Jogja Jogja

When the Bill Clinton administration in the United States of America was pressured by African countries for trade opportunities of African products in the US market, he initiated the Africa Growth and Opportunity Act which was passed by the US Congress into law giving African businesses access to the US market. The act which became very popular in African business and trade circles, is called AGOA.

Textile machine
When AGOA came into effect, many African countries saw a window of foreign exchange earning in the textile and garment section of the act and keyed into it. Many of such African countries now earn millions of dollars from garment and textile exports to the US annually.

Studies by the United Nations Industrial Development Organisation (UNIDO), indicated that the five best performing countries under AGOA exports in 2002 in Africa were: Lesotho with AGOA exports of US$ 322m; Mauritius - US$ 252m; South Africa - US$ 188m; Kenya - US$ 121; and Madagascar - US$ 90.

The UNIDO study of textile industries in Africa, Nigeria inclusive, further showed that AGOA has been the key driver for the development of garment industries in Africa in recent years through DPI. But the report stated that as at the time other African countries were reaping the benefit, Nigeria had not passed the AGOA Legislation and has not benefitted from the opportunity the act provided. More importantly, the report said that the textile industry was on the decline. The total export market size in the opportunity provided by AGOA is estimated at US$31 bn/year for which the country has so far failed to tap into.

Nigeria’s textile industry, according to studies, is almost a mono-product industry which can easily be attacked with the import of one product only (African prints). No participation in world production even after AGOA. There is practically no garment industry in the country as is the case in Egypt, South Africa and Kenya. As a result, there is no demand for fabrics from Nigerian textile industry other than African prints.

Findings from other African countries show that the garment industry in the AGOA countries has been mainly the creation of Asian foreign investors. Foreign investors by Asians brought not only the capital, but provided the training, the know-how and the knowledge of the marketing mechanism to the countries.

Nigerian textile industry in the immediate past, had so much capital from Asians until in the early 90s when the sector witnessed capital flight with a good number of these Asians divesting and exporting back their machinery and equipment to India and other African countries. Nigeria at the moment needs to attract a few foreign investors which would have a pull effect for other investors to follow.

Sadly, the textile sector of the Nigerian economy that would have championed the move to earn foreign exchange for the country and possibly attract more direct foreign investment to the sector, is virtually dead and cannot in the immediate future, rise to the challenge of integrating a garment industry that could compete for space in the US market.

A report by the Nigerian Textile Workers Union at the recently concluded delegates’ meeting in Kaduna painted a frightening picture of the position of the sector. The report states: “The parlous state of the Nigerian Textile industry is once again graphically reflected in the reports from the zones since the last Delegates’ Conference in 2004. At the peak of its production in the 80s, the textile industry provided about 500,000 direct jobs with well over 250 functional factories at the same time. Union membership was over 120,000 with great potential for more membership.

“Operational zones of the union were then 16 with area offices across the country. Meanwhile, following the crises of the 80s, the union was adjusted to eight zones with a steady membership of between 60,000 and 70,000. The current crisis which began more emphatically in 1997 when Nigeria became signatory to the World Trade Organisation (WTO) and fully liberalised textile trade under General Sani Abacha, had devastated the sector.
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