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PP RUEHMA RUEHPA
DE RUEHUJA #2059/01 2670656
ZNR UUUUU ZZH
P 240656Z SEP 07
FM AMEMBASSY ABUJA
TO RUEHC/SECSTATE WASHDC PRIORITY 1022
INFO RUEHOS/AMCONSUL LAGOS PRIORITY 7944
RUEHZK/ECOWAS COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC

UNCLAS SECTION 01 OF 02 ABUJA 002059 
 
SIPDIS 
 
SIPDIS 
 
DEPARTMENT PASS TO USTR (AGAMA) 
 
E.O. 12598: N/A 
TAGS: ETRD ECON KTEX ELAB ENRG EPET NI
SUBJECT: NIGERIA: TEXTILE AND APPAREL PRODUCTION 2006 DATA 
 
REF: STATE 114799 
 
ABUJA 00002059  001.2 OF 002 
 
 
¶1.  The following are statistical data for 2006 on textile and 
apparel production in Nigeria.  At this time, 2007 data are 
unavailable: 
 
-- Total industrial production - $59.5 billion, comprising crude 
petroleum ($55 billion), mining and quarrying ($181 million), and 
manufacturing ($4.3 billion). 
 
-- Total textile and apparel production - not available. 
 
-- Textile and apparel share of host country imports - $129 million, 
representing 0.6 percent of imports. 
 
-- Textile and apparel share of host country exports - $19.2 
million, representing nearly zero percent of exports. 
 
-- Export in textiles and apparel to the United States - $94,000. 
 
-- Total manufacturing employment - 1.9 million. 
 
-- Total textile and total apparel employment - 35,500. 
. 
Textile Industry Not Competitive 
-------------------------------- 
. 
¶2.  Nigerian textile companies cannot compete favorably with Asian 
textiles due to the high cost of production in Nigeria, from poor 
infrastructure and unreliable electricity supply.  Textile companies 
complain about the loss of orders as a result of competition from 
Chinese textile manufacturers and that some textile factories owned 
by both Nigerians and Asians have shut down as a result.  According 
to press reports, 33 Nigerian textile firms have closed in the past 
three years, causing the lost of 500,000 jobs. 
 
¶3.  Textile manufacturing is produced locally with an emphasis on 
African prints, which are sold locally and also exported to other 
West African countries. The manufacturers are not aware of U.S. or 
E.U restrictions on certain exports of textiles and apparel from 
China affecting export prospects for Nigerian manufacturers. 
 
¶4.  In a bid to remain competitive, employers have reduced wages and 
in some cases reduced their work force.  Minimum wage regulations 
are usually not complied with, and apply mostly to federal 
government workers only.  Workers at the lower tiers of government 
negotiate their wages with their respective governments, while wages 
in the private sector are set through negotiations with the unions. 
We are not aware of any GON policy or program that is in place to 
deal with dislocated workers in the sector resulting from increased 
competition. 
. 
Government Taking Action to Assist Industry 
------------------------------------------- 
. 
¶5.  The Government of Nigeria (GON) placed a ban on certain textile 
imports including African prints to protect the Nigerian textile 
industry.  Despite the ban, textiles are regularly smuggled into 
Nigeria.  The GON established a textile intervention fund to 
resuscitate the ailing sector.  Textile companies are investing in 
new machinery, while working to take advantage of Category 9 
certification to export to the U.S. 
 
¶6.  The GON has committed billions of dollars to constructing 
eighteen new power plants to improve electricity supply.  At this 
time, the domestic gas supply and infrastructure to support the 
power plants are not in place.  Industry experts have told us that 
there is not enough natural gas to supply the domestic market and 
continue exportation.  The new government is aware of the problem 
and discussions are ongoing to solve it.  The GON has announced 
plans to build railways, roads and other infrastructure to cut costs 
for manufacturers and increase competitiveness. 
 
¶7.  The GON tried unsuccessfully to raise funds with which to aid 
the industry through Eurobonds, but failed to meet the requirements. 
 Subsequently, United Bank of Africa has announced that it plans to 
raise 70 billion on behalf of the GON.  The bank will provide the 
funds raised to the GON which will lend to textile manufacturers at 
low interest rates. 
. 
Future Prospects 
---------------- 
. 
¶8.  Textile experts comment that if infrastructure is improved, 
interest rates low, and property rights streamlined, Nigeria's 
textile industry will be competitive.  One issue that hinders the 
industry is the lack of an apparel base, because of the focus on 
customized clothes.  As a result, tailors are not organized, trained 
or encouraged to produce mass apparel.  If these tailors received 
 
ABUJA 00002059  002.2 OF 002 
 
 
training, it is possible that Nigeria could became a significant 
apparel exporter.  In late 2006, the Nigerian Export Promotion 
Council (NEPC) established a human capital development center in 
Lagos to train apparel makers.  The graduates from the center have 
been employed by apparel exporters who have received orders from the 
U.S.  There are also plans by several state governors to replicate 
such centers in their states in collaboration with the NEPC. 
 
GRIBBIN