Rudland speaks on ‘murky’ tobacco industry
MULTI-NATIONAL company Gold Leaf Tobacco Corporation (GLTC) co-owned by South Africa-based Zimbabwean tobacco mogul Simon George Wilburn Rudland, who also deals in tobacco processing, cigarette manufacturing, marketing and distribution, has proved to be a significant player in the industry.
GLTC has made significant inroads into the market that was previously dominated by multinational companies. GLTC supplies its products to other distributors, wholesalers and retailers in and across southern Africa. NewsDay (ND) reporter Winstone Antonio recently caught up with Rudland (SR) who is also a member of the Fair Trade Independent Tobacco Association and a major sponsor of local football giants Dynamos Football Club having injected US$5 million. He shared some nuggets on the dirty games, espionage and violence that characterise the tobacco industry. Below are excerpts from the interview:
ND: Tobacco trade appears murky from the outside, and is often accompanied by dirty games, can you paint the picture for us?
SR: Globally, tobacco has always been a high-profile industry. This is largely due to the high value of monies exchanged within the industry as a result of the sin tax. (Sin tax is an excise tax specifically levied on certain goods deemed harmful to society and individuals, for example, soft drinks, fast foods, sugar, gambling and pornography). The financial reward for not paying the sin tax on cigarettes is very attractive to those people who are looking to make quick money. For this reason, the industry attracts smugglers, conmen and many other types of criminal syndicates who are chasing to make desperate big, quick and illegal money. These criminal elements unfortunately get greedy and try to muscle out the legal businesses with as you say “dirty games” as the criminals believe that there will be more in the pot for them if they are the only players in the industry. Regarding dirty tricks on the ground, a box of cigarettes carries a relatively high value in relation to its size, for this reason, it is very attractive for hijackers to target deliveries as it is easy to sell stolen cigarettes on the black market. The industry thus attracts criminals from all categories, thus making it seem “murky”.
ND: You have been accused of illicit sale of cigarettes in South Africa and manipulation of the industry. What do you say to that?
SR: I reject these statements with the contempt that they deserve. Any allegations against me of this nature are designed for the sole purpose of tarnishing my name and that of my business. I rest comfortably knowing that all my tobacco-related business is above board, legal and regularly audited by the government. I am proud to be a significant contributor to the fiscus through all our cigarette sales and will continue to grow our business. Also, I know that these accusations are made by only a few lone voices who are unfortunately given more airtime than they should have. Those who know me, those who have dealt with me and those who smoke our products know that integrity is at the very core of my principles.
ND: You are said to be one of the pioneers of “cheapies” illicit cigarettes that dodge taxes across the region, what do you say to that?
SR: I have no idea where and how these stories are crafted. These are cheap narratives created by competitors to ruin our business. Sometimes I laugh when I hear these comments, but it is not something that we take lightly. These allegations are serious and I challenge anyone who makes these claims to support them with evidence. They have never and will never be able to as it is all fiction. Perhaps these people who make these claims are better suited to directing movies.
ND: In August last year, you were shot in an alleged assassination attempt in Johannesburg, South Africa, what was really going on?
SR: I had no idea that I would ever be a victim of such a horrific incident. Even from a business perspective, this was totally unexpected and out of the ordinary. There were no warning signs. I had no disputes with anyone, it was very random. I do not know for sure who it was, but the police are investigating and the perpetrators will be brought to book.
ND: How much business do you do in South Africa and the region?
SR: I am a co-director in Gold Leaf Tobacco, we represent roughly about 15% of the South African market, which is quite significant given that we started this business from nothing in an industry dominated by multinationals with unlimited resources and at a time when advertising on tobacco was totally banned.
ND: How has the ban on tobacco sales in South Africa impacted your business?
SR: The ban on sales of tobacco has practically brought our business to a standstill. We have very high overhead costs and without the revenue stream, we are really facing difficult times. We are looking at ways to reduce overheads, however, I implore the South African government to give serious thought to the negative effects which the ban has brought upon the legal South African cigarette trade.
ND: There are claims that there is a tense relationship between Gold Leaf Corporation and the Tobacco Institute of South Africa (TISA). How far true is it?
SR: The Tobacco Institute of South Africa has previously made bald, unsubstantiated allegations against Gold Leaf, similar to those you already mentioned. Again, these were crafted with the intent of tarnishing the name of Gold Leaf. Importantly, TISA’s members were our multinational competitors. So naturally, these false allegations were below the belt attempts to once again diminish our market share. We, as Gold Leaf, do not retaliate nor resort to this level of name-calling on any of our competitors. We are all businessmen and we respect our competitors. I believe that any good businessmen would know that you do not make your candle shine any brighter by blowing out someone else’s.
ND: Gold Leaf Corporation has developed into one of the largest independent tobacco traders in the Democratic Republic of Congo, Zambia, Malawi, Zimbabwe, South Africa and Dubai. How have you managed to keep the business going and how are Gold Leaf's brands doing on the market?
SR: Well, we pride ourselves in committing to providing consumers a high-quality product at an affordable price. This is a global recipe for good business. Although not easy, this guarantees to deliver success. It doesn’t matter what language you speak or what culture you are from, you are always attracted to reasonable prices and high quality.
ND: You are a major sponsor of Dynamos Football Club, how long do you plan to keep that relationship going?
SR: Football is a sport very close to our hearts in Africa, for as long as our boys do our nation proud, we will continue to show our support.