The origins of Madhvani Group stretch back to 1914 and the rise of Kakira Sugar, Uganda’s leading sugar producer and a symbol of the Group’s resilience and deep East African roots. Madhvani Group’s innovative spirit has seen it diversify from its agriculture and agro-processing base into a vast array of sectors including manufacturing, insurance, IT, construction and property development, security services, trading, energy, air transport and tourism, having launched a series of luxury safari lodges in Uganda and elsewhere in the region. Today the group employs more than 10,000 people and its annual turnover in Uganda alone exceeds $500 million. Mayur Madhvani, son of Kakira’s founder, explains the corporation’s long journey and the emotional bonds that tie the group to Africa, and Uganda in particular
The story of Kakira Sugar and the Madhvani Group is quite a rollercoaster ride, but it appears to have a sweeter taste today after the 1985 recovery of the venture along with the government brought the sugar sector back to life in Uganda. Please give our readers a sense of the historical context of the company’s story so far.
It has been a long journey. My father came here 100 years ago. We are of Indian origin but we feel Ugandan. We built up a business from zero up to 1972, when it was one of the largest industrial groups in Africa. We were contributing considerably to Uganda’s GDP at that time, and along came a gentleman called Idi Amin, who felt that the economy could be run in a different way by empowering the local citizens. It sounds good, but I think what he was trying to do was to remove the intelligentsia. The Asians were told to leave, and they went to the UK, Canada and other places, and our group came to a standstill. It was like the dark ages. Uganda’s economy came to a grinding halt. Then fresh air came in. Africa has changed since then. We have a new government in Uganda; President Museveni came to power and invited us back. More on an emotional basis than an economic one, we decided we would take the industries back and help the country’s economy grow again. So with the blessing of stability we came back and built our company up again. The group has grown over the years in leaps and bounds. This shows how what Africa needs is political stability to allow us to tap into a massive market and a growing, vibrant middle class; they are the ones who want new products.
Is this Africa’s century, at last?
Africa is a lost diamond in the rough. It has tremendous resources and could become the bread basket to the world. I think the future for investment in Africa is excellent. And politically, the recent changes taking places in countries have been on a democratic basis and, above all, peaceful, as in Zimbabwe and South Africa. Our leadership is becoming mature. Africa is beginning to see itself again. South of Ethiopia, Africans are basically Bantu – they are one people. The British colonial system divided these peoples but they are one, and they are one market. So I think the idea of having an East African Community and then a regional market is where we have to go. But we have to be careful and realise that there is also such a thing as the sovereignty of countries, and once you have too much movement of people, you can get a reaction like the British and Brexit.
What about Uganda, specifically? What moment is Uganda at?
Uganda’s people are soft-spoken and always very polite. It’s our tradition in this country. And Uganda is 6,000 feet above sea level and right on the equator, giving it a perfect climate for agriculture. I believe we’re heading for an important era. We are expecting too much from the discovery of oil. What we have here is a greater asset in our powerful agricultural base and vast tracts of land that could be used for farming. People won’t always need oil, but they will always need food. We have plentiful maize and grains, and in the north the fruit fall off the tree and no one even collects them. This potential should be harnessed.
At Kakira, you have shown the way to diversify and exploit natural produce to the maximum…
It’s amazing how technology develops. Traditionally, sugar production created a by-product known as bagasse that was a nuisance and had to be thrown away. Then there is molasses, which all over the Caribbean has been used for hundreds of years for making rum and alcohol, and that was it. Now we have technology that allows us to use the bagasse like we do here at Kakira where we generate 51MW of power from the biomass. It used to be an environmental problem because it was burnt as waste and now it has become a contributor to the bottom line. Molasses can be used to make ethanol to ad to petrol. We are also looking into making spirits; I think there is a huge untapped market for things like Ugandan rum. We can make reasonable vodka and gin from our molasses. If ethanol doesn’t work out well, we can go to acetic and citric acids. We are putting up a CO2 plant because that also comes out of sugar production, so Coca-Cola and the others can use that. So sugar finally becomes a by-product of itself!
What plans does the group have to expand?
We are looking at building another sugar factory in the north of the country, like Kakira. Africa’s problem is poverty. Where you have poverty, you have insecurity. Where you have insecurity, you have infighting. If people have a good job and are making a wage, it is not a magical solution, but it helps. If we can build a sugar factory and create a livelihood for 100,000 people, that’s a lot. Then if you get two or three more business going, things start happening and the place becomes stable. If you look at Kenya, they have a vibrant young middle class, and they’ve changed the country. They don’t want politicians to take over the country; they want politicians to govern in a respectable way. It’s very exciting to see these things happen, and I think we are going to see Africa change. It’s going to become one mass market. What is the greatest asset of China? Its people. What is the greatest asset of India? Its people. I.2 billion people in one country; it’s a lot. You look at Spain and there aren’t so many people, but Europe as a whole is much bigger. Africa is one people; it’s just been divided.
Do you see tourism playing an important role in the development process? How can it work for Uganda, a country that seems to encapsulate Africa?
Absolutely. I’m very hopeful. There’s an old expression that says “Bad news travels fast”. You have a man, a ridiculous man: Idi Amin. Everybody knew him. Why? Because bad news travels fast. Now we are stable, we are safe. The streets are safe to walk at night. We are very bullish about tourism. Uganda’s standout features are its greenness and its people. As soon as you land in this country, you are struck by the lush vegetation and this beautiful lake that stretches over the horizon…
How do you see British investors getting involved in this key moment for Uganda?
I would tell them to come see. When you’ve seen, you will realise the opportunities there are here – it’s a no-brainer. If you took the time to leave the UK and said I want to see this green, lush country and this endangered species, the gorilla – of which there are only 700 left – you will find yourself falling in love and investing in some way. There’s nothing like visiting and seeing for yourself what the country is all about.
Is there anything you would like to add for the readers of The Daily Telegraph?
Our group is very keen to partner with foreign investors, and we’ve done that very successfully. I think any investor who comes into Uganda should see if there is a local company with which they can partner, because that makes things so much easier. We as a group don’t want to pretend that we know it all. If something proposed to us makes financial sense, we are ready to invest.