Towards survival of Nigeria’s leather industry

Features & Reports

Until Nigerians began to appreciate and patronise locally manufactured products, especially in leather, its chances of survival and competing favourably with the international market may not materialise.

Besides, Nigeria with a population of over 170 million people, if each person should depend on locally made goods; revenue generated from the non-oil sector would triple the gross domestic product of the economy especially now that the country is battling with recession.

At the just the concluded 2017 Lagos Leather Fair, which was put together by Femi Handbags, a private initiative to address the persistent and considerable challenges facing the Nigerian leather industry, stakeholders who converged at the fair clamoured for just one thing – the survival of the leather industry.Indeed, Nigeria’s earnings from the non-oil sector in 2015 exceeded its oil revenue, accounting for 61.1 per cent of the federally-collected revenue with about N448.83billion. The country’s earnings from the oil sector during the period dropped to N286.24billion.

According to a report from the Bank of Industry (BoI), the leather industry generates $700million annually with limited support, and has the capacity to create about 700,000 direct and indirect jobs.

The Guardian learnt that if appropriate policies are put in place, leather production, which has spanned many years in Nigeria could further boost the current revenue earned from the sector especially with lots of opportunities that abound.

With a global market size of $20billion traded annually and inherent opportunities it portends to non-oil exports, the Chief Executive Officer, Nigeria Export Promotion Council (NEPC), Segun Awolowo stressed the need for increased productivity in the leather industry to meet international brands.

Awolowo noted that the industry being an integral component of the Federal Government’s Economic Recovery and Growth Plan (ERGP), whose value chain is critical to the economy, has the potential of earning over $1billion for Nigeria by the year 2025, given all the required support and intervention.He said: “Our leather products are already competing with the international market. Many of them are being sold abroad already. But we need to increase productivity in order to meet up with other international brands.

“With approval of the Minister of Industry, Trade and Investment, Okechukwu Enelamah, the NEPC has commenced the process of implementing the zero oil plans. This non-oil export revolution campaign is set to systematically grow non-oil export from$2.7billion to $8billion in 2020, and eventually get into our target of $30billion by 2025, to bring a future economy where Nigeria will be able to survive on zero export of crude oil.

“Hides and leather is strategic. Fair provides platform to showcase creativity of Nigerians and offer opportunity to identify gaps and potential of the industry whose value chain is a critical economic sector as identified in NEPC’s zero oil plan, an integral component of the federal government economic recovery and growth plan ERGP,” the NEPC boss said.

Affirming his support to the leather sector, the Executive Director, Small and Medium Enterprises (SMEs), BoI, Waheed Olagunju, who promised to leverage more on capacity building for the entrepreneurs, expressed optimism that Nigeria can compete favourably in the global market with the quality of works displayed at the fair.

“With the right policies support, the current amount generated annually can be doubled if not tripled. That is the reason the BOI is actively supporting the leather sector.

“Rest assured that current and potential entrepreneurs in the leather value chain who have potentially valued proposals will all be supported by the BoI. We will mobilise our relationship with our government partners to ensure that we help them realise their potential and also ensure that they are able to explore their advantages in the domestic and international market,” Olagunju said.

Specifically interested in the revival of the Finished Leather Goods (FLGs), particularly the foot wears, the Ministry of Industry, Trade and Investment, also called for the stimulation of the leather sector. It was agreed that for it to work out, certain policies must be put in place across the value chain, right from the raw material to finished products.

Represented at the fair by the ministry’s Deputy Director, Industrial Development Department, Kunle Olorode said: “That in essence will promote our locally manufactured goods. We will also be looking for ways to which all these FLGs are produced in Nigeria, whether by indigenous companies or companies attracted by favourable investment climate, our interest is, it is made in Nigeria to create jobs in Nigeria. Therefore, it will be a win-win solution for us.

“The potential is there, but we need to stimulate the sector. The essence of government is about policy development. The agencies are there and we are the implementers,” he added.

While making a remark, the event’s special guest of honour, the Emir of Kano, Sanusi Lamido Sanusi, asserted that Nigeria boasts of the best leather in the world, with immense opportunities for the development of local industries.Sanusi expressed shock that till now, Nigerians remain neck-deep in importation of leather when the products are found in large quantity in-country, adding that it is the folly of a nation that chooses to export what it does not have and to import what it has.

The former Central Bank Governor, who was represented by the Danadalan of Kano, Isyaku Umar Tofa, said the history of leather production in Nigeria would not be complete without mentioning Kano State, noting that Kano leather is also known as the Moroccan leather.

Sanusi stressed the need for infrastructure development in the leather industry to enable more local production than over-dependence on importation of products.
Despite having the best leather, he regretted that Nigeria continues to import millions of pairs of shoes from Asian markets rather than buying from our local market.

“It is my hope that the leather fair such as this will encouraged investment, technology and infrastructure in market development so that we will continue to produce locally than we import. The convener of the Leather Fair, Femi Olayebi, said the fair was initiated to address the persistent and considerable challenges in the Nigerian leather industry.

With the theme: “Changing the narrative”, Olayebi noting that the fair is the first of its kind in Nigeria, decried the neglect the industry had faced over the years with numerous challenges. These relate to the dearth of artisans having the required skill-sets to manufacture leather products to international standards, constant electricity for production, and the sheer lack of work ethic exhibited by the handful available, among others.

“It is disheartening to find that the challenges in the sector have remained, with apparently no easy solutions in sight,” she added.Focusing on the essence of the fair, she explained that it aims to bring together under one roof, the major players along the leather value chain to start necessary conversation and thereafter take possible action.

With regard to some of the issues facing the industry, the Permanent Secretary, Lagos State Ministry of Commerce and Industry and Co-operatives, Akodu Olalekan, told The Guardian that Lagos being the financial market hub for FLGs is prepared to focus more on capacity building, especially for young entrepreneurs.

“This is the kind of initiatives the Lagos state governor, AkinwunmiAmbode is promoting. That is the reason why he has taken onboard to establish the N25billion trust fund to assist local entrepreneurs. It is only when we use our made in Nigeria goods that we can progress and government is to provide the enabling environment to young entrepreneurs to unleash their potential,” he said.

Olalekan, who was impressed with the works of Femi Handbags, added that the state would address the challenges faced by the entrepreneurs, which are hinged more on electricity.

The 2017 Lagos Leather Fair ended at the weekend with many side attractions including master classes, workshops and panel discussions treating pressing topics that bother on the success of the leather industry, with local manufacturers showcasing their home-made products ranging from hand bags, bands, slippers, wallets among others.

Guardian