CBN moves to stops bank services for textile smugglers
Textile smugglers are in for a tough times in Nigeria, as the Central Bank of Nigeria says it plans to make it difficult for them to operate banking business in the country.
This is part of strategies the apex bank hopes to deploy to discourage recalcitrant smugglers and also reposition the textile industry in Nigeria.
The CBN had recently announced an immediate restriction on access to foreign exchange to importers of textiles and other clothing materials in the country.
The decision, the bank said was taken to reposition the textile, cotton and garment industry for job creation and the development of the economy.
CBN Governor Mr. Godwin Emefiele, said this at the textile industry stakeholders meeting in Abuja.
In his remark at the meeting, the governor said “Effective immediately, the CBN hereby place the access to foreign exchange for all forms of textile materials on the foreign exchange restriction list.
“Accordingly, all foreign exchange dealers in Nigeria are to desist from granting any importer of textile material access to foreign exchange in the Nigerian Foreign exchange market. In addition, we shall adopt a range of other Strategies that will make it difficult for recalcitrant smugglers to operate banking business in Nigeria.”
He said, the apex bank took the tough measures to restore the sector back to its enviable place where it created jobs, boosted the economy and created wealth for the people.
In addition to the forex restriction, Emefiele said the apex bank would be providing financial support to textile manufacturers at a single digit interest rate.
This, he stated, would enable them to refit, retool and upgrade their factories in order to produce high quality textile materials for the local and export market.
As part of its Anchor Borrowers Programme, the CBN governor said the bank would support local growers of cotton to enable them to meet the needs of the textile industries in Nigeria.
In 2016, the CBN began discussions with the Kano and Kaduna State Governments to establish textile industrial areas in a bid to guarantee stable electricity in those industrial areas.
Emefiele said the bank would intensify efforts with these governments and others that may show keen interest to see to the quick actualisation of such programs.
He said, “We have decided to implement a few steps, which we believe will support the revival of the textile sectors.
“These steps include financial support to textile manufacturers with the provision of funds at single digits rate, to refit, retool and upgrade their factories in order to produce high quality textile materials for the local and export market
He added, “In the 1970s and early 1980s, Nigeria was home to Africa’s largest textile industry, with over 180 textile mills in operations, which employed close to over 450,000 people.
“The textile industry, at that time, was the largest employer of labour in Nigeria after the public sector, contributing over 25 percent of the workforce in the manufacturing sector.
“It’s no secret that the past 20 years have been very difficult for many textile firms. They have faced rising operating cost and weak sales due to high energy cost, smuggling of textile goods and poor access to finance.
“Many of them have had to lay off employees. Today, most of the factories mentioned have all stopped operations, as only 25 textile factories are operating today at below 20 per cent of their production capacities, and the workforce in Nigeria’s textile industry stands at less than 20,000 people.”