Tuesday, April 20, 2021

NACOTAN Commends CBN on Textile Forex Ban

The National Cotton Farmers Association of Nigeria (NACOTAN) has hailed the Central Bank of Nigeria (CBN) over its policy that restricts textile merchants from accessing foreign exchange (forex) through the apex bank to import textiles into the country.

The National Cotton Farmers Association of Nigeria (NACOTAN) has hailed the Central Bank of Nigeria (CBN) over its policy that restricts textile merchants from accessing foreign exchange (forex) through the apex bank to import textiles into the country.

Speaking on the policy’s impact, Anibe Achimugu, president of NACOTAN, noted that the ban has expanded the market, allowing for the absorption of farmers’ produce by improving the demand for Nigerian cotton.

Available data shows that in 2006, cotton production stood at 1.8 million tons and consumption at 1.7 million tons, whereas both fell to 920,000 metric tons and 805,000 metric tons respectively by 2019 when the restriction was instated.

NACOTAN, CBN to Revive Cotton Textile Sector

By 2020, a year after the CBN restricted forex for textile importation in a bid to revive the local fabric industry, production surged to 1.6 million metric tons, with consumption jumping to 989,000 metric tons.

Achimugu praised the policy as a game-changer for the industry and a welcome development for industry players, though he noted it may not be as happy a development for those smuggling textiles into the country.

According to Olorunfemi Michael, a cotton farmer in Ekiti State, the restriction on forex to textile importers has saved the industry from total collapse.

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“The main reason our textile industries have folded up was because of foreign exchange sale for importation of textile and garment materials. Thank God for the government that banned forex on textiles. This would encourage local production of cotton and textile materials,” he said.

Michael added that the federal government has really supported the cotton industry by providing soft loans to cotton farmers through the CBN’s Anchor Borrowers’ Programme, which has been a great help to producers.

 

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