New Law to Rejuvenate Cooperative Societies

The East African Community is set to have a common law on cooperatives by December, Mike Sebalu, Uganda’s representative at the East African Legislative Assembly said recently.

At a workshop held in Kampala to deliberate on the draft East African Community Cooperative Societies Bill, 2014, Sebalu told participants that this legislation would give EAC farmers an edge in exploiting market opportunities. He said the law would make it easier for EAC countries to go into joint ventures with different businesses in the region.

“The region needs incentives, a framework, and standards for cooperatives. It will enable farmers exploit the regional integration schedule,” Sebalu said. “While the national laws will be active at the country level, the new law will regulate the EAC cooperatives.”

Sebalu revealed that the draft bill would be ready by the end of September. According to the East African Farmers Federation (EAFFE), there are about 9,000 cooperatives registered in Uganda, 15,000 in Kenya, 6,000 in Rwanda and 9,964 in Tanzania.

However, most of them are not active. In Uganda, for instance, powerful societies such as the Banyankore Kweterana died. Supporters of the bill in Uganda include Uganda Cooperative Alliance (UCA), Uganda National Farmers’ Federation (UNFFE), National Union of Coffee Agribusinesses and Farmer Enterprises (Nucafe), and the ministry of Trade, Industry and Cooperatives.

Other promoters in the region include the National Cooperatives Confederation of Rwanda, the Cooperative Alliance of Kenya, and the Tanzania Federation of Cooperatives. Phillip Kiriro, an EAFFE member, said 80 per cent of their members were in small- scale agriculture. With a uniting law, he said, agriculture would be boosted.

“Our aim is to fight hunger, especially using small-scale agriculture, and our position is to look for investors who will come up with a module that will support small-scale farmers the law is an immediate resource we want to use to tap on to opportunities in the region,” Kiriro said.

He added that in Rwanda, the issue of land was sorted and the face of small-scale farming looked good.

“So, if you have land for credit it is easier to get credit, from the region’s cooperatives than relying on financial institutions like banks. Through cooperatives, we can deal with banks better and as a cooperative, we can get credit on behalf of an individual farmer,” he said.

According to Stephen Muchiri, the chief executive officer of EAFFE, the process to have a law started five years back, when EAFFE commissioned a study, with focus on cooperative legislations. Ethiopia, Kenya, and Uganda were subjects of the study.

“The World Bank Development Report of 2008 and the EAC Food Security Action Plan highlight boldly the need to promote cooperatives since they exist as business entities through a national law, they subscribe to collective action and promote socio-economic development,” Muchiri said.

Empowered cooperatives are crucial to ensuring food security and steady flow of income to individual farmers, he added.

Source : The Observer

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