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XINHUA NEWS SERVICE REPORTS FROM THE AFRICAN CONTINENT

 

Kenya mulls export tax on semi-processed
leather to promote value addition 

NAIROBI (Xinhua) -- Kenya is considering imposing an export tax on semi-processed leather in order to promote value addition locally, the leather industry regulator said on Thursday.

Charles Ndungu, head of research standards policy, Kenya Leather Development Council (KLDC) told Xinhua in Nairobi that Kenya currently exports approximately 80 percent of its semi-processed leather due to lack of local capacity to convert it into finished goods.

“We will consider imposing an export tax on wet blue leather once the leather industrial park is complete and the country is able to absorb all semi-processed leather,” Ndungu said.

He said that Kenya’s decision to impose an export tax of 80 percent on all raw hides and skins has dramatically reduced its sales overseas and led to new investments in tanneries.

He noted that under Kenya’s industrial agenda, the country hopes to process all hides and skins produced locally into finished goods.

According to KLDC, Kenya produces 2.5 million hides and 10 million skins annually.

“Unfortunately due to poor handling along the value chain most of the hides and skins are not fit for production of leather products for the international market,” he said.

He observed that most of the semi-processed leather is exported to India and China for further processing.

Ndungu noted that Kenya currently produces approximately eight million pairs of shoes annually against a demand for 24 million pairs of shoes.

“We are major importer of finished leather products despite having sufficient raw materials for producing leather products,” he said.

He added that most of the leather processing industry consists of small enterprises that operate in the informal sector.

KLDC said that it will catalyze the growth of local leather industry through development of common user facilities for processing leather into shoes, belts and other fashion accessories. 

             

 

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