East Africa: East Africa Has the Raw Materials but Lacks the Factories

[Independent (Kampala)] News Analysis -- East Africa has plenty of hides, cotton and oilseeds. What it lacks is the industrial capacity to turn them into shoes, clothes and cooking oil. Instead, the region spends billions of dollars importing goods made from commodities that its farmers and livestock keepers already produce.

Frank Dafa, executive director of the Confederation of Tanzania Industries, argued that agriculture, livestock production and manufacturing needed to be more closely connected. Manufacturers and policymakers urged cheaper finance, predictable trade policies and reliable local raw materials to help factories compete with imports NEWS ANALYSIS | THE INDEPENDENT | East Africa has plenty of hides, cotton and oilseeds. The imbalance was laid bare at a two-day meeting organised by the East African Business Council (EABC) and the African Development Bank (AfDB) in Dar es Salaam, Tanzania, last week.

Manufacturers and policymakers called for cheaper industrial finance, more predictable trade policies and better supplies of locally produced raw materials to help factories compete with imports. The figures make uncomfortable reading. East Africa produces about 370,000 tonnes of hides and skins annually, yet imported roughly $566 million worth of footwear, footwear parts and leather goods in 2025.

Exports of hides and semi-processed leather amounted to just $46 million. Only 37% of the region’s annual cotton lint production, estimated at 119,000 tonnes, is spun locally. Imports of textiles, clothing and second-hand garments reached $3.24 billion in 2025, more than three times exports of about $970 million.

Imports cost approximately $3.1 billion, against exports of $1.2 billion. Local production meets only 37% of regional consumption. These are not merely trade deficits.

They are evidence of the value that East African economies fail to capture between the farm and the shop shelf. Cotton is grown but too little is spun into yarn; hides are collected, but relatively few become finished leather goods. The processing, manufacturing jobs and profits often accrue elsewhere.