The leather industry is facing significant challenges due to a lack of clear and supportive policy decisions, which has stifled growth and threatened its sustainability.

Robert Njoka, chairman of the Kenya Tanners Association, has voiced concerns over stalled policy implementation, warning that without urgent intervention, the sector may not achieve the government’s ambitious target of injecting at least Sh120 billion into the economy from the current Sh15 billion.

Despite efforts by the Kenya Leather Development Council (KLDC) and the Ministry of Livestock to develop a comprehensive policy, its implementation has remained stagnant. This delay has placed the industry in jeopardy, as some beneficial policies have been reversed before the sector could fully benefit.

“Some beneficial policies have been reversed before the industry could fully benefit including the reduction of import duty of footwear as per the government directive”, Njoka told the media on Wednesday.

A case in point is the reduction of import duty on footwear as per the government directive ref ZZ/TS/GP/30 of August 9, 2021, issued by the National Treasury to the Kenya Revenue Authority Commissioner General.

This move, according to Njoka, has made it difficult for local manufacturers to compete with cheaper imports, further weakening the sector.

The rising cost of production is another major issue crippling the industry. Njoka, who is also the Managing Director of Reddamac Leather Centre, highlights the high duty on imported chemicals used for leather finishing, coupled with delays at ports, increased storage costs, and operational disruptions, which have made local leather products expensive and uncompetitive.

These barriers hinder Kenya’s ability to compete with neighbouring countries such as Rwanda and Uganda, where leather processing is becoming increasingly efficient and cost-effective.

“ Without urgent action, the industry risks losing the progress made over the past decade,” Njoka said.

The industry has also witnessed the closure of eight tanneries in the past three years, including Leather Industries of Kenya (Thika), Athi River Tanneries (Mavoko), Dog Bones (Nairobi), and New Market Leather (Nairobi). Others that have shut down are Nairobi Tanneries, Amin Tanneries, Samitex Tanners, Msai Tanneries (all in Nairobi), and Nakuru Tanners. The closure of these facilities has resulted in the loss of over 2,000 direct jobs and an additional 5,000 indirect jobs, exacerbating the country’s unemployment crisis.

Another pressing concern is the illegal drying and smuggling of hides and skins, which is undermining the local leather industry. The shortage of high-quality raw hides and skins is worsened by illegal exports, particularly to West Africa, where they are used for food processing. Smuggling of hides disguised as other goods continues unabated, as unscrupulous exporters evade duty by misdeclaring weight or classifying hides under different product categories. Despite repeated complaints from industry stakeholders, authorities have yet to effectively address the issue, allowing the problem to persist unchecked.

The decline in the quality of hides and skins further complicates the industry’s woes. Poor animal husbandry and slaughter practices have long been a concern, but the situation has been aggravated by the destruction of hides for food exports. This deterioration in quality has tainted Kenya’s international reputation, leading to lower export prices compared to neighbouring countries. For instance, leather exports from Rwanda and Uganda fetch higher prices due to better-quality raw materials and stricter industry regulations.

Another setback is the government’s decision to reduce export duty on raw hides and skins from 80 percent to 50 per cent. Njoka argues that this move contradicts the government’s value addition policy, as it makes raw hide exports more attractive at the expense of local manufacturing. The policy shift may also strain Kenya’s relations with other East African Community (EAC) member states, which maintain an 80 per cent export duty to promote local value addition.

Njoka emphasizes the need for policy consistency to attract long-term investment in the leather industry. He calls for an appropriate facilitative, regulatory, and coordination framework to support the sector’s growth. In particular, he urges the government to fully implement the leather policy launched on December 5, 2024, and grant duty remission for crucial inputs such as tanning chemicals and accessories. Such measures would enhance the competitiveness of local tanneries and encourage sustainable growth.

Addressing the challenges facing the sector, Principal Secretary for Agriculture and Livestock Jonathan Mueke assured stakeholders that the government is implementing mechanisms to revive the leather industry. He reiterated the administration’s commitment to reducing imports while boosting exports, with the ultimate goal of ensuring that Kenya no longer imports shoes in the near future.

However, the impact of these challenges is already being felt at the factory level. Njoka revealed that his company has been forced to downsize its workforce, reducing staff numbers from 400 to 180 due to the harsh economic climate. The uncertainty surrounding policy decisions has left manufacturers struggling to sustain operations, leading to significant job losses and reduced productivity.

The future of Kenya’s leather industry hinges on decisive government action to address these pressing issues. Implementing the stalled policy, ensuring duty remission for essential inputs, and cracking down on illegal exports are crucial steps toward revitalizing the sector. With the right support, Kenya has the potential to transform its leather industry into a global player, creating jobs, boosting exports, and contributing significantly to the economy.

Deputy President Kithure Kindiki has announced that Kenya’s leather industry is set to create at least 100,000 jobs by 2027 as the government shifts focus toward adding value to hides and skins. He noted that for years, the country has prioritized red meat and carcasses, despite hides and skins being more valuable.

Kindiki emphasized that economic transformation relies heavily on value addition and expanding manufacturing across key sectors during a visit to assess progress on the Kenya Leather Industrial Park (KLIP) in Machakos.