments to the loan agreement is concerned. They are adopting an attitude that takes them away from the usual indifference to repaying loans and reaping the gains of participating in the anchor borrowers’ programme as affirmed by the president of the National Cotton Association of Nigeria, Anibe Achimugu. Therefore, this has resulted in massive turn-around in their output.
We are not surprised at the attention being given to cotton production by the CBN because it is the most important fibre material for Nigeria’s textile industry. Already, most of the textile factories in the country have stopped production, leading to sack of their workers thereby swelling the unemployment market. Presently, only 25 textile factories are in business and even then, they are operating at below 20 percent of their installed capacities with a collective work force of below 20,000. It is against this background that we appeal to the CBN to sustain the current tempo so that the cotton sub-sector like the rice segment funded by the apex bank regains its glory and continues to contribute to the expansion of the economy. We also extend the same appeal to all the stakeholders in the cotton value chain to see the urgent need to reciprocate the gesture from the CBN for the collective good of the economy and Nigerians in general.