Tea value network delivering supply chain sustainability in Malawi

A multi-stakeholder coalition of businesses including Tesco, Marks & Spencer (M&S) and Unilever has made significant progress towards achieving a competitive Malawian tea sector where workers in the supply chain earn a living wage and smallholders earn a living income by 2020.

One year on from the establishment of the Malawi Tea 2020 value network, the gap between current wages and a living wage in the country’s tea sector has narrowed by a fifth. When in-kind benefits such as housing and welfare are taken into consideration, workers’ wages are now two-thirds of a living wage.

The ongoing partnership between producers, retailers, unions, NGOs and Government agencies has also improved general working and living conditions of tea estate workers including nutrition and worker representation, according to an update released today (24 October)

Rachel Wilshaw, ethical trade manager at Oxfam – a member of the Malawi Tea 2020 partnership – said: : “Malawi Tea 2020 is a rare coalition of parties which have the collective power to bring about positive change in the industry. We welcome the progress made in the last year on wages, nutrition and worker representation, particularly in the face of a devastating drought caused by the ‘El Nino’ effect.

“Nevertheless, these vulnerable workers need all companies – retailers, buyers and producers – to step up further if a living wage is to become the norm by 2020.”

Beyond status quo

Africa’s second-largest tea producer with 50,000 workers and 12,000 smallholders, Malawi is also one of the world’s poorest countries with 62% of the population living below the World Bank’s extreme poverty and about half of all children lacking adequate nutrition.

Tea sector wages increased following the first ever Collective Bargaining Agreement (CBA) signed by the tea industry and Plantation Union (PAWU) in August this year. The CBA is regarded as an important step for worker and employer dialogue, and for workers through the union to negotiate wages. The Agreement can be largely attributed to the work of the Malawi Tea 2020 partnership which includes 21 organisations such as the Ethical Tea Partnership, Fairtrade, Tata Global Beverages, Twinings, the Sustainable Trade Initiative, Rainforest Alliance and Taylors of Harrogate.

Ethical Tea Partnership executive director Sarah Roberts said: “I am greatly heartened by the progress that has been made in what is a very challenging situation. I applaud the efforts of companies which have enabled them go beyond the status quo and of the broader partnership which both supports and challenges us all to go further.”

Green tea

The initiative reflects a growing realisation among businesses that only a thriving and sustainable tea industry can deliver long-term impact for workers and smallholders. In 2013, leading businesses and organisations involved in the tea industry joined forces in the Tea 2030 partnership in a further attempt to ensure its future is sustainable.

Multinational consumer goods firm Unilever has previously worked with non-profit organisation Forum for the Future on a project to develop natural tea varieties and secure international tea supply for the future. By 2020, Unilever is aiming to sustainably source 100% of its tea, including loose tea.

Meanwhile, British retailer Tesco is leading a partnership to support children in tea-growing communities who may be vulnerable to trafficking and abuse.

George Ogleby