Posted on August, 11, 2021 at 08:57 am
WHY have Tanzanians taken great trouble to start primary cooperatives, create and strengthened cooperative unions? Indeed, why do people the world over celebrate annually the United Nations International Day of Cooperatives on the first Saturday of July? The answer to the two questions is simple: cooperatives are tools for creating shared prosperity and guarding human dignity.
In Tanzania, cooperatives are also tools for alleviating poverty.
So when you talk of creating shared prosperity and concern for the toiling Tanzanians, especially rural Tanzanians, you are in principal talking about using primary cooperatives to achieve those two goals. And those two goals cannot be achieved without putting in place positive policies and institutions that will help transform agriculture using primary cooperatives and their parent unions.
In Tanzania, primary cooperatives directly serving and organising grassroots producers are known as primary Agricultural Marketing Cooperatives (AMCOs).
AMCOs are important in alleviating poverty and reducing inequality when they are properly managed to serve crop growers, livestock keepers and anglers. Empirical evidence shows that where AMCOs are strong, economic growth originating from farming, livestock keeping, or fishing activities has increased income of members, hence alleviating poverty.
But good an AMCO may be, it has to enjoy lending from devoted banks and other financial institutions in order to run its operations successfully and safely.
Tanzania's banks must be considerate to cooperatives and join the Tanzania Agricultural Development Bank (TADB) in giving soft loans to cooperatives and enterprising farmers. Cooperatives that have no money cannot help members improve yields or help them access markets with ease.
The lending element is very important at this stage because Tanzania's cooperative movement has not properly healed from wounds it suffered in 1977.
Yet before that year in Tanzania, the word agriculture was synonymous with the word cooperatives. Secondly, currently products marketed by AMCOs happen to be raw materials that are badly needed by local industries. In 1977, the government restructured the cooperative movement. One of the results of that action was that people who were not answerable to cooperative members managed cooperatives societies.
Two things followed. First, members lost faith in and control over the cooperatives. This further opened doors for criminals to steal from and run down cooperatives. Second, cooperatives lost creditworthiness and therefore could not get capital for buying crops from farmers and implement development projects that create jobs and improve provision of social services.
Tanzania is now a lower middle-income nation. It has to make meaningful strides to become a proper middle-income nation by increasing agroindustries that would create jobs, increase consumer goods and a later stage start industries that create capital goods. The journey will be much easy by having policies and institutions committed to transforming agriculture. Banks are part of those institutions that are talked about.
This is not a far-fetched idea or a laughing matter. Those who have read the Tanzania Human Development 2014 will remember two out of the seven key messages. The first one says: In order to work for human development, economic growth and transformation have to expand employment creation and social service provision.
The second one says: Agriculture, manufacturing and tourism are the three key growth sectors that Tanzania has to focus on.
"For rapid and inclusive transformation, Tanzania needs to increase its economic productivity as well as its employment opportunities. Given their vast backward and forward linkages, their labour-intensity, and their immense potential to expand productivity, the agriwa Mara Cooperative Union (WAMACU), Nyanza Cooperative Union (NCU) and Shinyanga Regional Cooperative Union (SHIRECU).
These unions are presently driving much of people's development in Western, Northern and the Victoria Lake Zone parts of Tanzania. There is explanation of these successes in those parts of Tanzania. As argued in the foregoing paragraphs, agriculture financing is important to give AMCOs and Unions the financial ability to serve members.
Fortunately, the government has used the Tanzania Agricultural Development Bank (TADB) to give soft loans to cooperatives build physical infrastructure and cash to buy crops.
For example, until June this year, the TADB has supported crop and animal product value chains of more than 24 types disbursing 246,488,453,466.38. It disbursed a total of 2,382,925,425.00 for warehouses, 9,718,011,724.68 for infrastructure and 228,600,000.00 for promoting greenhouses. This year, the International Day of Cooperatives was marked at national level in Tabora.
In order to intensify efforts to strengthen the cooperative movement, Prime Minister Kassim Majaliwa, called on agriculture ministry to fight ills that undermine the cooperative movement. He also called the ministry to spread cooperative education so that co-operators understand what it takes to have an efficient and strong cooperative movement.
The premier called on auditors of cooperatives, COASCO, to change the reporting system so that it gives correct audit report information to farmers.
The premier reported that during the 2020/2021 fiscal year 4,494 out of 9,185 cooperatives were audited. Mr Majaliwa also called for regional data banks of co-operators, saying that such information is needed when planning supplies of farm inputs to regions.
The TADB participated in the five-day festivities in Tabora. In a statement to commemorate the day, the TADB Managing Director Japhet Justine, says the bank wholeheartedly participated in the festivities because the bank has worked very closely with cooperatives at all levels in order to improve the livelihoods of farmers.
"TADB has been a strategic partner for cooperatives," the MD says in that statement, explaining that 141 AMCOs and seven cooperative unions received a total of149,637,640,455.96 ---AMCOs received 22,030,864,870.44 and union received 127,606,775,585.52 shillings. Using its credit guarantee facility, the Smallholder Farmers Credit Guarantee Scheme (SCGS), the TADB together with its partner financial institutions extended to the agriculture sector 10.964 billion.
The total amount the bank disbursed to cooperatives is 160.601 billion shillings, the statement says. Over the years, Mr Justine said, the bank has made focused efforts to transform cooperatives in coffee, fish and cotton projects in the Lake Victoria zone, paddy, dairy and sisal projects in the eastern zone, sesame project in Tunduru District, maize projects in southern highlands regions and sunflower projects in the central zone.
The TADB, Mr Justine says, supports "cooperative values of self-help and solidarity and the ethical values of social responsibility and concern for community (because properly managed cooperatives) can reduce inequality and create shared prosperity."
For intellectual refreshment and enlightenment of those who were not there, the pre-independence cooperative movement paid for education of children of co-operators, groomed prominent Tanganyika African National Union (TANU) leaders who led the people during the independence truggle against British colonialim.
Those Uhuru stalwarts include Paul Bomani, George Kahama and Onesmo Eliufoo. On December 9, 1961, Tanganyika became independent of Britain and it became a republic on December 9, 1962.
About the writer: He is a professional journalist working as a media consultant and researcher based in Dar es Salaam.
Source: Daily News