• Thursday, July 25, 2024
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BusinessDay

Microfinance banks want development policy for textile industry

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The National Association of Microfinance Banks (NAMB) has urged the Federal Government to formulate a policy that would enhance the development and sustained growth of the nation’s textile industry.

Valentine Whensu, NAMB president, told the News Agency of Nigeria in Lagos that such a policy would curb large scale textile dumping and smuggling in Nigeria, saying the increasing activities of textile smugglers were scaring numerous investors and mortgaging national effort toward expanding employment opportunities.

The NAMB boss also urged the Federal Government to overhaul the extant policies that would reinvigorate the efforts of microfinance banks in poverty alleviation nationwide. “Although the sub-sector has received N100 billion from the Bank of Industry (BoI) through the Growth Enhancement Support (GES) scheme on cotton, textile and garments funds, those who took the loans got their fingers burnt. `It was discovered, shortly after accessing the loan that over 80 percent of the market has been taken over by cheap imports from Asian countries,” Whensu said.

According to him, the influx of foreign textiles into the country made locally produced textiles less competitive, as they are often costlier than the imported or smuggled ones. He also said the current problem in the nation’s textile industry was that other companies yet to access the loan chose to avoid it. “Most of them became afraid that they may not be able to repay the loan considering the prevailing unfriendly operating environment particularly with regards to lack of infrastructure.` `The country could boast of about 175 textile factories in the 1980s, but the number shrank to 124 in 1994 and 70 in 2002, following the lifting of the ban on the importation of foreign fabrics in 1997. “I urge the government to formulate and embark on protectionist policies, who knows, it could be a major solution to benchmark of crude oil threats we are facing,” he said.