Does Ethiopia have a comparative advantage in the leather industry?
Ethiopia is the 8th largest livestock in the world, and the second largest in Africa. Thus Ethiopia has naturally developed its leather industry in the past decades, mostly through large exports of raw skins. In 2008, the government implemented a 150 percent export tax on semi-processed wet blue in order to encourage the development of its leather industry, and capture a larger part of the added value of the sector. This was the first step of an integrated leather industry largely based on the livestock annuity. The transformation industry grew, providing jobs and rising the margin of the country on the leather.
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