The Managing Director Mr. Edward mudibo interview on K24 inside business
The East African Tea Trade Association is a progressive and socially aware organization. As such we are dedicated to integrating good corporate citizenship into our business strategies. CSR is integral to the long term sustainability of our business. In line with the mandate of theAssociation, the following CSR Projects were supported under EATTA’s CSR Programme 2016:
· Mji wa Salama Children’s Home
· Coast Hospice
Mji wa Salama Children’s home is an institutional care centre under the Child Welfare Society of Kenya which was started in 1970. It caters for orphans, abandoned neglected children of jailed parents, abused children both defilement/battered cases, HIV and Immigrants. Currently the home has 86 children; 50 boys and 36 girls ranging from 5 months to 18 years. We supported the Children’s home with basic needs including, food, medicine, clothes, firewood, footwear, pampers as well as paying off their electricity bill for the consumption period July-August. The home depends entirely on donations from well-wishers for its upkeep/survival and re-current expenditure.
The Coast Hospice, registered as a charity is the only hospice in the Coast region. It is located in Mombasa County and started operation in 2001. They provide quality palliative care to terminal ill cancer and HIV/AIDS patients, through the proper administration of drugs for pain and symptom control, as well as support to their families and care givers. Every year they have a direct impact in the lives of over 1,800 patients. Their goal is to bring peace to their last days and minimize suffering that comes along with terminal illness. This year EATTA supported the hospice through purchase of drugs, plastic chairs and tables as well as rebranding their signage which had worn out.
On behalf of the Board of Directors and Management of EATTA, we express our utmost and sincere gratitude and appreciation to Van Rees Kenya Ltd and Venus Tea Brokers who contributed Kshs 300,000 and Kshs 10,000 respectively to go towards the two charities. This is truly the true spirit of embracing CSR and we are truly humbled.
Mombasa International Show
The Mombasa International Show (MIS) was established in 1903 and is situated on the North Coast of the Coastal Resort City of Mombasa. This year EATTA participated in the Mombasa International Show under the ambit of AFA. The theme for the Trade Fair this year was “Enhancing Technology in Agriculture and Industry for Food Security and National Growth”, in other words . “Kuimarisha Teknologiaya Kilimo na Viwanda Ili Kujitosheleza Kwa Chakula Na Ustawi Wa Taifa”
AFA in conjunction with EATTA had the opportunity to showcase different Kenyan Crops and visitors to the show were not disappointed as they got an opportunity to sample some of the Kenyan Teas showcased at the sampling stand. This year AFA managed to scoop three awards in three different categories as below:
1. The best Regulatory Authority Stand – 1st Position
2. The best stand in Agro-processing and Value Addition – 2nd Position
3. The best Stand that Best Interprets the Show Theme – 3rd Position
AFA Awards at the Mombasa International Show 2016
The highlight of the Show was during the opening ceremony held on Thursday 1st September 2016 where, the AFA stand had the privilege of being visited by the Patron of the Show, H.E. Hon. Uhuru Kenyatta, EGH, the President of the Republic of Kenya and Commander in Chief of the Kenya Defence Forces who made a stopover at the EATTA booth accompanied by among others Hon. Ali Hassan Joho, Governor Mombasa County and Mr. Willy Bett, Cabinet Secretary Ministry of Agriculture, Livestock and Fisheries as well as Mr. Alfred Busolo Tabu, Interim Director General of AFA.
H.E President Uhuru Kenyatta with EATTA MD Mr. Edward Mudibo
H.E President Uhuru Kenyatta at the EATTA Booth
In 2016 EATTA has had the honour of hosting H.E President Uhuru Kenyatta at the Secretariat on Tuesday 19th January 2016 and having him visit the EATTA Booth at the Mombasa International Show on Thursday 1st September 2016. The key message from H.E the President is that EATTA in collaboration with TMEA needs to fast track the auction automation process.
On Tuesday 12th April 2016, EATTA hosted the Cabinet Secretary for Agriculture Hon. Willy Bett, the Acting Interim Head of Tea Directorate Mr. Samuel Ogola, and Member of Parliament for Makueni as well as member of the Parliamentary Committee for Agriculture, Livestock and Cooperatives Hon. Daniel Maanzo.
This is the first visit by the Cabinet Secretary since he was appointed to the position in December 2015. On hand to meet with the CS were EATTA Board members including Mr. Jacob Kahiu, Mr. Gideon Mugo, Mr. Simon Gikanga and Mr. Ben Gitonga.
In his remarks to those present, Mr. Bett said that he had not received the final report of the task force constituted to look into the tea industry. He said that the Government was keen to adopt the recommendations in the task force in as far as it would be of benefit to the tea producer. He said that he was looking into the recommendation that the Ad Valorem Levy be reduced from 1% to 0.75%. He asked for a confirmation that the benefit of the reduction of the levy would accrue to the producer.
The CS was informed that of fact that the Mombasa Auction was a multi origin market, any tax subjected to teas from one origin in exclusion to other origin teas will disadvantage that tea. A buyer will discount the cost of the tax on Kenyan tea to cover the amount they will need to pay.
The CS wanted to know why the prices had been declining since the end of January. It was explained to him that the decline in prices is as a result of the increase in volume offered that is up 19% compared to the same period in 2015.
The Secretary of State for International Development in the UK, Hon. Justine Greening, was in Mombasa to assess the progress of Kenya in terms of trade, investment and economic growth, supported by her government.
As part of the programme, she met key private sector players based in Mombasa to discuss on trade, economic policy and regulatory matters. She also sought to know more about transport infrastructure; doing business and investing in Mombasa; and priorities of the County of Mombasa. EATTA was represented in the meeting by the Trade Development Manager Mr. Brian Ngwiri. In the discussions held, Brian articulated the challenges faced by Mombasa based businesses caused by the poor road network, irregular and unreliable power supply and the Mombasa County Governments haphazard charging of cess and levies that are costly for the businesses based here. On tea specific issues that the tea industry is experiencing, Brian informed the Secretary for International Development that support for value addition initiatives including developing a common user facility would be a positive development. Brian gave the Secretary of State an update on the progress on automation of the Mombasa Tea Auction and the support from TradeMark East Africa. Brian, informed Ms Greening on the necessary support that would be welcome from TMEA for an end to end tea value chain intervention including capacity building in crop husbandry to ensure a better quality tea is produced upstream to capacity building to encourage SME’s develop necessary skills for developing new market opportunities.
Accompanying Ms Greening was the Principal Secretary for International Trade Dr. Chris Kiptoo and CEO of Shippers Council of East Africa Mr. Gilbert Langat. The Association was represented by Mr. Meshack Kipturgo of Siginon Group. Other organisations represented were KATO, KAM, Chamber of Commerce and Mombasa County Government.
1.0. Meeting Between Kenya Revenue Authority and EATTA
In the last update from the secretariat we informed you that we had written to KRA seeking an appointment to raise concerns on various issues of concern to the tea industry. We obtained an appointment for 20th March 2013 and together with a few members of the trade, we went and met with the Senior Deputy Commissioner for Southern Region as well the Line Managers responsible for issues of concern to the tea industry.
The issues discussed in the meeting were;
The outcome of our discussion was as follows:
a). Delay in cancellation of VAT bonds
Some of our members have been following up with KRA for cancellation of bonds going back 7 years. KRA informed the people in the meeting that part of the problem maybe exporters who fill the certificates of exports documents manually instead of the required online process. The Deputy Commissioner in charge of port operations committed to look into the matter and in a further follow up meeting held on Thursday 4th April 2013 a way was found to sort out the outstanding bond cancellation for one of our members.
The secretariat will regularly follow up with the Deputy Commissioner – Port Operations to ensure that the outstanding bonds are cancelled.
b). Reactivation of T810
Tea buyers buy none Kenyan teas in the Mombasa Auction and in some cases the teas may remain in the Transit warehouse for extended periods waiting to be re-exported. A concern raised in the meeting was that the T810 documents for import entries are archived. Reactivating the archived T810’s takes very long causing delays in preparation of export entries.
KRA committed to assign a person to specifically be responsible to reactivate the import entry documents. The exporters were advised that the re-activation window is limited so they need to be keen to process the export entries immediately they request for re-activation to avoid being timed out. The EATTA team requested that the activation of T810 should have some flexibility to make amendments in cases where the wrong number of packages is keyed in.
c). Lack of staff to release container customs hold
EATTA members raised a concern with the lack of adequate staff at shed 5 in the port to release custom holds on containers ready for export. It was reported that because the empty containers are sometimes located
A long distance from the port an exporter needing to export may require to work late into the night to get the containers into the port. On many occasions the customs officers are not available to release the customs holds. It was agreed that the solution to address the problem was for the exporters to communicate with officers at shed 5 on the day they expect to bring in containers after hours. That way the revenue officers will be on standby to offer services to the exporters. KRA also requested that as much as possible exporters should try and bring the containers for release of hold during working hours.
e). Failure of Simba System
On many occasions the Simba system experiences downtime causing delays in processing exports. KRA officers informed EATTA that the reason for downtime is the process of upgrading Simba that is ongoing. As a solution it was agreed that when the system upgrade is happening KRA will be notifying EATTA when scheduled upgrades are due. Another problem is the slow connectivity of computers in shed 5. This is being addressed by KRA. A longer term solution is a seamless connection between KWATOS and SIMBA.
2.0. Slow Speed in Selling of Tea
Some buyers have raised concern about the speed that brokers are selling tea in the auction. In the last Tea Etiquette workshop held in 2011 one of the resolutions passed was that brokers need to maintain a speed of selling five lots per minute.
Starting from sale 6 the secretariat has been monitoring the sale of tea through the auction so as to maintain a level of efficiency. This link shows an analysis of the brokers’ average speed for each of the auctions between sale 6 and 13.We urge all brokers to maintain the standard of five lots per minute particularly during this season where there is a huge amount of tea on offer in the auction. Download Report
3.0. Standards and Certification
East African Tea trade Association places top on the fundamentals of the Food Safety Management System across the food chain. This is to enable the trade attain competitive advantage in the global market. A capacity building program funded by Trade Mark East Africa since 2011 has been conducting numerous awareness and internal audit training workshops to East African tea producer members. The program has to date, trained over 500 production personnel from member factories with aim of implementing these standards. The program is on its last quarter of implementation with possibilities of further funding considerations.
During various workshops to sensitize members on automation, the EATTA members agreed to automate its redundant business processes along the chain to improve the efficiency and guarantee transparency but continue with the manual outcry system. Among the initiatives being considered for proposals during the subsequent forums include;
i. Bar cording of tea – a presentation to be done by GS1 to the membership
ii. Data Capture and Display of auction proceedings
iii. CCTV installation for Live coverage
iv. Standardization of file input/output formats
5.0.Tea Sales Payment System (TSPS)
The Adhoc-Committee on TSPS has been working with the three banks Equity Bank, CFC Stanbic, Bank Citibank in refining their respective Tea Sales Payment System as an alternative settlement platform. EATTA formulated a technical team comprising of EATTA, Equity Bank, CFC Stanbic Bank Citibank to work on the technical modalities of integrating the payment platforms. The two banks are ready to test out the integration model of the payment systems to members before proceeding to the live pilot phase. It is anticipated that testing will be done between May and June 2013.
East Africa Tea Trade Association and TMEA East Africa Inaugurated a Capacity building initiative of Tea Industries in East Africa to implement recognized International Standards(Food Safety Management Systems)
The East Africa Tea Trade Association is excited about this partnership with TradeMark East Africa which is expected to build the capacity of the tea industry in East Africa.
The East African Tea Trade Association is delighted to announce the 2nd Africa Tea Convention & Exhibition will be held on 28th - 30th August 2013 at the Kigali Serena Hotel - Kigali, Rwanda. This will be the second Tea Convention & Exhibition to be organized by East Africa Tea Trade Association and it is expected to be a global event for tea industry. The 1st event was very successful and was attended by major tea importers and consumers of the African tea all over the globe
East African Tea Trade Association is the premier body representing the interests of tea producers, tea buyers, tea brokers, tea packers and tea warehouses. EATTA has 167 members in 9 countries in Africa. EATTA runs the Mombasa tea auction that is the second largest tea auction in the world after the Colombo auction. Of the tea exported globally, 32% passes through the Mombasa auction.
The auction has grown by a remarkable 300% in the past 20 years, by offering teas from all the member countries. The tea task force report of 2007 made specific recommendations based on challenges facing the industry. EATTA has identified four areas that need urgent address by the Government of Kenya;
Currently there are two Bills in Parliament aimed at the Tea sector. One sponsored by the Government and another, a Private Member (Kones Bill). There needs to be a harmonization of the two Bills. The harmonized Bill should take into account the following provisions:
The tea trade in Mombasa made a donation of 10,300 kilograms of tea to the people of Pakistan on 3rd November 2010 at the EATTA Secretariat after the suffering and devastation caused by the recent floods and heavy rains. The tea was packed in water tight 5 kilogram bags. This donation is made in recognition of the good trade relations between the Association members and the great people of Pakistan. The good relationship was exemplified recently by the visit of the High Commissioner of Pakistan to Kenya HE Masroor Jumenjo in April 2010 to EATTA.
The 2010 Pakistan floods began in July 2010 following heavy monsoon rains in the Khyber Pakhtunkhwa, Sindh, Punjab and Baluchistan regions and affected the Indus River basin. At one point, approximately one-fifth of Pakistan's total land area was underwater. The floods directly affected about 20 million people, mostly by destruction of property, livelihood and infrastructure, with a death toll of close to 2,000.
Pakistan is an important market of East Africa. Pakistan buys all our grades of tea unlike other markets that buy particular grades. The Pakistan market being predominantly Islamic, takes tea as the beverage of choice. Many of our important tea markets are seasonal in the tea they purchase from the auction so that in some months demand for tea goes down; therefore Pakistan’s demand consistent throughout the year making it an ideal market.