The story of Magwa starts about 50 years ago, when most of the tea estates in South Africa were established. This was to provide jobs especially in rural areas, especially where very limited employment opportunities existed.
The paradox is that South Africa didn’t have the optimal conditions to produce tea; other places in the world – such as Kenya and Malawi – had better weather and soils suited for tea. To overcome the disadvantages, the tea quota system was introduced, putting local tea buyers under obligation to buy 54% of their requirements at a fixed premium price from local producers.
However, when the World Trade Organisation implemented the General Agreement on Tariffs and Trade about 15 years ago, the quota system was replaced by a much less favourable ad valorem duty on all tea imports. This was followed shortly afterwards by an agreement between Southern African Development Community (SADC) members to remove all import duties within the regional group.