Nigeria’s Textile Industry Needs Structural Reforms, Not Bailouts—MAN

By Adedapo Adesanya

The Manufacturers Association of Nigeria (MAN) has urged the federal government to shift its focus from periodic bailout packages to comprehensive structural reforms, warning that financial interventions alone will not revive Nigeria’s struggling textile industry.

The association argued that years of intervention funds have failed to restore the industry’s competitiveness because the core challenges confronting manufacturers remain unresolved.

The Director-General of MAN, Mr Segun Ajayi-Kadir, said the textile sector’s long-term recovery depends on tackling persistent structural constraints, including unreliable electricity supply, inadequate local cotton production, smuggling, obsolete machinery and limited access to affordable long-term financing.

According to him, while intervention programmes such as the Central Bank of Nigeria’s Cotton, Textile and Garment (CTG) Policy and the N100 billion Real Sector Support Facility have provided temporary relief, they have not addressed the underlying factors driving high production costs and weakening the industry’s competitiveness.

“Key challenges that need attention include the high costs and inadequacies of energy supply, rampant smuggling and counterfeiting, a lack of quality raw cotton, outdated machinery and inefficient loan structures. While aid funds may help with immediate needs like fuel and debt repayments, they do not resolve the core issues of energy supply, cotton availability or market access,” Mr Ajayi-Kadir said.

He outlined a package of reforms that, according to him, would rebuild the textile value chain and improve manufacturers’ competitiveness.

Among the recommendations is the development of gas-powered Independent Power Plants (IPPs) in key textile hubs such as Kano, Kaduna, Aba and Ogun, as well as the creation of industrial parks with shared infrastructure, including Effluent Treatment Plants (ETPs), steam utilities and machinery maintenance workshops to lower production costs.

Mr Ajayi-Kadir also called for measures to revive domestic cotton production through the introduction of high-yield, pest-resistant seed varieties and contract farming arrangements between textile mills and farmers to ensure a reliable supply of raw materials while reducing dependence on imports and exposure to foreign exchange volatility.

On financing, he urged the government to restructure industry loans by extending repayment tenures to between 10 and 15 years and permitting duty-free importation of modern spinning, weaving and printing equipment to boost productivity.

To protect local manufacturers from unfair competition, he advocated stronger anti-smuggling measures, including digital cargo tracking systems, border scanners and stricter enforcement of Executive Order 003 to prioritise locally produced uniforms and other government procurement.

The MAN chief further stressed the need to revive technical and vocational institutions to train textile engineers, weavers and computer-aided design (CAD) specialists capable of supporting a modern manufacturing industry.

He added that improving compliance with international quality and environmental standards would better position Nigerian textile manufacturers to benefit from export opportunities under the African Continental Free Trade Area (AfCFTA) and the African Growth and Opportunity Act (AGOA).

Mr Ajayi-Kadir pointed to Bangladesh, Vietnam and India as examples of countries that transformed their textile industries through sustained structural reforms rather than repeated financial bailouts.

According to him, Bangladesh emerged as the world’s second-largest garment exporter by providing duty-free access to production inputs and establishing special economic zones, while Vietnam built a globally competitive textile industry through reliable electricity, foreign direct investment and trade agreements.

India, he noted, strengthened its sector with PM MITRA textile parks, Production-Linked Incentive (PLI) schemes and investments in cotton production.

He maintained that Nigeria should concentrate on building a sustainable textile ecosystem instead of relying on temporary financial support for struggling manufacturers.

“With stable energy, reliable local cotton supply and protected markets, Nigeria’s textile industry has the potential to create millions of jobs and generate substantial foreign exchange earnings, just as Bangladesh and Vietnam have done,” he said.