Wednesday, June 19, 2024
HomeBusiness‘Why is it that Africans are not producing their food?’

‘Why is it that Africans are not producing their food?’

What a difference a decade makes to a billionaire. I first met the youngest billionaire in Africa in a boardroom in Johannesburg in 2011, while he was signing a multi-million-dollar loan. He was clean-shaven, very polite and maybe a little awkward. Fast forward to 2024 and Mohammed Dewji – worth an estimated $1.8bn according to Forbes – is a mature statesman of African business with a trimmed beard, humility and confidence to burn. His is a measured, authoritative, voice on investment in the continent.

“I think we are in the driving seat; we have an advantage being Africans. When we say beauty lies in the eye of the beholder; I think perception of risk also lies in the eye of the beholder. You talk to a guy in a bank in the centre of London about going into the Central African Republic – there is a lot of worry. For those who were born and raised in Africa, we understand the terrain and can mitigate risk and understand the returns,” he says. “I believe Africa has the potential to achieve double-digit growth. That is the only way we can eradicate poverty.”

These days, Dewji is setting the pace amid meetings with heads of state and forthright speeches at conferences around the world. His is a voice tempered, not only by the cut-and-thrust of business, but also by a harrowing kidnapping from outside a hotel in Dar es Salaam in 2018. It shook him to his core. He called me to a Johannesburg hotel soon afterwards to tell me what happened and I was shocked at how gaunt and shattered he looked.

“I was blindfolded for nine days with two people and there were times that I thought I was going blind or crazy. I said if they want to shoot me, they should shoot me!” he told me.

Six years on, Dewji is celebrating a renaissance in business with big plans for his fizzy drinks factories, an investment drive in the food-growing business in Africa, and a plan to set up business in the middle of nowhere in Zambia.

His family-owned manufacturing company giant MeTL, formed as Mohammed Enterprises Tanzania Limited, has become a giant in Tanzania. Dewji reckons the figures will show revenue of $3bn for 2023, up from $2.5bn the year before. The company makes everything from edible oils, soaps and food to beverages, textiles, energy and petroleum, and electronics. Dewji plans to build it and float it.

“I am planning to take my company public in 10 years. I want to call it a day and just do philanthropy,” he says.

A remarkable transformation

Dewji has overseen a remarkable transformation of the family trading company – turning over about $30m when he joined the board in 1999 – into a manufacturing giant.

For this, Dewji starts his 100-hour week daily at dawn and hosts at least 60 meetings every month.

“We have come a long way, but we are proud of one thing: in eastern and central Africa we are employing over 50,000 people. I believe that by doing all these agriculture and manufacturing projects we can reach the 100,000-job mark soon. We can double the number we are employing now, in the next five years,” he says.

There are probably few African companies brave enough to make that claim right now and fewer gearing up to invest a billion dollars into growing food.

The idea of Africa as a food-growing powerhouse, increasing the continent’s food security, struck Dewji during the war in Ukraine. He saw household bills double because of the rising price of grain. The fighting in Ukraine disrupted exports of grain to Africa from the ports around Odesa. Under a UN-brokered deal more than 32m tonnes of foodstuffs from Ukraine went to Ethiopia, Yemen, Afghanistan, Sudan, Somalia, Kenya and Djibouti – until the agreement fell apart in July.

“I say: why is it that Africans are not producing their food? If you look at it they have got 30% to 40% of the arable land, they have got a largely young population. Now, while I understand there are problems in South Africa and Zimbabwe, why not the rest of Africa? Now I am trying to unlock that. I am breaking that billion-dollar project into parts of a quarter of a billion each. I am starting with Tanzania. I want to invest in grains and corn, in wheat. I want to invest in edible oils, soya bean, sunflower oil and palm,” he says.

Then Dewji wants to invest in Mozambique, Zambia and the Central African Republic. Reportedly, he is prepared to float a SPAC (special purpose acquisition company) on the capital markets of London and New York to help raise most of the capital. He is prepared to put up $400m out of his own pocket.

Plans for food security

“I want Africa to be sovereign in terms of its food security with the inter-Africa trade agreements. Of course we have hindrances, in terms of infrastructure, but we can tap into the world market – this is one area I am looking at,” he says.

Investment in this project begins at home. Dewji says he will plough $300m into turning 100,000 hectares of Tanzania into huge plantations.

“If you look at statistics, many African countries are producing food with smallholder farms. I don’t have a problem with that, but my whole nucleus is to create large scale plantations and in the periphery have smallholder farms – but create transparency. I want to help them with technology, with AI, to be able to get them higher yields as well as transparency with offtake and pricing… supporting them with hybrid seedlings, with fertilisers, fungicide or insecticides,” he says.

This process is likely to take a lot of time. MeTL managers are meeting with villagers and farmers in Tanzania to explain and agree the way ahead.

“We want to make sure all is done very correctly and compensations have to be paid and we are doing meetings at village level, branch level and regional level before we get to national level. To a large extent I have made many strides in that,” says Dewji.

“My vision is to cut food imports by 50%. If you look in the edible oils space, our country’s consumption is 500,000 tonnes. In the grain space, our consumption, between corn and wheat – you are talking about 3m tonnes. My aim is to, at least, substitute 25% of those imports.”

Precarious origins

It will be another step in the remarkable life of a born entrepreneur who grew up with the dream of becoming the Tiger Woods of Tanzania and ended up becoming a Wall Street trader.

Dewji was not born with a silver spoon in his mouth; indeed, he was very lucky to have been born at all. On 8 May 1975, it took nearly twenty hours of labour to deliver the infant Dewji on a kitchen table, in a house of sand and mud, in Ipembe – a district of a few thousand souls in Singida, central Tanzania.

“I was the second child out of six born at home with a midwife. They never had the ultrasound system and it was complicated because the umbilical cord was around my neck, and it took about 18 hours for me to make it through. The hospital was 60 miles away, but the road was terrible. I thank the Lord and my mom who struggled, but that is my history,” says Dewji.

It was very normal in Singida during those times to give birth at home. [My parents] started freaking out – and it was 18 hours of labour for my mom. I love her very much. Many people feel that I am like my dad, but my mom and I are very similar.”

It had been a struggle for the Dewji family since the day his forebears boarded a small number of rickety boats on the west coast of Gujarat in India – a region known for its entrepreneurs – near the end of the nineteenth century.

As the family stood on the deck, looking out over the sea, they hoped to escape poverty to a new life in Africa. Family legend says a divine wind swept the boats safely across the Indian Ocean to the shores of Africa.

“Some landed in Zanzibar, others in Tanzania and Kenya. Then, we went inland to Singida in the centre of Tanzania, where my great grandfather, grandfather and I were born,” he recalls.

It took a generation for the Dewji family to start turning money in Singida and the best part of a century for the millions to come. The foundation of this was grinding hard work and faith.

“My grandmother was the actual entrepreneur; she was running a very small retail outlet. They lived behind it and in the front they used to sell retail stuff. We are talking about retailing one kilo of sugar, selling it in small bags. What she did, she was an entrepreneur and wasn’t educated. As Muslims we have to go to Hajj, if our health allows it. My grandfather said that we don’t have the money. But she was saving the money, she was sewing as well as doing small food deliveries. She sent my grandfather the money to go to Mecca for Hajj. The entrepreneurship started with my grandmother,” says Dewji.

Then came golf dreams, born of defeat.

“We were a big sports family. We played a lot of golf and tennis. It all started with tennis. My younger brother was really good, and when he started beating me I realised that I didn’t enjoy it as much. So then I started playing golf. I always played sports like football, and my father wasn’t happy because I used to break my legs. He said: go out and play a non-contact sport. I started the initiative myself and I got better and better,” he says.

On course

The young man took to the golf course with a will to win. By the time he left primary school, he was playing off a handicap of three and beating people twice his age. His father saw this nascent talent and sent his son to the Arnold Palmer Golf Academy in Orlando, Florida.

“You lived there, went to school for six hours, and the rest of the time you were learning and playing golf and gaining mental toughness. My school was small and I went to school with Jennifer Capriati [later world number one tennis player]. I was class president. We won the state and we went into the nationals. I played a girl in the nationals and realised she played better than me, and I didn’t play badly – I realised this wasn’t going to happen. I might as well study finance, and I started at Georgetown.”

His time at Georgetown University in Washington DC – the alma mater of Bill Clinton and Jackie Kennedy – yielded a bachelor’s degree in business, with a minor in theology.

While many of his fellow students struggled to stay awake during lessons, Dewji’s lecturers remember him as a serious young man prepared to stay behind to talk about the economy of his country and the value of the Tanzanian shilling.

This led to a short stint in New York as a Wall Street trader, until a phone call that was to change his life. Dewji needed money for a new suit and phoned his father back in Dar-es-Salaam.

Back to Africa

“He said that he believed that I could make many dollars in Tanzania – why don’t I come and join him? We could take the business to the next level. And he didn’t send money for the suit! I didn’t enjoy it and I went back and joined him.

He was now a rich man; he was the largest trader. When I came, I realised that the trading game margins would get very, very tight. You cannot have a trading country; you need an industrial base. I already felt that and there was no tax policy to protect manufacturers. And the industry failed because the tax was so low. I started talking to people and told them: look, guys, we need to create jobs and manufacture and use raw materials locally.”

This drive to manufacture can be seen in his quixotic tilt at the fizzy drink market in Africa, dominated by giants Coca Cola and Pepsi.

“I’m increasing my capacity five times over and investing €120m in the carbonated drinks space, setting up plants all over the country to compete with Coke and Pepsi,” he says.

“We are now selling over a billion bottles. I am increasing the capacity four to five times more. More than quadruple output. The competition is always going to be there. We are also fighting on a price point. We don’t have to pay royalties to anybody. We are also becoming as efficient, and don’t have the fat that multinationals have – we have the distribution.”

Breaking out

Meanwhile Dewji is also expanding in eastern Zambia, in the middle of nowhere. He bought a plot in Kapiri Mposhi, Zambia – population 14,000 – on the road from Lusaka to the Copperbelt; 60km north of Kabwe and 110 km south of Ndola. It is also on the railway line between Livingstone and Dar-es-Salaam.

What on earth is he going to do there?

“We are still doing feasibility studies. Then, we will decide what to manufacture there,” he says.

There speaks the soul of a born risk-taking entrepreneur.

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