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SULULTA, Oromia State | Leather Factory | $27mill | Completed

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Multi-Million US Dollar Leather Processing Factory Inaugurated in Ethiopia

A modern leather processing factory built in Sululta town of Oromia State at a cost of 27 million USD by China- Africa Overseas Leather Products S.C was inaugurated.

The factory, built on 80,000 square meters of land on the outskirts of Addis Ababa City, has a capacity of producing 450 million pieces of processed leather per year, General Manager of the company, He Mingliang said during the inaugural of the factory.

He said the factory employs 500 local people.

The General Manager also announces plan that the factory would be expanded if the condition is favorable by injecting 25 million USD. This will enable it to produce the stated products valued at 120 million USD.

This second phase project will also enable the plant to use 2000-2500 skins per day.

He said the factory is environmentally friendly.

Speaking on his part, State Minister of Trade and Industry, Tadesse Haile said the leather and leather products industry is one of the top priority sector identified by the Industrialization Strategy of the country.

He said the country’s five year Growth and Transformation Plan (GTP) mainly focuses on adding value on raw local materials.

Tadesse said one of the objectives of the GTP is to double the contribution of industry sector to the GDP after five years by attaining a 20 per cent growth annually.

As a result the plan is expected to strengthen the global competitiveness of the country’s leather and leather products industries thereby earn more foreign exchange.

Vise President of China Development Bank (CDB), Xin Yiren on his part said CDB and CADFund have supported and would continue to support Chinese enterprises to invest in Ethiopia.

CDB committed to promote Sino-African trade and economic cooperation and encourage more Chinese to invest in Africa, he said.

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Chinese company erects largest leather factory

China-Africa Overseas Leather Products S.C., a company fully owned by Chinese investors, on Wednesday inaugurated the largest leather and leather products factory in Ethiopia to date with a capital of some USD 27 million.

During the inauguration ceremony of the factory, He Mingliang, general manager of the company, said that about 500 local people would be employed in the factory.

Tadesse Haile, State Minister of Industry, told The Reporter that some 200 local people, of whom many are women, had already got job opportunities.

According to Mingliang, the factory, located in sululta town, 23 km north of Addis Ababa, in the Finfinne Special Zone of the Oromia Regional State, lies on an area exceeding 80,000 sqm (8 hectare) and construction took less than a year. “This project so far has consumed USD 27 million and has the capacity to produce 450 million pieces of processed leather a year,” he said.

Mingliang said that if the laws, policies and conditions were favorable, his company would launch the second phases of the factory that will inject an investment amounting to USD 25 million and has the capacity to use up to 2,500 cow skins a day for finished leather and leather products. The company aims to secure a total revenue of around USD 120 million annually from export sales.

According to Tadesse, the company is expected to manufacture finished leather and leather products, mainly gloves. Such outputs are destined to enter the market by the end of this fiscal year. He said that the company brought state-of-the-art technologies that are new to the local industry. “The new processing machines that we have seen have their own positive impacts on production levels and return.”

The factory not only creates job opportunities to the community but also gives on-the-job trainings. Tadesse expressed his satisfaction with what he saw during his visit to the different processing houses. Though what he saw was positive, he stressed that further trainings are necessary.

The company’s general manager told The Reporter that they had introduced advanced and internationally accepted sewerage treatment facilities and technology “to guarantee the realization of pollution-free disposal of waste materials”. However, Tadesse said that dialogue and discussions will be held in the near future on the issues of waste treatment and drainage systems. He further noted during his site visit that workers safety rules and protection also needed major attention.

China-Africa Overseas Leather Products S.C. is a joint venture company owned by Xinxiang Kudroda, Mingliang Leather Co. Ltd and China-Africa Development Fund (CAD Fund). According to the company, 55 percent of the USD 27 million capital invested was covered by both private companies while the remaining balance is the share of the CAD Fund.
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