Catalyst: Win-Win for Rwandan Tea

“Imbarutso: Win-Win for Rwandan Tea” was launched in March 2011 in joint funding partnership with the Gatsby Foundation and is the second WFT programme in Sub Saharan Africa.

“Imbarutso” will see an investment of up to $9million USD over a six year period with the aim of increasing smallholder tea production and farmers’ margins, turning smallholder farmers into viable and efficient Micro and Small Enterprises (MSE’s) as well as enhancing the competitiveness of the sector. 

Tea is Rwanda’s second most significant export earner, providing among the highest quality tea in world markets. Projected to exceed $60 million USD in revenues this year with production spread throughout 11 Districts, it is a vital source of rural income and livelihood for over 30,000 smallholder businesses and 60,000 households. 

In looking to successfully develop Rwanda’s tea industry, there are two important competitiveness issues.  Firstly, Rwanda produces 24,000 MTs per annum of made tea – approximately 7% of Kenya’s annual output.  Even with a planned increase to 35,000 MTs by 2015, Rwanda’s relative production will remain modest.  Secondly, through existing and new planting, about 65% of Rwanda’s tea will come from smallholder farmer production which is sold to the factories.

To expand the area of tea under production and significantly increase the volume and quality of tea, a win–win balance must be achieved whereby smallholder farmers have the appropriate financial incentive and professional support services, while factories are able to improve their throughput and profitability. This has the potential to transform the 30,000 smallholder farmers into viable and efficient MSE's capable of significantly improving their rural economies.

To achieve this win-win position, we will work with Government, factories, Cooperatives and smallholder farmers to address a variety of constraints along the value chain from production to end market.  At the smallholder farmer level, support will focus on enhancing the capabilities of the Cooperatives to provide higher quality and more comprehensive agronomic services, farm management and production logistics and enable them to better represent the smallholder farmer in commercial negotiations.  There's also a need to achieve a fairer distribution of the value chain proceeds between the producer and processor to encourage the smallholder farmers to invest in increased yield, quality and quantity.