TITLE: Making Co-operatives Work

AUTHOR: Charles Kabuga

REVIEWED BY: Paul Busharizi

I have long held the view that Uganda and Africa in general, is poor because of our inability, unwillingness or external schemes that prevent us from aggregating our resources be they land, capital or labour.

We try to go it alone as individuals, communities or countries preventing our ability to take advantage of economies of scale and the synergies that come with it. I have seen synergy defined as one plus one equals 11 not two.

The point is, when we come together we can unlock potential that is greater than the sum of our individual parts. That is why I am a big fan of the co-operative movement and the book Making Co-operatives Work: Optimising development through social capital by long time co-operator, Charles Kabuga could not have come at a better time in the history of our country.

It is an opportune time because there is a rush to start savings and credit co-operatives (SACCOS) around the country, to take advantage of the Parish Development Model (PMD) funds.

When the dust settles, there will be a handful of co-operatives left standing, hundreds of others set up opportunistically will have fallen by the wayside. Which will be sad, but inevitable.

Hopefully, the failed SACCOS will not discourage people from staying the course and joining the more viable SACCOS.

In his book, Kabuga does a commendable job of charting the history of the co-operative movement, internationally and in Uganda, outlining the theoretical framework on which they operate, the oftentimes uneasy relationship with state and what he sees as the future of the movement.

In Uganda, the co-operative movement was severely weakened by the economic troubles of the 1970s and 1980s. Structural adjustment of our economy, which required a cut back on public expenditure, privatisation and especially liberalisation of commodity marketing dealt a near death blow to the co-operatives.

He points out that co-operatives relied on the commodity marketing monopolies that the Government put in place and the co-operatives were the main suppliers to these marketing boards. When this were disbanded and private players began exporting commodities.

The co-operatives whose management failed to move with times found themselves adrift at sea with the inevitable collapse following soon after.

The closure of the Co-operative Bank in the late 1990s sounded the death knell for the co-operatives as we knew them at worst or forced a reset of how they had to operate in the future. Few co-operatives survived this carnage.

Kabuga has some time-tested advice on how sustainable co-operatives can be set up and some thoughtful ideas about how they may have survived the structural adjustment period. I agree wholeheartedly with him that co-operatives need to make a deliberate decision to build their capital base.

The practice now is that co-operatives tend to distribute a lot of their profit to the members annually. While this is good for morale and endears the leadership to the members it counterproductive in the long term.

Weak capital bases is a major reason why the co-operative movement failed to overcome recent economic upheavals. That being said, the relevance and the importance of the co-operative movement is needed now more than ever before.

Despite decades of economic growth, the wealth inequalities are widening and co-operatives, Kabuga maintains, may be just the mechanism needed to help bridge or at least slow the rate of inequality.

The beauty of the co-operatives is that they do not need anyone’s permission to begin. While to legally operate in the country one needs to register with the trade and co-operatives ministry, the will to co-operate has to be self-generated.

This is an important point because co-operatives are not about positioning for handouts but a tool for building self-reliance in our communities, leveraging the power of numbers to advance society.

For those with Cold War hangovers, he says co-operatives are not a socialist tool. That in fact there are co-operatives even in the most capitalist of societies albeit going by different description.

The book is potentially a powerful reference for the industry a critical resource in a world where the reality is settling in that we are going to have to develop ourselves and not rely on foreigners with alternative agendas that do not necessarily rhyme with ours.

It is written in very accessible language and is must read for any leader political or otherwise who has a genuine desire to uplift his people