A total of N13.4bn has been disbursed to beneficiaries of the Central Bank of Nigeria’s textile intervention fund, the Bank of Industry has said.
Aside from the Federal Government’s N100bn textile revival fund instituted in 2009, the CBN recently put in place additional N50bn intervention fund to facilitate the takeover of the existing debt as well as offer additional long-term loans and working capital to existing companies in the cotton, textile and garment sector.
The BoI said the CTG sector was once the largest employer of labour, after government, as it had an employment generation potential of over 600,000 and an annual revenue generation of $2bn.
It noted that the sector had since become moribund due to high production cost, poor infrastructure, especially inadequate power supply, multiple taxation as well as influx of cheaper and counterfeit textile materials from foreign countries.
The Acting Managing Director, BoI, Mr. Waheed Olagunju, who spoke in Abuja during a CTG forum, noted that with the various interventionist schemes of the Federal Government, the sector would soon return to its full potential.
Giving an update on the disbursement of the fund under its custody, Olagunju said out of the N100bn intervention fund, the bank had approved loans to 70 projects in the CTG value chain at a cost of N60bn.
Similarly, of the N50bn additional fund made available by the CBN, he said the bank had disbursed N13.37bn to various beneficiaries.
The BoI boss said the fund was approved by the central bank as part of the efforts to promote the development of the textile and garment sector.
He said, “The CBN recently put in place a N50bn special intervention facility to facilitate the takeover of the existing debt as well as provide additional long-term loans and working capital to existing companies in the CTG sector.
“The bank has to date approved loans of over N50bn, comprising debt takeover, term loan and working capital to 40 beneficiaries across the entire value chain in line with the CBN guidelines on the fund. A total of N24.37bn released by the CBN has been disbursed to the various beneficiaries as of September 30, 2016.”
Olagunju noted that modest achievements had been recorded in the sector as a result of the government’s various interventionist schemes.
He explained that while the capacity utilisation of some of the beneficiary companies had increased from 40 per cent to about 60 per cent, employment generation had hit 60,000 across the country.