Africa Economy: Kenya plans to set up Leather City to help spur industrialization

The Kenyan government has announced plans to establish a Leather City, a fully-fledged product development facility in Athi River, a town outside capital Nairobi, that will be the first of its kind in the region.

The industrial park will be set on 500 acres of land that has been identified in eastern Kenya, which the government is optimistic could generate 10 times the current value of exported raw leather to about 1.09 billion U.S. dollars in 18 months

"This is in line with government policies to move the country from an exporter of raw and semi-processed hides and skins to finished leather goods," Industrialization Cabinet Secretary Adan Mohamed told journalists in Nairobi late on Tuesday.

Mohamed said the establishment of the Leather City has been endorsed by the government, adding that the initiative is expected to spur investments in value addition for the leather sub-sector.

"As a country, we have abundant supply of raw hides and skins, and the ministry has embarked on plans to establish a world class industrial City in Kenanie, Athi River to move the country from an exporter of raw and semi-processed hides and skins to finished leather goods," he added.

The planned Leather City will feature world class infrastructure including a global standard effluent treatment plant that is a critical enabler in the tanning of hides and skins, as well as carefully master-planned integrated leather and leather goods production facilities.

Mohamed said the project will be fully funded by the private sector, in what is a departure from the past, with the government providing land and infrastructure such as the common effluent treatment plant.

He said the ground-breaking ceremony is slated for February.

Kenya has in the past established measures to prop up the leather industry, such as increasing export duty on raw hides and skins as well as budget allocations for development of tanneries in rural areas.

The Leather City is expected to generate revenue for the government and create employment opportunities in developing finished leather goods.

The park will house tanneries, a training center, common manufacturing facilities, chemical storage and distribution units, leather goods' accessories production units and a Common Effluent Treatment Plant (ETP).

The Leather City will also accommodate facilities from the service sector including business centers and those from the hospitality industry.

The initial phase will target at least 15 tanneries, each with a production capacity of 10 tonnes of raw hides and skins per day and at least 10,000 pairs per day each of shoes, hand bags, leather garments and industrial gloves.

Establishment of the industrial park will therefore play a pertinent role to increase the competitiveness in the sector by plowing in modernization, industrial decentralization, ecological preservation and natural consumption of energy and water resources.

"It will promote research and technological development to enable the country's sector keep abreast with the changing market trends and consumer preferences," Mohamed said. Endi