Nairobi, Kenya//-Leather Apex, an Umbrella Organisation of Kenya’s Leather Associations Across the Value Chain Working to Enhance the Global Competitiveness of Kenya’s Leather and leather Products, lauds the bold recommendation by the Ministry of Investments, Trade and Industry calling for the ban of increase import duty to 50% on imported shoes into Kenya.
The well-thought and timely actions by the Kenyan government will lead to an exponential growth of the leather sector in Kenya by inspiring investor confidence, motivating local production and ultimately creating value and jobs for farmers and young Kenyans.
The Secretary General of the Leather Apex Society of Kenya (LASK), Beatrice Mwasi, praised the Kenyan government’s policy recommendation to either ban or boost import charges on foreign-made leather shoes.
This would mark a watershed moment for the Kenyan leather industry, and it demonstrates the power of collective advocacy. According to Mwasi, “This move by the government is in line with leather stakeholders & recommendations over the years.
Indeed, the proposed legislation is the result of long-term efforts by a variety of stakeholders, including manufacturers, artisans, farmers, and, most crucially, young entrepreneurs who represent Kenya’s leather industry future. It shows that the government is listening to its citizens and is willing to take significant steps to defend local industries.”
The leather sector has immense potential to transform the economy of Kenya and has been identified as a priority manufacturing sub-sector under the Big 4 agenda and was key to increasing the manufacturing pillar contribution in the economy from 9 to 15 per cent of GDP.
Currently, the leather sector represents 0.3% of GDP, 0.7% of formal employment and 1.8% of exports with a contribution to real GDP and exports having grown substantially at 14% and 34% p.a. respectively over the past five years.
Further, it is a fact that Kenya hosts the 3rd largest livestock population in Africa which can provide a strong raw base for the local industry.
In 2012 the Food Agriculture Organization estimated at 3 million cow hides, 4.3 million goatskins, and 2.9 million sheepskins accounting for 10.67% of Africa’s cow hide production, 4.94% of goat skins and 3.75% of sheepskins in the continent.
“The ban will provide a more solid market for local farmers who produce raw leather. Farmers, many of whom have been struggling with fluctuating pricing and poor demand, will discover newfound purpose and financial security as the market for their produce becomes more consistent and profitable.
This is anticipated to stimulate more sustainable farming practices and minimise the number of livestock sold or slaughtered prematurely,” Mwasi added.
Despite the country having suffered declined leather production over the decades Kenya still boasts of a strong leather value chain industry base which includes 25 formal footwear manufacturing units, 11 registered leather products micro, small and medium-sized enterprises (MSMEs), 15 registered tanneries, four packaging and logistics companies, a small and medium-sized enterprise (SME) park and a a training centre for increased value addition.
According to the World Bank Kenyan manufacturers produced approximately 40% of total leather shoes demand in 2016 with hundreds of informal footwear manufacturing units covering 55 %–60 % of the local footwear production.
This was despite competition from cheap imports of leather and non-leather footwear including second-hand shoes from other countries around the world.
“The leather business is labour-intensive, and shifting the emphasis back to local production has the potential to create thousands of jobs, not just in manufacturing but also in allied industries such as transportation, marketing, and retail.
This change would be especially beneficial to young Kenyans, who make up a sizable chunk of the country’s unemployed population.”
Leather Apex estimates that increased demand for leather products in Kenya could lead to an increase of over 50,000 jobs across the value chain with the sector contributing more than Kes.25 billion up from the current 14 billion shillings.
“This legislative shift must be accompanied by other measures, such as quality control requirements, access to cheap financing, and expenditures in skills development. The government must also work to establish a brand for Kenyan leather on a national and international scale.”
Mwasi said the government’s decision is more than simply a nod of approval; “It is a rallying cry for all stakeholders to band together and work together to realise the potential that this policy shift opens.
This is just the beginning; much more work must be done to guarantee that this brave move results in long-term growth and success for all Kenyans involved in the leather sector.”
Leather stakeholders continue to note with concern the high lending rates that continue to make leather manufacturing in Kenya uncompetitive as compared to neighbouring countries such as Ethiopia and the need for building skills especially in tanneries and finished goods processing through investing in vocational training.
Further, there is a need for continued investment in modern slaughterhouses and training in flaying for abattoirs while farmers need education on the effects of branding and tick control methods to ensure hides and skins are of the highest quality.
