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Regional Report - Africa
Mr. Ivan Asiimwe, UCA (Uganda)
Agriculture today accounts for 32% of the GDP in Africa and is the sector that offers greatest potential for poverty reduction and job creation, particularly among vulnerable rural populations and urban dwellers with limited job opportunities. Growth generated by agriculture in sub-Saharan Africa is estimated to be 11 times more effective in reducing poverty than GDP growth in other sectors – a vital multiplier given that 65% of the continent’s labor force is engaged in agriculture.
The economic outlook for Sub-Saharan Africa for 2016 gives room for cautious optimism. A 4.7% increase in GDP across the region in 2016 has been higher than expected. However, the World Bank warns that low commodity prices and high borrowing costs, combined with security issues in some areas, will continue to affect growth rates.
Due to their highly democratic and locally autonomous nature, agricultural cooperatives have a potentially strong role in reducing poverty and social exclusion, and promoting rural and national development (Develtere et al. 2008; Birchall 2004, 2003). However, the development of cooperatives has been limited by inadequate research. There is a dearth of up to date literature on the status of African cooperatives since the liberalization of the agriculture sector in the mid-1990s (Wanyama et al. 2008). In addition, policy makers, practitioners, and others harbor outdated views on cooperatives, hampering progress in the sector.
Increasing food production in South Africa by providing Agricultural support through Agricultural Cooperatives
The government of South Africa through the Agricultural Department spending focus is on increasing food production by providing agricultural support to smallholder farmers through the comprehensive agricultural support program and implementing the Landcare, Ilima/Letsema food production and Fetsa Tlala food security programs. The department plans to spend over R7 billion on conditional grants to provinces to support approximately 435,000 subsistence and 54,500 smallholder producers, and improve extension services. It also plans to provide flood disaster relief in Limpopo, Mpumalanga and Western Cape, to which additional als of R209 million have been made. The spending focus will also be on making additional transfers of R50 million in 2014/15 and R50 million in 2016/17 to the Land and Agricultural Development Bank of South Africa to support the implementation of the retail emerging markets model. The six major sources of credit for farmers are banks (56%), agricultural cooperatives and agribusinesses (9%), the Land and Agricultural Development Bank of South Africa (the Land Bank) (30%), private creditors (3%) and other creditors and financial institutions (2%).
Cooperatives are excelling in Fair Trade Business
Today, there is an exponential proliferation of fair-trade products produced by cooperatives from Africa where many agricultural cooperatives are fair trade certified and are marketing their Agricultural produce including coffee, cocoa, sugar, wines and cereals through fair trade market. For example established in 2006 and Fairtrade certified since 2009, Ankole Coffee Cooperative Union in Uganda has grown from a small cooperative, which first exported 19MT in 2008 to the current 1557MT of Fairtrade and organic certified coffee. The Union serves over 8000 small scale coffee farmers, organized in twenty primary societies, bulking and exporting Robusta and Arabica coffee. The Union has constructed a multibillion coffee factory using 37.6% of its total construction costs from Fairtrade Premium and the factory has a processing capacity of 2 tons per hour and it is equipped with a color sorter, gravity table and coffee dryer. Cocoa growing in Côte d ́Ivoire, Uganda and other West African countries export the product to fair trade market (Fairtrade Africa’s Quarterly Newsletter Issue 18 - February 2016). In South Africa there are now 27 Fairtrade-accredited wine producers and this competition has driven up quality.
The Cooperative Week in Uganda: 27th June – 2nd July 2016
Cooperatives in Uganda this year from the 27th June – 2nd July 2016 undertook a number of activities across the country aimed at increasing awareness of cooperatives. These activities included among others: National Blood donation drive, Nationwide Tree Planting Campaign, National Cooperative Convention, handing over a petition to the Parliament of the republic of Uganda, Mega Media Drive and beginning of exhibitions at Nakaseke and main celebrations of International Cooperative Day. The drive created lot of public awareness and support across the country including the parliament, leaders and the development partners.