Business and government dignitaries from more than a dozen African countries convened in Bentonville Thursday (May 10) at the state’s first Trade with Africa Summit — a two-day event spearheaded by Toyin Umesiri and sponsored by Walmart, Westrock Coffee Company, Tyson Foods and eight other business interests.
The central theme for the Thursday’s speaker lineup was that Africa is not only open for business but the timing is ripe for more partnerships between Arkansas companies and those in Africa.
Denise Thomas, director of Africa and Middle East Trade relations at the World Trade Center of Arkansas, brought together Shakira Motan, trade commissioner for South African Consulate, and Consul General Nigerian Consulate Kayode Laro to talk about opportunities for Arkansas companies to trade with their countries. Catfish and aquaculture was the common ground the three reached quickly when Thomas asked the two panelists which sectors and areas Arkansas businesses could plug into within the remerging economies of Sub-Saharan Africa.
Laro said for far too long Nigeria was seen only as an opportunity for oil and energy sourcing but a much more sustainable fit for the country trying to rebalance its economy away from dependence on oil is catfish farming. While he was well aware of Arkansas’ prowess for growing rice and raising chickens it was catfish farming that intrigued him the most.
“Since the 1950s Arkansas has been a leader in developing catfish farms and there is so much we (Nigerians) can learn. Catfish is immensely popular in Nigeria as a protein source and the demand exceeds supply which creates an opportunity that needs to be met,” Laro said.
He said population growth in Nigeria had outpaced GDP until oil prices rebounded this year. He said feeding the people will continue to be an opportunity for foreign direct investment. One of the biggest challenges faced by Nigerian catfish farmers is the quality of feed and fingerlings. Laro said because farming is not that expensive to start it’s easy for Nigerian families to start their own business. However, they rely on feed they can source locally and do not get the best possible results.
Motan said South Africa is also investing in more aquaculture industries and would also like to learn more about catfish farming opportunities. Thomas extended an offer to them to come back and visit the University of Arkansas at Pine Bluff which has an extensive aquaculture program. Laro and Motan both jumped at the chance to work with the university to learn more about catfish farming which can be exported to Nigeria and South Africa.
Laro said there are opportunities for small- to medium-size U.S. companies to partner with interests in Nigeria and throughout Africa to help source materials and provide industry expertise. Too often African nations don’t trade enough with one another, he said, and when outside interests come in they quickly see the opportunity to help nation’s trade more effectively with neighboring countries on the massive continent.
Donnie Smith, former CEO of Tyson Foods, and Scott Ford, former CEO of Alltel have already taken the plunge into Africa by investing their money and expertise into helping grow a middle class of coffee and chicken farmers.
Smith said he and his family created a non-profit to build feed mills in Rwanda and has since expanded to Tanzania. Smith’s operation then began setting up farmers with small chicken coops costing $625 which they finance over 3 years. They teach the farmer sustainable broiler raising practices. He said the growers have been able raise their standard of living because they sell birds after 6 weeks for roughly $87, much more than the average $27 monthly income for a family of 5.
Smith said his non-profit is running two feed mills, and soon will have a chicken hatchery to supply better quality chicks for the growers. Smith said by 2050 the world will have added 2 billion more people and half of them will live in Africa. His mission for the rest of his life is to try and foster sustainable farming practices across the continent so that families can break the cycle of poverty and feed the generations to come.
He said in Rwanda the enterprises are managed by locals because as that country rebuilt itself after the horrendous genocide and war two decades ago the nation has established itself as one of the best places to do business on the continent. The level of corruption in government is nil and cooperation from local leadership is huge, he said.
Those are the reasons Ford gambled some of his retirement millions on growing a coffee business in Rwanda over the past nine years. Ford said he purchased a coffee mill operation in Rwanda in 2009 to compete with the two others who had been keeping prices low for coffee growers earning about 45 cents a pound. Ford said he went after the growers promising higher pay to get them to more a more sustainable wage because he knew the coffee would be a hit in the U.S. at a higher price. Ford said within three weeks the competitors raised their prices paid to growers and the new market standard was 95 cents a pound.
Ford said the journey to build Little Rock-based Westrock Coffee has not been an easy road, and many times than there was the threat of failure. He said with his wife’s blessing the family went all in more than once or twice and in its ninth year has just finally turned a profit.
Ford said there is now a new class of entrepreneurs in Rwanda who take pride in their work and have the money needed to better educate their children and raise the next generation. Beans for Westrock Coffee come from 20 countries around the world. Ford said he’s working to develop blockchain capabilities that can be digitized through mobile to provide transparency U.S. consumers demand. Westrock’s private label Donut Shop Coffee sold at Sam’s Clubs was the new product of the year in 2018 and has just served its one millionth cup, Ford said.
Ford said three things must exist for him to do business abroad: zero corruption, respect for the law that is equally followed by all parties, and regulatory policy the make sense for business. If one of those is absent, he won’t invest there. Ford recently left a country neighboring Rwanda because the government arbitrarily issued a new law without reason.
“I took the plant apart and shipped the pieces out on container,” Ford said.
He said when the poorest of the poor taste the benefit of the free market system, they will not settle for a government that won’t let them have access to that system.