Kenya’s cooperative movement under threat

July 27, 2011

, WINDHOEK, Namibia, July 27- Cabinet Minister Joseph Nyagah has decried the tough economic times and adverse weather conditions that are being experienced in Kenya saying they will impact negatively on the cooperative movement.
With majority of the cooperative movement made up of the middle class and the rural folk, the current drought is likely to shrink their disposable incomes which will likely be diverted from productive investment to purchase food.

“Saccos’ income will decline further while payments made by agricultural co-operatives continue to dwindle,” said the Minister at an International Co-operative Alliance (ICA) Ministerial Conference in Windhoek, Namibia.

Spiraling energy prices, especially petroleum are expected to compound the problem by driving up commodity prices and hence putting the cost of living beyond the reach of low income earners.

“High interest rates and fluctuating financial markets have already affected the financial co-operatives which play a very big role in socio-economic development,” reinforced Mr Nyagah.

With such a scenario, the economy too is threatened especially given that the Kenyan co-operatives account for 43 percent of the Gross Domestic Product, 31 percent of national savings and deposits of about Sh220 billion.

It is estimated that one in five Kenyans is a member of a co-operative and 20 million Kenyans directly or indirectly derive their livelihood from the co-operative movement.

Despite the huge contribution to the economy, the sector faces challenges such as the low adoption of technology, gender disparity in the leadership of co-operative institutions and youth unemployment.

It is against this background that Mr Nyagah, who is also the who is also the Chairman of the Conference said that ICA was promoting youth activities such as the art competition set to be launched in Cancun, Mexico in November.

This is part of a wider plan that is to be incorporated in the soon to be adopted co-operative policy for Africa.

During the Windhoek meeting- which is a review of ICA African Inter-ministerial Conference held in Nairobi in October last year- the minister took the opportunity to appeal for support for the millions of people in the Horn of Africa region who are facing starvation.

Mr Nyagah asked the ministers to rally their respective movements to join hands with ICA and assist famine victims. The movement has in the past come together to support Haiti and Japan citizens who suffered devastating earthquakes.


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