Textile manufacturers in Nigeria seek review of incentives to attract investments

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In order to promote growth of local manufacturers and a sustainable economy, the Nigerian Textile Manufacturers Association (NTMA) has urged the Nigerian Government to review some of its incentives to foreign investors.

Hamma Kwajaffa, the Director-General of NTMA said that some of the incentives set to attract Foreign Direct Investments (FDIs) to the country were detrimental and posed a threat to the survival of many local textile manufacturers.

According to Kwajaffa, “we decry the proposal that operators, who invest a minimum of $10 million in local Cotton, and Textile Garment Industry and employ 500 direct Nigerian staff, can import fabrics worth 50 percent of their operation levy free for a period of five years”.

He said “we textile manufacturers in the country have set a target to boost our production and also a 100 percent off-take of locally produced raw cotton. What happens to our own cotton produce? Will the farmers wait for you for these five years? With the proposed policy, that means you are discouraging cotton production and invariably the value addition to the textile industry”.

Kwajaffa said “after all, there are investors in the country with more than one billion dollars investment such as Sunflag Ltd., UNTL Ltd., which have above that in the textile industry. The investors that are being encouraged to come in with finished fabrics would kill local manufacturers and hinder our quest to attain global competitiveness.

He added that “if new investors are allowed to import fabrics duty free and VAT free, it will infringe on the planned 1.7 billion metres of finished fabric sector target programme for the textile industry”.

The Director General also revealed that fabric importation by would-be investors would also collapse cotton farming, hence all diversification in the sector would be impossible.

Kwajaffa urged the government to pursue its drive for foreign investment in a way that would not hinder local investors’ competitiveness, employment, wealth creation and industrial growth.


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