Kenya s leather industry on the spotlight

July 3, 2008

, NAIROBI, July 3- A survey into the leather industry shows that having an effective value chain could increase the country’s leather exports by 25 percent.

Dr Alfred Muthee who conducted the study said the rise could only be achieved if the capacities of the industry players were strengthened and the sector-based distortions were addressed to promote additional value addition.

Leather in world trade is valued at $20billion and Kenya is one of the significant African players in the export trade and earns about $15million annually from such trade.

Speaking during a stakeholders’ workshop, Muthee explained that the sector had been underperforming due to a myriad of reasons including the low production and poor preservation of hides and skins.

The situation, he noted was aggravated by the influx of second hand leather products.

As a country that has one of the highest population of livestock in Africa with 14 million cattle, 12million goats and 10 million sheep, , Kenya is capable of producing adequate hides and skins for a vibrant industry.

In 2006, Kenya produced about 2.6 million hides, 3.9 million goat skins, 2.5 million sheep skins and 63, 00 camel skins.

However, due to poor animal husbandry, improper skinning of animals, poor sanitation in slaughterhouses and the lack of market information of the commodities, the potential output is not realized.

But to fully revive the sector, the Value Chain Specialist recommended skills development and training at each supply chain so as improve farming and livestock branding practises.

He also called for the strengthening of the leather stakeholders associations as well as the formation of an apex body which would lobby for the sector’s interests.

"We need to train farmers on branding, improve on the transport of animals and create awareness of the value of hides and skins," he advised.

He also called on the government to facilitate an enabling environment through for example offering tax incentives to attract investors into the country.

But in a quick rejoinder, Industrialization Assistant Minister Nderitu Mureithi assured stakeholders that the government would take all the necessary intervention measures to revive the sector.

He said together with the World Bank had provided Sh1.5billion to upscale the activities of business and eventually turn around the sector.

Mureithi said the government had put in place resources to address some of the challenges faced by the industry and also develop strong linkages in the value chain.

"We will strive to ensure that we provide a conducive environment for not only the leather industry but all sectors of the economy," he stated.

He cited the 40 percent tax on export of raw hides and skins that has had a positive effect on the value addition in the sector.

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