Tanzanian tea factory Mponde gets new investor Mponde Holdings Company

TANZANIA – The government of Tanzania has officially handed over Mponde Tea Factory to Mponde Holdings Company, a joint venture between the Workers Compensation Fund (WCF) and the Public Service Social Security Fund (PSSSF), which seeks to invest in the factory.

The factory was closed in 2013 after the then investor, Usambara Tea Growers Association (UTEGA), allegedly violated the contractual agreement terms.

After a five-year hiatus, the state reopened the facility in 2018 to ease the local tea farmers’ economic and social burden that arose following the closure of the facility.

The Treasury Registrar, Mr Mgonya Benedicto, acting on behalf of the government, handed over the factory, important documents and other assets linked to the company to the Director of Mponde Holding Company, Mr Paul Kijazi.

“My office would like to express my sincere gratitude to the Mponde Holding Company Board, as well as the management of PSSSF and WCF Funds, for their cooperation and efforts in ensuring that the Mponde factory resumes production and that the people eventually get jobs again after a long period of unemployment,” he said.

Meanwhile, Mr Kijazi expressed gratitude to the government for the decision to hand over the factory, vowing to do everything in their power to meet the objectives of their investment, which is projected to provide a variety of benefits, including job opportunities.

History dictates that Mponde Tea factory was commissioned on September 14, 1971, and officially opened on December 28, 1973.

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The factory was built by the Tanzania Tea Authority (TTA) to serve indigenous small-scale tea farmers in both Lushoto and Korogwe districts in the West Usambara.

In December 1999 it was privatised and sold to UTEGA with financing from Lushoto Tea Company Ltd. The government was forced to break the sale agreement because UTEGA contravened sections of the agreement.

The reopening of the factory is key as tea is one of the main commercial crops in the country and a top foreign exchange earner.

In the 2020/2021 season, the country’s tea production volumes were set at 40,000 tonnes in the 2020/21 season, boosted by good weather conditions.

This was a 40% rise from the previous season’s 28,000 tonnes which was 20% short of the period’s target of 38,000 tonnes.

The 2019/20 tea production was also a decline from 2018/19’s 37,000 tonnes which had surpassed its target of 35,000 tonnes of tea.

The East African country targets to harvest 60,000,000kg by 2024/2025.

In a bid to meet this ambitious target, the Tea Board of Tanzania has set out a myriad of strategies including reviving abandoned old farms, expand existing tea plantations, for example, in Njombe and also to increase seedlings production for new plantations.

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