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Govt loses huge revenue to smuggling of textiles

13
Feb '10
Nigerian Textile Manufacturers Association (NTMA) revealed that, every year, Nigeria is suffering a loss of around $325 million attributable to evasion of customs duty and Value Added Tax by smugglers of fabric materials.

NTMA Chairman, Mr. Abiodun Ogunkoya at a news conference in Lagos, extended an indication to the concern that the smugglers are not only propounding a threat for the industry but have also disowned payment of considerable revenues to the government.

According to Ogunkoya, of the total $1.4 billion worth textile materials sourced by the country's market every year, almost 85 percent is smuggled. Mainly printed fabrics with fake and counterfeited materials are smuggled.

Fake trademarks of Nigerian manufacturers along with counterfeited SON Logo embossed on the labels, have been found on wax print fabrics made in China, he said.

He opined that to tackle the nation's textile smuggling issue and to safeguard the local industry, Federal government requires devising an effective system.

However, he welcomed the Federal government's move of distributing N100 billion for revitalization of textile industry and stated that, by end of this January N20 billion has already been released to the Bank of Industry (BOI).

The Chairman elucidated that the entire sum of N100 billion allotted for the textile sector would be discharged to BOI before end of the current year and emphasized that the fund will help the textile manufacturers with regards to modernizing.

The sector is still confronted with infrastructural problems like meager power supply and bad road conditions, which will bring to naught the benefits of the fund if proper steps are not initiated to tackle the issues, he said.

As compared to India, Pakistan, China and Turkey, in Nigeria the cost for making power available is much higher at 20cents/kwh, he added.

Addressing the press conference, Director General of Nigerian Textile Manufacturers Association,Chief Jaiyeola Olarenwaju, stated that majority of the textile manufacturers are upset over the rising costs of petroleum products in the country.

Fibre2fashion News Desk - India


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