AFRICAN GROWTH AND OPPORTUNITY ACT AND POLITICS OF TEXTILE PRODUCTION IN NIGERIA, 2000-2012.

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ABSTRACT

This study evaluated the impact of the implementation of the African Growth and Opportunity Act (AGOA) on the development of Nigeria’s textile industry, particularly the export of Nigerian textiles and apparels to United States of America. It adopted the qualitative descriptive research methodology for its data generation and analysis. It anchored analysis on the framework of complex interdependence which refers to the various, complex transnational connections and inter-dependencies between states and
societies and also among states. Flowing from its hypotheses, the study found that overall African export of textiles and apparels to the US has improved since the implementation of AGOA but that in the specific case of Nigeria the increase has been marginal at best. It further found that dependence of the Nigerian state on oil rents accounts for her failure to maximize access to the US textile market under the AGOA framework. The study therefore recommends the development of indigenous technology base for the exploration and exploitation Nigeria’s vast natural resources; the refocusing of attention from such
bilateral contraptions as AGOA to a more self-reliant industrialization that would help meet domestic product needs while at the same time position the country to be more competitive in the global political economy.

CHAPTER ONE
INTRODUCTION

1.1 Background to the Study
At its peak in the early1980s, the textile manufacturing industry in Nigeria was the pride of the Nigerian industrial sector with over 250 functional factories, 200,000- 250,000 direct employees, investment of over 30.0 billion metres of fabrics and over 300,000 tons of yarn per annum (Aguiyi et al, 2011 and NTMA, 2003a). The above success of textile industry in Nigeria was however short-lived as it began to experience some problems in the mid- 1980s due to many factors which included global economic
depression, conspicuous consumption of luxury items by political leaders, neglect of agriculture among others (http://depot. gdnet.org/cms/grp/general/nigeriaproposal.pdf, retrieved on 28/03/12). As a measure to revive the economy, Nigerian government adopted import prohibition as a trade policy instrument which laid more emphasis on quantitative import restriction than tariffs. Items placed on import prohibition list then were agricultural products such as fruit, vegetables, and grains as well as manufactured products such as rubber, chemicals, textiles and others (Oyejide et al, 2003a and GATT,
1991).
In 1996, the WTO committee on Balance of Payments Restrictions decided that Nigeria’s import prohibition measures could no longer be justified under balance of payment rules of GATT. In 1998, the committee stated categorically that Nigeria’s import ban was at variance with WTO rules. As a result, Nigeria offered to phase out such measures by 2005 under an eight-year elimination programmes (Oyejide et al, 2003a and Federal Ministry of Commerce, 2002).
Meanwhile, the United States, one of the major purveyors of contemporary globalization and a prominent crusader of trade as a pillar of global prosperity and security encourages as one of its major priorities, economic prosperity through trade and investment in Africa as a panacea to the endemic crisis of development in the region. In pursuant of this, the African Growth and Opportunity Act (AGOA) was signed into law by President Bill Clinton on May 18, 2000 as part and parcel of the US Trade and Development Act of 2000 and was touted as a historical turning point in US- African relations. Since then, AGOA has been the centerpiece of U.S. trade with Sub-Saharan Africa. The legislation provides for preferential treatment of exports from Africa in the form of duty-free and largely quota-free access to U.S. markets.
Section 103 of the ‘ACT’ (STATEMENT OF POLICY) of the Congress supported increased trade and investment between the U. S. and the sub-Saharan Africa through reduction in tariffs and non-tariff barriers and other obstacles to sub-Saharan Africa and the U. S. trade and expanded U. S. assistance to sub-Saharan Africa’s regional integration efforts. It also proposed negotiating reciprocal and mutual beneficial trade agreements, including the possibility of establishing free trade areas that would serve the
interests of both U.S. and sub-Saharan Africa. In addition, it welcomed countries commitment to the rule of law, economic reforms and the eradication of poverty through the private sector, especially enterprises owned by women and small business. Furthermore, it supported the establishment of a United States-sub-Saharan African trade and economic forum (Okuntola, 2013: 5). Finally, it sought the accession of sub-Saharan Africa to the Organization for Economic Cooperation and Development Officials in international business transactions. Section 104 (a) (1) (A) of the Act further stipulated that eligible countries must also establish or be making continual progress towards establishing a market-based economy; enact legislation to protect property; incorporate an open-rules based trading system and minimize government interference of the economy.
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