EABC wants zero-rating of leather inputs

Summary

Industrialists in the East African Community (EAC) bloc are pressing for zero rate of import duties for imported inputs used in leather manufacturing. They have also called for the six partner states to create a readily accessible market for leather products and promotion of exports. EAC regional leather forum urges for the creation of a ready market through fast tracking implementation of regional leather strategy

Arusha. Businesspeople in the East African Community (EAC) bloc have called for zero-rating of imported inputs used in the manufacture of leather.

They have also urged the six partner states to create a readily accessible market for leather products and step up promotion of exports.

“The governments should be the leading consumers of leather products, and should thus facilitate trade in leather products,” said Mr Peter Mathuki, executive director of the East African Business Council (EABC). He made the appeal here during the EAC Regional Leather Forum which attracted over 40 industry players.

Mr Mathuki said taxation of inputs used in leather processing, mainly the chemicals, was among the challenges facing the multi-million dollar industry.

This, he added, has led to insufficient supply of the chemicals, thus compromising the quality of processed leather in addition to fuelling illicit trade in the commodity.

“Import levy on leather inputs by some partner states is a drawback for the industry whose full potential has not been fully tapped,” Mr Mathuki said. Other challenges include lack of defined standards, poor quality tanneries and abattoirs and insufficient supply of equipment and accessories.

According to the World Bank, leather and leather products are among widely traded agro-based commodities with an estimated global value of over $150 billion.

Africa is home to about 15 per cent of the world’s cattle population, but accounts for only eight per cent of global production of cattle hides and four per cent of leather production.

EAC deputy secretary-general (Productive and Social Sectors) Christophe Bazivamo said the EAC was currently finalising the development of a regional leather and leather products strategy.

“We have prioritised the development of the leather sector value chain for job creation and as a means of providing affordable, new and quality options for leather products,” he said.

Ms Beatrice Mwasi, the secretary general of the Kenya Leather Apex Society, urged the EAC partner states to offer incentives for value addition in the leather sector and improve branding.

The industrialists also called for a gradual phase-out of secondhand leather shoes and other poor quality leather products through the production of quality goods. They argued that tapping the potential of the leather industry through private sector investments would create more jobs and incomes.

The one-day forum further called for a coherent and robust marketing strategy and good manufacturing strategies for the commodity.