The Chairman of Ushirika Council Mr. Japheth Magomere, OGW
The Chairman of the Co-operative Alliance of Kenya Mr. Stanley Muchiri, EBS
Ladies and Gentlemen
Today is an important day when we Kenyans join the rest of the world in marking the international co-operative day, better known in Kenya as ushirika day, which is marked on the first Saturday of July every year.
It is the day when cooperators look back and take stock of the achievements they have made and re-energize themselves to grow the movement to even higher levels.
It is very encouraging to note that Kenya’s cooperative sector has grown in leaps and bounds, recording remarkable achievements in economic growth and improving people’s standards of living.
At independence in 1963, Kenya had a mere 1,030 registered co-operative societies with a total share capital of Ksh.100,000. Todate, the number has grown to over 16,000 registered cooperative societies with a membership of over 13 million and a turn-over of over Ksh.100 Billion.
The movement is a key source of employment. Currently, cooperatives employ over 500,000 people directly. 63 per cent of the Kenyan population derives their livelihood directly from cooperative-based economic activities.
According to the International Co-operative Alliance (ICA), Kenya’s cooperative movement is the fastest growing in the world and is ranked the best in Africa and the 7th best in the World.
The savings and credit cooperative societies (sacco) movement in Kenya was admitted to the league of the ten (10) most developed globally. The members of the group of 10 are Kenya, Ireland, United States of America, Brazil, Mexico, Poland, Australia, Caribbean, Canada and Costa Rica. Kenya is represented in the group of 10 by Kenya Union of Savings and Credit co-operatives Ltd (Kuscco).
It should further be noted that Kenya offers consultancy services on co-operatives to various countries in Africa including Rwanda, South Sudan and South Africa, among others.
This is not an achievement of mean repute. It has taken Kenyan co-operators effort and hard work to grow the movement. I take this opportunity to thank them for the achievement and challenge them to sustain this growth.
The government recognizes cooperatives as suitable vehicles for development and a key and integral part of the government’s economic strategy in poverty alleviation, employment creation, food security and equitable distribution of natural resources.
Due to its very nature of mobilizing communities into economic activities both in the urban and rural areas, the government has fully devolved supervision of the sector. My Ministry will continue to support the sector by providing conducive policy and legal framework. Specifically, I would like to invite collaboration and partnership with the County Governments on the areas of value addition in all products and services which is the engine to drive Kenya into achieving Vision 2030.
Activity profiles of co-operatives cut across all sectors of our economy, notably in agriculture, finance, housing, transport, building and construction, manufacturing and distributive trade. The highest concentration of co-operative activities though, is within the financial services sector with a proportion of 49% while agriculture takes 38% and other industries constitute 13%.
In the agricultural sector, co-operatives are largely involved in the marketing of agricultural produce, while in manufacturing co-operatives involvement is confined to primary and secondary processing of agricultural produce. In the financial sector co-operatives are mainly involved in the mobilization of funds and disbursement of credit to the members.
The sacco subsector is the most stable with over 5000 savings and credit co-operative societies (saccos) which have been successful in mobilizing over Ksh.420 billion as members’ savings for disbursement as loans and Ksh.500 billion asset base.
The cooperative movement has championed marketing of Kenya’s arabica coffee which is renowned worldwide for its high quality and due to this it is used for blending other coffee varieties from other parts of the world.
Coffee marketing is mainly done through the Kenya Co-operative Coffee Exporters (KCCE) Limited, a farmers’ organization registered to handle coffee from the co-operatives sector by minimizing the intermediaries along the coffee value chain.
Its entry into coffee marketing in 2009 triggered a price increase from Ksh.20 per kilo of cherry to Ksh.140 per kilogram of cherry in 2010. This was the highest price ever paid to coffee farmers. I urge respective County Governments to build capacity in this subsector in order to ensure steady growth in price and quality of coffee.
The government has further set up the coffee development fund for financing the coffee sector and has instituted reforms to further streamline coffee marketing with a view to reducing costs thereby increasing the returns to coffee farmers.
Now turning to the youth, it is encouraging to note that Kenya has so far registered over 200 registered youth co-operative societies which include Bunge Youth Saccos in the counties, Matatu Saccos and Youth Saccos in the informal sector. The youth co-operative activities have been most pronounced in the transport sector where they operate matatus and boda bodas.
The recent establishment of the Uwezo Fund will indeed provide the much needed funds to finance various youth co-operative programmes in areas such as sports, cultural activities, trade, information and communication technology (ICT), matatus and film industry. This will engage our young population in productive economic activities hence reducing incidences of insecurity in the country.
Ladies and Gentlemen
The government has been steadfast in encouraging the youth as well as women to start income generating activities. To this end, the Ministry will facilitate the promotion and development of youth and women cooperatives countrywide.
The government has also directed that at least 30 per cent of contracts be reserved for youth and women. I urge all the Kenyan youth to form or join existing co-operatives in order to access this facility.
Lastly Mr. Chairman, I wish now to take this opportunity to thank everyone for having found time to attend this occasion. In particular I want to thank the National Council for Ushirika Day Celebrations for their tireless efforts towards perfecting the preparations to make this year’s Ushirika Day a truly memorable occasion.
Long live the co-operative movement. Long live Kenya.