- Simone Preuss |
According to World Bank estimates, Nigeria's textile and garment industry loses billions of US dollars in garments and textiles each year because of cheap imports that are smuggled into the country. Local production has dropped to a mere 40 million US dollars annually.
The cheap imports, particularly from China, are smuggled into the country from Benin, where they flood the market and drive local textile traders out of business. Add to that chronic power shortages, a rise in production costs and mills closing and it is no wonder that dilapidated factories are not a rare site in once proud textile production hubs like Kano and Kaduna, employing more than 350,000 people.
The country is desperate for change and the government has already put in 500 million US dollars to revive its textile industry. However, according to manufacturers and traders, monetary support alone will not fix the problem: The power situation needs to improve as well as the business environment if Nigerian textile and garment companies want to compete in a global economy and stand up to Chinese imports. Government protection is needed as well as a boost for the local currency.
“The political stability of a country is determined by its economy; we will support sectors that invest capital to expand and improve employment of youths,” said Ahaji Dikko Abdullahi, comptroller general of customs, who stressed the need for job creation.
Nigeria's woes started ten years ago when the country opened its doors to foreign trade: Aided by a WTO deal that allowed China unhindered access to its textile market, Chinese textile merchants started their large-scale textile imports to Nigeria. Though foreign nationals are not allowed to trade through retail channels, locals get recruited for a cut on profits, thus bypassing the law.