Home ECONOMY Kenyan leather exporters bet on US-China trade deal

Kenyan leather exporters bet on US-China trade deal

by biasharadigest
Economy

Kenyan leather exporters bet on US-China trade deal

President Donald Trump
President Donald Trump. FILE PHOTO | NMG 

Kenya’s leather exporters are predicting a better year as the US and China move to end their three-year trade wars.

A Chinese delegation is expected in Washington on January 13 for the signing of phase 1 of a trade treaty in what could end the tariff wars that have underpinned President Donald Trump’s first term in office.

Industry players said they expect the improved trade relations between the two States to translate to increased uptake of their goods in traditional export markets.

“The biggest importer of leather is China but its economy has not been doing well due to the wars with the US,” Mr Fahd Faisel, managing director of Nakuru Tanners told the Business Daily by phone.

“I used to export to China, India and Pakistan but things have been getting tough over the three years and as we speak, I have not been able to export anything in the last eight months.”

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Kenya’s earnings from leather exports fell 28.8 percent or nearly Sh1 billion to Sh2.46 billion in nine months to September last year.

The data by the Kenya National Bureau of Statistics shows that earning from hides and skins exports fell from Sh3.46 billion in the first nine months of 2018 underlining bleak prospects for livestock farmers.

The decline in export earnings shines the spotlight on the leather industry earmarked by the Jubilee administration as a key job-creator due to its labour-intensive nature across all value chains.

Apart from the raging China-US tariff wars, industry players have also blamed the declining earnings on the rise in the use of synthetic leather to make shoes, sofa sets and bags, among other utilities.

Lobby group Leather Apex Secretary-General Beatrice Mwasi said despite the depressed demand in China, the global market is also shifting to our neighbours like Rwanda, Ethiopia and Burundi due to their superior quality.

“One of the reasons is that the quality of our hides and skins has been falling over time and tanners are receiving poor quality from the slaughterhouses … countries like Rwanda, Ethiopia and Burundi have bigger animals and buyers are opting for them due to quality and size, Ms Mwasi said.

Stakeholders have for years decried low-quality leather leading to the production of low-quality finished products for the local and export markets.

The State has, in efforts to improve, quality of leather products last year started construction of a common-leather facility that will improve processing to high-quality products at Old Kariokor Market in Nairobi.

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