Govt. invites bids for Leather Park

The government has put out an international tender for the construction of the Kenya Leather Park to be located in Machakos County.

The leather park will sit on 500 hectares of land and will be run jointly by the Kenya Leather Development Council and the Export Processing Zones Authority.

Bidders will have to show capability of designing, supplying and constructing the industrial park as well as an effluent treatment facility.

To qualify, bidders will have to have a minimum turnover of a billion shillings a year as well as demonstrate ability to meet the design and construction standards.

According to the tender, bidders can form a consortium to go after the project but must be the lead partner in the joint venture.

To ensure only legitimate businesses apply, bidders will also have to submit a bank guarantee of Sh30 million to be held for four months.

The Ministry of Trade and Industrialization has already begun pre qualifying investors who will be allocated land at the leather park.

Leather companies that set up at the park will enjoy a 20 percent tax free incentive to sell their products locally.

This is expected to ensure local consumers access to genuine leather products at attractive prices.

Kenya’s leather sector is estimated to be worth Sh14 billion, but the sector has remained highly unstructured.

The challenge has been that the country exports mostly in raw skins and hides only to import expensive finished products.

The park will be subdivided into one and five hectare plots with lad set aside for 15 tanneries, treatment ponds as well as space for a minimum of 200 leather factories.

Infrastructure works at the leather park are expected to cost Sh7 billion.

The Ministry of Industrialization and Trade is also working on a leather policy that is expected to block importation of synthetic products as well as set standards for the sector.

Report by Grace Kabura