The Centre for the Promotion of Private Enterprise (CPPE) has cautioned that the Senate’s resolution calling for a ban on textile fabric imports could have far-reaching economic consequences, warning that the policy risks disrupting an estimated N17tn fashion and furniture value chain while threatening the livelihoods of about 10 million Nigerians.
The Chief Executive Officer of CPPE, Dr. Muda Yusuf, argued that although the objective of reviving Nigeria’s struggling textile manufacturing industry is laudable, an outright ban on textile imports would likely inflict more damage on the wider economy than the intended benefits for domestic producers.
According to the economic policy think tank, restricting textile imports would undermine the country’s much larger garment, fashion, tailoring, furniture and creative economy sectors, which depend heavily on imported textile fabrics as production inputs.
“The proposed measure is unlikely to achieve its intended objectives and could have significant adverse consequences for the Nigerian economy,” Yusuf said.
He maintained that effective industrial policy should focus on improving the competitiveness of local manufacturers instead of imposing import prohibitions that could disrupt supply chains, raise production costs and reduce consumer choice.
CPPE estimated that Nigeria’s fashion, garment-making and tailoring industry is conservatively valued at about N10tn, providing livelihoods for roughly 10 million people through thousands of micro, small and medium enterprises engaged in tailoring, garment production, embroidery, merchandising, branding and retail.
Beyond the fashion industry, the organisation noted that Nigeria’s furniture and interior design industry estimated at about N7tn also depends significantly on textile fabrics used in upholstered furniture, office fittings, hotel furnishings and mattresses.
It warned that any disruption in textile supplies would increase manufacturing costs, weaken the competitiveness of these downstream industries and threaten millions of jobs that currently generate more domestic value addition than textile manufacturing itself.
According to CPPE, Nigeria’s textile industry’s decline is largely attributable to longstanding structural challenges rather than import competition.
These challenges include high energy costs, expensive credit, inadequate infrastructure, logistics bottlenecks, obsolete manufacturing technology, widespread smuggling, limited access to long-term financing and inconsistent government policies.
Yusuf noted that textile manufacturing is one of the world’s most energy-intensive industries, making Nigeria’s high production costs a major impediment to competitiveness.
He further observed that imported textile fabrics already attract combined Import Duty and Import Adjustment Tax (IAT) ranging between 35 and 45 per cent, yet such tariff protection has failed to revive the industry because the underlying structural problems remain unresolved.
“An import ban addresses the symptom while leaving the root causes untouched,” the CPPE stated, adding that sustainable recovery requires reducing production costs, improving productivity and strengthening enforcement of existing tariff measures rather than introducing new trade restrictions.
The organisation also argued that local textile manufacturers currently lack the capacity to satisfy the quantity, quality and variety of fabrics required by Nigeria’s expanding fashion, garment, furniture and interior design industries.
It warned that banning textile imports under current market conditions could trigger shortages, inflate production costs and ultimately weaken downstream industries that employ significantly more Nigerians than the textile manufacturing sector.
Rather than adopting restrictive trade measures, CPPE advocated a comprehensive value-chain strategy to revive Nigeria’s textile industry.
Among its recommendations is the restoration of domestic cotton production through improved seedlings, mechanisation, extension services, enhanced security in farming communities and guaranteed off-take arrangements for cotton farmers.
The organisation also called for the establishment of a Textile Competitiveness Fund, financed partly from textile-related import tax revenues, to provide manufacturers with single-digit financing for technology upgrades and industrial modernisation.
Other recommendations include prioritising locally produced textiles and garments in government procurement for military, paramilitary agencies, schools and other public institutions; strengthening border enforcement to curb smuggling; reducing energy and financing costs; and improving infrastructure to enhance industrial competitiveness.
CPPE stressed that government procurement could play a pivotal role in stimulating domestic demand for locally manufactured textiles without disrupting industries that rely on imported fabrics.
The think tank concluded that while reviving Nigeria’s textile industry remains an important national objective, achieving it requires structural reforms that improve competitiveness rather than blanket import prohibitions.
According to Yusuf, a sustainable turnaround will depend on lower production costs, modern manufacturing technology, affordable long-term financing, revitalised cotton production and a more conducive business environment capable of supporting both textile manufacturers and the wider value chains they serve.
(The Whistler)
