Employees sort leather skins at Bata factory, Kenya. Two Italian firms
to invest over $24 million in Tanzania’s leather sector. PHOTO | FRANCIS
NDERITU | NMG
Two Italian companies have entered Tanzania’s leather sector to
take advantage of the large quantities of raw hides and skins produced
every year in the country.
Toscana Machine Calzature
(TMC) and ItalProgetti have signed an agreement with Prisons Department
and the Public Service Social Security Fund to establish two leather
factories in Moshi in Kilimanjaro Region.
The companies
will invest $24.5 million to construct two leather factories to be
managed jointly with Karanga Leather Industries Company Ltd in Karanga
Prison.
The two factories, one for shoe-making and
another for tanneries, will be constructed on 25 acres of land at the
industrial area within Karanga Prison, and are set for completion in 16
months.
TMC sales manager Daniele Ferradini said the
Italian companies will provide both finances and technology for
production of quality leather products for export to Italy and other
European countries. The plant is expected to produce 1.2 million pairs
of shoes per year.
The Public Service Social Security
Fund and the National Social Security Fund are also reviving leather
factories in Morogoro Region with the Prisons Department.
President John Magufuli has also invited Egyptian investors to
venture into livestock-based industries, mostly beef and leather
products, banking on Egyptian technology in leather and livestock
products.
Ministry of Industry and Trade reports show
that Tanzania has been importing shoes and leather products while making
little use of its livestock products.
In the region,
Tanzania has the second-largest herd of livestock, after Ethiopia, and
produces 3.9 million bovine hides, 2.5 million goatskins and 2.3 million
sheepskins.
Data from the Ministry of Agriculture,
Fisheries and Livestock Development shows that Tanzania has 23 million
heads of cattle, 16 million goats, 7 million sheep and 2 million pigs.
Low
investment in value addition in the leather industry has undermined
production, with thousands of tonnes of skins and hides going to waste
due to poor handling and low quality, officials say.
Earnings
Export
earnings from the leather sector has in recent years increased slowly
at an average of 22 per cent, indicating that the industry is operating
below capacity. Raw hides and skins are sold to Kenyan factories.
The
leather industry in Tanzania has the total installed capacity of 74.2
million square feet, but most of Tanzania hides and skins are smuggled
to Kenya where leather processing factories and tanneries are operating.
Eight
small and medium size leather factories are currently operating below
capacity with less than 50 per cent capacity in collections and
processing of raw skins and hides.
Tanzania imports
between 31,000 and 42,000 pairs of leather shoes from China and other
South East Asian states, but less than three percent (3 per cent) of
shoes are made from pure leather.
Under the Five Year
Development Plan spanning from the year 2016 to 2020, the government of
Tanzania had set a target for speeding industrial revolution and which
will make each of Tanzania’s 26 regions attract manufacturing industries
and agro-processing factories.
Minister for Finance
and Planning Dr. Philip Mpango said the government’s 2016 to 2020 FYDP)
need 107 trillion/- (US$ 53 billion) for its implementation and it aims
at boosting industrialization for economic development.
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