Leather
Leather
Leather
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INVEST IN ETHIOPIALEATHER AND LEATHER GOODS: INVESTMENT OPPORTUNITIESWith abundant and available raw materials, a highlydisciplined workforce and the cheap cost of doingbusiness, Ethiopia’s leather sector, including thefootwear industry and tannery, enjoy significantinternational comparative advantages. Ethiopia has thelargest livestock production in Africa, and the tenthlargest in the world, with 45.5 million cattle, 26 millionsheep and 21.7 million goats at current estimates. Theannual potential supply of hide and skins is estimated at4.8 million pieces of hide and 12 million pieces of skin.The higher fibre structure of the highland sheepskinsand goatskins of the country is renowned for producinghigh quality products. Currently, Ethiopia’s leatherindustry is in the forefront of the leather sectordevelopment within the Eastern and Southern Africaregion. The sector is shifting into semi-processed exportproducts. In this connection, the Ethiopian <strong>Leather</strong>Technology Institute, a strategic innovation and researchinstitute, plays important role in the productivity andquality of the leather sector. Ethiopia head quarters the<strong>Leather</strong> Association of Common Market for Easternand Southern Africa /COMESA/. Currently, there aremore than 40 tanners, footwear and leather productmanufacturers in the country.<strong>Leather</strong> garments – factsEthiopian footwear factories produce men’s casualshoes and children’s shoe-uppers made from pureleather. On top of that, the factories:• Sell directly to overseas importers/wholesalers, orto direct buying offices.• Facilitate the production and export of footwearunder the private labels of department stores,boutiques, shoe retail chains and mail order houses.• Source out from Ethiopia and other nations in EastAfrica and re-export; and• Facilitate the production and export ofinternationally well-known brands under contract.The Ethiopian footwear industry produces globallycompetitive shoes both in quality and in price.Due focus is given to maintaining the quality of thehides and skins, leather and leather products for export.All exports are tested by the Quality and StandardsAuthority of Ethiopia (QSAE).
INVEST IN ETHIOPIALEATHER AND LEATHER GOODS: INVESTMENT OPPORTUNITIESMarkets and Market AccessMajor agricultural export products of Ethiopia include:coffee, livestock products (leather and leatherproducts, live animals and meat), oil seeds and pulses,fruits, vegetables and flowers, textiles, natural gum and,spices products. Its agricultural export products havemarkets in neighbouring countries, Asia, the MiddleEast, Europe and America.Ethiopia is a member of a regional trade grouping - TheCommon Market for Eastern & SouthernAfrica/COMESA/ - a region inhabited by more than420 million people. Ethiopia also enjoys Duty Free andQuota Free (DFQF) privileges extended by, amongothers, USA - Africa Growth and Opportunity ACT(AGOA), EU - Everything But Arms (EBA), China - ‘0Tariff’ privilege and India - DFQF. The market accessesprivileges allow investors engaged in the agricultureand agro-processing export sector of Ethiopia to reapthe benefits of the preferential markets giving them thechance to get competitive edge for their productscompared to those outside of the scheme.Investment incentivesAs noted on the investment code of 2002 (as amendedin 2003) and Council of Ministers Regulation 2003(asamended in 2008) investors interested in the agricultureand agro-processing export sector will have:• Customs duty privilege for us capital goods andconstruction of materials necessary for the investmentand spare parts whose value is not greater than 15%of the total value of the capital goods.• Tax holiday privileges between 2 to 7 years of whichdetails will be provided by the Investment Board ofEthiopia.Investment guarantees• The Constitution and the Investment Code protectprivate property.• Foreign investors are entitled to make the followingremittances out of Ethiopia in convertible foreigncurrency: profits and dividends accruing frominvestment; principal and interest payment on externalloans; payments related to a technology transferagreement; proceeds from the sale or liquidation of anenterprise; proceeds from the transfer of shares or ofpartial ownership of an enterprise to a domesticinvestor; expatriate employees may remit, inconvertible foreign currency, unspent salaries andother payments accruing from their employment inhard currency.• Investors that suffer losses during a tax holiday periodprovided under the investment incentive are alsoentitled to a loss carry forward of such losses for halfof the income tax exemption period.• As a member of the World Bank MultilateralInvestment Guarantee Agency (MIGA), WorldIntellectual Property Organization (WIPO), theInternational Convention on Settlement of InvestmentDisputes between States and Nations of other States(ICSID) and having Bilateral Investment Promotionand Protection Agreement with the UK, investorsenjoy strong guarantees for their investment in thecountry.