CPPE Warns 10m Nigerian Jobs at Risk Over Senate’s Call for Textile Import Ban
- CPPE cautions that banning textile fabric imports could harm Nigeria’s N10 trillion fashion and garment industry, affecting about 10 million livelihoods.
- The group says import restrictions may increase production costs, reduce consumer choices and disrupt businesses relying on textile materials.
- CPPE urges government to focus on competitiveness reforms, cotton production, cheaper financing and infrastructure improvements to revive the textile sector
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The Centre for the Promotion of Private Enterprise (CPPE) has expressed concern that the Senate’s move to ban the importation of textile fabric may put the Nigerian fashion and garment industry on the precipice and risk the livelihoods of approximately 10 million Nigerian citizens.
Source: Facebook
The CPPE, an economic policy advocacy group, argued in a statement on Sunday signed by its Chief Executive Officer, Muda Yusuf, that while it acknowledges the importance of regenerating the local textile sector, an outright ban might create other economic hardships.
The organisation clarified that the consumption of textile fabrics is a critical component for the success of a variety of sectors, most significantly for the fashion, tailoring and garment industries.
Also included in the category of textile fabric dependents is Nigeria’s furniture and interior decoration industries.
According to the CPPE, the Nigerian fashion, garment-making and tailoring sector is far larger than the textile manufacturing segment, which he stated, with a conservative estimate, would be worth N10trn, directly or indirectly providing means for livelihoods for millions.
CPPE said:
“The size of Nigeria’s fashion, garment-making and tailoring industry is substantially larger than the textile manufacturing segment. “Restricting textile imports would drive up production cost, limit choices of products available for the consumers, and put extra pressure on thousands of MSMEs involved in the fashion and garment-making processes.”
The CPPE noted that the furniture and interior design sector is valued at close to N7 trillion, and that any such restriction to fabric availability could negatively impact competitiveness and make operating costly for businesses.
The organisation reasoned that a significant portion of domestic value is added through design, tailoring, embellishment, merchandise, retail of garments and in that regard, government policy should be designed to protect the entire value chain.
A reason CPPE cited for the current decline of the local textile sector has to do with structural reasons, which include high cost of energy and finance, poor infrastructure, and logistics bottleneck.
The CPPE said:
“The factors driving the decline of the country’s textile sector are far beyond imports. High cost of energy and finance, inadequate infrastructure and logistics challenges, low quality technology, the menace of smuggling and inconsistent policies all play a huge role.”
“It is important to also mention that import of textile fabrics already attract duties and other taxes ranging between 35 and 45%. Current measures are already implemented but have failed to adequately enhance the competitiveness of the industry because the fundamental challenge is increased operational cost”.
The organisation further added that local manufacturers lack the scale, technical capability, product quality, and breadth of assortment needed by the nation’s growing fashion, garment, and interior decor sectors.
“A sudden ban on the import of these materials could result in shortages, increase costs for operators, and diminish their competitiveness, while affecting industries with much higher job creation potentials.”
Recommendations by CPPE
The CPPE advocated for a move from import ban to competitive reforms and value-chain development.
The centre advised the Nigerian Military, paramilitary organizations, schools and other institutions to use local textile materials for their uniforms.
Also suggested was the establishment of a textile competitiveness fund, supported by duties levied on imported textile fabrics, which would cater to technological upgrades and modernisation, particularly for manufacturers at accessible loan rates.
CPPE said:
"We propose that this fund be sustained by contributions from taxes raised from the import of textile-fabrics.
"Such funding will enable manufacturers to update their technologies, purchase new machinery and improve the overall quality and variety of their output."
“This effort, coupled with the revamping of cotton production, introduction of new crop species, mechanisation, improvement of extension services, enhanced security and guarantee for the purchase of cotton by textile mills would assist the textile sector.”
Additionally, CPPE urged strengthened border patrols to curb smuggling and efforts to lower the costs of energy, and improve infrastructure to reduce logistics costs for businesses in the sector.
CPPE concluded:
“The sustainable development and renewal of Nigeria’s textile industry should be an all-inclusive value-chain initiative driven by efficiency, productivity and competitiveness in terms of quality and price, not by exclusion of inputs which the domestic sector cannot sufficiently provide for the time being."
CPPE advises govt against new tax on sugar-sweetened beverages
Earlier, Legit.ng reported that the Centre for the Promotion of Private Enterprise (CPPE) has warned against plans to impose additional taxes on sugar-sweetened beverages (SSBs).
CPPE position comes amid calls by Corporate Accountability and Public Participation Africa (CAPPA) for increased taxation on sugary drinks to address public health concerns.
Source: Legit.ng
