Knowledge Hub

Image courtesy of Prothem: Farmers attending capacity building training to improve best agricultural practices (2022).

Fabien Gahungu shares insights on working with Prothem and how they company has managed to collaborate with smallholder farmers to get them to achieve better income and livelihoods.

Fabien Gahungu, a Burundian agronomy engineer, is Prothem’s acting Managing Director. He has been involved with the tea sector since 1999 when he headed the high altitude crops project of the Provincial department of Agriculture. He also worked as an independent consultant in agro-environment.

Although Burundi is one of the smallest countries in Africa, it has about 95% arable land. The main crops are tea and coffee. Tea was introduced in Burundi more than 45 years ago, specifically controlled and managed by the Government who have five operational factories spread across the country. However, a group of farmers from Mwaro joined forces to challenge the status quo of the Government-run industry and started cultivating tea in 2002. By 2007, the group registered a company to develop their own processing plant. Eventually, the factory was complete and Prothem started operations in April 2011 and has been operational ever since.

Prothem has been structured in two ways: a tea processing plant as well as a microfinance to farmers. Currently, 95% of the tea processed by Prothem is from smallholder farmers who vary between 7,000 to 10,000 depending on the season. Prothem’s operations include tea collection from the farmers, processing and delivery to Mombasa for auction or sale directly to local and international packers.

In 2018, Prothem sought support from the Mastercard Foundation Fund for Rural Prosperity in order to modernise their factory and equipment, improve staff capacity building and train farmers on good agricultural practices in order to produce better-quality tea.

Fabien indicated that “being the first private tea company in Burundi, Prothem achieved one original goal of working together with the smallholder farmers to achieve prosperity within the tea sub-sector by encouraging legislation to privatise the tea industry and providing farmers with a crop that is reliable and income-generating.” By doing so, the industry has been revolutionised and more individual and private players are coming onboard. This expansion has enabled the industry to grow on both a local and international level and is attracting more investors.

Realizing that Prothem needed to work more closely with farmers, a microfinance model was introduced. It has enabled the company to offer produce to the farmers who are able to get credit and training, and use the tea they deliver to the company as security. 

Fabien notes that Prothem has been able to impact smallholder farmers by training them on a large scale on good agricultural practices. The company has also seen positive impact on the microfinance side of the business which has now been digitized leading to growth in activity including expansion of the loan book and digital payments. Lastly, with the acquisition of new equipment and upgraded infrastructure, Prothem has increased its efficiency in processing the tea, providing feedback to farmers and paying farmers. 

However, like many companies, Prothem has also experienced a number of challenges. During the pandemic period, Prothem had difficulty reaching farmers on the ground to provide them with the package of services and struggled to generate revenue from tea due to border closures. As a result, arrears were accumulating at several points in the project. The credit component had to be suspended at this time. Other challenges experienced include those related to climate change that affect the agricultural crops, lack of good infrastructure in roads and mobile network reach, and lack of trust requiring Prothem to convince farmers of the benefit of their microfinance offering.

Prothem’s 5-year plan, Fabien says, includes the expansion of its farmer base and investing in a second line to increase its processing capacity. The company also aims to continue providing staff with capacity building and to modernise its processing factory and equipment further to achieve the desired quality of output. In addition, in terms of energy, Prothem intends to replace its fueled generator with a boiler system which will be more efficient and economical. The company is also exploring solar and hydro options. 

Image courtesy of Prothem: Farmers pose during a training break at one of Prothem’s capacity building sessions (2022).

Prothem’s planned expansion strategies will in turn, create more jobs for the community as well as set them up as leading market players in the industry, says Fabien. He is proud that Prothem has managed to change many lives, 50% of which have been women farmers, by enabling and guiding farmers on saving their incomes in order to build resilience for their families and communities over time.

By Nashipae Leteipan, Communications Manager, Mastercard Foundation Fund for Rural Prosperity.