CBN Bans Sale Of Forex To Importers Of Textiles

Citing the whopping $4 billion spent annually on importation of textile materials into the country, the Central Bank of Nigeria (CBN) yesterday added all forms of textile materials to the list of items that are not eligible for foreign exchange from the official windows with immediate effect.

The apex bank has, however, promised a financial intervention to textile manufacturers with the provision of funds at single digits rate, to refit, retool and upgrade their factories to enable them produce high quality textile materials for the local and export market.
Speaking yesterday at a meeting with stakeholders in the textile industry in Abuja, the CBN Governor, Mr. Godwin Emefiele, said the decision was critical towards reviving the moribund sector and creating jobs for Nigerians.

He warned all FX dealers in the country to desist from granting any importer of textile material access to foreign currency in the Nigerian foreign exchange market.
He said going forward, the apex bank would adopt a range of other strategies that will make it difficult for recalcitrant smugglers to operate banking business in Nigeria, adding that details of the proposed strategies would be unfolded in due course.

“Effective immediately, the CBN hereby places the access to FX for all forms of textile materials on the FX restriction list,” Emefiele announced.
However, he noted that the apex bank would initially support the importation of cotton lint for use in textile factories, with a caveat that such importers will begin to source all their cotton needs locally beginning from 2020.

Emefiele’s declaration for the textile industry was highly commended by stakeholders, particularly the Cotton, Textile and Garment (CTG) association, which predict better days following the CBN’s intervention programme.
The apex bank governor said the country currently spends over $4 billion annually on imported textiles and ready-made clothing.
He said the CBN would craft adequate measures to deal with the menace of smuggling, which had often threatened efforts towards self-sufficiency.
According to him, CBN will make life difficult for smugglers.

Emefiele also said that the CBN would support efforts to source high-yield cotton seedlings “to ensure the yields from our cotton farmers meet global benchmarks.”
He further pledged that as regards the provision of stable electricity, the CBN would support the creation of textile production centres in certain designated areas in the country where access to electricity shall be guaranteed.
He expressed the confidence that these measures would discourage smuggling, resuscitate the critical industry, and support stakeholders’ efforts at creating jobs for Nigerians.
The CBN governor said with a projected population of over 180 million, the needs of Nigeria’s domestic market are huge and varied, with immense prospects, not only for job creation, but also for growth of the domestic textile industries.

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