In a report on Industrial Competitiveness 2017 released last Friday by EAC secretariat in Dar es Salaam, it indicated that the EAC is exporting an increase share of wet blue leath- er while missing out on footwear and other finished products.
Speaking on behalf of EAC Council of Ministers Chairperson, Ugandan Minister for East Af- rica Cooperation, Maganda Wandera said some of the difficulties facing regional producers in manufacturing leather products can be attributed to limited demand from consumers in the EAC bloc and limited capacity to produce quality leather finished goods.
Wandera said international buyers are of- ten reluctant to buy finished leather prod- ucts but prefer to raw leather to make their own finished goods.
“While the EAC is moving away from the export of raw hides and skins to wet tanned
or crust, the increase in unit price is minimal. A shift to dry tanned hides and skins will increase the region’s earnings hence the need to put em- phasis on new tech tanneries to produce com- petitive products,” he pointed out.
On his part, Stephen Kargbo who is UNIDO Representative in Tanzania, Mauritius and the EAC, said that the bloc’s members should con- centrate on leather footwear because of growing demand in the region and globally.
“The overall demand for footwear gives fur- ther reason for the region’s leather producers to engage in the footwear industry. Global demand of footwear in general is U$133 billion and grow- ing at 9 percent per annum since 2008, while the EAC demand is U$145 million with a growing rate of 7.3 percent per annum,” Kargbo revealed.
Currently, 83 percent of the region’s leather re- lated export earnings are from tanned wet blue with raw hides, skins and dry tanned or crust accounting for 14 percent and 2 percent only re- spectively.
The further processed forms which comprise prepared leather, footwear and other finished products make up only a percent of the total ex- port earnings
Kenya is the largest exporter of leather-related products in the EAC, followed by Uganda, Tan- zania, Rwanda and Burundi. In terms of growth, since 2011 Rwanda has experienced an increase of 48 percent annually, Uganda 38 percent while Tanzania and Burundi lag behind.
According to Food and Agriculture Organiza- tion of the United Nations (FAO), world trade in leather is growing fast and is estimated at U$125.4 billion annually with Africa earning mere U$4 billion of the total or about 3.4 percent despite commanding 14 percent of global raw hides and skins market and a fifth of the world’s livestock.