Finance tobacco locally: Gudu

LIVINGSTONE MARUFU

 The Stanford University Business School’s motto—change lives, change organisations and change the world—stood out for Meanwell Gudu.

Five years after Gudu was at the prestigious business school, he carries the mandate to change the landscape of the local tobacco sector.

The executive was appointed CEO of the Tobacco Industry and Marketing Board (TIMB) in April to replace Andrew Matibiri who retired from the company. He is not new to TIMB, having joined the tobacco industry regulator in 2008. He has held senior positions in the tobacco industry:  as director tobacco development at the Agricultural and Rural Development Authority and as head of Field Services Division at Tobacco Research Board.

“I have been part of the team that worked to increase tobacco production from a low of 48 million kgs in 2008 and to a record crop of 262 million kgs in 2019. This was made possible by an increase in the number of growers and hectares under tobacco,” Gudu told Business Times this week.

He takes over the reins at TIMB at a time well-connected and sophisticated syndicates control the funding, growing, buying, selling, marketing and exporting of the golden leaf industry.

The executive has taken the fight to the cartels which has seen the arrest the frontmen ripping off farmers. Over 80 illegal buyers have been nabbed as the authorities cleanse the sector to make the farmer benefit from the tobacco.

Gudu told Business Times that solving funding mechanisms will solve the tobacco puzzle.

“There are plans to keep the auction system running. The only way that can be achieved is to ensure farmers have access to more funds at their disposal,” Gudu said.

“The Government recently launched the Agriculture Finance Corporation in support of the National Development Strategy 1 document. The Land bank is mandated with undertaking expanded banking and financial services provision to all categories of farmers in Zimbabwe (A2, commercial, A1, resettled and communal farmers), thus underpinning agriculture recovery and productivity.” 

He envisions a collective sustainable production as the future for tobacco in Zimbabwe.

“This will entail efficient production of quality tobacco in conditions that limit the impact on the natural environment and that improve the socio-economic conditions of the people and communities involved in its production in line with the Sustainable Tobacco Production standard produced by the global cigarette manufacturing companies,” he said.

The current marketing system, he said, should also leverage on ICTs to improve efficiencies.

“Growers should monitor sales in the comfort of their homes through ICTs. There is need for use of Artificial Intelligence in the classification of tobacco and its pricing. Big data analytics can also be used for important decisions by many stakeholders. TIMB is sitting on a rich source of data which can even be used to create innovative products and services such as a futures market for tobacco leaf in Zimbabwe,” Gudu said.

The executive said there is need  for diversification to transform the tobacco value chain.

Tobacco farmers should diversify with tobacco as an anchor crop. Diversification options include food crops, horticulture crops, cannabis and industrial hemp, he said.

Gudu said the industry should take advantage of the fiscal incentives announced by Finance minister Mthuli Ncube and invest in niche tobacco products “especially smokeless and heated tobaccos”.

“The tobacco farmers could also invest into end tobacco use product processing for example pipe tobacco or packaged fine tobacco for Roll Your Own cigarettes,” he said.

The executive said TIMB was also rolling out the Tobacco Input Credit Scheme to support farmers with inputs, working capital and technical expertise.

Tobacco farmers are facing viability challenges due to debts that are carried forward by the contractors due to low prices and foreign currency retention levels.

Some farmers are going home with negative balances due to the failure to complete the repayment of the loan.

Gudu admitted that there was a mismatch between the auction rate and the retooling rate which is used by farmers to buy inputs.

“The retooling rates are generally not pegged on foreign currency auction rates leading to high cost of production,” he said.

Soon after the opening of the 2021 tobacco marketing season, some contracting companies faced IT system challenges due to a high number of decentralised selling points which affected processing of payments to farmers.

“That issue was discussed with the affected contracting companies and it was agreed that they revert to their old IT systems to ensure timeous payments to the tobacco growers. In the event of any IT system challenges, companies have been asked to communicate timeously with the growers so that they make their own decisions,” Gudu said.

He said challenges in payments were caused by delays in processing inter-bank money transfers by the national payment clearance system. This has since improved after the intervention of central bank, the executive said.

“As TIMB we always ensure that all stakeholders involved in the marketing of tobacco do so in an orderly manner hence continuous monitoring of the tobacco marketing process,” he said.

The tobacco sector has to grapple with deforestation caused by growers cutting down indigenous trees for fire wood for curing tobacco.  For Gudu, there is need to plant more fast-growing tree species to supply fire wood for curing tobacco to ensure that 100% of the crop is cured from renewable sources of energy by 2025.

“There is also need for more research and development of curing systems that can burn coal more efficiently and at the same time reducing the carbon foot-print of coal on the environment, for example, use of catalytic convertors to reduce carbon emissions from burning coal,” he said.

Gudu attended the advanced Executive Development Programme at Stanford University Graduate School of Business (Stanford Executive Programme). He is a holder of an MBA, Post Graduate Diploma in Management for Executives and BSc. Agriculture degree, among others.

The executive is a former advisory board member for Parirenyatwa Group of Hospitals. 

His hobbies include cycling (pumping legs for water) especially for raising funds for repairing water supply infrastructure in Hwange National Park and fishing.

“I am also a master angler for both bass and tiger fish. My biggest catch was an 8kg tiger fish caught in lower Zambezi River,” Gudu said.

The executive is reading Aaker Jennifer and Bagdonas Naomi’s book, Humor Seriously (Why Humor is a secret weapon in Business and Life) to assist him in harnessing humour in business and in general life.

“Humour plays a big role in motivating team members to achieve organisational goals,” he said.

There are some inspirational quotes the executive draws from.

His favourite quote from Warren Buffet is “Slow success builds character whereas fast success builds ego.”

Charlie Chaplin inspired Gudu when he said, “We are all tourists, God is our travel agent who has already fixed our itineraries, reservations and destinations. Trust him and enjoy life. Life is just a trip. Start living and stop existing.”

US President Joe Biden comes in handy for Gudu when he said: “I want to have people around me that have strengths and capacities that I don’t have.”

He is also inspired by Jeff Bezos’ maxims:

Make a small number of high quality decisions.

Obsess over customers.

 Innovate. Then innovate some more.

Embrace failure. Failure and innovation are inseparable and there’s a difference between good and bad failure.

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