Business / Economy
Welshman Ncube launches leather sector development strategy
14 Jun 2013 at 07:34hrs | Views
THE Government yesterday launched the Zimbabwe Leather Sector Development Strategy expected to make the country's leather sector a vibrant and internationally competitive industry.
Officially launching the strategy at the Zimbabwe International Exhibition Centre in Bulawayo, Industry and Commerce Minister Professor Welshman Ncube said the strategy constituted private-public platform for action.
He said the strategy was also aligned to the Industrial Development Policy and the National Trade Policy that were in line with his ministry's mandate under the Medium Term Plan (2011-2015).
"It provides a clear roadmap resulting from agreements between each of the value chain stages. The analysis was based on market led approaches that holistically considered economic and social issues together with cross cutting and enabling factors such as policy, access to finance and extension services," he said.
Prof Ncube said history had shown that resource rich countries had tended to grow slower than economies without substantial natural resources.
He said stakeholders needed to defy this historical background as a resource-rich nation and make the country the industrial hub of Southern Africa.
"The manufacturing sector reached its peak last year when it achieved an average capacity utilisation of 57 percent. However, it is disheartening that this year the general performance of the manufacturing sector has again fallen down to 44 percent in general and around 30 percent for the leather sector with availability and cost of electricity being one of the impediments to attain maximum capacity utilisation," said Prof Ncube.
He said Government through the Ministry of Industry and Commerce had been requested by the Common Market for Eastern and Southern Africa (Comesa) to come up with a National Leather Sector Development Strategy crafted within the confines of the regional leather and leather products strategy.
"The major objectives of the leather strategy inter alia include improved access to finance throughout the value chain so as to buttress the sector players' cash flows, improved market intelligence of all enterprises and stakeholders and improve quality and collection of hides and skins.
Critically of course there ought to be an improvement in value addition and quality through training, through a cluster based approach."
He said the National Leather Sector Development Strategy further sought to facilitate the leather and related sectors of the economy towards export-orientation and international competitiveness.
Prof Ncube said this would be done while ensuring that Zimbabwean firms and households enjoyed continued access to a wide range of high quality leather goods.
"It seeks to turn around the fortunes of the leather and related companies and address one of the most important factors in industrial development which is Industrial Cluster Development," he said, adding that this was one of the pillars of the present National Industrial Development Policy.
Minister Ncube said there was an emerging consensus that the development and promotion of industrial parks or clusters were recognised as an effective means of industrial development and promotional of Small and Medium Enterprises (SMEs) worldwide.
He said while efforts were being made to add value, leather sector was presently failing to absorb all raw hides and skins being produced.
"More hides are being exported from Zimbabwe in their raw form, instead of being exported at least in the first stage of value addition that is the wet blue stage," he said.
In 2011, 5 440 tonnes of raw hides including crocodile skins worth $28 million was exported.
"The average value of leather and leather products exported globally in 2010 was $184 billion of which hides, skins and leather made up $27 billion or roughly 16 percent. Of this amount, 40 percent of the value was exotic leather. In 2011, only 2,2 million pairs of footwear of all types were produced while four million pairs of mainly cheap synthetic shoes were imported essentially making us net importers of footwear," said Prof Ncube.
Speaking at the same occasion, Comesa secretary-general Mr Sindiso Ngwenya said they would continue to promote the economic transformation and growth of the region's economy through deeper and sustainable integration anchored in building industrial competitiveness through the development of national and regional clusters.
He said Comesa secretariat was working to promote value addition in the leather value chain as a mechanism of boosting job creation and intra trade.
"Building the productive capacities is an essential element for enhancing competitiveness to boost regional and international trade. It is in this context that Comesa is putting in place mechanisms to unlock value in sectors such as agriculture, industry and services, which are dominated by SMEs," he said.
Officially launching the strategy at the Zimbabwe International Exhibition Centre in Bulawayo, Industry and Commerce Minister Professor Welshman Ncube said the strategy constituted private-public platform for action.
He said the strategy was also aligned to the Industrial Development Policy and the National Trade Policy that were in line with his ministry's mandate under the Medium Term Plan (2011-2015).
"It provides a clear roadmap resulting from agreements between each of the value chain stages. The analysis was based on market led approaches that holistically considered economic and social issues together with cross cutting and enabling factors such as policy, access to finance and extension services," he said.
Prof Ncube said history had shown that resource rich countries had tended to grow slower than economies without substantial natural resources.
He said stakeholders needed to defy this historical background as a resource-rich nation and make the country the industrial hub of Southern Africa.
"The manufacturing sector reached its peak last year when it achieved an average capacity utilisation of 57 percent. However, it is disheartening that this year the general performance of the manufacturing sector has again fallen down to 44 percent in general and around 30 percent for the leather sector with availability and cost of electricity being one of the impediments to attain maximum capacity utilisation," said Prof Ncube.
He said Government through the Ministry of Industry and Commerce had been requested by the Common Market for Eastern and Southern Africa (Comesa) to come up with a National Leather Sector Development Strategy crafted within the confines of the regional leather and leather products strategy.
"The major objectives of the leather strategy inter alia include improved access to finance throughout the value chain so as to buttress the sector players' cash flows, improved market intelligence of all enterprises and stakeholders and improve quality and collection of hides and skins.
Critically of course there ought to be an improvement in value addition and quality through training, through a cluster based approach."
He said the National Leather Sector Development Strategy further sought to facilitate the leather and related sectors of the economy towards export-orientation and international competitiveness.
Prof Ncube said this would be done while ensuring that Zimbabwean firms and households enjoyed continued access to a wide range of high quality leather goods.
"It seeks to turn around the fortunes of the leather and related companies and address one of the most important factors in industrial development which is Industrial Cluster Development," he said, adding that this was one of the pillars of the present National Industrial Development Policy.
Minister Ncube said there was an emerging consensus that the development and promotion of industrial parks or clusters were recognised as an effective means of industrial development and promotional of Small and Medium Enterprises (SMEs) worldwide.
He said while efforts were being made to add value, leather sector was presently failing to absorb all raw hides and skins being produced.
"More hides are being exported from Zimbabwe in their raw form, instead of being exported at least in the first stage of value addition that is the wet blue stage," he said.
In 2011, 5 440 tonnes of raw hides including crocodile skins worth $28 million was exported.
"The average value of leather and leather products exported globally in 2010 was $184 billion of which hides, skins and leather made up $27 billion or roughly 16 percent. Of this amount, 40 percent of the value was exotic leather. In 2011, only 2,2 million pairs of footwear of all types were produced while four million pairs of mainly cheap synthetic shoes were imported essentially making us net importers of footwear," said Prof Ncube.
Speaking at the same occasion, Comesa secretary-general Mr Sindiso Ngwenya said they would continue to promote the economic transformation and growth of the region's economy through deeper and sustainable integration anchored in building industrial competitiveness through the development of national and regional clusters.
He said Comesa secretariat was working to promote value addition in the leather value chain as a mechanism of boosting job creation and intra trade.
"Building the productive capacities is an essential element for enhancing competitiveness to boost regional and international trade. It is in this context that Comesa is putting in place mechanisms to unlock value in sectors such as agriculture, industry and services, which are dominated by SMEs," he said.
Source - chronicle
