Give Africa the chance to flourish

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The Wood Foundation has called for other philanthropic organisations to follow suit in funding projects which look at creating long term progress

5th February 2018 by Gareth Jones 0 Comments

A Scottish charity is using its work in East Africa to highlight the positive impacts of using philanthropy to support communities.

Set up by oil tycoon Sir Ian Wood and his immediate family, The Wood Foundation Africa (TWFA) has been working with tea farmers in Rwanda and Tanzania since 2012.

The organisation has focused its investment on projects which aim to create long term and sustainable change.

It operates a venture philanthropy model - where the people it works with are considered as partners, and business development is given a high level of priority when donations are made. 

With its tea farming projects supporting up to 360,000 people and resulting in the communities moving towards being able to self sustain the factories, the foundation is calling on other organisations to embark on further projects which put business at the heart of supporting Africa.

Foundation chairman Sir Ian said that investing in projects across Africa which allow communities to become self-sufficient, alongside traditional aid projects, could have a huge economic impact.

He said: “Our vision is to develop farmers as individual small business men and women, while creating a world-class smallholder tea operation in Rwanda that provides meaningful and sustainable financial returns for farmers. This investment is all about the farmers but it is not a quick win, it has taken hard work, patience and time of all involved. Only through professional management and good governance will our vision come to full fruition.

“We are now starting to see the positive impact of our interventions for both the farmers themselves and the region in general. Our activities with smallholder tea farmers in East Africa provide a very successful example of the systemic and sustainable change that can be achieved through effective venture philanthropy.

“We have combined sound business principles with patient capital investment to enable and empower whole communities. What we are achieving in East Africa is a fraction of what could potentially be done by a much wider philanthropic effort, and we would wish to encourage other people to consider rural Africa for their philanthropic investments.”

One of the foundation’s first ventures in Africa was the acquisition of 60% of each of the Mulindi and Shagasha tea factories in Rwanda by EATI, a charitable company which is jointly owned by TWFA and Lord David Sainsbury’s Gatsby Charitable Foundation (Gatsby). 

Since acquiring the Mulindi facility, significant investment has been made to modernise equipment and activities in the field and factory. Smallholder farmers’ income has almost trebled, and 7,000 farmers have graduated from TWFA run Farmer Field Schools for Mulindi and the sister factory at Shagasha.

There are approximately 6,000 smallholder tea farmers supplying each of the Mulindi and Shagasha factories. The farmers have a 40% stake in both factories which will be handed over when specific financial and governance criteria are met.

To mark the progress that has been made, the tea farmers invited representatives from the foundation and others who have supported the initiative to two recent celebration events.

A four hour event was held at the Mulindi Tea Factory last week, with 5,000 farmers attending. There were various speeches from dignitaries along with singing, dancing and testimonies from the farmers. Prizes, including livestock, were also awarded to the farmers in recognition of their work, as well as a number of training awards being made.

Last Tuesday’s event followed a similar celebration at TWFA’s Shagasha Factory in November, where 4,500 smallholder farmers were in attendance.

Rwanda is recovering after the horrors of genocide, however there is still widespread poverty – particularly in rural areas. 

“You can see significant progress in Rwanda. Kigali, the capital city, is now one of the nicest and safest cities in Africa. There is still huge rural poverty however,” Sir Ian continued.

“There is a lot of work going on to try and enhance rural farming. Rwanda is a very stable country now, and is a good country to try and help. We have had great support for our projects there.

“Doing things in Africa isn’t easy for a whole lot of reasons. There is often that natural suspicion and lack of trust in what you are trying to do at first. That has gone completely now and our projects are having a big impact.”

The foundation’s work has a focus on givinng training to the workers so they are ready for taking on the business and helping it to grow once the TWFA takes a step back.

Sir Ian said: “We have purely focused on business principles. It is all based on how to get a better price for the tea, how do you give the farmers better training and things like that.

“I think in two or three years’ time we will be in a place where they are ready to take over the project.

“We will continue to follow it and give help when necessary, but there has already been a huge improvement in terms of knowledge and creativity.

“The farmers had no business acumen or training when we first started working there, but there has been great progress made.”

Sir Ian recognised the great deal of humanitarian work that has gone on across Africa, and said that further philanthropy is needed to help create economic change which can benefit countries on a long term scale.

“Part of what we are trying to do is to enhance people’s awareness and knowledge of what people can do,” Sir Ian added.

“I know that Africa is a long distance away, but it is possible to make a difference there.

“You come across a lot of people who have dedicated their lives to Africa. I have the utmost admiration for them, and they have given far more than we have.

“But I would like people to further understand that it is possible to do significant things in Africa, which can create long term progress, even in projects that do not involve a lot of money.”

Work with African farmers continues

Give Africa the chance to flourish

In addition to their partnership with smallholder farmers in the Mulindi and Shagasha factories, TWFA and Gatsby are leading the smallholder farmer participation in three major new tea planting projects – at Njombe in Tanzania (3,500 hectares) and at Kibeho Munini (4,000 hectares) and Rugabano (4,000 hectares) in Rwanda. 

For Njombe and Kibeho Munini, the tea factories are being built by Unilever with TWFA and Gatsby developing and financing the smallholder farmers’ participation: this will be 4,000 farmers at Njombe and 6,000 farmers in Kibeho Munini.

The third project, working with 6,000 smallholder farmers in planting 4,000 hectares of new tea in Rwanda, is with Luxmi, one of the foremost Indian tea companies, who will be building the factory with TWFA and Gatsby again supporting the smallholders. 

The total investment for all three projects will come to about $120m, with about $75m for the investment in the three new factories, and $45m to finance the smallholder farmer tea planting and to set up the service companies to significantly improve their skills and knowledge, plus the financing for fertiliser, etc.  These are the three biggest new tea planting projects in Africa at the present time.

DFID (UKAid) also provides partner funding to the TWFA projects in this sector.

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