Tanzania: Government Strategy On Leather Industry

Dar es Salaam — Tanzania has for years lagged behind in the hides and skins business. This is despite being among major livestock producers in Africa. There are no internal markets for semi-processed leather and very little for finished leather because of competition with imported used and synthetic products.

However, while the government is looking to regulate imports of synthetic and used leather goods which compete unfairly against local leather products, the question of how producers will be able to fill the gap of about 48 million pairs of shoes that the country demands annually is yet to be answered.

The Acting Director of Production and Marketing at the Ministry of Livestock and Fisheries, Mr Steven Michael, told The Citizen that statistics show that at least 50 million pairs of shoes are imported into the country annually.

Further he noted that locally produced shoes by both large industries and small and medium entrepreneurs (SMEs) is only 1.2 million annually.

"We don't produce much because our leather is of low quality and we also face a scarcity of trained personnel. However, we have developed a strategy to improve our hides and skin with a view to producing quality leather of grade I-IV to be able to invite both local and foreign investors to invest in the sector," he said.

Research shows that in 2017 the export earning of a total of 2,908 tonnes of hides was worth $1,507,000, too low compared to South Africa that earned $20,019,000 with fewer livestock.

Tanzania produces very little semi-processed and finished leather, 23.7m-sqft, far below Kenya's 89.5, and Egypt's 83.7m among others.

The country earned $21.1m from leather, hides and skins and leather products exports (URT, Leather Sector Development Strategy 2016-2020). This is very little compared to Nigeria's 130.7m, Ethiopia's 70.8, and Kenya's 52.1m, (FAO, 2020).

Ministry of Livestock and Fisheries

The Acting Director Mr Michael went on further to say that in order to protect local producers of leather products in the country the government upped the import duty of second hand leather products including shoes imported into the country from 25 percent to 35 percent.

He said stakeholders in the industry further called on the government to charge 5 percent on each pair of shoes imported into the country but research could not identify how the money would be charged and by whom and therefore dropped the request.

On non-leather products that are synthetic, he said the biggest challenge is how it would be charged because it has multiple use of both plastic and non-plastic and used for handbags as well as shoes.

Explaining about the country's strategies on quality leather, the acting director of production said the Hides and Skin leather Act of 2008, Article 18, is being implemented through a leather sector development strategy of 2016 to 2020.

"This strategy is being implemented to get quality leather and right equipment used to skin animals," he said.

He noted that since July 2019, they started implementing the strategy which has three levels which include training of at least 765 butchers as well as awarding them with fray knife for skinning animals the right way.

According to him, they have trained the 765 butchers in eight regions including Morogoro, Kilimanjaro, Arusha, Manyara, Kagera, Simiyu, Mwanza and Shinyanga.

Further noting that in the second level, they have been able to engage at least 113 inspectors in 13 regions, who have been awarded certificates for quality butchers. He noted that in the third level they had put skins in grades of one to five as quality hides and skin and identifying, where they can be found while grade six and more is qualified as reject.

Tanneries

Himo Tanneries Operations Director Sabas Woiso said the kind of hides and skin found in the country was of very low quality that they had to import from Zambia to be able to make quality furniture.

The skin has hit-marks, is not properly skinned, it has holes and other dents that make it difficult for companies to make use of it.

"We import most of the leather with good quality from Zambia because they use machines to remove skin from the animal," he said.

He called on the government to provide training that would enable the public to understand the value of hides and skin and also install machines that would remove skin without destroying it.

Shoe factory

Woiso Original Products Marketing Manager Teya Herman said they produce leather products including shoes from leather produced locally.

"We buy our products from leather produced in our own tanneries but most of it is of low quality riddled with dents and flaying holes that are very challenging for production.

"While we have the challenge of low quality leather produced in the country, we also face a challenge of unfair competition from synthetic products imported," Herman said.

Explaining further, she said that products which have an appearance that can be substituted as leather are sold at low prices thereby attracting a wide market compared to leather products that are produced locally.

"I know reports show that we produce less than the demand required countrywide, but I can assure you that if I get an order of 1000 shoes that assures me of market we can produce at least 1000 shoes on a daily basis and more," she said.

Meanwhile, a researcher currently at St Francis University of Health and Allied Sciences Ifakara - Veterinary Medicine, Prof Gabriel Mbassa, initiated a research financed by Tanzania Commission for Science and Technology to acquire facts on hides and skins production, processing and marketing in Tanzania with a focus to locate the constraints and develop solutions.

He said despite the high population and internal market, there is very little supply and demand for leather in the country.

He said tanneries in Tanzania include ACE Morogoro, Meru, Hua-Cheng, Xing-Hua, Lake-Tanneries, Moshi, Afro-leather, Himo, SAK, Salex, Paktan, Rudhra, SM-Saed, Rivalley, Covenant, Nyasele, Classic, Pak-Shinestar, Petrocity, P.M. Tito's and Stecor, capable of tanning 9.924 hides and skin to 110.5msqft leather, but only Himo-Tanneries and to a lesser degree Moshi-Tanneries produce finished (final) leather.

He said approximately 10 percent of hides and skin produced are tanned into final leather. Leather is not on market, and there is no demand because people depend on imported used and new synthetic products.

He said leather produced in Tanzania is declared to be of low grades (III-V) because the hides and skin are thin, small, having hot metal marks and flaying holes.

Tanning 1000 Kg hides and skin (100 hides or 600 goats/sheepskins) costs Sh863,055.50, making 1000 sqft, enough for 1000 pairs of shoes valued at Sh2 to 3m.

Processing one hide costs Sh2,126.56, split to two each of 10-sqft total 20-sqft sold at Sh2,500 - 4,000/sqft earns Sh50,000-80,000 with Sh28,734.40 to 58,734.40 profit. Tanzania tannery industry, however, lacks trained personnel. He noted that tanneries in Tanzania can tan 9.9 m hides and skin to 110 m-sqft leather. Himo and Moshi Tanneries produce finished leather; others generate chrome or mimosa crusts (semi-processed leather) for export.

He said while there is no internal market for chrome (wet-blue) or mimosa (wet-white) pelts/crusts, there is very little for finished leather.

Recommendations

The professor advises the government to activate leather goods market, and impose tariffs on imported synthetic plastics and leather and synthetic plastics, and encourage use of modern tannery technology as well as establish leather technology training and research institutes.

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