Overview of the Tea Component
Potentialities and Constraints in the Tea Sector
The main factor of agricultural development in
general, and of tea development in particular, is the will of people
to overcome the vicious circle of poverty, and their capacity to
adapt the farming system and practices within the constraints imposed
by the economic and natural environment. Rwanda has considerable
agricultural potential, despite the threat of overpopulation. There
are large areas with fertile soils suitable for growing many crops
with international market potential, including soils with the right
pH for tea and coffee, and high altitude locations with adequate
rainfall where production of top quality tea and coffee is possible.
The quality of the Rwanda green tea leaves is among the best in
the world and this excellent reputation is still acknowledged by
the international market, despite the deterioration of the processed
products which occurred after 1994.
Another important favorable factor for the development
of tea is the peoples’ willingness to face the challenge of
the future jointly, and in an organized manner, even though most
of the current farmers’ organizations have little financial
resources. The GoR decentralization policy with its focus on the
lower levels of the local government is an important factor of political
and social dynamics that can be instrumental in backing up the spontaneous
structuring of the rural people.
Finally, the liberalization and privatization policy
of the GoR is slowly beginning to bear fruit. This is evident in
the very significant increase of tea yields connected with the management
of the only processing factory that has been privatized.
However, Rwanda is a landlocked country. High costs
of transport affect the cost of fixed assets and of inputs, which
must be imported, and the cost of transporting finished products
to foreign buyers. The general underdevelopment of the rural areas
increases the cost of any ancillary service that economic operators
require. Tea yields are low by comparison with other producing countries.
As a result, despite very low labor costs and grower remunerations
significantly lower than elsewhere, Rwanda is a high cost producer.
Other constraints stem from the lack of up-to-date research, which
affects agronomic practices of traditional crops. To survive in
export markets, Rwanda needs to produce high quality products, cashing
in the opportunities offered by the natural conditions, and by the
skills already developed among growers and in the processing industry,
and to market them in new and innovative ways. A major constraint
faced by poor smallholder cash crop producers is the low level of
farm gate prices resulting in a lower share of the price of the
processed products by comparison with other exporting countries,
including nearby Kenya. This can only be partly explained by the
high cost of processing and marketing mentioned above, some of which
also affect Rwanda’s neighbors. Participation of smallholder
growers associations in tea factories/companies is a key to seriously
address this constraint.