Crunch time for Nigeria’s textile sector

Manufacturers want government protection while traders want a strong currency in the face of rising Asian competition.

Cheap imported fabrics, power cuts and a rise in production costs are making it difficult to for Nigerian textile traders in the country’s northern city of Kano to compete.

“Many traders have closed shop,” Nura Maliya, local textile trader, told Al Jazeera.

“I am about to follow if things don’t improve soon. Supply lines are drying up as distributors insist you pay upfront before they deliver. It’s useless coming to the market. And I am afraid many lives are being destroyed.”

Although several factories have benefited from a $500m government intervention to revive the country’s textile industry, manufacturers say that monetary support alone will not fix the problem.

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“It’s not only the financing that we need,” said Saidu Dattijo Adahama of Adahama Textiles.

“The electricity supply is still below 20 per cent. Second, the business environment is not really sufficient enough for “made in Nigeria” products to compete with the Chinese imports. You cannot compete with the Chinese without protection.”

Since manufacturers cannot produce enough material, this means that textile traders down the line must rely on imports, much of which is smuggled.

At the same time, importers have tightened the supply chain, insisting on upfront payment since the local currency, the naira, was devalued.

In the face of stiff Asian competition, manufacturers are asking for government protection.

Traders, on the other hand, want a quick propping up of the local currency to make imports affordable.

Until such interventions happen, more traders and manufacturers will be at the mercy of Asian suppliers.

Source : Al Jazeera


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