The Impact of Trade Liberalization Policy on Nigerian Textile Industries: Evidence from Comparative and Descriptive Method of Analysis

Abstract

Textile industry in Nigeria has been a leading industry that captures the development needs of the country’s early import substitution industrialisation strategy. It acts as a producer of essential mass consumer goods with ability to draw on an existing raw material base and massive employment of labour force. Structural adjustment policies such as liberalization, devaluation and deregulation have led to the demise of the industry. It is in line with this, that, this study was designed to find out the impacts of trade liberalization policy on the performance of textile industries in Nigeria. The study sought for information from secondary data, which includes reports from organized and private institutions such as MAN, NTMA, and international organisations like UNIDO, IMF/World Bank reports, etc. Both comparative and descriptive methods of analysis were employed to analyse the data collected. The study was designed to cover pre-SAP and SAP period for effective comparison. It was found that trade liberalization has negative impact on performance of the Nigerian textile industry in the areas of production: falling drastically, low sales, low capacity utilization and decline in employment. The study recommends for serious government intervention to encourage the public to patronize locally made Nigerian textile products, to limit import by quotas on textile production and to construct a petro chemical industry to ease the importation of textile inputs, e.g. chemicals and dyestuff.