While Botswana continues to struggle in establishing a leather industry despite a well established beef sector, lesser quality cattle producer Ethiopia is thriving on the world stage.
The East African nation is fast becoming the world’s best leather producer and exporter.
Ethiopian Ambassador to South Africa, Mulugeta Kelil said in an interview that there is an opportunity for Botswana to learn from their leather industry and establish itself as a global exporter of quality leather.
“We have the largest population of cattle and a large number of other animals, however, Botswana cattle have very high quality skins,” Kelil said. The ambassador, who is based in Pretoria, was in the country for ongoing bilateral talks between the two nations. He said given the quality of hides of Botswana’s cattle, there is an opportunity to establish leather factories that will export to the world’s largest producers at an attractive price.
“We used to import finished quality leather goods, now our finished leather is being exported to the likes of Italy just to make high end shoes and other things,” Kelil said, adding that his country now has a thriving leather works and products market. “We are able to create jobs through this industry,” he emphasized.
He said the process to transform the industry started about 10 years ago with the government deciding to invest heavily into the sector. “Previously, our leather was not so good, we used to export semi finished products at low prices, because our producers struggled with getting machinery that can get leather up to exceptional standard,” Kelil said, adding that his government established institutions for training in leather works while also providing incentives for the industry.
“The training gave the industry the workforce they needed, while the government further gave tax incentives on machinery importation. Low import tax helped a lot in the sector to establish themselves and compete with the world in producing the best leather,” he said.
He stated that the government further gave credit facilities for large producing factories which enabled them to operate irrespective of the markets. Kelil said the country has multiple levels of leather producers from small to large.
He said in order to encourage the establishment of smaller leather factories in different places, they used the cooperative model. “We support small producers to get their products to acceptable quality and to produce leather goods. The support includes training and financing. These factories now make goods they can sell in the Ethiopian market including shoes, bags, belts and the like,” he said.
Botswana has struggled to establish a leather tannery industry despite a history of cattle production. Talk of a leather park has only taken off in recent years, however it remains to be seen if it will indeed get established.
Kelil said his visit is part of an ongoing dialogue between the two governments. “We are looking for collaborations that will enable us to grow our economies. We have in previous times established agreements for cooperation, however we need to increase the pace. We hope for the two governments to sign a Memorandum of Understanding (MoU) by the end of the year,” he said. Kelil underlined that such an MoU would allow for structures that will enable the exploitation of opportunities in each other’s economies.
While Ethiopia has previously been an aid funded country, they are currently establishing themselves as a fast growing economy which is not reliant on mining. According to the African Development Bank, the country continues to be one of the fastest growing economies in the world with 2013/14 growth at 10.3% and this strong growth is expected to continue in 2015 and 2016.