The National Centre for Technology Management (NACETEM) on Wednesday, September 11, 2024, said that Nigeria’s leather industry had the potential to generate over one billion dollars by 2025.
Maryanne Onyejekwe, the South-West Zonal Coordinator, NACETEM, made this known at its Research Output Conference 2024 held in Lagos.
At the conference themed, “Leather Sector Assessment and Local Content Policy Studies”, Mrs Onyejekwe said that Nigeria was the highest producer of leather and finished leather products in Africa.
She noted that the nation was not only the largest producer of leather in Africa, but that its leather ranked among the highest quality leather found globally.
According to her, the industry generates about $600 million to $800 million annually, hence, the subsector can be a key driver of Nigeria’s economic growth and development.
“Also, the leather processing and fabricating industry aligns perfectly with national goals by actively contributing to the country’s industrialisation efforts.
“To unlock its growth potential and overcome challenges, the leather processing and leather fabricating industry in Nigeria can explore international collaboration and investment opportunities.
“Technology transfer and collaboration with international partners can facilitate the transfer of advanced tanning technologies and best practices.
“International collaboration can help leather processing firms gain access to the global market, partnerships with foreign distributors and retailers can open doors to new customer base,’’ she said.
Speaking about local content in the subsector, Onyejekwe noted that its development and utilisation in all sectors of the nation’s economy would increase the employment ratio geometrically.
Mrs Onyejekwe, who was also a director at NACETEM, said that local content would stimulate value creation and addition, and also improve the per capita income of the critical mass of its labour force.
According to her, it is in the light of the benefits of local content that the Federal Government passed into law the Petroleum Industry Act (PIA) and by extension and most germane to the discourse, the Presidential Executive Order 5.
She said that Presidential Executive Order 5 was to develop, promote and enforce local content and Made-In-Nigeria goods and Services (MNGS).
She said that local content development was critical for the economic growth and development of the nation, adding that it was more aptly so in the face of dwindling economic fortunes and increasing unemployment.
The director noted that Nigeria was more committed to its industrialisation efforts and reducing its dependence on oil.
Mrs Onyejekwe said that local content in terms of manpower, raw materials, technologies and machinery for Made-In-Nigeria Goods and Services (MNGS) offered the required trajectory to becoming an industrialised nation.
“It will also ensure a major shift from a consuming to a producing nation, thereby increasing import substitution and the nation’s Gross Domestic Product (GDP), entrenching economic diversification, and impacting foreign exchange.”
In her presentation, Olayemi Dickson, the Assistant Chief Research Officer at NACETEM, said that Nigeria’s Leather was highly demanded in Italy, Spain, India, and China, among others.
Mrs Dickson said that leather exporting companies in Nigeria produce over 8,000 jobs with an export value of about $272 million in 2022.
According to her, to meet international and local demands, the leather firms in Nigeria require a high level of technological capability.
“Technological capability includes firm-level technological capability and national-level technological capability.
“Firm-level capability includes a firm’s specific collection of equipment, skills, knowledge, attitudes and aptitudes needed to choose, install, operate, maintain, understand, adapt, improve and develop technologies.
“On the other hand, national-level technological capability is the collection of individual firm-level capabilities,” Dickson explained.
In his presentation, the Assistant Director of Research in NACETEM, Victor Sobanke, said that the leather industry made up about 24 percent of the Agricultural Sector’s contribution to Nigeria’s GDP.
Mr Sobanke said that unfortunately, despite the potential of the industry, the productivity of the sector was decreasing with unsophisticated technology resulting in substandard and low-quality leather products.
He said: “In fact, Nigeria is a net importer of finished leather products of about $500 million annually.
“Nigeria needs to convert its leather resources to fashionable finished products that are competitive in the world’s fashion markets.’’
The Assistant Director, NACETEM, Mirabel Omoruyi, in her presentation, highlighted the importance of awareness of local content practices in Nigeria.
Mrs Omoruyi said that Ministries, Departments and Agencies (MDAs) had average to high-level awareness; while private firms were mentally aware but lacked in-depth understanding of their working details.
She recommended that relevant MDAs and stakeholders embark on vigorous creation of greater awareness about local content policies and its provisions, to sensitise public and private sector organisations.
Also, the Head of Media and Publicity, NACETEM, Olutunde Babalola, said in his presentation that the biggest challenges to local content adoption are low technical expertise, inadequate infrastructures and obsolete local technologies in the MDAs.
Mr Babalola said that private firms had low technical expertise, low industrial capacity, substandard quality of made-in-Nigeria goods, superior substitutes, etc.
He said that other challenges were multinational corporations favouring foreign substitutes, bureaucracy in obtaining permits and licenses, substandard quality, obsolete local technologies, and inadequate infrastructures among others.
Mr Babalola emphasised the need for awareness while recommending building the capacity of Nigerian experts or workers and providing adequate industrial and infrastructural facilities.
The head of media said that other recommendations included improving the quality of Nigerian goods and services and developing a stronger industrial culture with complementary forward-looking regulations.
He reiterated the need to create awareness of local content policy and its benefits.
The Director General of NACETEM, Olusola Odusanya, said that some of the analyses done in recent times indicated that among a community of nations with similarities with Nigeria, one error Nigeria committed was lacking an industrialisation focus and export orientation.
Mr Odusanya said that as a result, most industries in Nigeria started facing problems when the local economy started facing problems.
According to him, if Nigeria has an industrialisation plan and focuses on exports, it will have a sustenance mechanism that allows its industries to thrive.
The NACETEM boss said: “If we had an export and industrialisation focus with the rubber industry, we would have ensured and had a situation where tyres, truck tyres, inner tubes and all the auxiliary materials produced from rubber would have been international rather than local products.
“So, there is a need for an aggressive reorganisation of the entire industrialisation system of Nigeria,” he noted.
