8 December 2017

Ethiopia: Livestock Abundance Vs Ethiopia's Growing Leather Industry

According to the Ministry of Agriculture and Natural Resources 2015 report, Ethiopia has the eighth largest livestock inventory in the world and it is the first in Africa. The country has 71 million sheep and goats, 52 million cattle, 36 million sheep, 35 million goats and 6 million camels. The El Niño induced drought broke out in 2011 has severely affected the livestock population of the country.

Though the nation has great number of livestock population, it has not been benefiting from its leather and leather products. Moreover, the hides and skins being exported to the international market lack quality.

However, the leather industry has shown an incredible transformation over the last few decades. The nation's footwear industry and leather sector has started to register encouraging development and enjoy international comparative advantages owing to its abundant and available raw materials, highly disciplined workforce.

In Ethiopia, the leather and leather production sector has been structured from micro and small scale enterprise up to high level industry. As 2016 Quality and Standards Authority (QSA) report, Ethiopia produces 2.7 million hides, 8.1 million sheepskins and 7.5 million goatskins every year.

Moreover, the sector has developed by 6 percent every year and its export rate has shown incredible increment after over the decade. Having realized that exporting value added leather products would have high demand in the global market, the government has designed export system to upgrade the sector to higher level. The export system guideline could help local and foreign investors who engage in the sector.

Nowadays, Ethiopia's leather and leather product industry is producing various semi-processed leather in different forms to processed leathers such as shoes, leather garments, stitched upholstery, jackets, backpacks, purses, industrial gloves and other leather items.

Especially the demand of leather shoe is increasing at an alarming pace. Thus, when we see the number and coverage of leather industries in the country, 16 (90 percent) of the medium and higher industries are found in Addis Ababa, 1 (5 percent) in Oromia and 1 (5 percent) in Tigray. On the other hand, those when look at those engaged in micro and small enterprises, there are 44 in Addis Ababa, 13 in Tigray, 11 in Oromia, 7 in SNNP, 2 in Amhara and 3 in Dire Dawa.

Moreover, there are 26 factories which produce leather clothing and items in the medium and high manufacturing level and 448 manufacturers have engaged in micro and small level. The factories installed capacity could produce 2.86 million leather cloths and 2.1 million leather items. The shoe, clothing and items which is produced in those aforementioned industries are produced in a value added way.

Their design and quality has attracted many buyers worldwide. But the market chain and competitiveness is still tough for Ethiopian leather products. Ethiopian leather products have ample market in Italy, UK, America, Canada, China, Japan and other Far Eastern countries, the Middle East and African countries.

The sector has created job opportunity for 23,352 people and out of this number 12,352 of them are women. However, taking the huge number of unemployed youth into consideration, more job opportunities are expected in the coming years. Lack of skilled human power, lack of quality in the skins and hides and the inability to produce value added products in high quantity and quality are among the challenges that need drastic solution.

To sum up, processed leather products have high market value. Since the government is the main actor, many activities are undertaking to modernize and promote the sector. Best experience of successful countries has been taken as benchmark. With the government's direct intervention the sector is flourishing from time to time. But it needs further intervention to make Ethiopian leather and leather products competitive in the international market.

Ethiopia

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