President Jonathan And The Textile Industry In Nigeria

Israel Mbachu,

“The bailout fund for the textile industry is N100 billion out of which the government has disbursed N30 billion to date through the Bank of Industry (BOI)”. – Israel Mbachu

No, the original Textile Revival Fund was a proposed N70 billion by the Obasanjo administration in 2006 which was not disbursed. The Yar’Adua government did nothing about it. Indeed, the Minister of Commerce Achike Udenwa and the Minister of State, Remi Babalola came before the Senate in July last year to scandalously claim that the reason the money was not disbursed was because no provision was actually made for it in the 2009 budget! In other words, for three years between the time of the promise and when the ministers appeared before the Senate, no provision was made for this fund. It was at that same hearing that Udenwa mentioned government’s plan for a N100 billion fund, but what was not clear at the time was whether this was an additional fund or one to replace the earlier promised N70 billion fund. Udenwa said the money was to be a loan from the Bank of Industry. We heard nothing again about this until now that Mr President through his Facebook commentary tells us that some N30 billion is being disbursed (not that it has been disbursed, as you claim). We do not know whether this is part of the N70 billion promised by Obasanbjo or the N100 billion promised by the Yar’Adua government. The only thing we know is what the President is telling us, which is that N30 billion is being disbursed now. He didn’t mention this as part of any N70 billion or N100 billion fund. Thus, until there is clarification, we can only go by what he said on Facebook. All the questions I raised here in my write-up are directly related to the N30 billion and the President’s claim that it is a bailout fund.

“Mr. Emetulu does not know that the textile industry in the 1980s before their gradual collapse owing to counterfeiting employed over 800,000 Nigerians against about 25,000 employed today. Imagine if this bailout fund will revive the industry that it will once more employ 700,000 Nigerians. What great impact this will have on our economy!” – Israel Mbachu

What gives you the impression that I do not know that the textile industry used to employ more people than today? What makes you think a N30 billion fund will suddenly produce 700, 000 textile jobs for Nigerians?

Dear Mr Israel Mbachu,

Unlike you, I cannot be certain whether or not Mr President would find my piece guffaw-inducing; but if he does, it will not detract from the facts as they presently stand. Yeah, that is what I want us to deal with here – facts. Now, did you say “there is a N200 billion agricultural bailout revival fund being executed presently by the government”? I’m afraid the facts do not bear you out.

The money you refer to is not a bailout fund. It is the N200 billion Commercial Agricultural Credit Scheme (CACS) proposed, not by Goodluck Jonathan, but by the Yar’Adua government early last year. The scheme as originally proposed is a bond to be floated by the Debt Management Office and to be administered by the United Bank for Africa and the First Bank of Nigeria with technical assistance from Central Bank.

Also, the scheme is not of wide industry benefit, because only corporate and large-scale integrated commercial farming enterprises with asset of no less than N350 million (excluding land) and capacity to grow such asset to half a billion naira in three years are to benefit. For non-integrated commercial farming enterprises to qualify they will have to have asset of no less than N200 million (excluding land).

Up till this very moment, controversy has bedevilled the execution of the programme as the money is yet to be disbursed, ostensibly due to disagreement between various agencies charged with the implementation. In fact, at one point, the Nigerian Tribune published that the money was missing and no one inside government came out to deny this!

In the meantime, precisely in late June this year, perhaps following criticism that the original scheme was only to benefit big farming corporations, NAPEP announced the unveiling of a N200 billion “MESO Credit Scheme” supposedly for medium, small-scale and rural farmers. Reading the fine print though, it became clear that there is no such fund available. What is being promised is a N1.5 billion “seed money” from the Federal Government with the rest to be raised from other sources. Needless to say, the last that was heard of this was that late June announcement by Dr Magnus Kpakol, the NAPEP Coordinator.

So, Mr Mbachu, if you have other facts different from what I have stated here, I encourage you to share them. It is not enough for you to declare me misguided without providing something to back such a claim. As you can see, I have no problem deferring to better information. That is why I began by admitting that the President and his advisers may have better information than the rest of us, due to their easy access to such information. I have heard nothing contrary to the facts I’ve stated here from the President or his advisers. But you have come here to suggest my comment is laughable based on information that isn’t exactly true. I mean, the whole idea of discussing this in the first place is because the President is talking of the N30 billion already being disbursed by the Bank of Industry to end users. If you have information that the N200 billion is being executed as you claim, let’s have the evidence.

The writer is right in a way. The textile industry in Nigeria is truly owned by the Indians. What type of bail-out plan do the Asians need. The textile industry in the north, is equally owned by all the core northern states. Rather than have them use their resources to revamp the cloth industry for the TALAKAWAS to send on suicide missions, they are busy talking abouth zoning our thoughts away from the oil wells. Workers in that sector up north, are being owed over 77m Naira since their retrenchment over 3yrs ago, Some have died waiting for their benefits. So, why must the resources of the Niger Delta, be used to save the neck of governors and senators who prefer the wobbly breast of the pharoahs in Egypt to the beautiful hips of my sisters at Akwete water-side in Abia state? What a country.

“You said that you are terribly tired of all these pen attacks on anything govt.” Next, you acknowledged that our govt. have not been doing well! So what is your problem with people’s frustration and their pen attacks on govt when you just confirmed that the govt failed the people not just once but on numerous occasions. Have you heard of this saying!.. Fool me once, shame on you. Fool me twice shame on me. Please be advised the masses have lost faith and have came to this sad reality / conclusion that putting their confidence in the Nigerian govt as it is constituted now, is like running on a fractured foot; very painful indeed. The govt collects all the crude oil proceeds (thanks to the Niger deltan) for the people and do absolutely nothing with it. Take a look at our infrastructures and you be the judge. In this country, the masses generate every thing for themselves and you have the guts to say that people just sit and wait for govt for every thing. I think that the masses should go into self government, Wilfred.

Drudge or whatever you call yourself, you must be very naive to imagine the president will just throw money at problems without adequate planning. You are sounding like the Republicans in USA while critizing Obama's economic policies.

There is no doubt that this writer is idle. He was on the president's page on facebook, and because he was idle, he decided to read the president's reply to a fellow Nigerian's comment. Just because he visited the page with malicious intentions, he did not care to leave his question or comment so that the president will answer like he did to the other fellow. He ran to write this piece with the belief that he'll score a point against the president. Well he actually scored the point he intended, afterall some people are already insulting the president. Let me ask him some questions. Is the textile industry not part of the nation's economic ventures? If the bailouts finally pays off and you or your friends are employed, won't you be happy? Like someone noted, money have also been appropriated for the agricultural sector and we hope too that things work out well with effective monitoring. I'm an ordinary citizen like you (that is if you are) and I'm terribly tired of all these pen attacks on anything government. They are not helping matters. We know that our governments have not been doing well but picking on just anything that governments do is not going to solve any problem. Even if the best brains in this country are elected to rule us, people will still derail them cos we want magicians and not leaders. Lets refrain from casting Jonathan in Bad light and see what we can do on our own to make our immediate communities to move forward. We're so soaked in the belief that we must wait for government to bring initiatives before we can make our lives better.

Oga GEJ,
the USA is a living example that protectionism pays. Just take a trip back to the Presidency of Roosevelt and you will see the great opportunities before you today

Its obvious that the only solution Nigeria have for all problems is the problem itself, throwing monies at problems. For example, His excellency failed to tell us the main reason the sector collapse, but was quick to tell us that they have appropriate billions of Naira as bail out fund. Is the money to buy generators for the industry, or provision of credit facilities for the marketers? Or after giving the militants in the Niger Delta monthly allocation, its another way of placating the North? This isn't change, it more of the same...... Bill Clinton.

Americans bailed out their banks and auto industries. Who makes such a stupid statement? Is American economy, their infrastructures, their transplant and/or accountability system of government all at par with the Nigerian system, such that whatever cures and/or applies to the American economy, also applies to the Nigerian economy? My goodness! Before you hurt yourself or someone else, the American economy is in a different league. Stop this copy cat mentality. What we need is a 24 hours electricity and every thing will fall in place. Investment in agriculture is good. At least we can feed ourselves. Remember the hierarchy of needs: food and shelter first.

I am certain Mr. President will read this write-up and laugh. This writer does not know that there is a N200 billion agricultural bailout revival fund being executed presently by the government. The bailout fund for the textile industry is N100 billion out of which the government has disbursed N30 billion to date through the Bank of Industry (BOI).

My dilemma though is Mr. President's response that funding is the main problem of the textile industry and that he consulted with MAN, Nigeria Labour Congress, and the Textile Workers Union. I believe the appropriate body to consult is the Nigerian Textile Manufacturers Association (NTMA).

They would tell Mr. President that the No. 1 problem of the textile industry in Nigeria is that the designs of the local companies are counterfeited in China and India and smuggled into the country. They are then sold at cheaper prices in our markets at Dugbe, Ibadan; Main Market, Onitsha; Balogun Market, Lagos, etc, undermining the sale of local textile designs. The counterfeiters are Nigerians collaborating with Chinese and Indian partners.

Today, 80% of the African textile prints sold in Nigeria and in most markets in other African countries, particularly Ghana, Uganda, Kenya, are counterfeited designs of the local companies. Even Uganda recently earmarked US$250 million bailout revival fund for their textile industry.

Mr. Emetulu does not know that the textile industry in the 1980s before their gradual collapse owing to counterfeiting employed over 800,000 Nigerians against about 25,000 employed today. Imagine if this bailout fund will revive the industry that it will once more employ 700,000 Nigerians. What great impact this will have on our economy!

Let the government address the matter of counterfeiting. I am certain they are not short of professional advice on how to combat the counterfeiters and their collaborators.

This Jonathan does not strike me as an intelligent person. Anybody can do the job our leaders are doing today: giving out money. Did they find out why the textiles companies failed before attempting to resuscitate them? These companies must have failed for different reasons. Unless our leaders start by thinking, planning, vetting before taking actions that involves money, our country will continue on this endless vicious circle.

@ AbdulWahab, i agree totally with you. Sort out the powr problem, then all these other things will work out. Of what use is 30billion naira for textiles if power is not available thereby making our goods non competitive?
The inputs of production MUST be available and steady.

Why should Nigeria have to ban anything for the industry to grow, as the president said, we need to create a condusive and competitive environment for our industries to grow. The more we use local content/improved power, the cheaper production will beocme and hence be able to compete with the imported products, then again there is incentive for the textile industry to compete with the imported goods textiles as the textile industry in Nigeria is largely controlled by foreigners (chinese and Indians)

Anyone taking Jonathan words serious is diluded. Jo must make political statement that cannot be backed by action. Have you not heard him stated EFCC will be cleansed of corruption. What as he doing the to demon of corruption (Waziri). Dont worry many of us we kno Jo after 2011 election

How can we enforce ban on Chinese textiles when it is included in our world trade agreement???, una no get work , make available good funds and power so this people can effectively compete with others that's all.

Well said. All we are ever told is of billions released for this and that with no break down of the technicalities.
The key is to reinvigorate cotton farming, improve transport, irrigation and electricity in the area and the industry will naturally start up again. and most importantly put a tariff on imported goods and cut red tape for manufacturers

God bless you Kennedy!

On the same Facebook page of yesterday I made the same case for agriculture with the President. After Awolowo Farm Settlement in the South West of may years ago, is there any state government having anything tangible thing to do with agriculture other than to share fertilizers, tractors and loans which end up invariably in wrong hands in most cases!

Agriculture is one way to address UNEMPLOYMENT, arrest social crimes and also to feed the nation adequately with left over if well preserved for EXPORT.

We gave Malaysia oil palm seed in the 1960s...where are we today? It is a shame!

Thanks Kennedy.

JMO Ekundayo
Malaysia
Email: jmo.ekundayo@gmail.com

When it is even the chinese people who killed the textile industry. They are still the ones running it. Now they will get free loans to do business in Nigeria and rake all their income back to china and leave Nigeria with nothing including employment. I dont think we have visionary government. These foreign suckers will only employ Nigerians and use them as slaves. Our government must learn to protect our businesses, create enabling environment for Nigerians to exercise their ingenuity, and we will see Nigeria moving fast to economic glory. I have been to Aba many times, I see the ingenuity of Aba fashion designers, shoe makers, furniture makers etc whose work Nigeria will earn a lot through exports. These people need government input. These are the businesses that will drive Nigeria's economy but first we need power, electricity!

@ Kennedy Emetulu, "...saying government has no business being in business, but ended up telling us you gave them 30 billion naira as bail out funds!"

I do not see how this is a contradiction. Weren't American banks bailed out with billions of dollars?
So what is wrong with bailing out the long-suffering Textile industry as a short term aspect within a comprehensive plan in rejuvenating that whole sector?

I take your point on Agriculture. That is the easiest and most assured way of reaching millions of Nigerians and positively affecting their life and livelihood.

I am not holding my breath with regards to any substantial progress being made by this 'dyed in the wool' PDP APOLOGIST. Aluta Continua!

It is simply my assessment.

Government is an act of continuity.The bailout to the textile industry if I understand it correctly predates the Goodluck Jonathan administration.It was initially concieved by Obasanjo but for whatever reason,the idea was dumped.Not even the Yaradua led administration could have sufficient courage to address it.The alternative investment in agriculture the writer suggested takes time to develop and have return on investment as it is design to grow the economy on the long run. However, the bailout to the textile and other related industries is targeted at reflating the economy within a short term period.The relative advantage is puttting Nigerians back to work and in the process empowering them economically to purchase agricutural produce by the time the government invest in that sector massively. This is similar to what the American government did with their auto industries. Imagine how many youths particularly in the North would be off the streets with this bailout when these textile industries becomes fully operational by accessing this loan.
Government in my understanding works with limited funds and such funds must be applied in areas of priority. I think the president took the right decision.

I dare the president to prove that he is not grand standing by challenging his corrupt certificate forging and recently awarded national honor friend who heads the Customs Service to enforce the ban on cheap Chinese textiles imports. More than anything else, this is the monster that is devouring our local textile plants faster than anything else. There are entire factories in China dedicated to the production fo textiles destined for Nigeria without giving a damn about the fact that the product is banned in nigeria. If the Chinese want to sell in the huge Nigerian market, they should set up the plants in Nigeria. Anything outside of this is self-deceit. The Chinese cannot be employing their citizens to produce cheap textiles for import to Nigeria while driving our plants out of business. Granted, our plants need to improve in effiency.

I dare the president to prove that he is not grand standing by challenging his corrupt certificate forging and recently awarded national honor friend who heads the Customs Service to enforce the ban on cheap Chinese textiles imports. More than anything else, this is the monster that is devouring our local textile plants faster than anything else. There are entire factories in China dedicated to the production fo textiles destined for Nigeria without giving a damn about the fact that the product is banned in nigeria. If the Chinese want to sell in the huge Nigerian market, they should set up the plants in Nigeria. Anything outside of this is self-deceit. The Chinese cannot be employing their citizens to produce cheap textiles for import to Nigeria while driving our plants out of business. Granted, our plants need to improve in effiency.

If president Goodluck Jonathan is honest about reviving our textiles industry, he should tell his man Friday who heads the Customs service to enforce the ban on cheap chinese imports. if the Chinese want to sell in our huge market, they should set up the factories inside the country and employ Nigerians. Period.