Manufacturers of finished leather products were in Abuja, the Federal Capital Territory, FCT from November 18 to 23 for the first-ever Made-in-Aba fair facilitated by Senator Enyinnaya Abaribe and organised by the Small and Medium Enterprises Development Agency, SMEDAN. OLUGBENGA SALAMI captures the opening ceremony, particularly the passionate call of Association of Leather/Allied Industrialists of Nigeria, ALAIN for government’s urgent attention to the sub-sector
Though Nigerians produce one of the best quality leather products in the world, the sub-sector is still struggling to survive with the expected yields for both producers of the finished leather and government to be realised. At a time in the history of Nigeria, the sub-sector provides the highest foreign income earner for the country after crude oil, but unfortunately, it has continued to be neglected despite efforts to revive it.
There is no doubt that if revived, the leather industry is capable of creating jobs and wealth for Nigerians and the country in general. Leather is a popular input in fashion and furniture industry, it has a presence in these industries that cannot be missed. Some other areas where leather is being used include jackets, bags, handbags, belts, and seats among others.
The importance of leather can never be over emphasised. That is the reason why the Association of Leather/Allied Industrialists of Nigeria, ALAIN is canvassing for the development of finished leather goods in Nigeria, especially in Aba, known as one of the leading industrial cities if the country.
At the first Made-in-Aba fair organised by the Small and Medium Enterprises Development Agency, SMEDAN in Abuja, National Secretary of ALAIN, Comrade Ken U. Anyanwu said many projects aimed at bringing growth and development to the sector nationwide have been conceptualised by the association and these include the establishment of One-Stop-Export Shop in Aba in 2009. He explained that this is to track and repatriate export proceeds from the daily informal exports of Finished Leather Goods of over one million pairs per week and benefit from the federal government’s Export Expansion Grant, EEG.
Others mentioned by him was the proposed establishment of ALAIN Micro-Finance Bank in 2010; development of 10-man cooperative society concept that secured only 16 cooperative society facility of N3m each in 2011. He said many other applications are still pending in NERFUND. Similarly, the association, he further disclosed has in 2010 proposed the finished leather supply chain between Aba and Kano to be funded by NEXIM Bank, Abuja with a view to cushioning the effect of short supply of finished leather manufactured in Kano, exported to Europe but re-imported into Aba for use by the numerous manufacturers.
In 2011, ALAIN also proposed the use Radio Frequency Identification, RFID technology in the leather sector as a means of identifying finished leather/leather goods manufactured in Nigeria. In the same vein, in June 2012, the association, according to Anyanwu executed a memorandum of understanding, MoU with the African University of Science &Technology and RFID Research Centre, Abuja on the implementation of the use of RFID in the leather sector.
Good enough, the secretary said the ALAIN/RFID Research Centre, AUST Abuja, commenced the implementation of the RFID use in the leather sector with the sub component of the project, “Leather Industry Members Identification & Profiling Project” in April, this year.
Speaking on the current production capacity, Anyanwu said Nigerian finished leather goods are sold within the country, the entire West African sub-region and beyond. He affirmed that Aba is the major production centre of the Nigerian shoes, bags and belts etc, with production estimated to be over 80 percent of all finished leather goods produced in Nigeria. These products are found in all markets, city shops, super markets and special shoe markets under bridge in Alakoro, Lagos.
There are several loading bays for the various countries, towns and cities. In Aba, there are over 30 loading bays located in these clusters; Imo Avenue, Powerline, Aba North Shoe Plaza and Umuehilegbu Industrial Market (Bakassi), apart from the daily throng of buyers who move around from cluster to cluster, shop to shop looking for Finished products (shoes, bags, belts etc) to buy.
According to the ALAIN scribe, foreigners, businessmen and women from Cameroon, Togo, Ghana, Mali, and Equatorial Guinea, among others stay days and weeks in Aba as they come to buy or order for what they wanted as finished leather products. He added that the exit ports are Calabar Seaport, Oron waterways and Lagos for those that buy from Lagos Shoe Market, mostly other West African Coastal countries that do not come to Aba.
Currently, he said over 12 (20ft &40ft Container-size) trucks depart the loading bays in Aba on weekly basis, especially on Fridays, Saturdays and Sundays with very big “sacks of shoes” to markets in Cameroun including the Bokolo Market in Yaounde and Mace d’Laga market, Douala. Anyanwu informed that these two major markets in Cameroun are distribution centres, from where the distribution of shoes, bags, belts etc from Aba continues the movement to other parts of Africa and beyond.
The ALAIN secretary further stated that an estimate of over 100 million pairs of these products is exported in this process per annum. Specifically, he put those of bags/wallets at above 30million per annum for export and 50million per annum for local consumption.
For belts, he said over 20million of the finished products are exported per annum from Nigeria with 30million production for local consumption annually. “The estimated foot-wears produced all over Nigeria maybe said to be within 260 million pairs annum and represents over 65percent of the footwear market. Bags are over 80million per annum, same as above. Belts are over 50million per annum, same as above”, he said.
“Pick-up vans are seen on daily basis leaving the clusters in Aba with sacks of shoes to various markets and cities in Nigeria and estimated to be over and above 160million pairs per annum or about 20 percent of Nigeria’s footwear consumption”, he added.
Speaking on the local requirement of finished leather goods, Anyanwu said on foot-wears, Nigeria with a population of over 160m people, each individual, men and women, young and old has an average of two pairs of foot-wears to him or herself. This, he put the quantities at over 320 million pairs of foot-wears per annum as local consumption. He said bags are over 80million and belts at over 50million per annum respectively.
Still justifying the need to develop the sub-sector, he said “if an average cost of foot-wear per pair is N2, 000, multiplied by 320million pairs; it will amount to over N640billion spent on buying shoes alone and if all these shoes are produced locally and sold by Nigerians, it will change the face of the foot-wear industry in Nigeria.
According to him, one of the major factors that militate against the growth and development of the finished leather goods sub-sector is the continued importation of finished leather goods from Asia.
He therefore advised that the first step towards the development of the finished leather goods sub-sector is to give the opportunity to local manufacturers to produce for Nigerians by total prohibition of importation of finished leather goods into Nigeria. The continued importation of finished leather goods from Asia is killing the local industries and affecting seriously over 200,000 local producers.
The ALAIN scribe further enjoined the government, particularly the Federal Ministry of Finance and the Nigerian Custom Service, NCS to uphold the prohibition of importation of finished leather goods into Nigeria, stressing the need for government to develop the finished leather goods sub sector.
The simple approach that he suggested that could be used includes patronage, equipments and finance. He said finished goods value chain in Nigeria employed youths and persons between 18-55 years and are engaged in mostly micro, small and medium enterprises, MSMEs.
In Aba, for instance, Anyanwu disclosed there are over 200,000 manufacturers, warning that if action is not taken to restrict these imported finished leather goods from China, Nigeria may witness a mass job loss from the sector before the end of 2014.
Currently, it is estimated that Nigeria spends over N640billion annually on foot-wear purchase alone and if the local manufacturers are given the opportunity to produce for Nigerians, the sector would witness an upsurge of business activities within the first two years of the restriction, more wealth would be created while more than two million jobs will be generated.
Again, another major area where government could develop the sector is assisting the local manufacturers with equipment. The need to re-engineer the industry nationwide cannot be over emphasized. Anyanwu stated that the sole press machine, which is a sole attachment machine for the lasted shoe upper, is fabricated in Aba and costs less than N150, 000.
“We can develop a joint financing programme of “One-Manufacturer, One Sole Press Machine” to add value to the finished leather goods produced in Nigeria. Other equipments can be purchased through this joint financing programme.
There is no denying that finance contributes to the success of any project. Lack of access to finance is a reoccurring decimal in the finished leather goods sub-sector. The ALAIN secretary therefore requested the government and all agencies relevant to the sector to develop a policy framework that would be appropriate for on-lending to the producers.
Promoting Value Added Finished Leather Goods for local and international markets is the only panacea for a sustainable growth, development, wealth creation and employment generation in the Nigerian leather sector. The approach for this sustainable growth can only be actualised if certain steps that would further develop areas that the country has comparative advantage are actualised.
He commended President Goodluck Jonathan, for approving the made-in-Aba fair aimed at enhancing the development, growth, employment and wealth creation in the country. The ALAIN scribe noted that this would further expose the ingenuity of the Aba-based Micro, Small and Medium Enterprises, MSMES, who has been dubbed the hub of MSMEs in the entire West African sub-region by the World Bank.
Minister of Industry, Trade and Investment, Dr. Olusegun Aganga, at the opening ceremony of the fair reiterated the federal government’s commitment to continue to promote locally-manufactured products for export so as to create more jobs and wealth for the populace and generate foreign exchange for the country, just as Senate president, Senator David Mark advocated ban on imported military booths.
Aganga pointed out that the growth of the non-oil sector needs to be given priority attention in the transformation agenda of the present administration as it is imperative for its attainments.
According to him, the trade fair was in line with the goal of President Goodluck Jonathan’s administration of reducing importation of substandard products into the country and promoting the patronage of locally-manufactured goods.
Senator Mark, who was represented by the chairman Senate committee on Federal Capital Territory, FCT, Senator Smart Adeyemi noted that the only way to encourage manufacturers of made in Aba products was to ban such products as military booths, INEC ballot box and bags which the local producers have demonstrated expertise in.
He appealed to federal government to avail the industrialists the presence and services of Bank of Industry in Aba to enable them enjoy the services of the bank through availability of soft loans to aid them in their businesses. Government, Mark reiterated must take radical steps to promote made-in-Nigeria products as a cardinal factor in Jonathan’s transformation agenda.