Browsing by Author "Eshetu, Mulualem"

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    The Performance and Determinants of the Ethiopian Leather Export Sector
    (Addis Ababa University, 2002) Eshetu, Mulualem; Asgedom, Getachew (PhD)
    Ethiopian leather export sector has been the second most important source of foreign currency to the country. However its share among the country's merchandise export earnings has been declining in recent years. In terms of foreign currency, the export earning from this sector has been fluctuating mainly due to unstable nature of the international market price particularly in the 1990s. This study has, therefore, tried to examine the overall performance of the sector. In particular an econometric approach using Ordinary Least Square (OLS) has been applied to determine the significance of major quantitative factors for the variation in the supply response of the export sector under review. Consequently, the world market unit price/value of the exports and the local real exchange rate have been found to have significant effect on the long run supply of the export sector. In the short run analysis, the domestic consumption pressure and world supplies from major exporters are found important factors in hindering the growth of the export sector. On the other hand the real income of the country (which represents domestic production capacity) does not appear to have significant contribution to the change in supply response of the export sector under study. In addition, poor quality status and insufficient supply of the raw stocks were among the main constraints for local tanneries to operate under capacity and consequently contributing to the declining trend of the export earning. The main causes for these constraints include traditional way of production, preservation and storage facilities. Moreover, lack of premium prices for higher quality raw hides & skins supplies plays a major role for disincentive in quality upgrading and limits the rates of recovery