Ir

Mdhomvu, Tungazara and MaghimbilTANZANIA

REPORT

Phase II: Co-operatives

and Social Protection

like education and trusteeship for peasants

ABSTRACT
In the /950s and 1960s Tanzania had the third largest co-operative
movement
in the world. These co-operatives provided economic and
social protection to members so tflat poor peasants could sell their
crops even in years of bad world market prices. The services provi-
ded by co-operatives,
who took out loans, collapsed when the government abolished co-
operatives in 1976. They were re-introduced.in 1982 but, due to
. their abolition,
they had lost capital, personnel and members. The
current co-operatives are much weaker than the pre-1976 ones and
cannot provide the same kind of protection they once did. Co-
operatives have still a great potential for social and economic
protection but much change in the government policy on co-
operatives is needed.

in Africa. Co-operatives

Introduction
THEREIS NO SINGLE INSTITUTION besides the co-operative that has played
role in the lives of Tanzanians. The strong co-operative
a greater
movement
in Tanzania served members and non-members all over the
country and in the 1960s Tanzania had the largest co-operative
movement
in Tanzania operated on the
principle that the economically and socially strong should shoulder
the weak. The decline. of the co-operative movef!1ent since the 1970s
has resulted in the erosion of the protection they provided to their
members. Cmrent co-operatives
are weak and have suffered from
obstructive and ineffective government policies(Kennedy, 1994: 191).
The term "co-operative" is ordinarily associated with the consumer
co-operative
store established in 1844 at Rochdale, England, of28
people. The term is also used to describe collective self-help. What
made Rochdale special is that it worked and so became the basis for a
. worldwide movement. Rochdale provided the rules by which co-

VOL 17 NO 2 JULY 2002 JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA

29

operative societies could function. These rules (including voluntary
and open membership, democratic control, a limited return to capital,
the ownership by members of any surplus, member education and co-
oper~tion among co-operatives) are adaptable and can be utilized by all
classes and all nations (Melnyk, 1985:3-4).

The concept of the co-operative is fluid and the principles of co-
operatives offer organizational flexibility. Co-operation has taken a
great variety of forms. In some case only loose associations
are
formed, such as the Italian fishermen co-operatives for administering
member insurance. In other cases co-operation is rigidly organized and
cohesive, such as the Israeli kibbutzim with community ownership of
work. Between these two extremes there is a large range of co-operative
types (Melnyk, 1985:3).

and social protection

Co-operatives
Co-operatives have helped to provide social protection in modern
Tanzania. They have contributed to social stability and passed on to their
members the values and norms that promote social order and stability.
Modern co-operative institutions based on Rochdalean principles were
introduced in mainland Tanzania (Tanganyika) inthe 1920s. Their legal
status has been defined in various laws, starting with the Co-operative
Societies Ordinance of 1932.

Modem co-operatives in Tanzania are basically a rural phenomenon.
They are owned and run by peasants and their main activity is buying
members' and non-members' crops for export. The early co-operatives
enabled peasants to reap the trading profit, which had before gone to
Asian merchants. Co-operatives provided security because they bought
peasants' crops even in years of very low prices on the world market.
Co-operatives also provided social services support to their mem-
bers. In Moshi older peasants told us that the Kilimanjaro Native
Co-operative Union (K~CU) provided scholarships for its members'
children and supported primary and secondary education. The KNCU
built Lyamungo Secondary School in 1962, which was given to the
government
in 1965. It e:,en opened its own business school (KNCU
College of Commerce) in 1956. The latter was closed in 1962, possibly

30

JOURNAL OF SOCIAL OEVELOPMENT IN AFRICA VOL 17 NO 2 JULY 2002

:1----------------------iiiiii_a;;:; __;;l~;;.ii.iii$l;;;.~;:;;~.;:"',;;:;.~

..:.::::",,,,,7"':....-_.._~

Mchom~u, Tungazara and Maghimbi/TANZANIA REPORT

due to conflict between the established co-operative leadership and
the emerging political
in
1961 but the nationalist struggle entered party politics only in 1954).

leadership (Tanganyika got Independence

The decline of the co-operative movement
in 1976 and
Modem co-operatives were abolished by the government
re-established in 1982 (Bantukari 2000:40-43). The abolition contributed
to the current. bad state of co-operatives because they lost both capital,
personnel and members after abolition. By 1976 the co-operatives had
built up an an encouraging level of capital
through retained earn-
ings, cash reserves, members' deposits and cash investments in various
holdings. These resources were all frozen when co-operatives were
abolished (Bantukari 2000:45).

When co-operatives were re-introduced they had lost their mono-
poly in buying peasants' crops in their respective areas and they now
have to compete with crop merchants. This is part of the structural
adj'ustment policies which have helped to weaken co-operatives.
Modem co-operatives now are very weak: for example, they buy only
about 10% of the peasant cotton crop although in the past they handled
the whole crop.

In 1968 the co-operative movement

in Tanzania was the largest in
Africa, handling £27,500,000 worth of the country's annual exports.
This was half the value of the country's exports. Only in Israel and
Denmark did co-operatives market a greater proportion of a nation's
overseas business (UPA 1968:85). The peasants interviewed in focus
group discussions. in Same, Dodoma, Moshi and Mwanza dismissed
the suggestion that the current
provide
social protection, saying that the old co-operatives were better placed
to do so. The old co-operatives
had well-defined functions which
helped peasants to consolidate their social and economic position.
These functions were:

Distributing farm implements and other agricultural inputs;

(post-1982)

co-operatives

• Acti~g as trustees for peasants who took loans from credit agencies;
• Running special funds for members' education;
• Constructing primary and secondary schools;

VOL 17 NO 2 JULY 2002 JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA

31

• Supporting higher education through scholarships;
• Building factories for processing agricultural products bought from
members (e.g. cotton gunneries, coffee curing, oil processing mills
and maize mills) ..

in Moshi, Dodoma anq Mwanza
Findings from field observations
indicate that modem co-operatives have been in decline since 1976.
When they were re-introduced in 1982, they were allowed to form
without share capital subscriptions in the strict and practical sense.
Members of co-operatives were required to pay only non-refundable
dues and co-operatives were thus unable to build up capital. Although
the law was changed again in 1991, current co-operatives lack crop-
buying funds. Another researcher observed that in 1960 co-operatives
wete able to meet 33.5% of the funds required to purchase crops but
by 1996.they could raise only 0.7% of the funds (Banturaki 2000:41).

Membership
Focus group discussions conducted in Chome and Ugweno divisions
(Same and Mwanga districts) revealed that co-operatives have very few
members at present and most peasants in the country are forced by
circumstances to sell their crops to crop merchants. In Kilimanjaro,
Mwanza and Dodoma regions before 1976 most peasants were
members of co-operatives. In most villages in Moshi district (now Hai,
Rombo and Moshi districts) all peasants were members of the KNCU
but only a tiny fraction are members today. The total co-operative
membership in the whole countryside has dropped from serving about
20% of the peasants in 1976 to about 5% in 1982 and 3% in 1991
(Banturaki 2000:49-50). This figure obscures the fact that, b'efore
1976, co-operatives served almost all peasants because they were not
restricted to their own membership.

The peasant informants were clear that they got a better deal when
selling crops in the pre-1976 period than now. Crop merchants who
buy most of the crops in the country now do not pay the second
payment, which is the difference between the price co-operatives give

32

JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA VOL 17 NO 2 JULY 2002

MChomvu, Tungazara and MaghimbilTANZANIA

REPORT

members up front and what they actually get in the world market after
deducting costs like interest on money advanced by banks.

legislation placed the co-operatives'

The commercialization of co-operatives
The 1982 co-operative
apex
organization
under the patronage of the ruling political party and
membership was almost compulsory, but not clearly de~ned, because
every village in the country was supposed to be a political wing of the
ruling party and a multi-purpose co-operative society. After the 1991
co-operative law, membership has become voluntary and peasants are
not obliged to sell their crops to co-operative societies. At the same
time co-operatives have introduced attempts to make their members
pay share capital. This has contributed to the low number of members.
Co-operatives have in the 1990s become more elitist and are controlled
by the richer peasants in the villages. The poorer peasants have thus
been disenfranchized and marginalized.

In Kilimanjaro, Mwanza and Dodoma regions, where the co'
operatives were surveyed, no poor peasants have been "chased" from
co-operatives but most poor could not meet the conditions for joining
them after 1991 and were therefore sidelined. In Bukoba, for example,
the peasant must pay the share capital in full and at one time and be
able to sell
over 200kgs of coffee per year
(Bantukari 2000:42-43). The situation is the same in Dodoma, Mwanza
and Kilimanjaro. Most of the poorer peasants cannot afford the time
waiting to sell their crops to bureaucratic co-operatives. They are thus
forced to sell to crop mercHants, who offer lower prices.

to the co-operative

for example,

Sometimes co-operatives themselves cannot offer price incentives
and they have thus lost their traditional role in protecting peasants. It
(Family Mirror 31 July-6 August
was reported in one newspaper
2001),
in Kagera region borrowed
peasants' coffee in the previous year's coffee season (that
is, 2000).
In 2001, under the cloud of last season's debts,
these co-operatives
have announced a price of Tshs. 80 per kilogram of dried unpulped
robusta coffee. At the same time private traders from Uganda were
prepared to pay Tshs. 170 per kilogramme for the same coffee.

that co-operatives

VOL 17 NO 2 JULY 2002 JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA

33

'r

problems

in co-operatives

for Co-operatives

Operating
It has also been reported by the Minister
and Mar-
keting in Daily News 25 June 2001 that co-operatives
are
now in an appalling state. By May 200 I they owed banks Tshs.17.8
billion. This is very discouraging
had accumulated
this mammoth debt despite the cancellation of their Tshs. 44 billion debt
by the government
during the
general meeting of the Arusha Co.operative Union (ACU) on 23 June
200 I. The ACU itself owes banks more than Tshs. 5.8 billion and it
owes other creditors Tshs. 899 million.

in the last ten years. This was revealed

as co-operatives

in Tanzania

The Minister

said that

the ACU was found by an investigating

supervision

of ACU projects

committee to have incurred a loss of more than Tshs. 145 million. The
was the result of poor
and "ghost"
payments (payments not backed up by the delivery of goods; or services.
The
or goods or services not measuring up to the value of payments).
It did
in a shady manner.
ACU had been approving loans to members
not conduct proper financial supervision,
auditing and employment
and
losses.
this, according to the Minister, contributed to frequent
in old-
The ACU had a small
investment base and conducted
to the
fashioned ways.
of co-operatives.
benefits
said the
Minister,
the ACU would not be able to survive in a liberalized market
economy with fierce competition.
contributes

financial
business
sensitized
in this way,

to the endless woes in co-operatives

Its members were not adequately

in co-operatives

leadership

continued

If things

Poor

today.

All these problems

seem to be the order of the day in contemporary

peasants

Dodoma

and Mwanza

co-operatives.

regions mentioned

In focus group discussions

in
the same
by
and the
theft. More data on this theme will be

Tanzanian
Kilimanjaro,
problems over and over again. They were'particularly
the practice o(ghost
payments made by co-operative
regular occurrence
presented
in Tanzania to enable them to
to revamp and popularize
run profitably
the current Co-
operative Act is reviewed. This is a positive attitude, but we note that
is needed in order to enable them
major policy reform of co-operatives

later. The Minister promised that his ministry is committed

and that his ministry will ensure

discouraged
officials

co-operatives

of outright

that

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JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA VOL 17 NO 2 JULY 2002

r

Mchomvu, Tungazara and Maghimbi/TANZANIA REPORT

make a meaningful contribution to the economic advancement
and
social security protection of the Tanzanian peasant. The role of crop
for example, must be clearly spelled out and, when crop
men;hants,
merchants threaten the peasants'
the co-operative must be
given priority in policies on marketing and agricultural reform.

security,

It seems clear that co-operatives specializing in crop buying are in a
serious crisis and cannot provide the social and economic protection
they used to before 1976. Their members cannot be solely blamed for
the poor state of their co-operatives. Contradictory policies over the
years,
including policies which have abolished strong and viable co-
operatives which poor peasants toiled for years to build, have also
contributed. The government
as an
economic venture with an important social function and formulate
policies conducive to their evolution. This will occur only when there
is a change in government
thinking and when it is able to view the
peasant co-operative as a tool for social security protection.

should view the co-operative

From in-depth interviews we found that co-operatives

lack capital
to buy crops and to provide social services to members. They are
unable to attract credit for their members and, even if such credit were
few creditors would accept
available,
the guarantee of shaky co-
operatives
for their members. Many co-operative unions are under
receivership because of their huge debts. These include co-operatives
in areas where they were strong before 1976. Some of the bigest of
these under liquidation are the Dodoma Region Co-operative Union
(CRCU), Tanga Region Co-operative Union (TARECU), (Shinyanga
Region Co-operative Union (SHIRECU), Lindi Region Co-operative
Union (LIRECU), Ruvuma Region Co-operative Union (RURECU)
and Buha Co-operative Union.

Case study I: The CRCU co-operative
The CRCU covers Dodoma region. It was abolished by the goverrtment
in 1975 and a new CRCU was established in 1984 as CRCU 1984 Ltd.
The problems it faces are similar to those faced by other co-operatives
all over the country and it? situation will serve as a case study.

VOL 17 NO 2 JULY 2002 JOURNAL OF SOCiAL DEVELOPMENT IN AFRICA

35

After the 1991 Co-operative Act every co;operative must have formal
members and those served by the co-operative
are not automatic
members. Every co-operative member has to contribute shares:
if a
co-operative has no contributions
it ij tlot registered. Thus mem-
bership has dwindled in the 1990s, as we saw earlier.

•
•

CRCU 1984 Ltd. had clear objectives including:
improving the standard of living of its members;
conducting business on behalf of peasant farmers in Dodoma
region;

• buying mixed crops like maize, millet, sunflower, fmger millet,

peanuts, chicken peas, oil seeds, honey and beeswax.

Three hundred or more primary co-operatives in Dodoma regionjoined
CRCU but each village contributed a share capital of only Tshs.
1,500.00 (about US$2). The initial membership capital contributed by
all co-operatives amounted to Tshs. 399,000 only. Thus CRCU did not
have the capital to procure crops. To salvage this situation CRCU took
.out a loan ofTshs. 1,225,000,000 from the National BaI?kof Commerce
(NBC). Having failed to service its loan, CRCU ultimately became a
giant debtor. The total value ofCRCU was only Tshs. 94,000,000.

Co-operatives continued to decline financially and in 1992 the
Ministry of Agriculture and Co-operatives put up a budget of Tshs.
35,000,000,000 to rescue them. This sum was distributed to different co-
operative unions in the country. In Dodoma it was claimed that CRCU
was buying crops which did not exist (these are also known as "vacuum
crops" in Tanzania). There were also claims that crops had been bought
but they did not tally with value of money paid. Funds were misused to
purchase items not budgeted for. It was claimed that luxury cars were
bought and officers of the union were paid unnecessary allowances.
Between 1984 and 1992 the management of CRCU changed five times
and no manager completed two years of service. Thus no manager
stayed long enough to ensure that a proper system was set up and to
make sound plans for crop buying and exporting or selling locally.
Under these condition~, adequate measures to pay back bank loans
were not formulated. From 1984 to 1990 the leadership of CRCU was
. very weak

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JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA VOL 17 NO 2 JULY 2002

Mchomvu, Tungazara and Maghimbi/TANZANIA

.BEPORT

The CRCU continued to make heavy loses and there were many cases
of cheating. For example a CRCU lorry leaving for Dar es Salaam could
be loaded with 10 tons of crops but, when it reached a government
checkpoint such as a weighing bridge, the load would register only 7.5
tons. Or the record in the lorry might show 10 tons but the actual
weight would read 15 tons; but no manager or board member to.ok any
measure to prevent
for
Dodoma rural district,
the point was reached when CRCU started to
default in paying its staff salaries. In March 1997 a liquidator (LART)
was appointed for CRCU and the six other unions mentioned above.

this. According to the co-operative

officer

These assets went

into receivership but the last time money was
received in March 1998 when LART handed over Tshs. 1,200,000. The
liquidator was supposed to be paid Tshs. 200.000 every month and a
watchman Tshs. 17,000 per month. Two lorries, one Fiat (10.9 tons)
and one Scania (9 tons) were handled over to the liquidator. By mid
2001 these lorries had not been sold. Before liquidation the Scania
lorry was hired out for a six month period to a businessman from Moshi
at a rate of Tshs. 650,000 per month. After one year the businessman
came to renew the contract and since then he has not been seen in
Dodoma. Before liquidation the Fiat lorry was taken to Dar es Salaam
for maintenance:
the bill came to Tshs. 1,200,000. This lorry was
dumped at Buguruni Garage and parts of the lorry were sold in bits.
All that is left is scrap ..The watchmen has left and abandoned CRCU
property worth Tshs. 13,000,000 at Gulwe. Three godowns in Kondoa
have also been abandoned. LART has so far not facilitated the liquid-
ation. By April 1997 there were 22 ex-staff who owed CRCU Tshs.
9,600,000. Trade creditors owe CRCU Tshs. 136,000,000. Peasants
and other Tanzanians understand the potentials of co-operatives
in'
improving their position but they feel they have been let down by those
in authority:
In some areas peasants are trying to reform their co-
operatives or build new ones.

Case study IT:Mvumi Makulu Zabibu Co-operative
In the Dodoma region vines grow well but there is no local market for
grapes and wine. A government wine-pressing mill was closed down

VOL 17 NO 2 JULY 2002 JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA

37

in the early 1990s ana since then the problems of the growers have
increased. In 2001 they were in the process of forming a vine growers
co-operative society (Mvumi Makulu Zabibu Co-operative Society)
in an attempt to protect their status. This has deteriorated sharply after
structural adjustment measures which have removed government
subsidies 'for crop inputs and reduced the traditional protection given
to co-operatives. The anarchist application of trade liberalization has
allowed the importation of cheap wines (mostly from South Africa)
into Tanzania to the point where the nascent local wine industry and the
security of vine growing peasants are threatened.

Co-operative now have very few members. From in-depth interviews
in the villages these appear to be the richer peasants who are able to
wait for longer periods before selling their coffee and other crops. Poor
peasants cannot do this because of pressing requirements for cash to
buy social services like health and education and for necessities like
food, cloth, kerosene and building materials. The 1991 Co-operatives
Act treats share capital as a necessary feature of business that can be
transferred seamless1y to a co-operative enterprise. Members of a co-
operative are therefore not able to exercise their rights until they have
paid their shares, their entry fees and any other dues prescribed in the
by-laws of the particular co-operative society. Although the 1991 Co-
operative Act does not explicitly state that payment of share capital is
a condition for regis.tration, co-operative officers and the local elite
have enforced this. The local elite, which consists of rich peasants, may
have its own interest in dominating other peasants socially. Thus, even
if co-operatives become economically viable, they may in the long run
provide protection only to rich peasants and not the poor majority.

The 199 I Co-operative Act recognizes 'co-operatives as private
institutions estabfished and managed by members. It also decrees that
the co-operative movement in Tanzania is based on the international
principles adopted by the International Co-operative Alliance. This act
doe not layout a prescribed co-operative structure. Strictly speaking,
therefore, when rich peasants organize themselves in co-operatives and
leave their poorer neighbours at the mercy ofthe naked market, they break
no law. There is thus a need for the Ministry of Co-operatives and Mar-

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JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA VOL 17 NO 2 JULY 2002

Mchomvu, Tungazara and Maghimbi/TANZANIA REPORT

keting to take a broader view of co-operatives as an instrument that can
help poor peasants in production and marketing, Co-operatives need to
be addressed in a broad policy framework to improve their capacity to
provide social security and economic protection. This can be done
through special schemes to help poor peasants to join by lending them
resources to buy share capital in existing co-operatives or to form their
own.

also felt

that co-operatives

institutions but are also,

Co-operatives are poorly managed but this problem is not beyond
correction. The peasants
need more
government support in auditing and supervision. We can add that the
1991 Co-operative Act misses the point. Co-operatives are not only
commercial
traditionally, mutual support
organizations. The 1991 Co-operative Act clearly states that the co-
operative society must appear commercially viable before it is registered
and a feasibility study has to be submitted with the application for regis-
tration. Under the 1982 Co-operative Act everyone living in a village
where a co-operative operated was a de facto member ofthe co-operative
society.The 1991 Co-operative Act bases membership on purely economic
criteria and members' choice and the area of operation ofa co-operative is
not defined in terms of a neighbourhood or administrative boundary, as
was the case in the 1982 Co-operative Act. The 1991 Co-operative Act
endorsed the voluntary nature of co-operation, which is one ofthe co-
operative principles, but not the social aspect of co-operation. The idea
of the strong supporting the weak in co-operation is missing.

Savings and credit societies
Besides co-operatives dealing with crops the other category of modem
co-operatives are savings and credit societies. These are very impor-
tant in light ofthe fact that most Tanzanians are absolutely poor. So far
these societies have not reached as many people as either the old or the
current crop co-operativ~s. Membership of a savings and credit co-
operative depends on a regular
income or the ability to pay and
traditionally,
therefore, these societies have drawn their members from
salaried employees.

VOL 17 NO 2 JULY 2002 JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA

39

Primary school teachers seem to be leading in the country in forming
savings and credit societies. In Dodoma and Kilimanjaro regions credit
and savings societies were noticed. In Moshi town there was a teachers
saving and credit society and one for the staff of the Northern Diocese
of the Evangelical Lutheran Church ofT;mzania. There was one for the
st-affof Co-operative College Moshi and in Dodoma one for teachers.
All these savings and credit societies function in the same way.
Members, who are employees, authorize their employers to make a
monthly contribution from their salary and send it to the savings and
credit co-operative on their behalf When members take out a loan they
authorize the employer to make a monthly deduction from their salary
thus
on their behalf and send it to the society. The contingencies
covered are many and range from the death of a family member
to
raising a small sum of capital for building part of a house or injecting
capital in a small business.

Saving and credit societies faGe problems

similar to other co-
operatives. They have very limited capital because their salaries and
thus their deductions, are small. No capital from outside has been
injected into the societies and members can borrow only after monthly
deductions and loan repayments have been made. They thus cannot
borrow on short notice and have to queue for loans which can only be
made at the end of the month. Because only small sums can be
borrowed members have not been able to break out of the vicious cycle
of continuously coptracting small loans which cannot significantly
change their economic situation. Unless there is major reorganization
ofthese co-operatives they will continue to playa small role in poverty
reduction and social security protection.

The teachers savings and credit association in Dodoma rural district
started by contributions of Tshs. 1,000 per share which has risen to
Tshs. 5,000 per share. A single member can own up to 20% of all
shares. The society has a membership of 14,000 teachers:
it is the
largest saving and credit association in the central zone of Tanzania.
Total collections in one month amounts to Tshs. 9,000,000 and the same
amount is given out each month as loans; thus very small loans are
given out. However the members felt that these loans were important.

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JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA VOL 17 NO 2 JULY 2002

Mchomvu, Tungazara and MaghimbilTANZANIA REPORT

Co-operatives and women
in this paper is that co-operatives have a great potential
The argument
in providing social protection for the household. The focus on the
peasant is not accidental but is a consequence of historical reality. Co-
operatives formed a formidable social movement in the 1950s and 1960s.
They had built up funds and could offer economic and social incentives
like scholarships to members and other peasants who lived where co-
operatives operated. Social conditions in Tanzania have not changed,
except insofar as poverty has actually increased in the 1980s and 1990s.
About 70% of the population are still small-scale peasants. The middle
class is very small, even in urban areas, where most people are petty
traders or are involved in the informal sector. The fact, however, that co-
operatives in Tanzania have always been dominated and controlled by
men is a key to one of the weaknesses of co-operatives. Since their
inception in the 1970s modern co-operatives
on the
marketing of cash crops. Colonial and post-colonial extension effort
always targeted the male head of the peasant household
as the
"farmer". Few women have thus been members of co-operatives, even
after Independence.

concentrated

The situation is the same in other countries in Africa. Government
support, devised to increase cash crop production, goes to men who
attended courses at farm institutes, are. granted loans and are taught
improved methods of crop production. Women have largely been
excluded from those benefits. Stereotypes about gender roles seriously
inhibited the capacity of women to support themselves on the land (Pahl
1988:352).

In Dod0ll!-a,Mwanza and Kilimanjaro regions it was not difficult to
observe the well-known phenomenon of the asymmetrical division of
labour between men and women. Women shoulder more than their
rightful share in producing crops,
in domestic labour and in milking
animals. In Oodoma and Mwanza men take animals to pastures. However
in Kilimanjaro this occurs only in the plains.
In the mountain zone
where most of the people live, the feeding of livestock is only done by
women. This is very laborious work, which sometimes involves much
walking. Animal fodder is not easily available because of high human

VOL 17 NO 2 JULY 2002 JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA

41

population density. Land and animals are owned and controlled by men.
Whatever security is provided by co-operatives,
they tend to favour
men and marginalize women, who provide so much of the labour in
peasant households.

In theory after the 1991 Co-operative Act women have been able to
join co-operatives on their own after paying the necessary dues.
However in real life the registered co-operative member is still the
male head of the household. Yet it is well known that, when the social
and economic condition of women improves, social protection for a
greater section of the population (including children) occurs. Much
reform is therefore needed in co-operatives to improve the status and
role of women. In Rochdalean co-operatives, encouraging women to
establish their own co-operatives may help to improve their position.
However this assumes that other reforms will be put in place,
like
changes in the social attitudes and reforms to ensure that more women
own land, animals and crops.

Conclusions: building a new co-operative
These problems are widespread all over the county. Given the reality
of the socioeconomic conditions in Tanzania we argue for strengthen-
ing the rural co-operative so that even a minimal degree of social
protection for the majority can be guaranteed.

community

The antithesis of the co-operative is the crop merchant. Quite often
these are large companies from Western Europe but there are also local
crop merchants, some of whom are involved in processing peasant
crops like cotton and cashew nuts. The way that structural adjustment
and liberalization was introduced in Tanzania left little or no protection
to the peasant co-operative. Subsidies (such as those on fertilizers)
for extremely p.oorpeople have been attacked by the World BaOk and
IMF. The strength of co-operatives in Tanzania has been reduced by
policies like structural adjustment. It is not clear why the government
cannot provide some systematic and long term protection to peasants'
co-operatives when governments in Western Europe, North America
and Asia protect their farmers and offer them subsidies. When one of
the authors of this paper visited co-operatives
in Japan in 1998, he

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Mchomvu, Tungazara and Maghimbi/TANZANIA REPORT

witnessed a very strong co-operative movement where small-scale
farmers and fishermen thrive. Ordinary co-operative members and
leaders there said that government financial support was crucial to their
success and pointed out that loans given to co-operatives by govern-
ment through local government were charged at a much lower interest
rates than those charged by financial

institutions.

Crops merchants,

unlike co-operatives,

are not bound to treat
peasants well when it comes to crop prices and other business matters,
so the strong arm of capital kills the poor peasant and forces better-
off peasants to organize against their poor neighbours. The security
and even survival of poor peasants is at risk, as they cannot single-
handedly confront crop merchants who are backed by industrial capital
and financial
The peasants feel that they have been let down when it comes to co-
operative policy. Peasants worked really hard to build co-operatives
and they had high hopes of them. The decline of co-operatives has
resulted in the decline of farming and thus a lower output. As a result
peasants are unable to build strong institutions without help.

institutions within and outside the country.

+I

I

Co-operatives have a great potential in breaking up the old division
oflabour which oppresses women and young people. Thus they can help
to liberate the whole nation if they are given the necessary organiz-
ational and financial support. The government needs to formulate clear
and long-term policies on co-operatives and peasants and others must
be confident tha( ifthey build strong co-operatives,
they will be given
legal protection. The abolition of co-operatives must end and the
authorities may even be persuaded to accept the idea that the abolition
of co-operatives
Co-operatives

advantage
because they can be flexible. They can be formed at community level
with people who know each other well. The Ministry of Co-operatives
and Marketing can help to remould all rural (peasant) co-operatives,
to
incorporate a savings and credit scheme. One of the greatest problems
for Tanzanians is the lack of credit to purchase machinery, seeds and
other inputs and to develop their farms. Co-operatives can be directed
to undertake social
inno-

in the 1970s was wrong.
have a managerial

innovations and better-planned agricultural

and organizational

VOL 17 NO 2 JULY 2002 JOURNAL OF SOCIAL DEVELOPMENT IN AFRICA

43

vations like the wider use of high-yielding varieties of seeds (HYYS),
irrigation and fertilizers. Co-operatives can thus help bring a social and
economic revolution in Tanzania through an agrarian revolution. This
will make them strong instruments of social protection for peasant
households.

The government must promote the co-operative as a movement and
as a community, ifit is to be successful (Melnyk, 1985: 135- 136). The co-
operative community can serve as the intermediate stage between
individuals and families on the one hand and the government and wider
society on the other. As they have the organizational and managerial
advantage of being small and consisting of members who know each
other well, this will help in building the trust to undertake both small
and,
large, social and
economic ventures.

later, (when there is experience and capital)

One scholar has identified barriers to the evolution of local classes
of capable entrepreneurs in Africa (Kennedy 1994: 191). Among these
barriers are obstructive and ineffective government policies and the
competitive threat from foreign. capital, endowed with considerable
advantages not available to local entrepreneurs. After the 199 I Co-
operative Act social reformers and co-operative members and potential
members expect legal reform which clearly favours the small peasant.

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