African Textile Industry Falters Despite AGOA
The global textile and garment market is valued at around US $400 billion, which is an impressive figure that attracts entrepreneurs from around the world to venture in the sphere. Unfortunately for the African sub-continent and for Nigeria in particular, the trade has not been very profitable.
At a seminar on the textile industry, it was pointed out that the market share of Africa in the global textile-related business, as estimated in June 2008, stands at a mere $200 million..
Obia Ofemtold the stakeholders that while a large number of African countries are taking endeavors to make the most of the opportunity thrown open by African Growth and Opportunity Act (AGOA) and other preferential trade concessions by EU, the Nigerian industry is still grappling to find a space in the international market.
The country has practically taken no initiatives towards taking this opportunity for expanding its textile industry. Even the availability of massive resources and cheap manpower could not help the country secure a place on the export charts.
If the situation continues in the present way and if measures are not taken to improve the market conditions, experts believe that by 2009, the entire chain of textile factories in the country would meet a disastrous fate.
On the global front, textile production is expected to grow by 25 percent by 2020 in which the Asian region is likely to be a major contributor. Abolition of the US quota regime since the start of 2005 has made the continent a hub for textile trade.
This is also because most of the Asian countries, instead of resorting to imports for their raw material supplies, opted for investing heavily in backward integration projects, just like their counterparts in developed countries. This gradually strengthened the textile base in countries like China, India and Bangladesh.
As a result, most of the textile trade is concentrated in Asia and is being monopolized by countries like China, India, Bangladesh, Vietnam and even Cambodia, who are rapidly capturing the value added textile market deserted by the developed nations due to high costs of production.