Leather

Leather and leather products are among the most widely traded products worldwide, and they are based on a renewable and readily available resource. It is estimated that the international trade exceeds US$ 80 billion annually, and it is expected to continue growing alongside the increase in population and urbanization of developing and emerging countries.

Production and supply have gradually moved from industrialized to developing countries and emerging economies, which are now becoming major players in the trade. In fact, developing and emerging economies can now manage the whole supply chain on their own and are fast becoming the most important suppliers of value-added finished products. About 45% of footwear, for example, is made in China. The supply chain is global and a great deal of trade is nowadays South-South and South-North.

Other developing countries - and especially many least developed countries (LDCs) - because of their large livestock, have a remarkable growth potential, but this remains largely untapped. This is mostly due to weaknesses in technical know-how, access to information, visibility, quality management, marketing, investments and international industrial alliances. It is in this area that most of the International Trade Centre's (ITC) efforts are deployed, and LDCs are the forefront as ITC's partners. One of the major challenges of the technical cooperation is enabling suppliers from these countries to become part of the global networks. ITC efforts focus not only on industries, but also on artisanal communities that risk to be wiped out by the competition of imported mass-made products that could have potentially devastating socio-economic consequences.

ITC interventions in the leather sector are focused on those materials that are the by-products of the meat industry. Fashion furs, from wild or farmed animals, are not covered and exotic skins are only considered where development and improvement of trade are concerned in compliance and collaboration with the Convention on International Trade in Endangered Species of Wild Fauna and Flora(CITES), non-governmental organizations and governmental protocols for the protection of endangered species, as well as animal welfare legislation.

The following, in a nut shell, is a description of ITC activities, which covers the whole value chain. Examples provided are for illustration purposes and are not exhaustive. For more information, please contact us. You may also wish to visit http://www.intracen.org/leatherline/, the ITC information source on the leather sector.

Information

Information and communication technologies can make an impressive amount of information available,especially in affluent markets but the digital divide still penalizes many developing countries when it comes to being recognized in the international market. To alleviate this, ITC helps to facilitate research by entrepreneurs in developing countries, and increase the visibility of their leather industry to allow them to enter the global supply chain network, and so improve and expand their trade.

Recognizing the need to establish a globally accessible 'meeting point' for suppliers and buyers in a constantly evolving market, ITC has developed the dynamic Internet-based portal Leatherline.org. Launched in 2005, Leatherlinehas recorded peaks of over 9,000 visitors eachmonth, positioning it self as the sectoral website of choice worldwide. A wide array of information is available based on ITC's own research, collaboration with partner institutions and interactive inputs from the users. The portal also includes a market place for business generation. Feedback from users supports this approach.

Marketplace

African Platform

Leather Guidebook

Support Services

Market Trends

Information Sources

Photo gallery

In line with the development priorities of LDCs and the objective of increasing trade through improved visibility of marginalized industries, the "African Platform" was created within Leatherline to provide a one-stop shop.This is a unique source of information and market intelligence on the African leather sector, and contains complete industry profiles from 21 selected countries. Expansion of the existing platform and addition of new ones for other geographical areas are under consideration, in cooperation with sectoral associations.

Within the goal of raising the international awareness of the industry supply capacity, facilitating the development of business links, and supporting the countries' trade promotion efforts, the biennial event "Meet in Africa" (MIA) was organized by ITC for first time 1998. MIA was organized in cooperation with sectoral associations in Cape Town, Casablanca, Tunis and Addis Ababa. In 2006, the organization of MIA was handed over to African organizers. With a blend of technical activities around a core international trade fair that recorded up to 375 exhibitors in a single event, MIA allowed many SMEs, which were normally left outside the international business circuits, to promote themselves and generate business. The consolidated ITC experience in organizing MIA was transferred in a technical paper, Basics for Organizing Trade Fairs, which has a strong focus on leather exhibitions.

Data and Research

Advisory Services

Leather being a highly specialized industry sector, ITC’s advisory services are customized to the needs of the industry at the national and the regional level. The services cover sector analysis and strategy formulation to direct cooperation with businesses and multiplier organizations in the areas of product improvement, adaptation, marketing, business networks development and enhancement of export-oriented support services.

The leather supply chain covers the recovery of raw hides and skins, their preservation until tanning, progressive tanning operations with several degrees of leather finishing, use of the leather for the manufacture of finished leather products, such as footwear and leather goods. Exports takes place at each stepof the supply chain and the driving factor is quality, as this affects the progression of the process and the export competitiveness of the raw, intermediary or finished products. Quality is the result of the application of the correct techniques and work organization, and of the capacity to effectively apply buyers' specifications to ensure marketing success.Enhancing the dual and interlocked production and marketing know-how is what inspires most of ITC advisory services at the business level, together with the cooperation for the identification of markets and the development of business networks.

Advisory services on quality enhancement allows ITC to provide assistance in the rationalization of processes, such as the correct and reduced use of chemicals, and their best possible recovery so as to lessen the environmental impactwhile ensuring increased income generation. ITC dedicates an important part of its interventions to capacity building for a responsible use of processing to avoid the known environmental hazards of leather production. Events dedicated to create awarenessand develop know-how on environmental-friendly technologies and measuresare examples of such work. Business leaders and especially professional associations are targeted as a way ofinfluencing industry and policymakers. Facilitating contacts and cooperation between industry in developing countries and suppliers of environmental-friendly technology is also part of the interventions, as is the identification of the thematic information sources. Complementary information has started to be developed by ITC, such as in the case of "Vers un tannage plus respectueux de l'environment", which was developed in cooperation with the Tunisian Centre National du Cuir et de la Chaussure (CNCC).

Training

ITC approach in the leather sector is based on the belief that customized rather than off-the-shelf training responds better to the specific needs of a highly specialized industry and its operators. Interventions are mostly focused on the business sector, comprising on-the-job training in real work situations that take into account constant changes in markets and technology, rather than generic standard training for mixed audiences.

ITC can at any time provide specialized consultants or mobilize sectoral training institutions according to the requirements of projects orclients.These can cover subjects related to production, quality control, market compliance, export marketing and communication.

In Bangladesh, for example, workers and supervisors were trained on the whole process cycle for the production of footwear and leather goods. They received training including product conception and pattern making, cutting, stitching, assembling and finishing, thus enhancing process efficiency and supply capacity. The skills development required a mix of classroom training, practical exercises and on-the-job training. A group of SMEs was trained in product design and development, and received individual coaching for the creation of a collection of handbags that was presented and promoted at MIPEL, a high-style leather goods exhibition in Italy. In the area of quality management, laboratory operators were trained in product testing and certification, while a group of SMEs followed a programme on quality management system preparing them for ISO 9001 certification.

While enterprises are generally the primary recipients of training, sectoral organizations are associated to the events so as to develop their awareness and understanding of the issues. This also allows them to directly interact with the participating business actors, stay on top on future initiatives and participate in the dialogue with policymakers.

Networks

A constant network development by ITC aims first and foremost at facilitating dialogue and cooperation between entities concerned with the leather sector in both developed and developing countries with the ultimate goal to develop and improve trade, as well as supporting project delivery.

The network encompasses national and regional professional associations, trade promotion organizations, training and research institutes, service providers, publishers, international organizations and organizers of trade fairs, as partners for capacity building, information exchange, market development and promotion, technology innovation and tools development.

Projects

ITC implements projects in the leather sector at the national, the regional and the global level by partnering with regional economic entities, support institutions and business enterprises.

Recently implemented projects or projects under implementation:

Bangladesh: "Bangladesh Leather Service Centre (BLSC) for Export Development" - Donor: Government of Italy

The project took shape and momentum following the 2000 Roundtable of the Integrated Framework, during which the leather industry was identified as a priority area for export diversification.Leather was also identified as a"thrust sector" in successive Bangladeshi national export policies. Upon a request from the business sector at anational sectoral symposium organized by ITC in Dhaka in 2004,in cooperation with the industry and the Government, the "Bangladesh Leather Service Centre (BLSC)" was established and the skills of the service providers were developed. It has subsequently become the central support hub for the whole sector. The BLSC covers training, quality testing and certification, quality management, product design and development, marketing and promotion, and finance support schemes for underprivileged micro entrepreneurs and artisanal communities (see the Advisory Services and Training chapters above).

Regional leather sector development in COMESA countries - Donor: CIDA

ITC's leather activities within the PACT II project (Programme for building African Capacity for Trade) were designed based on a complete value chain analysis, resulting in a COMESA regional leather strategy. This strategywas approved and adopted by the Council of Ministers in November 2011 in Lilongwe, Malawi.

A supply and demand survey was conducted in seven COMESA countries and officially presented at sixnational dissemination workshops held in Zambia, Zimbabwe, Kenya, Uganda, Ethiopia and Sudan. PACT II provided support and financing for SMEs from the COMESA region toparticipateatthe All African Leather Fair held in March 2011 in Nairobi, Kenya, where stakeholders reported business for US$ 2 million.

Business tours to India and Italy generated business worth approximately US$ 5.5 million. Thesehaveproven to be sustainable, as 14 months after the travels were organized, total business reported reached almost US$ 10 million.

Through PACT II, direct contacts were established between COMESA stakeholders and overseas buyers. Technical collaboration was initiated through technology transfer, awareness building of effluent treatment, opening of channels for the purchase of machines and chemicals. An important result of the direct contact between SMEs from the COMESA regionand suppliers was the creation of a bonded warehouse in Ethiopia for the import of chemicals for distribution to tanners. The last significant activity was the organization in September 2012 of a South-South Investor's Forum in Nairobi where five SMEs from Indonesia and India discussed in direct meetings with 19 colleagues from Kenya, Uganda and Sudan the possibilities of direct investment, technical, financial and marketing collaboration. This process is still on-going.

Chad: "Value chain analysis of the leather sector" (within the Integrated Framework Programme) - Donor: IF

ITC interventions in Chad were multiple and covered the whole value chain. Hide and skin-quality improvement were implemented through training and the installation of a locally made mechanical flaying devise (SFF - static flaying frame), as well as the distribution of locally produced professional flaying knives.

In collaboration with the local association of butchers a pilot was launched to transform a slaughter slab into a mini abattoir, aiming at hide and quality improvement, which has an additional benefit food safety.

Better conservation techniques were introduced and discussions have been initiated with the Government of Chad for the construction of tanneries.

In close collaboration with the Italian Ministry of Foreign Trade Promotion (ICE) and the Italian association of tannery and footwear machine producers, a complete production line for shoe manufacture has been provided to Chad, and Chadian artisans will shortly be trained in design, development and production techniques in order to be able to produces shoes locally.

Fiji: Strengthening of capacities and services in the agri food sector - Donor: European Union

ITC has recently launched a project in Fiji that seeks tocreate alternative employment opportunities for seasonal sugarcane workers and unemployed people. Toads, which are perceived as a pest due to the lack of predators and populate the islands in the tens of millions, are turned into a useful product.

People living rural areas were trained in the production of leather from toad skins, which are an abundant renewable and sustainable local resource in full respect of the environment. The experiment was positively judged by the European Union and inserted in a livestock project that will be launched in Fiji in 2013. The experiment shows ITC's unique capability to generate niche products that have an important local impact.

Global: Pythons - A Review of the Trade in South-East Asian Python Skins - Sponsor: the Government of Denmark.

ITC developed in close collaboration with CITES, TRAFFIC and IUCN a technical paper, The Trade in South-East Asian Python Skins, which focuses on the five most traded species of pythons. This was a first-time approach to research the trade flow from the hunters in rural areas in the region, to the high-end fashion houses in Europe. Subjects such as animal welfare, sustainability and the legality of the trade are extensively discussed in the paper, as well as the feasibility of breeding pythons in captivity.

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Leather

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