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Textile Industry Under Threat From polyester Scarcity, Others

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Textile
  • Textile Industry Under Threat From polyester Scarcity, Others

The current scarcity of polyester is threatening the survival of textile industry in Nigeria, investigation has revealed.

Polyester fibre is used as cushioning and insulating material in pillows, comforters and upholstery padding. It has high tenacity and durability and can withstand strong and repetitive movements.

But the material, according to operators, is scarce because local production is not sufficient to meet its demand.

Operators are also said to be having challenges accessing foreign exchange, making it difficult for them to procure essential raw materials.

Even though the Federal Government recently reduced the import duty on some of the raw materials and chemicals for the sector, operators said that it was not a consolation as it did not solve the challenge of access to forex.

The Director-General, Nigerian Textile Manufacturers Association, Mr. Hamma Kwajaffa, told our correspondent that the polyester, a synthetic fibre derived from coal, air, water, and petroleum, was not produced in enough quantity to satisfy the demand of the users.

According to him, Eleme petrochemical plant, that produces polyester locally, does not produce enough and that the scarcity is exacerbating the crisis in the sector as more manufacturers have suspended production, sacked workers and turned to other sources of income.

“Most of the Okada riders you see today used to be textile manufacturers,” Kwajaffa said.

The situation, according to the operators, has overshadowed the various efforts taken by the government to revive the sector, such as the Central Bank of Nigeria’s N50bn Textile Intervention Fund and the slash in the import duty of some of the raw materials for the sector.

According to Kwajaffa, the major challenge faced by manufacturers in the sector is access to forex, insisting that there is little collaboration between the apex bank and commercial banks in the area of making forex available to customers.

He said, “To access foreign exchange, we have to go through our banks. They keep telling us that they do not have foreign exchange to give. The situation has impeded our production activities because most of our production components cannot be sourced locally.

“Some of the manufacturers have already stopped production, and it is becoming difficult to convince others not to suspend production.”

He also said, “Easy availability of foreign exchange will allow textile manufacturers to procure raw materials, and thus help in enhancing production, resulting in job creation and increased contribution to Nigeria’s Gross Domestic Product.”

On the N50bn CBN intervention fund, Kwajaffa said most of the operators could not access the loan, adding that out of about 50 people that had applied for it, only 15 people were given.

He called for the release of the textile development levy to the operators, recalling that 10 per cent levy on imported fabrics was established by the government in 1997 to revitalise the textile industry.

He noted that if the funds were established as a special trust fund, it would enable more practitioners, who could not access the N50bn CBN intervention fund, to benefit from it.

Kwajaffa remarked that out of over 84 textile firms that existed in the country in the 80s, only about 24 were left, some of which were managing to stay afloat.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Tony Elumelu Acquires Shell, Total, ENI Stakes in OML 17

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Tony Elumelu Acquires Shell, Total, ENI Stakes in OML 17

Tony Elumelu owned Heir Holdings Limited and its related company Transnational Corporation of Nigeria Plc on Friday announced it has completed the purchase of 45 percent stake in Oil Mining Lease (OML 17) through TNOG Oil and Gas Limited.

The acquisition includes all assets of Shell Petroleum Development Company of Nigeria Limited (30 Percent), Total E&P Nigeria Ltd (10 percent) and ENI (five percent) — in the lease.

It was further stated that TNOG Oil and Gas Limited will also have the sole right to operate OML 17.

The field presently has a production capacity of 27,000 barrels per day. Also, there are estimated 2P reserves (proven and probable) of 1.2 billion barrels and an additional one billion barrels in possible reserves — all of oil equivalent.

A consortium of global and regional banks and investors provided a financing component of $1.1 billion for the largest oil and gas financing in Africa in over a decade.

In a statement released on Friday, Shell said the completion was after all the necessary approvals have were received from authorities.

“A total of $453m was paid at completion with the balance to be paid over an agreed period. SPDC will retain its interest in the Port Harcourt Industrial and Residential Areas, which fall within the lease area,” the SPDC said.

Speaking after the completion of the deal, Elumelu said “We have a very clear vision: creating Africa’s first integrated energy multinational, a global quality business, uniquely focused on Africa and Africa’s energy needs. The acquisition of such a high-quality asset, with significant potential for further growth, is a strong statement of our confidence in Nigeria, the Nigerian oil and gas sector and a tribute to the extremely high-quality management team that we have assembled.

“As a Nigerian, and more particularly an indigene of the Niger Delta region, I understand well our responsibilities that come with stewardship of the asset, our engagement with communities and the strategic importance of the oil and gas sector in Nigeria. We see significant benefits from integrating our production, with our ability to power Nigeria, through Transcorp, and deliver value across the energy value chain.

“I would like to thank Shell, Total and ENI, for the professionalism of the process, the Federal Government of Nigeria, the Ministry of Petroleum Resources, and the NNPC for the confidence they have placed in us.”

Tony Elumelu is the Chairman of Heirs Holdings Limited, Transcorp and United Bank for Africa Plc.

Also, read Transcorp Plc Acquires FGN’s 100% Equity in Afam Power for N105 Billion

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Exporters Say CBN Pre-export Requirements is Frustrating Export of Goods

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Institute of Chartered Shipbrokers

Exporters Say CBN Pre-export Requirements is Frustrating Export of Goods

Exporters have said the recently introduced pre-export requirements by the Central Bank of Nigeria is creating unnecessary bottlenecks for exporters and the movement of goods out of the country.

Exporters, who spoke under the aegis of the Network of Practicing Non-oil Exporters of Nigeria (NPNEN), said the electronic Nigeria Export Proceed Form now required by financial institutions from exporters had come with so many challenges.

Ahmed Rabiu, the President, NPNEN, explained that the new policy had several requirements that often led to delays and loss of income on the part of exporters.

He said, “We acknowledge the CBN’s desire to ensure that all exports out of Nigeria are documented in order to ensure that the proceeds of such exports are repatriated.

“However, the reality on the field shows that the process is causing undue delays and consequently, encouraging corruption.

According to them, in the new pre-export requirements, the Central Bank of Nigeria wants an export transaction to be initiated through eNXP processing on the trade monitoring system.

After which exporters are expected to have a pre-shipment inspection agent, the Nigeria Customs Service and other designated government agencies carry out their pre-export inspections.

The exporters said the pre-shipment inspection agent was expected to issue a clean Certificate of Inspection while Customs would issue the Single Good Declaration. All these they said takes time and delay goods from leaving the country on time.

Pointing to a recent report, they said about N868 billion worth of goods bound for export were stuck at the ports due to the new policy.

Speaking further Rabiu said, “For example, for the PIA to issue the CCI, the exporter is required to upload a certificate of origin as one of the supporting documents for the eNXP.

“The PIA is also required to upload the CCI to the TRMS(M) and until this is done, the Customs service will not issue the Single Good Declaration.”

He added, “After issuing the SGD, the customs is further required to upload it into the TRMS before the goods are allowed to be gated into the port and loaded on the vessel by the shipping line.

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Ardova Plc in Talks to Acquire Enyo Retail and Supply Limited

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Ardova Plc in Talks to Acquire Enyo Retail and Supply Limited

Ardova Plc, Nigeria’s leading integrated energy company, has commenced discussions to acquire Enyo Retail and Supply Limited.

According to the statement issued and signed by Oladehinde Nelson-Cole, Ag. Company Secretary/General Counsel, Ardova Plc, Enyo is one of the newest and fastest-growing retail and supply companies in the downstream sector.

It stated, “This announcement is pursuant to the acceptance in principle of AP’s offer and acquisition framework by the shareholders of Enyo, it is subject to the successful completion of a due diligence exercise and the receipt of all required regulatory approvals.”

“This announcement is pursuant to the acceptance in principle of AP’s offer and acquisition framework by the shareholders of Enyo, it is subject to the successful completion of a due diligence exercise and the receipt of all required regulatory approvals.

Speaking on the yet to be completed deal, Mr. Olumide Adeosun, CEO, Ardova Plc, said upon completion, Ardova will retain the Enyo branded stations which will operate side by side with the Ardova brand while simultaneously leveraging on the strengths of Ardova and its group companies.

He added that the two companies are determined to conclude the deal by the end of Q1 2021.

Enyo presently operates over 90 stations across the nation and attends to over 100,000 retail customers on a daily basis.

Ardova Plc and Enyo Retail & Supply Limited promised to furnish stakeholders with more information on the progress of the deal.

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