Livestock council turned into State firm to improve services

• Parastatal expected to boost operations and enhance competitiveness in local and export markets as it seeks independence

The leather industry is set for better times, with the changing of Kenya Livestock Development Council (KLDC) into a parastatal, as it seeks more independence to streamline operations and enhance competitiveness in the local and export markets.

Set up in 2010 as a semi-autonomous body and turned into a fully-fledged autonomous institution in August 2011 as a state agency, KLDC has been mandated to formulate policies to add value to leather products and increase profits for livestock farmers.

“The re-launch of the council as a state corporation is a milestone in the sub-sector, which will enhance value addition and competitiveness,” said Livestock Development minister Mohammed Kuti.

The ministry says the state corporation will mitigate against leather export losses and initiate capacity building activities related to the leather industry to augment leather production and goods in the country.

The minister said earnings from the leather industry had increased from Sh2 billion to Sh5.86 billion over the last 16 years, with employment numbers also rising to 16,000 persons as per end of last year from 1,600 in 1995.

Dr Kuti said Kenya’s leather and leather product exports have increased from 85 per cent export of raw hides and skins as at 1995 to 90 per cent as at the end of 2011.

The minister added that there was also an increase of raw materials from 6.3 million pieces to about 8.25 million over the same period.

Export losses due to poor leather quality from immature livestock like calves and tax evasion by black market leather dealers have been cited as key factors eroding revenue inflows.

However, with creation of the stand-alone parastatal, registered leather dealers will have a channel to enable them access premium markets in Europe, Asia and the Middle East.

Losses in the production chain will also be reduced with adoption of modern leather processing techniques.