TRALAC - Trade Law Centre

Nigeria: "Exporting our way to wealth"

Saturday, 06 June 2009

Source: 234Next.com

It has been the recurrent refrain of every government in the last three decades to reduce the nation’s dependence on crude oil as a major foreign exchange earner. The Federal Government at every opportunity would promise to revive the non-oil sector to no avail. The administration of President Umaru Yar’Adua has been no exception. Despite its well publicised campaign to revive the sector, it is neglecting the textile industry.

The United States, for example, has enacted a legislation, the African Growth opportunity Act (AGOA), which allows for the export of Nigerian fabric and textile to her domain.

Working with the Nigerian Export Promotion Council, AGOA has also set up an administrative structure to help Nigerian textile manufacturers benefit from the legislation.

However, according to Dorai Prabhu, an administrative official and fabric trainer for AGOA, the country is failing to utilise this opportunity. Under the act, Nigerian fabric can easily be exported to the United States. “The textile industry has a good chance of providing employment and can boost the nation’s revenue generation. There are over 6,000 items on the list (of things that can be exported) and even if all are not available in the country, at least the nation has some that it can effectively tap into,” he said.

Isa Aremu, the general secretary, National Union of Textile, Garment and Tailoring Workers of Nigeria in a telephone interview condemned the high import rate of textile in Nigeria.

“The government has opened the market to allow the Nigerian market to be flooded with imported textile from China and India making the country to be flooded with imported goods instead of improving its export trade,” he said. Although, the Federal Government had, in 2008 promised a N70 billion bailout for the industry, the manufacturers have no confidence in the promise.

The president, Manufacturers Association of Nigeria, Bashir Borodo, says: “It is just talk-talk. You know that the government always promises, but fulfilling those promises is a problem.”

AGOA’s Textile and garment initiative

The clearance to export fabric and textile to the United States was given to Nigeria in July 2004. Assessing the success of the programme in Nigeria, Mr. Prabhu said Nigeria has not been utilising the programme to develop the economy and the people as a whole.

“The programme is not well utilised in Nigeria as compared to other neighbouring countries like Ghana and the Republic of Benin, where they have taken the initiative to develop their people and their revenue generation. There is little of AGOA in this country. Most people do not even know what it means or what is it that we do. The government is also not doing anything to encourage the initiative,” he said.

Mr. Prabhu said the scheme is meant to build the economy and empower people to stand on their own.

“We teach them how to make garments that are of international standards. There are talents in Nigeria and the people are brilliant but are operating under ignorance and lack of knowledge and expertise in most of the fashion field. That is why it is difficult for them to compete with the international market.

“Fabrics well designed and sewn in Nigeria can compete anywhere in the international market. If they cannot all export their products, they can use the knowledge to make better their lives in the country and improve the economy,” he said.

In Ghana, the initiative is big and handled by the president as a special project. Factories have been built and loans are easily available for those who want to take part in the scheme.

The Nigeria textile problem

The type of cotton planted in Nigeria has been identified as one of the reasons the textile industry is on a decline.

Mr. Prabhu said: “The variety of cotton planted in Nigeria is not of international standard because it is an old variety. This is making it difficult for the fabrics produced in the country to compete with those produced elsewhere”.

Textile manufacturers in the country give credence to Mr. Prabhu’s assertion. They too have complained about the quality of cotton produced, saying it has impacted negatively on the textile industry. A poor quality control system that allows for the contamination of cotton by pests and diseases has also been identified as a major problem. Nigerian cotton farmers also use polythene packages to store their crops and this leads to contamination. Fabric produced using this contaminated cotton do not dye properly and are therefore undesirable in the international market.

“The government needs to first improve the variety of the cotton grown in the country so as to make the companies produce better and modern day fabrics,” Mr. Prabhu said.

The government is said to have budgeted N20 billion for cotton growers out of the proposed N70 billion bailout fund.

Comment from AGOA beneficiary

A current beneficiary of the AGOA programme, Kiki Kamanu, who exports her ‘Made in Nigeria’ fabric to the United States through the scheme, said fabric produced and designed in Nigeria have a better chance of selling in the international market if well packaged and given unique designs.

“Nigerian fabrics are beautiful and readily accepted outside the country if the concept is good. At least I have a variety of markets and customers in New York and some other places outside the country,” she said.

45 students selected from across Nigeria are currently been trained on how to manufacture garments to international standards under the AGOA scheme. The students will also be taught marketing skills so they can sell their products.



“ Latest AGOA Trade Data currently available on AGOA.info


Click here to view a sector profile of Nigeria's bilateral trade with the United States, disaggregated by total exports and imports, AGOA exports and GSP exports.


Other regularly updated trade statistics on AGOA.info include: (click each link to view)

  • AGOA-Beneficiary Countries’ AGOA and GSP Trade Aggregates

  • AGOA Trade by Industry Sector

  • Apparel Trade under AGOA’s Wearing Apparel Provisions

  • Latest Apparel Quotas under AGOA

  • Bilateral Trade Data for all AGOA-eligible countries individually.