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FG Targets $1Billon Earning From Leather Exports By 2025

The Federal Government has anticipated receiving roughly $1 billion from the export of leather goods by 2025, according to Prof. Mohammed Yakubu, Director-General and Chief Executive Officer of the Nigerian Institute of Leather and Science Technology (NILEST).

Eko Hot Blog reports that he claimed that this year, Nigerian exports of leather goods totalled $800 million.

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He claims that the exports of leather goods from Nigeria were approximately $800 million in 2018 and 2019 before falling to $650 million in 2020 as a result of COVID-19.

According to the national leather policy, exports of leather goods are expected to generate about $1 billion in income by the year 2025, he said.

He talked outside of a capacity-building and research trip to Portugal’s leather industry.

It is a component of attempts to put into effect the Vice President Yemi Osinbajo-initiated National Leather and Leather Products Policy Implementation Plan.

The delegates studied various leather organizations, tanneries, the Centro Tecnologico Do Calcado De Portugal (CTCP) (Footwear Technology Centre of Portugal), as well as its Innovative Laboratory and workshop facilities.

They spoke with some of their machine suppliers and attended commercial meetings with the Portuguese footwear components and leather goods makers organization (APPICAPS).

According to Yakubu, the goal of the trip to Portugal was to observe them, learn from them about their policies, procedures, industry dynamics, and technology, and to comprehend how they were able to transform their artisanal industry into a sophisticated and contemporary one.

In order for Nigeria to become a significant player in the global leather market, it was also necessary to determine how to entice the Portuguese leather industry to establish manufacturing facilities there.

The D-G estimated that the global trade in leather goods is currently between $300 and $400 billion.

“Every week, more than 20,000 pairs of shoes and different high-quality leather materials were exported to African, Asian, and European countries from Southeast, Southwest, and Northern parts of Nigeria. You can imagine how much we are talking about in a month or a year.”

According to him, the high cost of imported processing materials was responsible for the spike in the prices of most Nigerian leather products compared to the foreign ones.

“For instance, now you can get a leather of one square meter costing about $5. But, by the time you add up production costs, the cost of processing may rise to about $30. So, you may end up buying imported leather rather than buying leather processing materials,” he said.

Yakubu said in view of these problems associated with the high costs of processing materials for leather industries, the institute had used its researchers to find lasting solutions.

“Leather industries can now get materials locally to produce leather at a lower cost, sell it abroad with high quality and quantity,” he said.

Yakubu believes Nigeria can attain high-level production of leather in the world if science and technology were accorded special attention, especially in the area of manufacturing.

“Our local industries must be revived and small and medium industries must be assisted with capital and training just like what obtains in Asian countries,” he said.

The NILEST boss also appealed to the government to introduce special local technology and industrialisation programmes at all levels.

“The world is fast moving on technology; we are in a paradigm shift where only people with skills have the upper hand in the economy,” Yakubu said.

Yakubu said that at the end of the visit, the team resolved to consolidate the gains from the study trip and add value to the activities of NILEST as well as the Nigerian leather sector, in areas of research and development.

It was also resolved that CTCP and NILEST will facilitate the partnership between the Portuguese and Nigeria Leather Association and Entrepreneurs.

The Portuguese leather investors are to take advantage of Nigeria’s abundant raw materials for manufacturing leather, footwear, and leather goods through NILEST.

It was resolved that CTCP and NILEST are to attract funding and collaborators to Nigeria, which will enhance the improvement of the processing of leather and leather products in Nigeria.

Nigerian Ambassador to Portugal, Alex Kefas, said President Muhammadu Buhari’s visit in June 2022, the first of its kind, served as an impetus to the diplomatic relations between Nigeria and Portugal, which bordered on bilateral trade, technology transfer and capacity building.

The delegates first visited CTCP, a private, non-profit organisation founded in 1986, with 483 private companies as members.

It employs 43 technicians, engineers and senior specialists and trainers and works with approximately 15 external consultants/trainers in a regular basis.

Its Chief Executive Officer, Dr. Leandro Melo, said CTCP aims at supporting all companies of the footwear cluster which is represented by more than 1500 SMEs from the shoe industry, 300 SMEs from the components industry, 307 from the leather goods industry, and small entrepreneurs in the field of design and project engineering, all related to footwear and leather goods.

Portugal has about 120 leather and leather goods companies and is driven by small businesses.

Since 2010, exports of the industry have increased by 250 percent, and in 2020, export of leather and leather goods increased by 29 per cent to 197 million euros.