Kenya

Kenya is a country where cooperatives constitute a significant portion of the economy and are comparatively well organized.

Key institutions

Statistics

    • “63% of Kenyans derive their livelihoods directly/indirectly from cooperative based activities”
    • “46% of the population is estimated to live in absolute poverty”
    • “In 2007 the cooperatives mobilized 31% of the national savings”
    • “250.000 people are directly employed by cooperative based institutions”
    • “Cooperatives gather at least 7 million members in Kenya”
  • Gicheru 2012 (see below):
    • Cooperatives contribute around 45% of the GDP

Texts

  • Gachie, Josphat. “Cooperatives Movement / Societies in Kenya. Softkenya.com.
    • “Kenya has the highest proportion, in percentage points, of GDP attributable to cooperatives globally, standing at 45 per cent, followed by New Zealand with 22 per cent.”
    • “Kenya boasts about 15,000 registered cooperatives with 12 million members. There are more than 320,000 employees and a further 1.5 million people engaged in small scale and informal enterprise funded by cooperative loans.”
    • Kenya Co-operative Bank was established in 1965. (Received banking license in 1968.)
    • A retired Swedish banker, Sven Lindkvist, helped established an accounting system to help agricultural co-ops better access to credit by establishing their own sacco system.
    • In the 60s, “Catholic Relief Services (CRS), the Department of Cooperative Development (DCD) and Kenya National Federation of Cooperatives (KNFC) teamed up to promote savings and credit societies.”
    • “The structure of the cooperative movement in Kenya places individual members at the bottom of a pyramidal organizational structure. The Cooperative Alliance of Kenya (CAK), formerly known as Kenya National Federation of Cooperatives (KNFC), is at the top as apex body. Saccos fall under KUSCCO under a similar structure.”
    • “Most of the primary cooperatives in Kenya have their origin in state-controlled promotion of cooperative development, which saw most of the people join cooperatives not on the basis of their common bonds and mutual trust, but due to the directive from the state that compelled those engaged in similar economic activities to join specific types of cooperatives. For instance, in the agricultural sector it became mandatory for cash crop farmers to join cooperatives in order to market coffee, cotton, pyrethrum and milk.”
    • Regulating and streamlining co-ops is an important part of the Kenya 2030 plan.
  • Gachie, Josphat. ”History of Cooperatives – saccos in Kenya. Softkenya.com.
    • Roots of Kenyan cooperativism in concept of harambee—“coming together.”
    • “Formal cooperatives started taking shape much later when European settlers formed the Lumbwa Cooperative Society in 1908. For about two decades, the society was restricted to the settler population. Africans were only allowed to establish cooperatives after 1930s. The first piece of legislation on cooperatives was the Cooperative Societies Ordinance enacted in 1931. On February 8, 1931, the Kenya Cooperative Creameries (KCC) was the first cooperative to be registered, followed shortly in the same year by the Kenya Farmers Association The Kenya Planters Cooperative Union (KPCU) was registered in 1937 and the Horticultural Cooperative Union (HCU) in 1951. However, the 1931 Ordinance did not allow Africans to participate in cooperatives.”
    • Department of Cooperatives established in 1946—thus, a colonial legacy. Supported by colonial administration thereafter.
    • Around the time of independence, cooperatives become a part of the doctrine of African Socialism.
    • Kenya-Nordic Cooperative Development Programme established in 1967, allowing access to credit for co-ops.
    • Cooperative movement continues to grow in 1980s and 1990s, but liberalization and structural adjustment hurt their competitiveness.
    • Sacco regulation increases in 2008-2009, and the Cooperative Alliance of Kenya Limited (CAK) was formed in 2009, following the collapse of the Kenya Federation of Cooperatives Union. “CAK’s mandate is to promote cooperative development, unite the movement and represent the cooperatives’ interests on all matters of policy and legal framework.”
    • The Ethics Commission for Cooperative societies was established in 2011.
  • Gicheru, E.N. et al. “An Analysis of the Socio-Economic Impacts of the New Integrated National Transport Policy: The Case of 14-Seat Transport SACCOs in Kenya.” Presented at the ICA Global Research Conference held at Mikkeli in Finland, 24-28 August, 2011.
    • Reviews a reform meant to bring the matatu “paratransit” system from the informal to the formal economy—which involved requiring operators to upgrade their vehicles and establish SACCOs. Criticizes the top-down nature of the policy and the lack of participatory design.
  • Gicheru, E.N. “Engaging Co-operatives in Addressing Local and Global Challenges: The Role of Co-operatives in Generating Sustainable Livelihoods.” Presented in Addis Ababa, Ethiopia, at a conference on 4‐6 September, 2012.
    • Emphasizes the role of cooperatives in building an economy around the needs of the poor
    • Cooperatives contribute around 45% of the GDP
  • Gweyi, Moses Ochieng. “An Investigation of the Impact of Co-Operative Movement in Rural Development in Kenya.” International Journal of Business and Commerce 3, no. 2 (October 2013).
  • Kobia, Silas K. The Co-operative Movement in Kenya : Challenges and Opportunities. Nairobi: Lukiko Consulting Trust, 2011.
  • Koffide, Alfred. “COOPERATIVES IN KENYA: THE REGULATORY BODIES AND REGIMES.” Gin Kelly Law World. September 5, 2014.
  • Ouma, Sylvester J. A History of the Cooperative Movement in Kenya. Bookwise Limited, 1980.
  • Tshishonga, Ndwakhulu and Andrew Emmanuel Okem. “A Review of the Kenyan Cooperative Movement.” Theoretical and Empirical Studies on Cooperatives. Springer, 2016.
  • Wanyama, Frederick O. “The Qualitative and Quantitative Growth of the Cooperative Movement in Kenya.” In Cooperating Out of Poverty, The renaissance of the African cooperative movement. International Labour Organization, 2008.