Making cooperatives count in social-economic growth
In Uganda, cooperatives play a significant role in driving agricultural and economic transformation, especially for smallholder farmers.
The co-operative movement in Uganda employs about 16% of the country's population, mostly from financial Co- operatives and Agricultural operatives. With a 2.68% contribution to the GDP.
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Winning big in bridging the gap between financial institutions and farmers, providing necessary financing and support for agricultural activities.
Some cooperatives have made considerable progress in improving their members' incomes and standard of living.
In the recent past, Organizations like VisionFund Uganda have developed innovative financial products that aid cooperatives, enhancing their capacity to support smallholder farmers effectively.
However, the sector faces several challenges. Issues such as delayed registration processes, limited access to administrative services, and inefficiencies due to centralized operations have hindered the growth and performance of cooperatives.
The vast majority of cooperatives and Saccos succumb to limited access to capital, insufficient management skills, and regulatory hurdles. They may struggle with maintaining member engagement and achieving economies of scale.
It's evident in all sectors that balancing democratic decision-making with efficient operations can be difficult. Competition from larger, well-established businesses also poses a significant threat to their sustainability and growth.
There has been a renewed effort to decentralize services, digitize cooperative management processes, and promote the merging of smaller cooperatives to create more robust entities. These measures aim to enhance efficiency, reduce costs, and improve regulatory compliance.
Additionally, cooperatives in Uganda are encouraged to adopt diversification strategies, improve leadership and management, and enhance member participation. This approach helps in building resilience within cooperatives, as evidenced by the success of entities like the Nyakatonzi Growers’ Cooperative Union in Kasese district.
