Nigeria targets local 300,000 tonnes of cotton output as local farmers get seedlings

Ivorian farmers carry cotton balls, on December 5, 2015 in the village of Kanawolo near the northern city of Korhogo. Ivory Coast cotton output rose 11 percent to a record 450,000 tonnes in the 2014/2015 tonnes compared with the previous season on the back of favourable weather and more farmers, an executive of the cotton ginners association said on May 27, 2015. / AFP PHOTO / Issouf SANOGO

Nigeria’s Central Bank, (CBN) vows to revive Nigeria’s moribund cotton, textiles and garments sector, the Central Bank of Nigeria (CBN) on Monday commenced the distribution of cotton seeds and other inputs to farmers in Katsina State.

To encourage local textile production, the apex bank also threatened to blacklist individuals, banks and companies involved in illegal textile importation.

Over 100,000 farmers collected the cotton seeds during the national flag-off of distribution of seeds/inputs to farmers for the 2019 planting season.

The CBN governor, Godwin Emefiele, who opened the distribution of the seeds said the exercise will help improve cotton production in the country from about 80,000 tonnes in 2018 to over 300,000 tonnes by 2020.

Mr Emefiele said the support of the bank to cotton production was part of the commitment to consolidate on the gains of the restriction of foreign exchange allocation on finished textiles and 42 other items in the country.

The CBN governor identified insufficient cotton seeds as one of the major challenges cotton farmers face in the country.

He said the bank sought to change the narrative on the cotton and textile industry in Nigeria through the distribution of high yielding cotton seeds to farmers.

The provision of seedlings to farmers cultivating over 200,000 hectares of farmland, along with extensive training on proper farming techniques, will boost the production of high-grade cotton lint from the current rate of less than one tonne to about four tonnes per hectare.

Also, he said, the move would reduce the amount spent by Nigeria on imported textiles and ready-made clothing estimated at about $4billion annually.

Mr Emefiele said the package included fertiliser, pesticides and knapsack sprayers, while the National Cotton Association of Nigeria will ensure compliance of its members with the stipulated terms for the support to be provided to farmers.

He said the choice of Katsina was based on the immense potential of the state as the leading cotton producer in Nigeria.

The CBN, he said, was committed to the revamp of the cotton and textiles industry, given its immense potential to Nigeria’s growth objectives as well as the bank’s efforts at creating jobs for a large number of Nigerians.

“In the 1970s and early 1980s were the glory days of the textile industry in Nigeria. Nigeria was home to Africa’s largest textile industry, with over 180 textile mills that employed over 450,000 people, representing about 25 per cent of the workforce in the manufacturing sector,” he said.

He recounted that the industry was supported by the production of cotton by 600,000 local farmers across 30 of Nigeria’s 36 states, with thousands of ginnery workers who processed the cotton from farmers, and a large number of distributors selling the finished clothes to consumers.

Mr Emefiele lamented that farmers and processors have had to deal with low-quality seeds, rising operating cost and weak sales in recent times.

He attributed this to the high energy cost of running factories, poor access to finance and smuggling of textile goods estimated to cost Nigeria over $2.2billion annually.

According to him, only 25 textile factories were currently operating in Nigeria with a workforce of fewer than 20,000 people.

A large proportion of clothing materials, he said, were now being imported from China and countries in Europe

He said the CBN was committed to addressing impediments to the growth of Nigeria’s agricultural and manufacturing sectors, as both sectors represent over 52 per cent of Nigeria’s gross domestic product (GDP).

“If we are able to drive productivity gains in these sectors, it will undoubtedly translate to a higher growth rate for the broader economy, result in increased rural incomes, and improvements in living standards for a majority of Nigerians,” he noted.
Threat to blacklist offenders

Mr Emefiele said the restriction of foreign exchange to 43 items was yielding the desired results, apart from driving interest by potential investors seeking to make investments to support improved production of textiles in Nigeria.

To curb smuggling, the CBN Governor said the bank was gathering data as well as investigating the accounts of individuals and corporates currently involved in smuggling and dumping textile materials into Nigeria.

He said individuals and companies involved in the illicit trade will be blacklisted, while all banks, their owners and top management involved in the illegal business would be barred from further conducting any banking business with the companies.

“With a population of over 190 million people, Nigeria clearly stands out as a virgin market that must be tapped. If we are determined in our drive to create jobs on a mass scale and reduce youth restiveness in Nigeria, the cotton, textiles and garments industry cannot be ignored,” Mr Emefiele added.

The Katsina State Governor, Aminu Masari, said the federal government’s initiative to promote cotton production under the Anchor Borrowers’ Programme of the CBN would support the textile industry in the country by encouraging local production.

His Kano State counterpart, Abdullahi Ganduje, who spoke on behalf of other governors in the North-West geopolitical zone, stressed the need for strong institutions to complement monetary and fiscal policies aimed at developing the Nigerian economy.

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