PROMOTING COOPERATIVES IN MALAWI

PRESENTED BY : JOHN MULANGENI NKOSI

FROM SUPPORTING COOPERATIVES IN MALAWI PROJECT

Presentation Outline

• Malawi Brief Country Profile

• Development of Cooperatives & Current statistics

• Supporting Cooperatives in Malawi Project Activities

• Project Challenges and Movement Challenges

• Proposed way forward

Map of Malawi

Malawi Brief Profile,

• A land-locked country in the southern part of Africa

• Shares boarders with Zambia, Tanzania and Mozambique.

• Its total area is 118,480 sq km of which 24,400 sq km is water(lake Malawi).

• Climate: sub-tropical; rainy season (November to May); dry season (May to November)

• Terrain: narrow elongated plateau with rolling plains, rounded hills and some mountains

Malawi Brief Profile• Are of bantu origin and comprise many

different ethnic groups, plus Asians and Europeans.

• Based on diversity of tribes there are also diverse cultures.

• Very friendly and peace loving people. It is their friendliness that makes the country known as the Warm Heart of Africa

• Maize is the main staple food

Malawi Brief Profile……History of the Country

• Established in 1891 as a British protectorate known as Nyasaland

• Got independent in 1964 and was renamed to Malawi.

• For three decades it was under one-party rule with its first President Dr. Hastings Kamuzu Banda.

• From 1994 Malawi has been under multiparty era.

• Current President is Professor Peter Mutharika

Malawi Brief Profile….. The Economy

• Agriculture based, maize is grown mainly for consumption while tobacco, tea, sugar cane, coffee and cotton are produced for exports, with tobacco being the main export earner followed by tea, sugar, coffee and cotton.

• Except for sugar and tea the rest is grown by smallholder farmers.

• Other crops which are exported include rice, macadamia, soybean and g/nuts.

Development of the Cooperative Movement in Malawi• First cooperative got registered in 1947- Lingadzi

Mbazi Mutual Cooperative Society and was in Lilongwe District.

Development of the Cooperative Movement in Malawi The cooperative history in Malawi can be

divided in three eras: Colonial era

from 1946 to 1964Used Cooperative Ordinance from BritainIn 1962 there was cooperative college

Post independence erafrom 1964 to 1994 eraStill used the inherited Cooperative Law from BritainGovernment took over assets of the movement including

the college

Development of the Cooperative Movement in Malawi Cont..

post multiparty era from 1994 to Date.There was a cooperative policy put in June 1997 and new

Cooperative law was put in place in 1998There was now a considerable renewed growth of

cooperatives in all sectors but there was limited education by the government

There was support for the financial cooperatives sector but there was no education support for non financial cooperatives

Development of the Cooperative Movement in Malawi……contd

• First Cooperative policy developed in June 1997 and this was followed by new cooperative law in 1998. These two documents are the ones in use to date.

• Ministry of Industry & Trade is responsible for promotion and development of cooperatives.

• It is the custodian of the Cooperative Development Policy and the Cooperative Societies Act.

• New Finance Cooperative Act enacted in 2012 to cater for growing number of financial cooperatives. This falls under the supervision of the Reserve Bank of Malawi.

Development of Cooperatives Contd……Current Statistics

1. Financial Cooperativesi. Savings and Credit Cooperatives

-192 registered

2. Non-financial Cooperativesi. Producer and Marketing Cooperatives

-382 registered

ii. Multi-purpose Cooperatives-Community Savings and Investment Promotion (COMSIP) -107 registered

*There are currently 681registered cooperatives

Current statistics

Genesis of the project Supporting Cooperatives in Malawi• UK College fact finding visit 2010 to gather

information for project (UK Co-operative Group supported)

• Main gap identified was capacity building

• Work with African Development Bank – transformation of water user groups to cooperatives through training

• Application to Scottish government

Supporting Cooperatives in Malawi Project Activities• Project started in 2012 and will run up to 2015

• Covers all of Malawi

• Objective of Project is to: provide capacity building trainingsprovide tailor-made support, mentorship and advice to

start-up and established co-operativesAssist selected co-operatives to identify marketsSupport in the establishment of a national

Cooperative body

Project Achievements• Provided support to cooperative trainings to 300 groups

in:Cooperative formationRecord keeping and Financial ManagementMarketing and Sales Promotion

• Target was 2,700 learners. So far, 6,031 of which 4,108 women

• Provided financial support for 10 groups’ participation in international trade fairs.

• Facilitating establishment of national cooperative body

One of the group that was assisted to attend an international trade fair aimed achieving market linkages for

Members of Nkhongono ku Banthu COMSIP Cooperative Society Limited in Karonga District pose for a photo after receiving Record-Keeping and Financial Management training aimed at achieving objective one for provision of large scale trainings to new and existing cooperatives

Members contribute in the raising of capital after business management trainings.

Members of Kapacha Dairy Farmers Cooperative in Mzuzu have diversified their activities after being trained in Business Management.

Members of Nagoneka COMSIP Cooperative Society Limited in Blantyre District showcase some of their produce during Dr. Sara Alldred visit. The Cooperative also helps them to procure farm Inputs (seeds, fertiliser) which increases yields. More for families to eat, and they can sell the surplus!

After training, members of Nagoneka Cooperative developed weaving skills as part of a diversification strategy. Their desire is able to find reliable markets abroad.

Project Challenges

1. Majority of group members are illiterate

2. Demand for training outstrips supply.

3. 200 groups waiting for training, average membership 100

4. 6,000 have been trained, 20,000 waiting

5. Remote locations, poor infrastructure (lack of project vehicles)

6. How to embed a cooperative education tradition

Challenges Cooperative Movement1. Cooperative Policy and Law not aligned

with ILO recommendation 193 of 2002

2. In adequate Human and Financial resource for Cooperative in the Department.

3. The country does not a cooperative development strategy that would guide promotion and development of cooperatives

Way forward

1. Training of lead people who can provide the training to others

2. Project extension to reach out to many groups

3. Increase project funds

4. Procure project vehicles and recruit more staff

Way forward for cooperative Movement

1. Seek assistance technical as well as financial for review of the cooperative policy and cooperative legislation

2. Engage the Government to increase budget allocation and expand staff in cooperative department which currently has only 9 officers

3. Seek assistance technical as well as financial for development cooperative development strategy for the country.

End of Presentation

• Thank you Very Much for your attention !!

• Zikomo Kwambiri pomvetsera!!