Leather industry calls for Government support

03 Jan, 2021 - 00:01 0 Views
Leather industry calls for Government support

The Sunday News

Judith Phiri, Sunday News Reporter
THE National Leather Working Group (NLWG) has called on the Government to intervene on the duty structure for components that are usually imported for the industry such as chemicals, equipment and other manufacturing inputs saying the fees are too high for the viability of the sector.

In an interview, National Leather Working Group (NLWG) secretary in the Bulawayo leather cluster, Mr Fungai Zvinondiramba said the duty fees were too high for some of the players in the sector to acquire some of the basic components.

“There is a need for Government to intervene in terms of the duty structure for components that are usually imported for the industry such as chemicals, equipment and manufacturing inputs. Duty fees are so high and paid in foreign currency, this then hinders the growth of some small players in the industry,” said Mr Zvinondiramba.

The rough estimate for chemicals range from five to 15 percent and the components between five to 40 percent.

He said the leather value chain needs to also sort out issues pertaining to cost structures and technology, and the leather sector value chain players believe that, with adequate support, the sector could be turned around and ultimately contribute to sustainable exports.

Mr Zvinondiramba said some of the actors in the value chain have either closed or were operating below capacity due to unfavourable macro-economic environment over the past decade, including the period of the Leather Strategy 2012 to 2017.

He said the sector was facing many challenges.

“One can note that some of the challenges include poor animal husbandry practices resulting in poor quality of hides and value added products; absence of sector specific policies; lack of technical and managerial skills; high cost of finance, unsuitable or absent slaughter facilities; poor marketing of leather commodities; and, production of poor quality products due to inadequate and/or obsolete technology,” he said.

He also noted that there was a need to lobby for the development and reform of 70 percent of identified policies and legal frameworks for transformation of the leather sector by 2030.

Mr Zvinondiramba said there was hope of resuscitating the sector with the Zimbabwe Leather Sector Strategy (2021-2030) which seeks to increase the competitiveness of the leather value chain through building stakeholders’ production capacities from about 30 percent to 75 percent by 2030 and enable them to access local and export markets.

He said the vision of the Zimbabwe Leather Sector Strategy (2021-2030) was to be a vibrant and internationally competitive, reliable and innovative leather industry contributing to sustainable development through value addition. Stakeholders should increase capacity utilisation of value-added products from 30 percent to 75 percent by the end of 2030.

Mr Zvinondiramba added: “The strategy also seeks to enhance the application of sustainable production technologies from the current 10 percent to 60 percent of the manufacturing companies and to increase the export of leather products from 10 percent to 40 percent of production by 2030.”

The leather sector strategy 2021-2030 emphasised and prioritised the creation of value by unlocking wealth for the players at each of the nodes, such as farmers, traders, merchants, suppliers, abattoirs, tanners and both small and large-scale manufacturers and retailers.”

Mr Zvinondiramba said the leather value chain in Zimbabwe was well structured starting from the livestock farmers, till it reached the end players, the manufacturers and retailers, and the actors at various nodes play significant roles in the generation of revenue and contribution to the Gross Domestic Product.

Zimbabwe is ranked 48 in the world (0,35 percent of the world livestock herd) and 14 in Africa. However, Africa is a small producer ranked sixth out of seven continents with a total share of 1,3 percent. Zimbabwe has great potential to scale up its production and processing of raw hides.

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