Agaju Madugba, Katsina
Governor of the Central Bank of Nigeria (CBN), Goodwin Emefiele, has flagged off the distribution of seeds and other input to cotton farmers in Katsina State under the umbrella union of National Cotton Association of Nigeria for the 2019 planting season.
According to the organisers, the project sponsored by the CBN in collaboration with the Federal Ministry of Agriculture was designed to revive the nation’s moribund cotton, textiles and garments industry.
Describing the launch as a “milestone event,” Emefiele explained the choice of Katsina saying that it is the leading cotton- producing state in Nigeria. The cotton and textiles industry, given its immense potential, is indeed vital to our growth objectives as a nation, and to our efforts at creating jobs for a large number of Nigerians.”
According to Emefiele, “on assumption of office in June 2014, I indicated in my inaugural speech that one of my key objectives as governor of the Central Bank of Nigeria is to build a people- focused Central Bank.
“In addition to a focus on key macroeconomic concerns such as lower inflation and exchange rate stability, I believed that the Central Bank ought to play a more important role in supporting Nigeria’s economic development, given the constraints faced by rural farmers, SMES and manufacturing companies.
“More importantly, we believe that CBN’s intervention which is aimed at import substitution will help in conserving scarce foreign exchange for Nigeria.
“We have placed considerable emphasis on addressing impediments to the growth of Nigeria’s agricultural and manufacturing sectors, as both sectors represent over 52 per cent of Nigeria’s GDP.
“If we are able to drive productivity gains in these sectors, it will undoubtedly translate to higher growth rate for the broader economy, result in increased rural incomes, and improvements in living standards for a majority of Nigerians
“The over 60 per cent drop in crude oil prices between 2015 – 2017 and its attendant effects on economic growth, inflation and our external reserves, provided further impetus on the need for the CBN to support measures that will drive productivity in critical sectors of the economy, while also weaning our economy from its reliance on proceeds from the sale of crude oil.
As some of you are aware, in the 70’s and early 80’s, Nigeria was home to Africa’s largest textile industry, with over 180 textile mills in operation and employed over 450,000 people.
“The textile industry then, represented close to 25 per cent of the workforce in the manufacturing sector. Beyond the jobs created in the factories, this industry was supported by the production of cotton by 600,000 local farmers across 30 of Nigeria’s 36 states, thousands of ginnery workers who processed the cotton from farmers, and a large number of distributors that sold the finished cloths to consumers.
“It is no secret that the past 20 years have been very difficult for the cotton, textiles and garment sector. Farmers and processors have had to deal with low quality seeds, rising operating cost and weak sales due to high energy cost of running factories, smuggling of textile goods, and poor access to finance. Smuggling of textiles goods alone is also estimated to cost the nation over $2.2bn annually.
“Today, due to the unfortunate activities of smugglers and dumpers, most of the factories mentioned above have all stopped operations, as only 25 textile factories are operating today, and the workforce in Nigeria’s textile industry presently stands at less than 20,000 people. In addition, a large proportion of our clothing materials are now being imported from China and countries in Europe.
“Today, Nigeria currently spends about $4billion annually on imported textiles and ready-made clothing.
“With a projected population of over 190 million Nigerians, the needs of the domestic market are huge and varied, with immense prospects for growth of the domestic textile industries.
“One quick example that highlights the potential of this local market, includes the need to support provision of uniforms and clothing apparels for students, military and paramilitary officers as well as workers in the industrial sector. In addition, when we consider the amount spent on outfits for religious and social events such as weddings, naming and funeral ceremonies on a weekly basis, the potential market size is well over $4bn.
“In addition, under the Anchor Borrowers Program, we intend to improve the linkage between cotton farmers and ginneries, by ensuring that ginneries are able to offtake the high-quality cotton produced by these farmers.
“So far 23 ginneries, spinners and several textile producing firms have been identified and we intend to support them in retooling their processing plants, while providing them with improved access to finance at single digit interest rate, in order to help sustain their operations and improve their production capacity. The same support will be extended to the yarn spinners and textile weavers and producers.”
Also speaking at the ceremony, Governor Aminu Bello Masari said that his government was disturbed by the decline in agricultural produce including cotton.