The many woes of Nigeria’s textile industry

In April 2016, Aisha Abubakar, Minister of State for Industry, Trade and Investment, took a tour of few surviving textile mills in Lagos State. Abubakar visited Spintex Mills Nigeria Limited, Lucky Fibres Plc, and Nichemtex Plc, all in Ikorodu, Lagos State.

Abubakar’s mission was to ascertain the state of the industry, hear directly from key players on the challenges facing the industry and then proffer enduring solutions.

The key players narrated all their woes to the minister. They complained about smuggling, high energy costs, import policy flip-flops and poor patronage by the public and the private sectors.

Twenty-eight months after the visit, these problems facing the industry are still there.

A research conducted by The Economist in 2015 notes that illegally imported Chinese-made fabrics imitating Nigeria’s signature prints flood Nigeria with some Customs officials turning a blind eye to them.

The report says that dilapidated textile factories in the country’s northern city of Kaduna are what remain of the industry, which in its heyday employed 350,000 people.

According to the World Bank, textiles smuggled into Nigeria through Benin Republic each year are worth $2.2bn, as against local Nigerian production estimated at US$40m annually.

In the early and mid-1980s, Nigeria had over 180 textile mills employing more than one million people. There were United Nigerian Textile Limited (UNTL), Aswani Textile, Afprint, Asaba Textile Mills, and Edo Textile Mills, among others, but there are fewer than three full-fledged textile mills today.

Even the firms earlier visited by the minister are basically rug producers and cotton processors/ exporters, which today are classified as textile firms.

Nigeria’s lack of will to tackle smuggling head-on has been its biggest woe.

India, which began its industrial journey almost the same time as Nigeria, is today world’s largest exporter of textile products after China, with 13 percent global market share, dwarfing Germany and Italy who now come third and fourth respectively. The country’s textiles industry is estimated at $108 billion, contributing five per cent to Gross Domestic Product (GDP) and 14 per cent to overall Index of Industrial Production (IIP).

The industry attracted Foreign Direct Investment (FDI) valued at $2.41 billion between April 2000 and December 2016, creating 100 million direct and indirect jobs with over 350 textile mills working.

Like Nigeria, India has an arid land that grows cotton used by textile firms. However, unlike Nigeria whose tanneries in Kano and Kaduna are comatose owing to poor cotton seedlings and demise of textile mills, India has explored the opportunity to produce enough cotton to service textile mills and export 1,307.11 million kgs in 2015/16.

Incidentally, Nigeria has a N100 billion Cotton, Textile and Garment Fund set up to spur the growth of the industry. Over sixty percent of this fund has been disbursed, according to the Bank of Industry (BoI), in whose custody the fund is domiciled.

However, despite the disbursement, there has been little improvement because textile makers, since the inception of the fund, made it clear that their major problem was not funding but smuggling and unbridled importation. An industry like textile needed to be protected in the past in Nigeria, but successive governments evolved unclear and uncertain import policies that killed the industry.

In the face of Nigeria’s quest for economic diversification and recovery, industry watchers want the government to take proactive action.

Some investors visited a textile firm in Kaduna four years ago, but they are yet to return since then.

How many government agencies, departments and ministries are taking patronage of local firms seriously?

“What we need is the enabling environment. We cannot compete with the level of smuggling and counterfeiting going on now. We used to have about 127 textile firms in Nigeria but that has come down to two or three now,” Grace Adereti, president of the Nigerian Textile Manufacturers Association (NTMA), said in Lagos, at a Made-in-Nigeria stakeholders’ meeting last year.

ODINAKA ANUDU