INVESTIGATIONSBUSINESSDAY INVESTIGATION
Aba’s N120bn shoe industry booms despite neglect
by ODINAKA ANUDU On Jan 28, 2019
leather shoe industry
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Leonard Kujabi, a Gambian bank worker, was in Aba, Nigeria’s shoe capital, in May 2018. He came to the country with his family for a three-week holiday. After crisscrossing Powerline, a cluster in Ariaria Market, one of the days, he bought 15 pairs of shoes, selling 10 to friends and neighbours while keeping the rest for his family.



“Aba-made shoes are gaining traction in The Gambia,” Kujabi said on the phone. “They are strong, durable and cheaper, compared with what we get in our country.”
One million pairs of shoes are produced by more than 80,000 leather makers in Aba each week. With 48 million pairs produced each year at an average price of N2,500 a pair, the industry is said to be worth up to N120 billion.

Traders from West African neighbours storm the industrial city every week to buy different product designs, just as Southern African schools are beginning to place orders directly from the shoemakers. Canadians, Europeans and the Chinese are also in the party, placing orders themselves directly or through their Nigerian proxies, BusinessDay was told in Aba.
“We are already struggling to meet demand,” said Ken Anyanwu, secretary, Association of Leather and Allied Industrialists of Nigeria (ALAN), who produced shoes for the Nigerian Armed Forces in 2016.

The business is already online, with the likes of Gada Africa, and abanaijamade.com.ng, among others, handling marketing and distribution of those shoes, including belts and trunk boxes, after online orders are taken. Online shops take 20 to 50 percent cuts from sellers, BusinessDay gathered from the shoemakers.

“We have built partnership with local and some international logistics handling companies,” said Ben Chiobi, a retired air vice marshal, who founded the newly-birthed Gada Africa.
Chiobi said this was to ensure that every product people order would be taken to them conformably.

The Aba leather industry is made up of shoes, trunk boxes and belts. It provides employment for tens of thousands, with many specialising in different stages, such as designing, patterning, cutting, skiving, stitching, peeling and finishing. It is made up of clusters such as Powerline, Imo Avenue, Bakassi, Aba North Shoe Plaza, Omemma Traders and Workers, ATE Bag, and Ochendo Industrial Market, comprising input suppliers, among others.

However, the industry is in thriving in chaos as the majority of shoemakers in the industrial city are poorly structured and are not registered at the Corporate Affairs Commission. Exports are made informally, making tracking and planning difficult.

Their machines are crude and much of their work is still done by human labour. The more advanced shoemakers in Lagos are mostly foreigners, who design their shoes abroad and then import Completely Knocked Down shoes back to the country for finishing.

“This is where the problem lies. We in Aba have no good machines,” Anyanwu of ALAIN said.
“The Bank of Industry has done its best by giving some of us N300,000 each, but it takes $250,000 to $750,000 to set up a standard shoe factory. So, what can N300,000 do when the industry is capital-intensive?” he asked.

He said this is why the majority of Aba shoemakers are not meeting demands and are overworking themselves once orders are placed.
“It is a problem already for us because if a customer comes and we can’t meet demand, he will go elsewhere. The industry needs retooling,” he said.

Nigeria and Ethiopia have things in common in terms of leather. Ethiopia is home to 56 million cattle, which provide ready raw materials to shoemakers. But Nigeria, with more shoemakers, has 131 million cattle, goats and sheep, according to the Federal Ministry of Agriculture (2011 figures). Ethiopia is the second most populous (with 105 million people) after Nigeria with almost 200 million people.

Another hitch is that Aba shoemakers import animal skins from China and many parts of Africa and Europe.

“What happens is that the tanneries in Kano and Kaduna process animal skins and sell them as leather in the global market, earning foreign exchange,” said Chinatu Nwagbara, coordinator, Made-in-Aba Project, who produced shoes for former President Olusegun Obasanjo in 2016.
“So we go to China and other countries to buy. Sometimes, we buy our products and re-import,” he said.

More investments are going to Ethiopia. Between October and December 2016, Ethiopia attracted over $500 million in FDI to the shoe and leather industry. About 124 investors willing to invest $3.5 billion indicated interest to swell the export-oriented shoe market, according to the Ethiopian Investment Commission (EIC).

Ethiopia exported $33.7 million worth of footwear products mainly to the United States in 2015, one million lower than the preceding year. Through the African Growth and Opportunity Act (AGOA), the US-Africa trade law that allows duty-free and quota-free access into the US market, Ethiopia shoe exports jumped from $630,000 to nearly $7 million between 2011 and 2012, a more than tenfold increase, according to statistics from USAID.
The Abia State government said in 2016 that Huajian Group in Ethiopia, which made shoes for Ivanka Trump, wife of US president, would be coming to Aba.

In September 2017, Sherry Zhang, general manager of Huajian Shoes in Addis Ababa, told BusinessDay in the Ethiopian capital that the company was still interested in setting up a shoe factory in Aba, southeast Nigeria. But this has not happened since. However, a new set of machines have been imported by a new investor in Aba, who plans to modernise the industry, BusinessDay was told.

Q

The same people making new shoes
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Are also the one importing used UK and Chinese shoes to sell
No wonder government ignore local product

Why are the SE leaders always neglect any developments in their region?

Despite government neglect these guys are marching on. Even people from Canada are placing orders. Like everyone know the problem with Southeast just like every region in this country is the ruling class. Imagine if clueless Orji uzo kalu and Theodore Orji invested heavily in infrastructure in Aba city. Our leaders need to be shaken to their core. We are suffering for nothing in this country.

helinues:
Why are the SE leaders always neglect any developments in their region?

Not all southeast leaders. But most of them are just not ready for governance. It's just prestige,power and avenue to make stupid wealth for themselves and their great-great-grandchildren.

Government neglect? Was this not the same state the governor sent some set of people to China for training recently on shoe making, where Fashola commissioned the Independent Power Plant for recently?

More than 80,000 young men and women are producing 1 million shoes every week with almost bare hands adding 120billion naira to our GDP annually. This is shoes alone. We have not factored in Clothes, metal fabrications that would wow the Germans, Children beddings, infact anything can be produced in Aba. Just give them the sample and you will be amazed.

That's great. One day government will realise and patronise

9jatriot:
Government neglect? Was this not the same set of people the governor sent to China for training recently and Fashola commissioned the Independent Power Plant for recently?

You mean government sent 80,000 artisans to China for training? Of course not because it's impossible. These interventions while commendable are just a drop of water in the ocean. These guys need access to good equipments and it costs money. Most of them produce this shoes in the most horrible situation inside poorly lit rooms trying to meet up with clients demand.