The Central Bank of Nigeria (CBN) has threatened to blacklist individuals, banks and companies involved in illegal textile importation into Nigeria.
CBN Governor, Godwin Emefiele, who handed down the threat on Monday at the flag-off of the distribution of cottonseeds and other inputs to farmers in Katsina State, said Nigeria currently spends about $4 billion on importation of textile materials and ready-made clothing annually.
Emefiele said the restriction of foreign exchange to the importers of 43 items including textiles was yielding the desired results, apart from driving interest by potential investors seeking to make investments to support improved production of textiles in Nigeria.
To curb smuggling, the CBN Governor said the bank was gathering data as well as investigating the accounts of individuals and corporates currently involved in smuggling and dumping textile materials into Nigeria.
He said individuals and companies involved in the illicit trade will be blacklisted, while all banks, their owners and top management involved in the illegal business would be barred from further conducting any banking business with the companies.
“With a population of over 190 million people, Nigeria clearly stands out as a virgin market that must be tapped. If we are determined in our drive to create jobs on a mass scale and reduce youth restiveness in Nigeria, the cotton, textiles and garments industry cannot be ignored,” the CBN Governor said.
Emefiele said the seeds will help improve cotton production in the country from about 80,000 tonnes in 2018 to over 300,000 tonnes by 2020.
Over 100,000 farmers collected the cottonseeds during the national flag-off of distribution of seeds/inputs to farmers for the 2019 planting season.
Emefiele said the support of the bank to cotton production was part of the commitment to consolidate on the gains of the restriction of foreign exchange allocation on finished textiles and 42 other items in the country.
The CBN governor identified insufficient cottonseeds as one of the major challenges cotton farmers face in the country.
He said the bank sought to change the narrative on the cotton and textile industry in Nigeria through the distribution of high yielding cottonseeds to farmers.
“In the 1970s and early 1980s were the glory days of the textile industry in Nigeria. Nigeria was home to Africa’s largest textile industry, with over 180 textile mills that employed over 450,000 people, representing about 25 per cent of the workforce in the manufacturing sector,” he said.
He attributed this to the high energy cost of running factories, poor access to finance and smuggling of textile goods estimated to cost Nigeria over $2.2billion annually.
According to him, only 25 textile factories were currently operating in Nigeria with a workforce of fewer than 20,000 people.
A large proportion of clothing materials, he said, were now being imported from China and countries in Europe.
The Katsina State Governor, Aminu Masari, said the federal government’s initiative to promote cotton production under the Anchor Borrowers’ Programme of the CBN would support the textile industry in the country by encouraging local production.
His Kano State counterpart, Abdullahi Ganduje, who spoke on behalf of other governors in the North West region, stressed the need for strong institutions to complement monetary and fiscal policies aimed at developing the Nigerian economy.