kenya is one of the countries in South Africa that can present lots of brand leather shoes. In this blog, we discuss how kenya could develop its leather industry.
The leather industry in Kenya is exhibiting signs of expansion, with shoes and other leather products created locally finding their way onto worldwide market shelves.
However, the industry is struggling to overcome obstacles such as the proliferation of counterfeit goods, a lack of value addition, and a shortage of skilled workers.
In a recent interview with Business Daily, the secretary-general of the Leather Apex Society of Kenya, Beatrice Mwasi, discussed the efforts being made by the umbrella industry lobby as well as other stakeholders to enhance the country’s share of the worldwide market for leather.
The Kenyan market has made room for footwear and bags that are marketed under the label “genuine leather,” however the purchasers of these products are typically left dissatisfied due to the products’ limited lifespan.
What kinds of negative effects has this situation had on the value chain of the leather subsector?
It displaces legal commercial activity, which results in manufacturers of leather products losing their market while customers receive products of worse quality.
The production of counterfeit goods results in the loss of employment opportunities as well as potential money from taxes.
What initiatives have been taken by the various stakeholders to buck this trend and enhance the leather industry?
As a method of reducing the number of counterfeit products on the market, the industry is working toward the goal of publishing a policy position paper on the harmonization of nomenclature, branding, and traceability.
Our efforts to raise the import tariff on completed leather products were fruitful, and we were successful in doing so.
This provides local manufacturers with the much-needed cushion against being outcompeted by countries that significantly subsidize their leather businesses.
The Leather Industry Network Project, which is being run by the Centre for Business Innovation and Training (CBT) in conjunction with national leather associations in East Africa and is being funded by GIZ-EAC, GFA Consulting Group, and Africa Leather, is developing new products of a world-class standard, which will enable local workers to secure multi-billion shilling contracts with international retail conglomerates.
Our efforts to raise the import tariff on completed leather products were fruitful, and we were successful in doing so.
What kinds of initiatives are being undertaken to improve value addition?
The instruction on “Buy Kenya, Build Kenya” is a really positive step in the right direction.
Leather Apex played a key role in the formation of joint production units, which would enable small and medium-sized businesses (SMEs) to improve the quality of their own products.
This was accomplished with the goal of improving the overall quality of the products.
Cobblers and other leather product makers have gained new expertise in product finishing, branding, and marketing as a direct result of our networking efforts with leather enterprises from industrialized countries.
Cattle play a significant role in the economic well-being of the people who live in Kenya’s dry and semi-arid plains, known collectively as the Asals.
The commercialization of leather production presents an opportunity for these pastoralist communities to become more economically integrated.
In spite of the vast animal population that exists among the pastoral communities, the value addition for hides and skins is still in its early stages of development.
The majority of manufacturers preserve their hides and skins by sun drying, suspension drying, and other methods, which result in products of lower quality.
What is the current value of the leather industry, and what do experts believe its full potential to be?
The value addition rate has been stagnant at five percent, which is costing the nation direct earnings of billions of shillings and job possibilities for thousands of people.
Kenya’s portion of the approximately Sh1.5 trillion worldwide market for leather is expected to be Sh14 billion with considerable potential for expansion, if exports of raw and semi-processed hides and skins, which constitute over 95 percent of exports worth Sh9.4 billion, were optimized.
The further processing of skins and hides has the potential to generate between 150 and 250 million dollars, or 15 to 25 billion shillings, in gross domestic product.
Do we have the expertise that is required to expand the variety of leather products that are available for sale on the markets in Kenya and other countries?
In order for the export-oriented leather park in Kenya to function properly, the country will require the services of 66,000 qualified individuals.
Because there is no correlation between the demands of industry and the provision of skills by local institutions, the sector is plagued by a severe lack of skills, causing it to suffer from a massive skills deficit.
How has the industry responded to the issue posed by the lack of skilled workers?
The vast majority of players provide their employees with training while they are still on the job.
Then there is the growing quality consciousness as well as the strict import quality benchmarks, both of which require the industry to upgrade itself to the finest practices that are being pursued globally.
Imports that are sold at lower prices and have higher standards of quality provide a significant challenge to the industry.
To maintain one’s position in the market, it is essential to possess technical abilities that have been honed via training and become increasingly specialized.
Is it the case that Kenya currently exports leather products that have been finished? If so, where do you plan to sell them, and how much can you expect to get for them?
Wet blue (which accounts for 85% of industry output), leather crust (which accounts for 9% of industry output), and finished leather and products (which accounts for 6% of industry output) are mostly shipped to China, Italy, and India.
The majority of other final products are shipped out of the country and into the EAC region as well as other African countries.
Others have, albeit in limited quantities, found their way to the United States of America and several regions of Europe.
For instance, under the Kenya-UK economic partnership deal that was only recently inked by the two nations, there is a significant potential for even more exports to take place.
However, in order to take advantage of this potential to its fullest and export finished leather products, additional work needs to be done to improve our competitive position.
The Ministry of Industrialization in Kenya approached the World Bank in 2014 with a request for technical assistance to conduct competitiveness assessments and develop competitiveness strategies for four key industries.
These industries were textiles and apparel, food, food processing, and food packaging.
Processing, furniture, and leather and leather products are all included in this category.
The Ministry of Industry, Trade, and Cooperatives have decided to give serious consideration to these four industry areas as potential priority sectors for industrial development and employment generation in Kenya.
The Economic Transformations Group, Inc.
(ETG), a sustainable economic development consultant with offices in both New York and Silicon Valley, was given the task of completing the investigation and developing a strategy for the leather industry.
ETG was based on
previous research and analysis conducted by Kyram Consultants Ltd.
In the context of Kenya’s long-term ambition to become an industrialized middle-income country by the year 2030, the leather and leather products sector provides an important opportunity for industrialization and diversification of exports.
Kenya has set this goal as its long-term goal.
However, there hasn’t been much value addition in the leather industry, and the majority of Kenya’s exports have been in the form of unprocessed, raw hides and skins.
Expanding exports of both semi-processed and finished leather goods presents an opportunity for the leather industry to make a positive contribution to overall economic expansion.
In order for the industry to advance, the raw material base needs to be improved (particularly in terms of the quality of hides and skins), the tanning subsector needs to be boosted, and leather goods need to be manufactured.
and marketing.
Your comment submitted.