How can Nigeria’s textile industry be revived?
The first thing to direct our mind to is whether or not the raw materials are locally available. If they are there, then there is a beginning; if they are not, then the nation will only be digging itself into greater trouble. As far as the machinery for it goes, there is nothing we can do about it for now because it has to be brought in from outside. But having brought it in; has the nation been able to replicate the machinery? I say no on two counts. One, the educational system really is in the pit right now and you need the link between our tertiary institutions and the textile industry like it obtains in other climes.
Finally, there is the issue of funding, which none of us can run away from. The situation where we are still dealing with an MPR (Monetary Policy Rate) of 14.18 per cent for everything just can’t work. If we look at it as honestly as we can, I think we have been placed where the West wanted us to be. The argument now is, is it cheaper to borrow outside than to borrow in the country?
In Europe today, the interest rate is in single digits. From a face value, it looks promising, but it is detrimental in the sense that what you may be getting now from there, given that as far as our economy is concerned, it has not developed its own internal dynamics. The propping up of your currency is artificial and what you can be sure of is that the payback of such loans will keep such investments perpetually in debt.
It is even happening right now within our clime where you have companies from without supporting their companies within by sending them the equipment they require. You declare so much in naira but at the end of the day, you look at your books and discover that you are in the red. We do have the capacity to produce cotton, but we have a problem. The Americans tell you ‘government has no business in business’ and that production (and) agriculture should not be subsidise at the same time, but they subsidise their farmers. For example, if you look at the extension services, they are essentially run by government in the US.
We also need automation to be able to compete. To do this, you need power. Companies re-tooled to gas when it sold for two dollars per cubic foot. Now, what we are faced to fight is that government is saying that the market should determine what the price is, which to me does not make sense. The issue of power should also be addressed.
Dr Alofoje Onuigboje (Chairman, Manufacturers’ Association of Nigeria, Edo/Delta branch)