The Manufacturers Association of Nigeria (MAN) has said that the production of polypropylene by the Dangote Petroleum Refinery & Petrochemicals will revive Nigeria’s struggling textile industry and save the country $267 million in import costs.
The Director-General of MAN, Segun Kadir-Ajayi, in an interview on Channels Business Incorporated programme, highlighted the struggles of the textile industry, which was once thriving and employed over 25,000 workers aged between 18 and 40 in the northern region alone.
He explained that many companies had been forced to shut down due to the absence of local polypropylene production and the scarcity of foreign exchange required for imports.
He further said that the production of polypropylene by Dangote Refinery & Petrochemicals will ensure that Nigeria, which currently imports 90% of its annual polypropylene requirements (amounting to 250,000 metric tons), will now become a net exporter, generating foreign exchange to strengthen the economy.
“For us in the manufacturing sector, this is a welcome development. It more than covers the 250,000 metric tonnes that constitute our national demand, which has been severely lacking.
“You can imagine the sectors it will impact—the textile industry, the plastic industry, the furniture industry. We are looking at an amount in the region of $267 million being saved. This is the amount spent every year in scarce dollars to import these materials. It is a welcome development for manufacturers, as it will incentivize investment in the sector,” he said.
Kadir, who lamented how the collapse of the textile industry led to widespread unemployment, explained that with the local production of polypropylene, manufacturers will no longer need to rely on imported supplies. This, he added, will help reduce their costs and improve efficiency.
“We have seen the global trend of the textile industry relying on the petrochemical industry. So, you can imagine the boost this is going to bring to the sector.
“And now that it is available locally, we no longer need to look for foreign exchange to meet our demands. This is cheering news for manufacturers,” he said.
He urged the federal government and other stakeholders to support local polypropylene production through incentives, stating that this would attract more investment into the sector and increase manufacturing’s contribution to GDP.
He added that this would significantly aid the government’s goal of achieving a $1 trillion economy.
“If the economy is going to save $267 million in imports at a time when the government is striving to create a $1 trillion economy, this is a significant saving, especially considering the scarcity and inadequacy of foreign exchange supply.
“When we see champions like this blazing the trail, showing that we can even become a net exporter, it is certainly worthy of support.
“The NNPC has a capacity of 13,000 metric tonnes. When you add this to what Indorama has, along with the massive supply from Dangote, we will become a net exporter.
“This means all our imports from Saudi Arabia, South Africa, South Korea, China, and India will be eliminated. We can now aim for self-sufficiency and even export for foreign exchange,” he added.
He said that polypropylene production, with its far-reaching impact, will extend beyond the Dangote Refinery & Petrochemicals, resulting in significant job creation, increased tax revenue for the government, higher investment in the sector, foreign exchange earnings, and supporting the manufacturing sector in making a substantial contribution to the country’s GDP.
“I believe that what we should be looking forward to is the government’s deliberate efforts to incentivize more investment in the sector and create policies that encourage patronage of made-in-Nigeria products. This will enhance the competitiveness of Nigerian products in terms of price and quality,” he said.
Dangote’s $2 billion Petrochemical Plant in Ibeju-Lekki, Lagos, is designed to produce 77 grades of polypropylene. With a capacity of 900,000 metric tonnes per year and a turnover of $1.2 billion, it aims to meet the growing demand in plastic processing industries both in Africa and globally.
“The plant is expected to boost investment in downstream industries, create jobs, increase tax revenues, reduce foreign exchange outflow, and contribute to the country’s GDP growth,” the statement added.
