Tax clash threatens Ethiopia's leather industry
According to local media, the leather industry in Ethiopia is currently in disagreement regarding a proposed removal of the export tax on raw hides and skins.
The Ministry of Agriculture is in favour of the move, citing economic hardships faced by producers. However, the Ministry of Industry is against it, fearing the negative impacts it may have on local manufacturers.
Stakeholders are warning against hasty decisions and are emphasising the need to balance exports with domestic manufacturing. Concerns have been raised about inadequate storage facilities, declining market demand, and subpar quality.
Last year's exports declined to just $32 million, from $122 million only four years ago, with hide and skin exports contributing only $737,436. Experts are cautioning against a full removal of the tax and instead suggest temporary revisions to support both sectors. They are also urging investment in technology and infrastructure to boost the industry's competitiveness.
