PUBLISHED ON December 1st, 2014

EAC Cooperative Societies Bill seeks to stimulate trade

The level of optimism is high among co-operatives in East Africa, in light of the ongoing East African Community (EAC) Co-operative Societies Bill 2014 being pushed to be enacted into law.

The bill, being advanced by the regional members of Eastern Africa Farmers Federation (EAFF), seeks to realise and enhance the engagement of the co-operative movement in the EAC integration process.

According to the Trade, Industry and Cooperatives minister Amelia Kyambadde, Uganda is optimistic that the envisaged law is timely as the country is in the process of reviving and strengthening cooperatives to realise more benefits from cross-boarder trade.

Co-operative movements were hit by challenges from the 1970s through to the mid-2000s, but the agenda is fast-gaining momentum and stimulating a lot of interest across the region.

“The bill is attaining considerable support from all regional stakeholders, its intention is in the spirit of development, as it seeks to bond the scattered cooperatives across the region to work for a common good,” Kyambadde said during a recent interview.

Key intentions of the bill

The bill intends to harmonise national co-operative laws in the EAC partner states, and to provide a framework for co-operatives to exploit the EAC regional integration agenda.

In a business sense, the bill considers boosting effort in helping members of cooperatives especially farmers to get a clear understanding of the EAC Common Market protocols which will, at the end, ease regional trade for the benefit of members.

Kyambadde explained that the piece of legislation comes with development-focused provisions like creating a framework for partnerships (joint ventures) expected to operate beyond the confines of the EAC member states – this will boost collective marketing and realisation of large economies of scale.

It proposes to permit co-operatives to draw their membership from any of the EAC partner states.

This means that a coffee co-operative union in Uganda can have members that are coffee primary co-operative societies from Burundi, Kenya, Rwanda or Tanzania. Similarly, a SACCO in Uganda can get members from any of the countries.

“Different cooperatives in our countries have varying degrees in terms of competitive advantage in production, trade and advocacy; therefore, merging regional capabilities will make them emerge stronger,” said the minister.

Mike Sebalu, a member representing Uganda in The East African Legislative Assembly (EALA) noted that the Assembly overwhelmingly supports the Bill and they expect it will be signed into law after all the second and third readings in the House are done.

Masses involved

Sebalu, the prime mover of the bill said that EALA, in close collaboration with EAFF, held public hearings across the EAC region in September.

During the hearings, participants were given a chance to have their views captured in the law; the well-attended hearings grew participants from the co-operative movements, government ministries, private sector and civil society.

Sebalu sounded optimistic that the bill would expectedly be signed into law by the heads of the partner states during the EAC Heads of State Summit in December 2014.

“In this bill, we are exploring possibilities of involving the bulk of East Africans indulged in primary production to partake in the regional integration agenda and tap into its benefits,” he said.

Sebalu explained that the regional law will be supreme over the respective national laws operating in the countries, without any form contradiction because the provisions were tabled before the stakeholders and debated accordingly.

Genesis of the bill

In response to the challenges facing the co-operative movement in the region, EAFF commissioned a comparative study to look at the different laws and policies governing co-operatives in Eastern Africa.

The study was conducted in 2009 by Mr. Joseph Nkandu, the Executive Director of the National Union of Coffee Agribusinesses and Farm Enterprises (NUCAFE).

NUCAFE is one of the three EAFF member organisations in Uganda that have played a central role in conducting awareness and sensitisation on the Bill at the national and district level.

The other two organizations are the Uganda Co-operative Alliance (UCA) and the Uganda National Farmers’ federation (UNFFE).

Nkandu noted that the process is receiving overwhelming acceptance among the stakeholders because it is a demand-driven initiative, unlike most of the bills initiated by government executive arms.

“This bill was premised on wide consultations across Africa, the contents are meant to improve on the respective national legislations in the EAC partner states, we need them to adopt to the good practices from a number of the different country laws,” said Nkandu, the Executive Director for The National Union of Coffee Agribusinesses and Farm Enterprises.

The state of cooperatives in EAC

As of 2013, Kenya is reported to have the highest number of registered co-operatives in East Africa, at about 15,000; the co-operative movement in Kenya is the most advanced in Africa. According to the International Co-operative Alliance (ICA), 18 of the largest 20 SACCOs in Africa are from Kenya.

In addition, according to the World Co-operative Monitor Report of 2014, Co-operative Bank of Kenya is the 70th largest co-operative in the world (and largest in Africa) in terms of turnover over GDP per capita.

Tanzania and Uganda each reported at least 9,000 registered co-operative societies in their respective countries, most of which are agriculture-related co-operatives.

In Uganda, agriculture co-operatives account for over 50% of co-operatives in the country. In Rwanda, there are over 6,000 registered co-operatives.

Source: New Vision

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