Strong Raw Material Base for the Leather Industry
Ethiopia offers untapped natural resource base for leather and leather products production with one of the highest livestock population globally. Leather, footwear and other products manufacturing is highly incentivized and promoted with massive investment facilitation backing from the government.
Currently, the leather industry is thriving remarkably. Anchor foreigner companies, for instance from Italy, China, UK, India, and Turkey, are operating within the country and the number of tanneries are increasing from time to time. Concurrently, international market destinations are expanding and the amounts of products that are supplied to the global market have increased in volume, variety and quality.
These days, Ethiopian made leather and leather products are exported in large volumes to high quality demanded markets in Europe and other parts of the world. And it is not now surprising to see Ethiopia’s leather products in some of the largest shopping malls of Italy, United Kingdom, North America, Canada, Germany, Japan, China, Vietnam, Thailand and in many African markets such as in Kenya, Sudan and Uganda. Consequently, the sector is registering encouraging development and showing promising export revenue.
According to Leather Industry Development Institute the leather and leather product exports have shown substantial increment from 67 million USD to 115.4 million USD between 2004/05 and 2016/17 fiscal years and significant achievements are registered in increasing export volumes, and diversifying goods.
In the first half of the Ethiopian budget year, the country has earned a total of 69.6 million USD from exports of various high end leather products. The amount, compared with the same period of the previous year, surpassed by 20 percent.
Ethiopia’s leather industry, as it bases on country’s livestock resources, has sizable investment potential and business opportunities. And investing in the sector does not only benefit the country but it also generates high returns to investors. The sector is also enjoying significant international comparative advantages.
Particularly, owing well known sheepskins (in terms of quality, thickness, flexibility, strength and compact structure) that are very suitable for the production of high quality leather garments, gloves and other leather goods apart from creating more opportunities in the world market make the country the right place for leather industry.
Furthermore, government’s investment friendly policies and strategies along with the duty free access for markets in USA and EU markets are sector’s good opportunities for investors.
Not only these, the enabling and conducive atmosphere in terms of provision of incentives, including duty exemptions on capital goods and five-plus years of an income tax holiday as well as the political and economic situations are the other positive aspects of investing in Ethiopia.
With all these and other favorable investment opportunities, therefore, Ethiopia invites potential investors to take part in country’s leather sector that would benefit them hugely.
Ready for Your International Business
Leather Products:
Ethiopia’s footwear exports: mainly to the US market including brands such as Lucky brands (Guess & Marc Fisher), Calares (Naturalizer), Wolfe.
Ethiopia exports gloves to the US, Europe and China markets.
Manufacturers source leather locally and import other inputs duty free.
Opportunities for Investors:
Untapped resource base in which FDIs can capitalize on; only a fraction of the potential transformed in to final products.
Investment opportunities from soaking up to product making.
Duty free import of raw material & inputs.
New Leather dedicated industrial parks construction underway.
Investment opportunities in chemicals, accessories and machinery (currently all imported).
Raw Material
Ethiopia ranks 7th globally with 60 million cattle and 60 million sheep and goat population.
Large Raw Hides and Skins: total of 80 million sq.ft sheep and goat; 110 million sq.ft bovine.
Annual finished leather production: 120—135 million sq.ft out of which 50% is exported.
Sheep Skin
Low fat content, thin yet strong leather can be created with superb softness; fine grain pattern gives a very natural and elegant look.Has huge applicability for gloving (sports, dress, military etc.), high end clothing, high end footwear and fine luxury goods.
High strength and higher fibre density with firm stand.
Goat Skin
Tighter fibre density with relatively uniform distribution across its thickness, strong and fine nap with standing strength (writing or velvet effect). Better strength even at lower thickness.
Cow Hide
High strength and higher fibre density with firm stand.