Kenya is betting on an upcoming leather city to tap into the lucrative leather industry that could generate Sh100billion in annual revenue and create over 20,000 jobs at a time when export of raw hide has taken a toll on earnings from the leather industry.
Traditionally, Kenyan leather is exported raw or as wet blue, the lowest level of leather processing, bringing the country Sh10 billion in yearly earnings. Adding value would see this figure jump ten fold and thus the idea of the leather hub.
The proposed project to be allocated Sh1 billion will sit on a 500-acre Export Processing Zone Authority land at Kinanie in Athi River and is expected to be in operation in eighteen months. “We have 15 tanneries and there is potential to have more, but we are held back by the huge investment required, the need for effluent treatment plant systems and export of raw materials. The sector generates Sh10 billion, but has capacity to generate 10 times more if we move from export of wet blue (semi-processed) to finished leather,” said Adan Mohamed, the cabinet secretary Ministry of Industrialization.
The hub will target 15 tanneries which will produce 150 tonnes of raw hides per day and manufacturing units that will produce 10,000 pairs of shoes daily, hand bags, leather garments and industrial gloves.
“The government has identified leather and textiles as focus areas in plans to increase exports and create jobs in a relatively short time,” Adan added.
The idea of setting up the leather city was as a result of a leather task force which has been working with the Leather Development Council and Kenya Industrial Research and Development Institute on a road map to establish a fully-fledged product development facility complete with a globally standardised effluent treatment plant (ETP).
The leather industry is making a comeback after the collapse of tanneries that saw fortunes dwindle in the 80s and 90s. The market for leather products have grown both locally and internationally which is inspiring the setting up of the hub.
Statistics by the Kenya Leather Development Council, show that Kenyans now buy 20 to 24 million pairs of shoes every year, double the volume of two years ago.
Global trade in leather is worth $77.5bn (Sh6.68 trillion) with footwear taking 60 per cent of this.
China, Italy and India are currently the top leather producers in the world.