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Senior Business Reporter
THE government should allow local companies in the leather sector to import raw materials duty free to promote growth and development of domestic factories, an official said yesterday.

Shoepack factory manager, Tembinkosi Wena told Business Chronicle that it was imperative for the government to safeguard the survival of local companies in light of the uneven playing field created by the influx of cheap imported footwear products that were entering the country duty free. Due to this among others, a number of companies in the leather industry have closed down in recent years.

Wena, whose Bulawayo-based company manufactures shoes and is still operating contrary to recent reports that it had suspended operations said: “We need to understand our leather industry at large and come up with measures that promote viability and competitiveness in the face of cheap and completely finished imported footwear products that are entering the country duty free.”

He said such products were threatening the viability of killing local leather industry.

Wena said some businesses were importing shoes from within the Sadc and the Common Market for Eastern and Southern Africa (Comesa) duty free because of the protocols on trade that member states agreed.

“While the government hasn’t allowed local companies in the leather sector to import raw materials duty free, this has created an uneven playing field as shoe manufacturers are grappling with the payment of duty on critical raw materials such as chemicals and glue.

“About 95 percent of shoe components come from outside the country. If the duty on imported raw materials is factored in the cost of production, which among others includes high rentals, and expensive water and electricity, the cost of producing a shoe in the country is very expensive,” said Wena.

He urged the government to find measures to stimulate production and competitiveness in the leather industry.

Despite the operational challenges facing the local leather industry, Wena said Shoepack would remain operational supplying the local market with footwear products.

Shoepack requires about $100,000 to recapitalise operations.