Banks and other foreign exchange dealers in Nigeria are prohibited from selling forex to any person seeking to import textiles and other clothing into the country. Instead the Central Bank of Nigeria would provide financial support at single digit interest rates to the textile sector to enable operators rejuvenate their capacities through refitting, retooling and upgrading of their factories. These initiatives are expected to help the textile manufacturing sector bounce back to service the domestic market and the export sector.
The measure is intended to reposition the textile, cotton and garment industry for job creation and development of the economy and restore the sector to its hitherto enviable position in the national economy and also save money spent on importing textiles and clothing. Other areas of expected support from CBN include the provision of high yield cotton seedlings and the development of textile industrial areas where stable electricity supply would be guaranteed.
The Nigerian textile industry in the 1970s and 1980s was the third largest in Africa. By 1987 the country had 37 textile firms operating 7,16,000 spindles and 17,541 looms. Between 1985 and 1991 it recorded an annual average growth rate of 67 per cent and was employing about 25 per cent of the work force in the country’s entire industrial sector.