The leather industry has petitioned the government to reimpose the maximum suspended duty on imported footwear and leathergoods to protect local industries and to introduce a 10% export duty on raw hides and skins to increase capacity utilisation of local tanneries. They have also asked the government to grant incentives of 20% on export of value added leather products.
Industry leaders argue that following the liberalisation of the economy only eight tanneries have remained in operation and are operating at 20% of capacity. The closure of tanneries resulted in a loss of over 2,300 jobs in tanning, 1,200 jobs in the micro enterprises dealing with leather products and 3,800 jobs in footwear factories. Kenya has 16 registered medium and large-scale commercial tanneries with a total investment of $50 million (KSh4 billion).
A government press release stated: ‘We expect this sub-sector to be revived after the accreditation of Kenya as a beneficiary country under the Agoa. The products under this sub-sector are eligible for export to the US duty free under the Act. Over 18,000 jobs will be created if the sub-sector is revived.
