Country: Nigeria

Shandong Ruyi Technology Group, a China-based multinational enterprise operating textile and apparel businesses, will invest US $ 600 million in the textile industry of Kano State, Nigeria. This was decided following the recent talks between the Kano State Investment Promotion Agency and the company officials.

Both the parties are expected to sign a Memorandum of Understanding (MoU) and make this deal official in the coming few months. “We are about to conclude talks with them (Shandong Ruyi Technology Group) and they are encouraged by the commitment of the State Governor’s administration to provide tax incentives as well as free land for this huge investment,” averred Alhaji Isyaku Umar Tofa, Chairman, Kano State Investment Promotion Agency.

The decision to provide free land to Shandong Ruyi is a part of the measures that the Nigerian Government is taking to attract Foreign Direct Investment (FDI) into the country. The deal between the textile manufacturer and the Government will not only boost the struggling Nigerian textile industry but also create employment opportunities for locals. The textile industry was once the backbone of the country’s economy.

Information on when the MoU signing will take place is yet to be announced by the Nigerian Government. Also, inputs on commissioning date of the project and other key details will be shared as and when received. Watch this space for more information.

A tripartite deal is expected to be inked among state garment factory of Cross River Government, Nigerian Police and Peace Corps of Nigeria for production of their uniforms. This was announced by State Commissioner for Information and Orientation, Rosemary Archibong.

The yet to be inaugurated garment factory is equipped with all the facilities to produce military and paramilitary uniforms. “We are happy that the Nigerian Police and the Peace Corps have indicated interest to sow their uniforms from the Cross River Garment Factory,’’ the Commissioner was quoted as saying.

Also Read – Local Nigerian textile firms to produce paramilitary uniforms

The factory has been set up in the area to create employment opportunities for the youth as well as generate revenue through the sewing of customized clothes, military and paramilitary uniforms, informed the Commissioner, who further said that the factory would also design and produce costumes for the annual Calabar Carnival.

India has set up a first-of-its-kind Apparel Training Centre in Nigeria, in partnership with the Nigerian Government, to support the textiles industry of the West African country, which is also an important trading partner for India.

The Apparel Training Centre has been established in Kaduna region of the country under the Cotton Technical Assistance Programme for Africa which is being implemented by the Indian Department of Commerce, Government of India under 2nd India Africa Forum Summit.

Also Read – Nigerian T&C sector’s struggle continues

M K Dwivedi, Joint Secretary – Department of Commerce said that the Centre is aimed to support and catalyse the initiative of the Government of Nigeria in realizing the objectives to rebuild the cotton & textile value chain and address the need for skilled workforce for domestic as well export-oriented apparel industry in the west African region.

The bilateral trade between the two countries stood at US $ 12.17 billion in 2015-16 as against US $ 16.36 billion in the previous fiscal. Nigeria is Africa’s leading oil producer nation, and its major export to India is crude oil.

According a leading news site, Punch, there has been an unprecedented flow of investments from multinational manufacturing corporations into various sectors of the Nigerian economy in the last decade. The multinational manufacturing companies have forayed into the Nigerian market do good business, and are affirming the potential of Nigeria as an exciting and largely unexploited market offering a huge opportunity for local and global enterprises to capitalize on.

However, the major concern is that ‘home-grown’ enterprises are not taking the advantage of opportunities in their home market. The local textile and garment manufacturing value chain, in particular, is not able to capitalize on the country’s potential due to lack of initiatives and funding from the Government.

Also Read – Local Nigerian textile firms to produce paramilitary uniforms

In the era of ’50s to ’80s, Nigeria had over 140 textile manufacturing factories, accounting for 25 per cent of the nation’s employees in the manufacturing sector and accounted for over 60 per cent of the textile industry capacity in West Africa. However, with Government’s apparent focus on the oil sector in the 1980s, the development of the textile industry gradually became stagnated. As such, an industry which once boasted an annual growth rate of 67 per cent in 1991, now has 25 textile mills operating, with all running at less than 40 per cent of installed capacity and employing just over 25,000 people.

In countries like India, Vietnam and the USA, textile manufacturing is making huge economic contributions and driving growth and development… Nigeria’s textile industry can once again become the booming sector of the country if restructuring of policies and schemes takes place to better fund and support the T&C sector.

China is keen on joining hands with the Western Nigerian state of Kwara to establish a textile industrial park in the state.

Chinese Ambassador to Nigeria Gu XiaoJie revealed this when Kwara’s Governor Dr Abdulfatah Ahmed led a joint delegation of the state and a Chinese company, Ming Bo Jin Sheng Star Co Ltd, to the Ambassador in Abuja last weekend.

According to the governor, apart from the fact that “Kwara State is a gateway to the north and the south, the state is not new in midwiving realistic Public Private Partnership as exemplified by the Shonga farms initiative, a new hotbed of Commercial Agriculture in Nigeria”.

The Governor had earlier told the Ambassador that given the current economic climate in Nigeria, the states need to take risks and go beyond the traditional methods if they expected to meet their electoral promises.

The governor, who had led a similar delegation to Dr Okechukwu Enyinna Enelamah, Minister of Industry, Trade and Investment, said, “When established, the park is expected to accommodate more than 40 textile industries with the state providing necessary enabling environment to jump start the park.”

On behalf of China, the Ambassador has promised the Kwara government that his country will treat the budding relationship in the textile industry with the Western Nigerian state “as a priority”.

“Textile is a traditional industry to China. It is common knowledge that Chinese textile products compete favourably with those of Germany and Italy. Our companies are also conscious of corporate social responsibility in African countries,” he said.

Once touted as the biggest employer in Nigeria, the textile sector of the country is witnessing job-cuts on a scale larger than ever. Over the years, there has been a steady dip in operations of the textiles companies in the country, leading to loss of jobs, dearth of skilled manpower, low capacity utilization and plunge in Government’s earning.

With the sector noting surge in imports of textile products, indigenous textile companies have closed down one after the other, costing Nigeria almost 800,000 jobs. According to former Nigerian Minister of state for Trade and Investment, Dr. Samuel Ortom, the Nigerian textile industry has suffered the most because of the increasing production cost, coupled with the high influx of cheap textile products from outside the country.

Also Read – Nigeria Plans to Resuscitate its Textile Industry

However, the country is making efforts to revive its textile sector, Minister of Industry, Trade, and Investment Okechukwo Enelama elaborated the Nigerian Government is aiming for public-private partnerships in all the sectors of the country, including garment sector, for the betterment of country’s economy.

Public-private Partnership or PPP, if implemented, may result in surge in demand for skilled workers in the labour-intensive garment industry of Nigeria. This will certainly help the country improve its employment rate which has dived drastically over the past few years.

Nigeria is planning to diversify its economy through the revival of country’s textile, apparel and footwear industry. The country is a major foreign currency earner in oil trade, and owing to decrease in international oil prices, it has now decided to broaden the economic horizons and the new administration too has favoured the revival of country’s textiles saying “it would play a major role in diversifying the economy’’.

FBN Capital, a local financial institution mentions, “Not only could country’s textiles result in revenue diversification and reduce pressure on the import bill, it could also help boost employment.

In a report released by National Union of Textile, Garment and Tailoring Workers of Nigeria (NUTGTWN), it was mentioned that the Nigerian textile industry performed poorly in the first half of 2014. “This is understandable considering the economy as a whole is strained due to the current macro headwinds,” affirms FBN Capital.

Also Read – Nigerian textile industry has potential to touch US $ 30 billion

Although there are around (only) 30 operational mills in the country while 80 are moribund, the decision to revive the Nigerian textile industry came after few developments that took place in the sector which prompted the Government to resuscitate country’s textiles and footwear industry.

Meanwhile, Aba (located in south-east Nigeria) has received global recognition with investors from Brazil showing interest in joining forces with the State Government to provide modern machineries aimed at boosting shoe production. Also, the Nigerian Investment Promotion Commission (NIPC) is willing to work closely with National Cotton, Textile and Garment (CTG) Policy Committee.