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Cablegate: Nigeria: Agoa Iii: Information On Textile And

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 02 LAGOS 000457

SIPDIS

STATE PLEASE PASS TO USTR C. HAMILTON

E.O. 12958: N/A
TAGS: KTEX ETRD EINV ECON PREL NI AGOA
SUBJECT: NIGERIA: AGOA III: INFORMATION ON TEXTILE AND
APPAREL PRODUCTION CAPABILITIES

REF: (A) STATE 26964, (B) 03 Abuja 1972

1. (U) Summary: Nigeria's textile and apparel industry
is uncompetitive and in decline, and manufacturers are
skeptical about the possibilities of reversing the
industry's long downward trend. Nigerian producers are
not yet eligible for AGOA textile and apparel benefits,
and most believe that AGOA alone will not bring about a
substantial increase in their textile or apparel trade
(Ref B). Many are leaving the business, with
corresponding negative upstream effects on Nigerian
cotton producers. End summary.

-----------------------------
TEXTILE PRODUCTION FACILITIES
-----------------------------

2. (U) Over the last ten years, many of Nigeria's
textile mills have permanently shut down. Membership
in the Nigerian Textile Manufacturers Association
(NTMA) has declined from 124 members in 1994 to fewer
than 60 today; most remaining mills are operating at
only 60 or 70 percent capacity. The industry has shed
more than 60,000 of its 140,000 jobs, and most
observers expect further decline.

3. (U) Nigerian spinning, weaving, and processing
facilities are fully mechanized, but equipment is often
outdated and poorly maintained. According to NTMA's
executive director, Nigerian spinning facilities have
810,000 spindles and 26,000 open-ended rotors. The
country's weaving facilities, he says, have 16,840
shuttle looms and 2,640 shuttle-less looms and produce
approximately 450 million meters of gray cloth
annually. Most Nigerian textile manufacturers import
ginned cotton from neighboring countries, but some,
like locally owned Nigerian Textile Mills and part
Indian owned Afprint, operate domestic cotton
plantations and ginneries. A handful of firms also
produce polyester yarns and fabrics.

-----------------------------
APPAREL PRODUCTION FACILITIES
-----------------------------

4. (U) Nigeria has no organized apparel industry. Most
garments are produced by individual tailors or by small
businessmen working with one or two assistants and a
handful of sewing machines. Locally produced or
imported cotton fabric is the most common input, with
imports coming chiefly from ASEAN countries. These
should decline after the GON's January 2004 ban on
textile imports. Finished products range from
traditional dress to designer clothes geared toward
Nigeria's affluent.

-----------------------------------
TARGET MARKET FOR FINISHED PRODUCTS
-----------------------------------

5. (U) According to NTMA's executive director, 65
percent of Nigeria's textile production, mostly cotton
or polyester yarn and gray cloth, is sold domestically,
with the remaining 35 percent exported to neighboring
countries or Europe (primarily Italy, Spain, and
Portugal). Yarn produced from Nigerian cotton is often
exported as discounted non-dying yarn due to
contamination by fibers from cotton pickers'
polyethylene bags. None of Nigeria's finished products
are exported to the U.S.

-------
COMMENT
-------

6. (U) Nigerian textile manufacturers are uniformly
bleak about the prospects of turning around a declining
industry. High input prices, unreliable power
supplies, and poor transportation infrastructure have
forced many producers to close their doors, and many
observers expect further decline, particularly since
attracting new investment has become increasingly
difficult. Nigerian producers are not yet eligible for
AGOA textile and apparel benefits, and few producers
have expressed interest in expanding textile or apparel
manufacturing facilities. Unless Nigeria secures AGOA
textile and apparel certification or sees its main
textile products, cotton yarn and gray cloth, become
eligible for duty-free treatment, the legislation's
extension is unlikely to have much impact.

GREGOIRE

© Scoop Media

 
 
 
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