Scots oil tycoon gives Rwandan tea factory to 5,000 local farmers

Scots oil industry tycoon Sir Ian Wood has handed over ownership of the largest tea factory in Rwanda to 5,000 local smallholder farmers.

Sir Ian, whose wealth is valued around £1.8bn, was in Rwanda to sign over the Mulindi factory to those who cultivated the tea, in a move that will further increase direct profits for growers.

The Wood Foundation, the charity set up by the North East family, acquired the tea factory in 2012 with Lord Sainsbury's Gatsby Charitable Foundation after the plant was privatised by the Rwandan Government.

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Since the purchase, when 45 % of shares were given to smallholders, around £11m ($15m) has been invested in factory improvements and agricultural training with the foundation assisting in building markets and corporate governance.

Smallholder tea farmers working close to the Mulindi tea factory, which will now be totally run and controlled by those who grow the crop after Scots oil tycoon Sir Ian Wood handed over his shares in the plant. PIC: A Campsie.

With Sir Ian now satisfied the factory is a well run-business, the 55% stake held by the philanthropists has been handed over to the farmers so they can run it themselves.

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Sir Ian, who attended the handover ceremony at the tea factory with Prime Minister of Rwanda, Édouard Ngirente, said: “It’s been a matter of great pride and satisfaction for Lord Sainsbury and I to work with the tea farmers at Mulindi.

"It was difficult to begin with but with the investments and significant training programmes the farmers performance and their income have greatly improved.

Sir Ian Wood at an awards ceremony at Mulindi in 2018, where he presented prizes to tea farmers, including this cow. PIC: A Campsie.

"We are very pleased to be handing over a well-established successful company and will continue to provide some support for an interim period.”

Tea is an increasingly important crop in Rwanda, raising around £70m ($93m) of national revenue in 2019/2020 and directly employing around 60,000 people. Smallholders dominate the supply of the crop.

Sir Ian frequently visited Mulindi, with the tycoon treated to a “rock star’s welcome” at an awards ceremony for farmers in the shadows of the factory in 2018, which was attended by thousands, some who walked through the night to get to the event.

The tycoon has spoken candidly in the past about the challenges getting the factory into good order.

Sir Ian Wood and the Rwandan Prime Minister, Edouard Ngirente, at the official handover ceremony. PIC: Contributed.
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Since the philanthropic investment in the processing plant, its capacity has increased from 60 metric tonnes to 120 metric tonnes of greenleaf per day.

Meanwhile, the average annual gross income of a farmer has roughly doubled in eight years to $2,881 (approximately £2,188) in 2021.

More than 5,000 farmers have been trained on best practice tea management skills with $3.1m (£2.3m) paid to farmers as bonuses over and above their greenleaf income.

Dr Gerardine Mukeshimana, Rwanda's Minister for Agriculture and Animal Resources, said the handover was a “historic moment” for Mulindi's tea factory.

She said: “I am so happy to see this empowerment at the rural level. "

She said the exit of The Wood Foundation and the Gatsby Charitable Foundation underscored their “commitment to farmers’ empowerment” and “confidence in the people and country of Rwanda.”

Sir Ian is best known for his work with the Wood Group, an oil services company which he transformed from a modest-sized company in Aberdeen to one that operated in 50 countries, employing some 35,000 people.

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