N100BN TEXTILE INTERVENTION: WHY TEXTILE COMPANIES CAN'T CREATE JOBS NOW


UNEMPLOYMENT in Nigeria is pri­marily the result of failed industries. However, in view of the capacity of the manufacturing sector to absorb more workers than any other sector in the econ­omy. In the 1980s, the Nigerian textiles industry was the third largest in Africa after Egypt and South Africa. The sector was a key player in the nation's economy, particularly in the provision of jobs.

It used to be the largest employer of la­bour in the manufacturing sector after the public sector. The industrial sector then generated an annual turnover of $8.95 bil­lion; an average of 25 per cent of the sec­tor's gross domestic product (GDP) which accounted for not less than 10 per cent of corporate income taxes.

Regrettably however, by the mid 1990s, the fortunes of the cotton and textile in­dustry dwindled due to government ne­glect and policy inconsistencies. Precisely in 1994, when many textile manufactur­ers began to feel the pinch of the unfriend­ly economic and political environment, they were forced to close down, while some relocated to other countries within the sub-region in the wake of massive smuggling and importation of textiles into the country. The situation became worse in 1997 when the Federal Government lifted the ban on textile importation.

Figures showed that the number of tex­tile and garment factories fell from 175 in the mid 1990s to about 35 in 2015, while employment dropped from 137,000 in the 1990s to 60,000 in 2002 and further to 24,000 in 2010.

The performance of the Nigerian tex­tile industry has remained at low ebb as at today, due to lack of an enabling environ­ment and unless urgent steps are taken to address the problems the momentum gained in 2010 would be lost. Those, who spoke to the Daily Sun at different times, expressed concern over the silence of the Federal Government's 2016 budget on the revival of textile industries in spite of past promises.

According to the President of (NUT­GTWN), Oladele Hunsu raw materials remain difficult to source despite the union's campaign for supportive textile policy.

He, however, commended the Federal Government on its efforts to resolve the scarcity of cotton and other raw materials bedeviling the textile industry, which led to improved production by the compa­nies. As at today, we have 24 operational textile mills, which are: Angel Spinning & Dyeing; African Textile Manufactur­ers; Adhama Text & Garment Industry; Chellco Industries; Dangote Agrosacks; Funtua Textiles; Holborn (Nigeria); Lucky Fibres; Nigerian Spinners & Dy­ers; Spintex Mills (Nig.); Stallion Textile Industries; Sunflag Nigeria; Crown Na­tures Nigeria; Terytex (Nig.); Tofa Tex­tiles; United Nigerian Textiles; Woollen & Synthetic Industries; Zaria Industries; ITI (Nigeria), Marklint Medical Complex; MDV (Nig); Supertex Limited Kaduna; Nigeria Braiding Company and Arewa Textiles Limited..In a bid to revive the na­tion's ailing textile industry, the Federal Government had in December 2009, put in place a N100 billion Cotton, Textiles and Garment (CTG) Revival Fund. The fund which was domiciled with the Bank of Industry (BoI), was specifically meant for the revitalisation of the CTG industry along the entire value chain. It was also geared towards providing cheap capital for the development of the sector and making it one of the highest employers of labour in the country. The BoI is mandat­ed to grant loans to textile companies at an interest rate of six per cent. According the Acting Managing Director of BoI, Mr. Waheed Olagunju, the bank had given out more than 60 per cent of the fund as loan to different textile companies across the country since 2009. But the deplor­able condition of textile factories across the country does not match with the fund claimed to have been disbursed so far, which has raised concerns about who got the money.

Also speaking in the same vein, the Director General of Lagos Chamber of Commerce and Industry (Lagos Chamber of Commerce and Industry (LCCI)), Mr. Muda Yusuf, noted that the intervention fund has failed to achieve its objectives because the issue of raw materials and machinery were not taken into consider­ation when it was being planned.

He pointed out that to ensure the re­vival of the textile sector, a number of is­sues should have been put in place, such as ensuring that the country is competing effectively in the production of cotton in line with world standard and that the equipment are producing effectively and efficiently, to enable the companies com­pete favourably.

In his reaction, Director General of Nigerian Textile Manufacturers Asso­ciation (NTMA), Hamma Kwazafa, ac­knowledged government's interest in the sector through intervention funds, CTG and the Export Expansion Grant (EEG). "We are stagnated now; the problem goes beyond money," says President, National Union of Textile, Garment and Tailoring Workers of Nigeria (NUTGTWN), Ol­adele Hunsu. Hunsu said that although, there was a significant improvement in the industry, as 1,500 jobs have been saved through the intervention, efforts to put the industry back on track have been frustrated by government's policy incon­sistency.

SOURCE: THE DAILY SUN.