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Union raises alarm over N70bn textile fund
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The National Union of Textile, Garment and Tailoring Workers of Nigeria (NUTGTWN) says Nigeria does not have up to 300 moribund textile industries.
This is in response to reports by the Nigerian Export Import Bank’s (NEXIM) that more than 300 textile companies have shown interest to borrow from the Federal Government’s N70 billion textile rehabilitation fund.
According to Oladele Hunsu, first national deputy president of NUTGTWN, “With the record we have, all the moribund textile industries in Nigeria are not up to 300. So the organisation disbursing the N70 billion meant for moribund textile industries and cotton farmers should be careful so that they do not get into wrong hands.
“We had earlier raised alarm over this issue when we heard that some businessmen were applying for the loan because they see it as having part of the national cake.”
The intervention loan intended to change the face of the prostrate textile sector was meant as soft loan to stakeholders to boost their production capacity.
Out of the N70 billion, N20 billion is earmarked for cotton farmers, while N50 billion is for textile manufacturers.
The textile industry had seriously been threatened in the past years, by inadequate funding, invasion of local markets with foreign textiles and cotton products, high cost of production occasioned by epileptic power supply and high cost of low pour fuel oil (LPFO) that textile factories use for steam generation.
The problems of the industry go beyond money, when the basic infrastructure such as regular power supply are not there to boost production the money may still be invested in the sector and be spent on infrastructure which should have been provided by government.
Hunsu said the loss of jobs was highest last year when United Textile Mill in Kaduna closed down with about 5000 people sent to the labour market.
Atlantic Textile Mill in Lagos also closed down with about 1000 people out of job while other existing factories have been cutting down jobs due to inability to cope with high cost of production and inability to compete in the market as most of the factories have cut down their workforce from 500 to 250 while some reduced from about 800 to 400 and when these are put together about 10,000 people are so far out of job this year.”
The sector which use to have over 100 factories now have about 50 existing factories in the country with less than five really operating at a reasonable condition but still struggling to survive the harsh production environment as the capacity utilization now falls bellow 20 percent.
The sector in the past was the largest employer of labour after government as it employed over one million Nigerians and secured captive market of 250,000 tons of raw cotton for growers and generated over N1 billion in revenue to government.
It was also a major consumer of high percentage of local raw materials such as cotton and polyester.
“The problem of inconsistency in government policies is one basic issue that needs to be resolved, especially policies concerning the textile industry. The problem of the industry has gone beyond money,” the union leader said.
Stakeholders had in the past suggested that government should consolidate its commendable policy of ban by setting up a task force consisting of stakeholders to assist customs in ensuring effective implementation. . Address urgently and on a sustainable basis the energy problem. . Take immediate step to halt the unabated rise in diesel prices, as most industries are generator driven.
This is in response to reports by the Nigerian Export Import Bank’s (NEXIM) that more than 300 textile companies have shown interest to borrow from the Federal Government’s N70 billion textile rehabilitation fund.
According to Oladele Hunsu, first national deputy president of NUTGTWN, “With the record we have, all the moribund textile industries in Nigeria are not up to 300. So the organisation disbursing the N70 billion meant for moribund textile industries and cotton farmers should be careful so that they do not get into wrong hands.
“We had earlier raised alarm over this issue when we heard that some businessmen were applying for the loan because they see it as having part of the national cake.”
The intervention loan intended to change the face of the prostrate textile sector was meant as soft loan to stakeholders to boost their production capacity.
Out of the N70 billion, N20 billion is earmarked for cotton farmers, while N50 billion is for textile manufacturers.
The textile industry had seriously been threatened in the past years, by inadequate funding, invasion of local markets with foreign textiles and cotton products, high cost of production occasioned by epileptic power supply and high cost of low pour fuel oil (LPFO) that textile factories use for steam generation.
The problems of the industry go beyond money, when the basic infrastructure such as regular power supply are not there to boost production the money may still be invested in the sector and be spent on infrastructure which should have been provided by government.
Hunsu said the loss of jobs was highest last year when United Textile Mill in Kaduna closed down with about 5000 people sent to the labour market.
Atlantic Textile Mill in Lagos also closed down with about 1000 people out of job while other existing factories have been cutting down jobs due to inability to cope with high cost of production and inability to compete in the market as most of the factories have cut down their workforce from 500 to 250 while some reduced from about 800 to 400 and when these are put together about 10,000 people are so far out of job this year.”
The sector which use to have over 100 factories now have about 50 existing factories in the country with less than five really operating at a reasonable condition but still struggling to survive the harsh production environment as the capacity utilization now falls bellow 20 percent.
The sector in the past was the largest employer of labour after government as it employed over one million Nigerians and secured captive market of 250,000 tons of raw cotton for growers and generated over N1 billion in revenue to government.
It was also a major consumer of high percentage of local raw materials such as cotton and polyester.
“The problem of inconsistency in government policies is one basic issue that needs to be resolved, especially policies concerning the textile industry. The problem of the industry has gone beyond money,” the union leader said.
Stakeholders had in the past suggested that government should consolidate its commendable policy of ban by setting up a task force consisting of stakeholders to assist customs in ensuring effective implementation. . Address urgently and on a sustainable basis the energy problem. . Take immediate step to halt the unabated rise in diesel prices, as most industries are generator driven.
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