The call by the Nigeria Labour Congress (NLC) on the Federal Government to set up a comprehensive mechanism to revive the nation’s industries, particularly the textiles sector, is timely. For many years, the textiles industry has been largely comatose and completely neglected at the expense of the nation’s economy. Painting a gloomy picture of unemployment and poverty in the country at the recently concluded third International Conference and Award of Fellowship of the Association of Textiles Technologists of Nigeria (ATTN ) in Kaduna, a chieftain of the NLC, Comrade Issa Aremu, warned that the level of unemployment and poverty, especially among the youths could lead to social unrest. He advised that the government can prevent the imminent upheaval if it harnesses the vast job opportunities in the textile and allied industries for sustainable development.
Recent data from the Manufacturers Association of Nigeria (MAN) and the Federal Ministry of Trade and Investments corroborate the position of Labour that over 776,000 jobs were lost in the textile industry in the last few years due to neglect and lack of funding. The result, according to data from MAN, is that about 73 percent of textile and garment sector goods in the domestic market are smuggled, thereby killing local industries. This is a sad and avoidable situation.
Nigeria once had a very vibrant textile and garment sub-sector with fixed investments of $4bn (about N880bn). This was second only to South Africa in sub-Saharan Africa, and third largest on the continent. Also, Nigeria used to have 63 percent of the textile manufacturing capacity in West Africa and controlled over 60 percent of the textile market in the country. Within the same period, the sub-sector reportedly had 175 fully functional mills that employed over 800,000 people.
Today, employment in that sub-sector is at an all-time low, with less than 24,000 employees working in 25 mills with low capacity utilisation, according to the Federal Ministry of Trade and Investment.
As a result of this, the domestic textile market has fallen to a mere 12 percent. This has been compounded by low export and high influx of cheap products. With falling crude oil prices in the international market and sharp decline in government revenue, this is the time to reposition the textile sub-sector, diversify our economy and create jobs.
Therefore, government should make the textile industry a priority by providing the much-needed funding, infrastructure and enabling environment, especially adequate power supply. These and other incentives will make the industry come back on stream. Indeed, the long term strategy should be to revive the entire textiles value chain to boost economic growth.
For instance, the production of cotton for domestic use and exports should be strengthened, while existing players in the sub-sector should be supported to expand their operations.
It is regrettable that challenges forced many of the industries to either shut down or relocate to neighbouring West African countries. Together, the firms employed between 250,000 and 300,000 workers. The few that are still working are operating below installed capacity.
To revive the ailing textile companies, government should design policies to address their problems. It should make arrangements for adequate funding of their operations through low interest credit facilities. The focus should be to protect the local market and encourage production for both domestic use and exports that will bring foreign exchange, while tightening the noose on textile imports.
It is unfortunate that despite the great potential of the textile industry as a big revenue earner, the various intervention funds set up by the Federal Government have not achieved the desired objective of reviving it. There is, for example, the case of the N100 billion Cotton Textile and Garment Revival (CTG) Intervention Fund which is not being accessed by the firms because 80 per cent of the Nigerian textile market has been taken over by cheap imports from Asian countries. Not even the six per cent interest rate over five years has succeeded in attracting investors to access the loan. It is estimated that N300 billion worth of textiles and garments are smuggled into the country annually.
Government should urgently address the problems hampering the revival of the sector and do whatever it can to protect the local industries. The textiles industry is labour-intensive. It should not be ignored by any country that needs to create jobs for its teeming population. The government should revive the industry without any further delay.
