Uganda is one of the Common market for Eastern and Southern African (Comesa) member countries with low value added produce, according to government. This has seen the bloc lose out on opportunities on the international trade.
In order to address this, Comesa is developing an industrial policy that will encourage countries to enhance their manufacturing sector and to add value to their primary produce.
Raw material supply
While at the 4th Fourth Biennial Conference of stakeholders in agriculture and Network of Universities (RUFORUM) in Maputo, Mozambique last week, Comesa Secretary General Sindiso Ngwenya said: “Africa’s supply of raw materials and semi-processed leather products was a low yield earner with minimum profits.”
In order to advance Africa’s potential to become competitive in the leather and leather products sector, Mr Ngwenya advocated for involvement of the local universities in enhancing research and technology to add value to the region’s agro-based commodities.
“Improvements in the leather tanning processes and designing of leather products will require research”, he said. “Development of Small and Medium Enterprises tools will require research. Reverse engineering will require research. This is in addition to the development of technology to fabricate machinery for the leather industry.”
Mr Ngwenya: “This is easily attainable through the specialised institutions that already have the mandates to spearhead these initiatives by working closely with the universities both in the region and at global level.”
Africa contributes 21 per cent of the total livestock production in the world yet it earns only 2.67 per cent of the total global earnings from the multibillion dollar industry. Mr Ngwenya attributes the poor earnings to low level of adoption and use of science, technology and innovation.
“The continent earns approximately $4 billion (about Shs10.4 trillion) from leather and leather products while globally the industry is greater than the sales of cotton, sugar, tea and meat combined earning over $150 billion (about Shs390 trillion),” Mr Ngwenya said.
Uganda’s leather industry has the potential to generate up to $500 million from the home market and $5 billion from the COMESA region, according to Mr Nicholas Mudungwe, the regional industry expert. It is estimated that in the financial year 2008/9, Uganda lost revenue equivalent to US$249.7 million by exporting raw hides. The return per unit weight realized by business men when they sell finished leather products is 12 times that when they sell raw hides and skin. (Source: Trade Ministry)