Alleged corruption blighting the tanning industry

Tanzania
Published:  05 May, 2014

The government in Tanzania admits that at least 75% of the country’s hides and skins are being smuggled out – despite a government ban of their exports in raw form – The Guardian on Sunday in Tanzania has reported that ‘dirty deals’ within the ministry fuel the malpractice.


The Minister for Livestock and Fisheries, Dr Titus Kamani, last week revealed that the malpractice was still rampant and robbing the government of significant revenues and leaving the few tanneries without business leaving them operating as as warehouses.

He said despite government efforts to increase export levy on the commodity, dealers now circumvent authorities through smuggling. But investigations by The Guardian on Sunday have it on authority that several exporters of hides and skins were operating under full support of officials from the Ministry of Livestock and Fisheries Development.


Most of the traders caught smuggling raw hides and skins are still in the business despite orders that their trading license be revoked. The Guardian on Sunday has since learnt that most of exporters of hides and skins are foreign traders or Tanzanians of foreign origin.
Interestingly, at least two companies owned by Pakistanis have repeatedly been caught smuggling raw hides, but no action has been taken against them it is alleged.



Last year, one of the companies was caught smuggling raw hides worth over Sh 165m/-, but no action was taken against it. Another company, Paktan Trading Company, also owned by Pakistanis, had was caught several times smuggling raw materials.

It was not until June, 2012 that owners of the company stopped using the name after realizing that it was behind a lot of scandals. By September, last year, the owners of the company started a new company with the name SFA Trading, and was duly issued a trading license by the Ministry of Livestock and Fisheries Development.
The papers investigations reveal that the new company was formed following advice from some senior officials from the ministry who informed the traders that they risked being locked out of business – because the other company was tainted with smuggling cases.
However, the firm’s director, Mohamed Waqas, two other employers Sufyan Afyal and Usman Afyal, had a case in court in connection with poaching – so using the same company name was risky.

Reliable sources revealed that the Pakistanis continued to operate skin and hides businesses without proper licences from June 2012 to September – without a trading licence.

Records indicate that the traders continued to receive large sums of money from abroad through the name, Paktan Trading Company, despite stopping using the name the previous year. It received close to $100,000 within one month.
Statements seen by a Guardian on Sunday reporter show that the company received $8,466 on March 1, last year from overseas; $17,154.30 on March 18 and another $7,970.00 on the same month.
On March 28, the same year, it received another $32,000 before another $17,653.25 was delivered on April 2, 2013, all from abroad. Most of this money was wired into a commercial bank in Kariakoo from China, Pakistan and India. In total, the company received $1.4 million when it was not legally doing business
“It is surprising that they continued to use the name to transfer money from overseas when it didn’t have a trading licence,” said one of their sources who declined to be named.
“There is only one person who can issue and approve export permits, so the whole process is prone to corrupt deals,” he said, adding that the existence of a committee of five people to approve the documents, the decision lies with only one or two people.
Records indicate that companies Kilimani Forest and Agro-Products, in March this year exported 15 containers of wet-blue hides, all valued at $16,000 approximately Sh27, 376,440m/= per container.
“It is not possible to have all containers with the same quantity and monetary value because one cannot make the same for all containers,” our source said.

Another trader who cleared only two containers for export on April 10, 2014 had one container packed with 1,916 pieces of wet-blue hides valued at $46,579.48 in one container. The other one had 1,847 pieces of wet-blue hides valued $46,291.25, or about Sh74m/- in each container.