Shortage of import inputs renders 10 out of 28 leather factories /tanneries to halt production as the remaining 18 work under minimal capacities, the Ethiopian Leather Industries Associations (ELIA) reveals.
“The sector is challenging to operate since almost 99 percent of inputs like chemical, accessories and others are imported for factories,” said Solomon Getu, secretary of ELIA, adding, “The industry is mostly dependent on foreign currency to import inputs from the existing 28 leather producing industries, 10 of which have fully stopped their production. From the remaining 18, only 8 are working at 40-50 percent production capacity while the rest ten are working with less than 15 percent of their capacity.”
It is to be recalled that a few months back the association had requested the relevant government bodies, Ministry of Industry and National Bank of Ethiopia (NBE) to re-amend the forex retention for factories to access more foreign currencies they earned from their export earnings to import inputs.
The association expressed that the leather industry aught at least to access 40 percent of the foreign currency earned for the purpose of import inputs.
The retention and utilization of export earnings and inward remittances directives no. FXD/79/2022 that was amended and became effective on January 6 on its article 4.1 stated that banks are required to surrender 70 percent of the foreign currency earnings from export of goods and services, private-transfer and NGO’s transfer to the NBE.
However, as Solomon indicates, no response has been given by the relevant bodies.
With the leather tanneries and leather product manufacturing industries being related; the impact on leather tanneries is said to have a ripple effect on the producers.
In the 2021/22 budget year, the leather and leather goods export generated only 40 million dollars. As Solomon manifested for the current budget year it will be difficult even to generate 30 million dollars from exporting leather products if the situation continues with the way it is now.

In the past three years, the export earnings from the sector have declined in relation to internal and external factors like COVID 19.
In the 2017/18 and 2018/19 budget year the sector contributed USD 130 million and USD 120 million respectively that reduced to USD 75 million in the 2019/20 budget year.
Meanwhile, the export earnings have eroded compared with the preceding year. Nonetheless, the local market has been boosted in the budget year as per the explanation of Solomon.
As he indicates, the Ministry of Industry and the Development Bank of Ethiopia are working to facilitate forex access to SMEs including the leather industry which they expect could be an option to solve the problem.
The association in collaboration with the Ministry of Industry and the Ministry of Trade and Regional Integration and United Nations Industrial Development Organization /UNIDO/ has organized the 13th all African leather fair to be held from February 16-18, 2023 at the Millennium hall.
As indicated, more than 250 local and international tanners, footwear and leather goods manufacturers, leather garment producers, machinery and input suppliers and technology logistics and financial institutions and companies and more than 17,000 visitors are expected on the occasion.
“The upcoming event will play a great role to initiate the leather industry and reverse the downturn of the leather sector after math of the pandemic and international market failure,” remarked Remedan Bedada, president of the association, whilst expressing hope for a positive turn for the industry.

Regions, Zones said to follow suit

The Ministry of Trade and Regional Integration (MoTRI) and Cement Manufacturers’ Board (CMB) announce retail price caps on cement.
The price implementations are said to be effective starting from January 30, 2023 with prices varying in for regions and city administrations but well within or less than the 1200 birr per quintal point.
Since the highest demand is in Addis Ababa, the board has set different retail prices for various cement brands. For instance, Dangote Cement – Birr 1,106.85 per quintal; Derba Cement – 1,067.33 per quintal; Capital Cement – 1,052.25 per quintal; and Kuyu Cement – 1,065.25 per quintal. Cement prices for Regional States and Zones are said to be made public in the near future.
In its most recent effort to reduce the cost for end users, MOTRI disclosed that it will regulate cement gate prices set from December 22, 2022, for the next six months. This most recent attempt at market stabilization follows actions like establishing fixed consumer pricing, restricting individual purchaser sales quantities, and requesting producers to eliminate wholesalers from the supply chain.

MOTRI admitted that recent control measures had made the situation worse and increased the number of illegal traders instead. The government now intends to reduce its interaction in the cement market.
A couple of weeks back, it can be recalled that on December 22, 2022, the ministry had issued a factory gate price which brought the price of one quintal of cement from 750 birr to 795 birr.
The country has suffered from a cement shortage since 2020 due to low domestic production levels. This has been exacerbated by security issues, a lack of raw materials and a shortage of foreign currency. Expansions of existing factories, coming new companies in the sector is expected to stabilize the market, according to the Board .As indicated on the press conference, Government projects are getting 30 percent of production from every factory and real-estate developers can also get cement directly from factories.

Haile hotels and resorts 8th destination in Addis Ababa, Haile Grand Hotel, has officially launched its service. The five-star designate located in the heart of the capital was fully constructed by Ethiopians and has been giving its trail service starting from October 2022.
The elegant hotel which lies on a 15k hectare plot of land consumed 2.5 billion Ethiopian birr to construct across a 5 year timeline.
As indicated, the hotel consists of 157 rooms, 4 restaurants and 2 private dining rooms with 4 bars, pastry and coffee shop including a cultural food hall, 8 conference halls and health and beauty centers including a pool and gym with parking that can handle more than 200 cars at a time.

So far the hotel has created job opportunities for 450 employees of which 120 of them are new graduates.
For more than 22 years, Haile-Alem International PLC has been engaged in various investments including; agriculture, real-estate, education and hotel sectors. With 12 years of experience in the hotel investment sector, the PLC has 7 hotels and resorts in different parts of the country. It is said that Ethiopia’s long-distance running

legend, Haile Gebrselassie, is expanding hotel chains across the country with future aims of expanding the hotel chain to 20.
Haile Hotels and Resorts started its operation in the city of Hawassa with a 4-star resort. The company now has 8 hotels and resorts including Haile grand in Addis Ababa in Hawassa, Arbaminch, Adama, Gondar, Batu-Ziway, Shashemene, Sululta, and Addis Ababa.
Speaking on a press conference held on January 26, 2023, Haile GebreSelassie said that lack of foreign currency, instability inflation and other issues had delayed the construction which was expected to be finished in 3 years. Haile called local investors to get in the service sector and the government to support local investors. As Haile further explained the Haile-Alem International PLC is also planning to expand its service out of Ethiopia.