Agricultural Cooperatives in the Kingdom of Eswatini: Financial Efficiency, Challenges and Opportunities (original) (raw)
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For small land-holding, developing and agricultural based economic countries like Ethiopia, cooperative type of business is recommended as a solution to promote income distribution, reduce poverty and vulnerability, and improve quality of life and social welfare. Ethiopia is a second largest populace country in Africa and has nine regions and two city administrations. South Nations Nationalities and Peoples Region (SNNPR) state is third populace and most densely populated region in Ethiopia. Most of the farmers' in this region have small plot of lands for their living, farming and raising animals. It is obvious that such smallholder farmers are characterized by producing small amount of produce. They might bring small portion of their product to market, and the earnings might goes to cover their routine expenditure and might save the remaining for next farming season. Having this clear fact in to consideration, Since 1960s, the government of Ethiopia is promoting the significance of cooperatives as an organization that could enhance the development of small scale-farmers and other communities. Unlike other regions, SNNPR is the pioneer for starting cooperatives type of business; cooperatives are still flourishing in the region. Cooperatives are expected to serve farmers by providing agricultural inputs, output marketing and mobilizing savings and providing credit services to their members. The objective of this paper is to show role of cooperatives in rural development the case of South Nations Nationalities and Peoples Region. Until June 2011, in SNNPR state there were about 8872 primary cooperatives, 44 Cooperative Unions and One Regional Farmers Cooperative federation are established. These cooperatives have a membership of male 693,898 (77%) and female 209, 861 (23%) totally 903, 759. This is about 30.3% from the total households of the region. Despite early establishment of cooperatives across the region and country wide, cooperatives couldn't flourish as expected. Past attitude (ideology), lack of committed leadership, lack of good governance (management), lack of working capital, attitude and practice of corruption, lack of knowledge and skill, lack in provision and utilization of improved technology, weak vertical and horizontal linkage within and among cooperatives, lack and inappropriate support from government and other stakeholders.
International Journal of Economic Behavior and Organization, 2020
Cooperatives enable people to improve their social and economic conditions by pooling their resource and efforts together in ways that are more productive than working individually. The aim of this study was to identify determinants to performance of MPACs. Multistage sampling was employed to select study area and sample households. Study area selected purposively because of its accessibility and relatively large numbers of functional cooperatives. Primary data were collected from 122 members of sample cooperatives those were selected using simple random sampling proportional to size of members in the cooperative through semi-structured interview schedule and key informant interview and focus discussion. Moreover, secondary data were obtained from audit reports of sample cooperatives. The collected data entered to SPSS version 20. Descriptive analysis such as mean, percentage and frequency were analyzed along with probit model. However, their moderate involvement in service provision of agricultural input distribution cooperatives output marketing service in the study area was found as it was not outstanding that majority of the cooperatives did not carry out purchasing of farmers output. The model result revealed that from thirteen explanatory variables included in the model for analysis numbers of shareholding in cooperative, membership to union and working relationship in cooperative were found to be significantly and positively related to members' satisfaction to overall performance of MPACs. On the other hand, family size of household, cooperative age and degree of corruption in cooperative were found to be significantly influence degree of member's satisfaction to their cooperative overall performance negatively. Therefore, cooperative management and staff members should strive to render valuable services to its members.
The influence of intangible resources on the performance of agricultural cooperatives
Asian development policy review, 2023
The purpose of this study is to investigate the relationship between intellectual capital (IC), which is represented by structural capital (SC), relational capital [RC], and human capital (HC), and member participation (MP) and performance within the context of agricultural cooperatives. This study employs a survey technique involving 104 palm oil smallholders' cooperatives in Peninsular Malaysia, and the data are analyzed through the partial least squares (PLS) technique. The results indicate that MP and RC have a significant direct relationship with cooperatives' financial performance. Simultaneously, MP also has a direct and significant relationship with the cooperatives' non-financial performance. This proves that MP is the most important intangible resource that determines the cooperatives' financial and non-financial performance. Members' cooperation contributes through active involvement and sharing of constructive ideas, while RC contributes to the competitive advantages in cooperatives' business dealings. Meanwhile, SC and HC have non-significant relationships with cooperative performance. The findings confirm the postulation of the RBV that internal resources are useful to gain superior performance in the marketplace. Therefore, management of agricultural cooperatives must maintain good relationships with their members and relevant constituencies to ensure sustainable performance. Contribution/Originality: The originality of this study lies in its attempt to explore the performance determinants within the context of palm oil smallholder cooperatives, which is scarce in current literature. Thus, the study enriches the current knowledge pertaining to the performance behaviors of agricultural cooperatives from the RBV theoretical perspective. 1. INTRODUCTION Cooperatives have a major role in mitigating poverty and promoting the well-being of the people, especially their members. Additionally, cooperatives serve as catalysts for promoting inclusive and sustainable growth, and they provide employment for local people. The contributions occur through engagement in various economic activities that create employment, business and income opportunities for the local people (Esim, 2014). Moreover, the agricultural cooperatives have contributed to a relatively better quality of life and the empowerment of small
Review of Agricultural and Applied Economics
Background of the research: Agricultural cooperatives are established for the sake of improving the livelihood of smallholder farm households through improving their profitability. However, due to several challenges facing the cooperatives, their establishment may not guarantee such an achievement. Hence, it is essential to empirically verify their impact on profitability of the smallholder farm households. Purpose of the article: The purpose of this study is to measure the impact of agricultural cooperatives on profitability of small holder potato farmers in Eastern Ethiopia. Methods: The study was conducted making use of survey data on members and non-members of agricultural cooperatives in Eastern Hararghe based on multi-stage sampling method. Simple inferential and econometric methods of data analyses were carried out. The simple inferential analysis involves mean comparison tests whereas the econometric analysis is related to PSM method along with simulation-based sensitivity analysis. Findings and value added: The inferential analysis indicates that there is no significant difference in per unit profit between members and non-members. This result also holds true with disintegration of components of the profitability into per unit price, per unit cost of production and per unit cost of marketing. The PSM result also shows that, except the slightly significance for per unit cost of production in favour of non-members, there is no significant difference in terms of per unit profit, per unit price, and per unit cost of marketing. The result implies that membership to cooperatives does not guarantee positive impact on profitability of its members. Recommendation: Therefore, it is recommended that strict follow-up is crucial on the cooperatives' performance; agricultural cooperatives better be functional in all aspects attached to profitability of farmers; active participation of member farmers is inevitable; frequent and regular trainings are also necessitated in order to build the managerial capacity of the leaders; and there should be clear framework of coordination in production and marketing activities. The other mentioned challenges should also be considered.
Asian Journal of Research in Business Economics and Management, 2015
This study is entitled "Comparative study of the factors affecting the sustainability of agricultural cooperatives in Rwanda". The Government of Rwanda views cooperatives as a potential vehicle through which the cooperatives members could expand access to income-generating activities, develop their business potential, including entrepreneurial and managerial capacities through education and training; increase savings and investment, and improve social well-being with special emphasis on gender equality, housing, education, health care and community development. Agricultural cooperatives in Rwanda lead to a variety of achievements to its members, such as the supply of agricultural inputs, access to financial aid, market access among others. However, not all the formed cooperatives are fruitful to their members. Most of these cooperatives start well, members are willing to work hard for their development, they perform well in the beginning, but after a while, most of them become dormant, or even it becomes worse and they fail completely. The main objective of this research was to analyze factors affecting the sustainability of agricultural cooperatives. The present research was guided by the following specific objectives: to analyze rice production and factors of yield variation before and after joining cooperative, to examine the social factors of sustainability agricultural cooperatives in Rwanda, to identify economic factors of sustainability agricultural cooperatives in Rwanda and to identify institutional and governance factors affecting agricultural cooperatives in Rwanda. It was conducted on two farmers cooperatives located in the Southern province of Rwanda. Among those cooperatives, one is considered as a model cooperative and the other one a cooperative with poor performance. The target population from those two rice farmers' cooperatives was 350 from Ngiryi and Nsuri cooperatives, from which a sample size of 154rice farmers was derived from Ngiryi and Nsuri cooperatives. The sampling methods used are cross-sectional survey with 154 respondents selected by systematic sampling and cluster sampling. Another method adopted in this research is participatory approach. The multiple linear regression analysis was also used to assess the level of success of cooperatives from socioeconomic and institutional factors. The key findings from the field survey revealed that, the average mean of rice production in Ngiryi cooperative was 2.94 tons before farmers being grouped into cooperatives, after joining cooperative, the yield shifted up to 4.96 tons. This showed that after rice farmers were grouped into cooperatives, the yield was increased by sixty eight percent (68.7%) of the total production before joining cooperatives. The same case of Nsuri cooperative, the average yield before cooperative was 1.55 tons while after intervention of cooperatives the yield was 3.271 tons of rice. For the considered social factors, due to the level of significance of 0.01 with the p-value of 0.0000, (p-value<0.01), the analysis showed that there is significance effect of social factors on the sustainability of Ngiryi cooperative, with p-value of 0.0000 (p-value<0.01), the same was observed for Nsuri cooperative the analysis showed that there is significance effect of social factors on Nsuri cooperative. For the considered economic factors, the results from the chi-square table showed that there is significant effect of economic factors on the sustainability of Ngiryi cooperative with p-value of 0.000 which is less than to level of significance of 0.01. The Pearson chi-square from this correlations was found to be 9.562 respectively. Whereas for Nsuri cooperative the results from the chi-square table showed that there is no significance effect of economic factors on the on Nsuri cooperative. This is explained by p-value of 0.066 which is greater than the level of significance of 0.01 (P-value =0.066>0.01) and their corresponding Pearson chi-square of 3.373 respectively. In terms of the considered institutional and governance factors (the understanding of cooperative principles and concepts by cooperative leaders, decision making by cooperative leaders, understanding of the tasks by leaders and involvement of cooperative members in decision making), the results from the chi-square test of Institutional and governance factors in the case of Ngiryi cooperative showed that there is significant effect of fore mentioned factors to the sustainability of agricultural cooperatives. Whereas on the side of Nsuri cooperative, Chi-Square Tests showed that there is no significant effect of institutional and governance factors on the functioning of Nsuri cooperative. By conclusion drawn from the comparative study of two rice farmers cooperatives, the Ngiryi cooperative has better management and better performance compared to Nsuri cooperative, these were arrived by comparing level of contribution or R-square values where Ngiryi perform at 57% mean while Nsuri cooperative has succeed at 44% respectively.
Survey of the Performance of Agricultural Cooperative Societies in Kogi State, Nigeria
European Scientific Journal, 2012
This study deals with the analysis of the performance of agricultural cooperative societies in kogi state of Nigeria. A simple random sampling technique was used in the selection of 28 Agricultural cooperative societies and 280 members. A structured questionnaire was used to obtain information on the membership and activities of the cooperative societies. The paper reveals that there are five major types of registered agricultural cooperative societies in the area. The study further reveals that cooperative societies in the area engaged in crop, livestock, processing and storage enterprises. The farm produce of the societies include: Rice, maize, yam, cassava, and livestock and farm inputs procured are: improved seeds, fertilizers, agro-chemicals and farm implements. The average capital accumulated per member was N6,556.71 while the average loan disbursement per member was N6,451.00. Only 67 percent of the total loan from the societies went to the agricultural sector. It is suggested in the paper that government should increase the supply of credit to cooperative farmers and embank on enlightenment campaign to increase the participation of rural farmers in cooperative activities.
For small land-holding, developing and agricultural based economic countries like Ethiopia, cooperative type of business is recommended as a solution to promote income distribution, reduce poverty and vulnerability, and improve quality of life and social welfare. Ethiopia is a second largest populace country in Africa and has nine regions and two city administrations. South Nations Nationalities and Peoples Region (SNNPR) state is third populace and most densely populated region in Ethiopia. Most of the farmers’ in this region have small plot of lands for their living, farming and raising animals. It is obvious that such smallholder farmers are characterized by producing small amount of produce. They might bring small portion of their product to market, and the earnings might goes to cover their routine expenditure and might save the remaining for next farming season. Having this clear fact in to consideration, Since 1960s, the government of Ethiopia is promoting the significance of cooperatives as an organization that could enhance the development of small scale-farmers and other communities. Unlike other regions, SNNPR is the pioneer for starting cooperatives type of business; cooperatives are still flourishing in the region. Cooperatives are expected to serve farmers by providing agricultural inputs, output marketing and mobilizing savings and providing credit services to their members. The objective of this paper is to show role of cooperatives in rural development the case of South Nations Nationalities and Peoples Region. Until June 2011, in SNNPR state there were about 8872 primary cooperatives, 44 Cooperative Unions and One Regional Farmers Cooperative federation are established. These cooperatives have a membership of male 693,898 (77%) and female 209, 861 (23%) totally 903, 759. This is about 30.3% from the total households of the region. Despite early establishment of cooperatives across the region and country wide, cooperatives couldn’t flourish as expected. Past attitude (ideology), lack of committed leadership, lack of good governance (management), lack of working capital, attitude and practice of corruption, lack of knowledge and skill, lack in provision and utilization of improved technology, weak vertical and horizontal linkage within and among cooperatives, lack and inappropriate support from government and other stakeholders.
2021
Cooperatives entities have a great contribution in socioeconomic development of nations, whether developing and developed countries. The National vision 2050 cooperatives are expected to contribute immensely. At regional level, cooperatives have been included in strategies to achieve Africa Agenda 2063. Internationally, cooperatives are among strategies to achieve the global agenda 2023 through the Sustainable Development Goals (SDGs- 2030)(MINICOM, 2018). Cooperatives activities contributed directly to achievement of some SDGs such as SDG 1: end poverty in all its forms everywhere especially help in enhancing resilience and production capacity, and better distribution of income among citizens. SDG-2: End hunger, achieve food security and improve nutrition and promote sustainable agriculture where 48% of registered cooperatives are distributed in the agricultural activities which are farming, livestock and fishing activities. They also contribute to SDG-5: Achieve gender equality an...
Journal of Business Management & Social Sciences Research (JBM&SSR), 2015
The study was conducted in Gog woreda, southern Gambella, Ethiopia with the objectives to assess the roles of regional cooperative promotion agency in promoting the sustainability of agricultural cooperatives and to examine the challenges of members' participation in agricultural cooperatives. To address the objectives of the study, both quantitative and qualitative methodologies were used through primary and secondary data source. The primary data were collected through face to face interviews using structured interview schedule and focus group discussion. The study used a multi-stage sampling. Descriptive statistical tools such as mean, minimum, maximum, percentage and standard deviations were used to analyze the data. Therefore, the general findings of this study reveal that, the major factors that challenged the roles played by the regional cooperative agency and members participation in agricultural cooperatives in the study area were inability of cooperative promotion agency to play its roles appropriately resulted from failure to implement cooperative laws failure to conduct timely auditing and inspections, less budget allocation by the regional government and inadequate trained manpower , inadequate members' awareness about cooperatives, poor participation of members, poor members' involvement in decision making, unwillingness of members to involve in conflict resolution, inadequate managerial skills of the leaders, absence of training, interference of local leaders in the decisions and managerial affairs of the cooperatives, unavailability of financial institutions, inadequate infrastructures, inaccessibility to improved seeds and inadequate agriculture extension services.
The present study determined factors that affected the proper functioning of smallholder-cooperatives in the Lepelle Nkumpi municipality, Limpopo Province of South Africa. By employing discriminant analysis, data collected from 140 cooperative members from 13 different agricultural cooperative were analysed to i dentify factors that can be used to discriminate between functional and dysfunctional agricultural cooperatives. The results indicated that the independent variables that accounted for most the differences between functional and dysfunctional cooperatives were size of cooperative, availability of stakeholders to assist in improving the level of skill of members, satisfaction of members with assistance provided, number of females in the cooperative, number of years the cooperative had been in existence, members participation in decision making and age group. It was recommended that government should intensify efforts to improve skills of members and also provide assistance to the satisfaction of cooperative members in order to assist cooperatives to become functional.