The Aba leather industry which had hitherto benefited from fundings by the Bank of Industry (BOI), is currently undergoing some torrid financial lapses as the development financial institution has allegedly withheld financial assistance to small and medium scale entrepreneurs in the renowned leather footwear manufacturing city.
According to reports, BOI was supposed to fund about 1,000 businesses without a time frame but allegedly withdrew after assisting only 21, most of whom had allegedly repaid their loans in full.
In his reaction to the situation, Okechukwu Williams, President of Leather Products Manufacturers Association of Abia State (LEPMAAS), Okechukwu Williams, bemoaned that the bank’s decision to withdraw assistance has cast Aba leather clusters in bad light as loan defaulters, adding that it was a harmful precedence to the state and national economic development given the large number of artisans the sector employed.
According to him, rather than quit funding businesses in the commercial city due to allegations of low loan repayment by about 1,000 small businesses earlier programmed to benefit from the funding arrangements, what the bank should have done was to redesign the market’s leather cluster project because of its huge influence towards growth of the economy.
He added that more consideration should be placed on the production timetable of the leather manufacturing sector, level of development of businesses required loans and quantity of funds needed by the artisans to do their work lucratively.
“When you also look at the place the sector had put Nigeria on the world’s shoe production map, you cannot but agree that, it is unfortunate that BoI abandoned its earlier arrangement to fund the sector,” he noted.
Frontpage September 1, 2020