Ocir-the was created
in 1975 as an autonomous public body in order to
supervise the tea sector. Can you briefly come back
on your major achievements and especially the role
you played in the rehabilitation of the sector after
the events of '94?
Before 1975, the tea and coffee sectors were
gathered under one single authority. And it is
in 1975 that we became an autonomous body responsible
for production, processing and marketing of the
Rwandan tea.
Ever since, production was increasing steadily
until 1994 when the war affected tremendously
our production. From 1995, we gradually resumed
our production. 70% of our factories had been
damaged, so we restarted with a very weak production
capacity. On top of it, some of our experienced
workers had run away or had been killed during
the genocide. So, we also had to rebuild our human
resource capacity.
In a first stage, it was urgent to rehabilitate
quickly our factories and plantations, which had
been unattended for a few months. The Government
identified the tea sector as one of the priority
sector to be rehabilitated since it was also source
of foreign currency. But the first funds that
we received came from international donors such
as the European Union, which enabled us to rehabilitate
4 factories in a first stage. In 1996, the Government
provided us with financial resources to rehabilitate
2 more factories. The other three factories that
remained just needed some small repairs to improve
their productivity. Apart from the EU, we also
received funds from the African Development Bank,
some investment funds and the Belgium government.
In 1998, we completed our rehabilitation.
In 2001, you reached a higher production level
than before the '94. How do you explain such a
growth in volumes?
We reached in 2001 the highest production ever
since we started production of black tea back
in the 60's. With 14,260 Tons, the production
level was 33% higher than in 2000 and 18% more
than the previous record reached in 1998, the
"El Nino" year. This was due to a combination
of a few factors: first, we enjoyed excellent
weather conditions. In 2000, we embarked in a
process of increasing the yield per hectare by
injecting more fertilizers in the plantations.
We also trained our workforce to the new techniques
that would improve the productivity of everyone
involved in the process. Besides that, I decided
to visit every factory at least once a month in
order to keep a close eye on the way each factory
is being run and determine their needs. Every
month, we choose one of our 9 factories to organize
our top management committee, so that we can inspect
the facilities as well as the field and then carry
out a critical analysis of the situation, leading
to improvement proposals.
Also, we noticed that before 2000, there was a
lack of synergy between the planters, the associations
and Ocir-The. So, we tried to implement a dialogue
and a vision for the sector so that we all agree
to head together towards a same goal. We looked
together in new ways to enhance productivity and
improve techniques at all levels so that everyone
can contribute to moving in the right direction.
Do you easily find markets for those increasing
volumes?
Yes, our tea is well appreciated abroad. We have
focused on improving our quality and this is how
we have managed to make the difference with foreign
teas. But since 2001, we have been facing a drop
in international prices of around 18%, mainly
due to increased international production of tea
from East Africa, Sri Lanka and India. Also, the
September 11th impacted on the regions we used
to sell our tea such as Pakistan that imported
65% of our production.
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Do you market your
tea abroad yourself?
No, actually 80% of our tea is sold through the
Mombassa auctions, which is the second largest
auction center in the world. So, we don't sell
our tea ourselves but it came to our attention
that most of our tea was actually bought by Pakistan.
Today, Pakistan is the third largest importer
of tea in the world. So, in the end, the quantity
they buy from Rwanda is marginal as compared to
the volumes bought worldwide. For example, they
import a lot more tea from Kenya. But we make
the difference with the quality. 90% of the tea
that we sell through auctions are rated first
grade, the highest quality. Kenyan teas are roughly
on the same quality level as ours but they have
the competitive advantage of having lower transportation
costs. Hence the importance for us of focusing
on higher quality.
A privatization program of the productions
units has been engaged. What is your timeframe
for the completion of this privatization process?
We will soon start the "pilot" phase
of the process by privatizing two of our largest
factories, one called Mulindi from Byumba province
and the other called "Pfunda" from Gysenyi
province. After that, we will do an analysis of
how the privatization process went and decide
how it should be continued according to the experience
we will have gained from the 2 first sales.
Have you found any investor interested in
the sector?
We have been in contact with a number of companies
and individuals who have come to visit our factories
and expressed strong interest? The privatization
Secretariat is in charge of advertising those
investment opportunities internationally and launching
the technical and financial bids. Ocir-Thé's
role is to provide technical information or advice.
Sowarthe is now a private company and is one
of the best performing tea companies in Rwanda
as it owns only 10% of the plantations but produces
more than 30% of black tea production. How do
you explain such a performance?
They have indeed a very high yield per hectare.
One of the major factors is the fact that they
roughly use five times more fertilizers on their
plantations than we do in ours. Also, out of more
than 1,200ha they look after close 300ha only,
the 700 remaining hectares belong to tea growers
that used to be under our supervision until July
2001. So, part of their success is also due to
the work we did with those growers in improving
their production until recently when we let the
farmers run their own show. However, it is anyway
proved that the flexibility that the private operator
can benefit from is a major asset when it comes
to reach objectives. As a State company, we don't
have this flexibility that enables us to react
quickly. Also, the private sector has the capacity
to give more incentives to their workers than
the public sector can afford. So, the privately
owned entity like Sowarthe does often become more
productive as workers are more motivated.
What will Ocir-Thé become once the
privatization process gets completed?
Ocir-Thé will still exist under the same
name. We will be more like a Tea Board advising
private tea entities, keeping statistics, issuing
certificates, ensuring that the tea is produced
according to our national standards and of course
we will always contribute to support the sector
in its development, represent its interests abroad
and facilitate business contacts.
You are also chairman of Sowarthe. How do you
combine those two positions and the personal experience
you get from them?
The Rwandan tea is one tea, we try to give our
best to produce the best tea quality. We are not
in competition with Sowarthe as such. We combine
our images and technical know-how to make sure
that it will benefit to the sector as a whole
in terms of management and access to foreign markets.
At my level, the experience that I gained both
in Ocir-The and Sowarthe enable me to get a larger
vision and apply that vision to ensure that there
is synergy and complementarities between the public
and private players in the tea sector.
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RWANDA
