This is the second Limeblast dealing with the US$3,186,000 Raw Hides and Skins Grading and Pricing System project financed under a grant for US$1.4 million by CFC. This month I would like to put my magnifying glass on this expensive project and analyse what has been achieved. Ms Calabrò of Unido explains that the Hides and Skins Grading Norms used by the CFC funded project were 'guidelines' and were tested in target areas of those countries which were part of the project. These guidelines were issued to demonstrate hides and skins improvement activities. She says that it was clear from the beginning that the project was not a hides and skins 'development' programme as these areas are the responsibility of FAO and not Unido but the decision was made to include it in the programme for 'demonstration purposes only'. I have no quarrel with this. These guidelines are objective and useful and adapted to the environment in which they are used. The big problem is how to implement them. The CFC booklet states on page 1 that the project is focused on providing standards for the grading and pricing of African raw hides and skins. The text continues saying that the standards, once implemented, will enable African raw hides and skins to compete on an equal footing with similar products in the international market. FAO writes in a paper issued by their Committee on Commodity Problems, presented in December 2003 during the eighth session of the sub-group of hides and skins that: 'There are reports of a marked improvement in the quality of grades presented to the markets in the focus countries.' Who told them this? The answer is simple! FAO states that 'the project was closed in March 2003 after a satisfactory terminal report by the project executing agency', who apparently had to judge their own work. How objective can such a report be? So let us see how much the Raw Hides and Skins Grading and Pricing System's project has influenced the price structure and the selection standard in the countries that benefited from the project compared to those who were not amongst the elected and preferred. With the help of acquaintances including S M Naseem, managing director of Mima Leather Ltd, Pakistan, and Ron Sauer of the SauerReport, whom I thank for their collaboration, I was able to construct a table of raw and wet-blue tanned goatskins. I looked at prices from 1999, when the CFC project was started, to 2004 and compared the prices of raw skins from Kenya, which benefited from the CFC project with the prices of raw skins from Rwanda and Pakistan, who did not. I also compared wet-blue skins from Kenya and Ethiopia, who both benefited from the project, to wet-blue from Rwanda which was not a participating country. You can see from the statistics that there is absolutely no difference whatsoever in the way the prices in the participating countries reacted to the market tendencies compared to countries that were not participating. Prices in Kenya and Ethiopia compare to prices in Pakistan and Rwanda exactly the same as before, during and after the Raw Hides and Skins Grading and Pricing System project. Therefore, the project has had no discernible effects on the prices of Kenyan and Ethiopian skins in the world market and the stated main objective of the project has not been achieved! I also wanted to include Tanzania in the graphic but the actual records on Tanzanian prices of dry goatskins did not go back that far. However an important trader in Tanzania told me that there had been 'Absolutely no change to the way hides and skins are selected and sold and that the CFC project had 'Absolutely no influence on the prices of hides and skins.' The bottom line is, therefore, that $3,186,000 of public money was wasted! The alleviation of poverty at grassroots level which is mentioned on page 11 of the CFC booklet has not occurred. Kenya had in the recent past a superb modern abattoir, the Kenya Meat Commission, which provided for machine flayed hides. The country also had a number of well equipped functioning tanneries. 'Thanks' to the WTO and free trade the meat industry has been privatised and the KMC is closed. The majority of the tanneries have closed too. So the country was theoretically in an excellent position to produce good quality hides and skins, and process these hides and skins in their own domestic factories, but the abattoir and the tanneries lost out to the raw hide and skin merchants who seem to be capable of buying their green hides and skins more or less at the same price as they sell the cured material to the subsidised tanning industry in India and to the Far East, depriving the local Kenyan tanners of the raw material. This situation is, of course, neither the fault of CFC nor the hide and skin improvement project. The CFC booklet furthermore states on page 15 that Esalia has designed a registered Quality Mark to be awarded to tanneries and contract tanners who follow the Esalia/Unido guidelines. The mark is said to be designed to provide confidence for the international market. It should also trigger flayers to produce high quality hides and skins with the incentive that they will be remunerated better for better-flayed skins. Personally I have never come across one single shipment that bears the Esalia Quality Mark. I asked Esalia to 'please inform me how many certificates you actually issue monthly, and for how many exporters in the four affected countries? How many certificates have been issued totally since the system is in place?' Yes, you guessed it: no answer! Anyway the CFC booklet is full of mental exercises concerning theories of what should be done, policy recommendations on Trade and Livestock Management, techniques that should be adopted, dissemination of project results to the stakeholders, without ever mentioning what the actual tangible results of the project were. They do mention that 'it is recommended that the project lifetime be extended in order to observe any significant changes in the industry. So they admit that three years and 3 million bucks is not enough to make even a small change!!!!! If you read paragraph 5 on page 31 of the booklet entitled 'Lessons learnt and recommendations for action' you'll see that it's full of recommendations but totally lacking in lessons learned. Sam Setter samsetter@limeblast.org
