Sheba Leather Industries, one of 16 companies under the conglomerate of Endowment Fund for Rehabilitation of Tigray, has resumed exporting footwear after a five-year hiatus.
In its first shipment since ceasing operations, the company has exported 6,588 pairs of shoes to Italy and generated 83,000 dollars. Sheba also plans to ship 25,000 pairs shoes to the same destination next year.
It ceased export operations in 2013 following instability in the international market, according to Zerabruk G. Michael, marketing and sales manager at Sheba Leather Industries.
“Due to market instabilities, most of our buyers quit buying our products,” Zerabruk told Fortune.
Established with a paid-up capital of 93 million Br in 2004, the 900-employee company is located in Wuqerotown, 45Km from Meqelle, Tigray Regional State.
Sheba Leather started operations in leather manufacturing and added the production of women’s bags, and men’s and women’s shoes following the government’s mandatory requirement of value addition in 2010. In the six years prior to the government’s announcement, the company was producing and exporting pickled and wet blue sheep and goats leathers, in addition to supplying sheep crust, gloves and lining, and goat crust.
Currently, Sheba Leather manufacturers six women’s and nine men’s branded shoes. The raw materials including leather, shoestrings and soles for its products are sourced from the local market with some imports from Italy and Turkey.
The resumption of its export business will play a significant role in generating much needed foreign currency into the country, according to Alazar Ahamed, a marketing and promotion expert.
“The company has resumed export at a critical time,” said Alazar.
Data from the Ministry of Trade shows that exports keep missing set targets. During the past 11 months of the just-ended fiscal year, the country generated only 2.5 billion dollars in revenues from export, which is 53pc of the target. This has widened the trade deficit of the country.
During the past fiscal year, Ethiopia generated 45.5 million dollars from footwear exports, representing just 1.8pc of total export revenue.
“It will also promote local products to the international market and keep the brand reputation at the international level,” Alazar said.
Sheba is one of 16 operational leather manufacturers still operating in Ethiopia, although 24 are registered. The rest of the companies are at different stages of construction, according to data provided by Ethiopian Leather Industries Development Institution.
The institution provides assistance and support to existing and new companies, according to Berhanu Serjebo, communications director at the institute.
“We facilitate loans and land acquisitions to companies who wish to join the manufacturing industries for leather and value-added leather products,” said Berhanu.
The universities of Bahir Dar, Woldia, Addis Abeba Science & Technology and Technical and the Vocational Education & Training colleges provide training of professionals specialising in leather manufacturing and leather-product manufacturing. Specifically, Adiss Abeba Science & Technology University trains students in footwear technology.
Corrections & Clarifications: This story was edited on August 13, 2018, to clarify to readers that the company had only halted the export of footwear, not all leather products.
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