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Co-operation in the Mountain Kingdom
I suspect that few readers will be readily able to point to Lesotho on a map. It is a small mountain kingdom, land locked by the Republic of South Africa and the only independent state in the world that lies entirely above 1,000 metres in elevation,. It not only has a diverse co-operative sector, but it has been pioneering ways of involving students and young people with the help of the Co-operative College. In this article, Mervyn Wilson, Chief Executive and Principal, looks at co-operation in the mountain kingdom, its history and prospects.
Lesotho has a population of just under 2 million. Accurate statistics are difficult, as it has one of the highest rates of HIV/AIDS infection in sub-Saharan Africa, now estimated at about 29% of the population. This has resulted in a sharply falling life expectancy now down to 35 years compared to 48 in 2001. Life expectancy at birth in the UK is 75 years. Lesotho lies 175th in the UNDP life expectancy listings – there are just two countries below it. It is also a poor country, ranked 149th out of 177 in the UNDP Human Development Index which is a comparative measure taking into account life expectancy, literacy, education and standard of living.
It has also had more than its fair share of political instability, including internal military coups, external military intervention and civil disturbances, which have all impacted by disrupting economic life. Today though the military have returned to the barracks and undertaken to support the democratically elected Government. The Government is clear of the need for self-help solutions to lift and keep people out of poverty and drive economic progress, and recognises the distinct contribution that co-operatives can make to that strategy.
The co-operative movement is nothing new in Lesotho. Co-operation started when it was a British protectorate, with the first co-operative registered in 1948. It specialised in wool and mohair products, marketing them to the overseas market via South Africa. In the following years marketing co-operatives grew strongly, followed later by the formation of consumer co-operatives and then in turn the Basutoland (as Lesotho was formerly known) Co-operative Banking Union. BCBU was so successful that it came under significant political pressure orchestrated through the country’s Chamber of Commerce and in 1963 BCBU was declared insolvent by the Registrar.
Arguments continue to this day as to whether the Bank was genuinely insolvent, or if the Registrar bowed to political pressure. Either way, it was a blow to the growing co-operative movement.
After independence in 1967, a number of highly committed co-operators in the country became more politically active, and leadership within the co-operative movement weakened. A number of co-operatives got into difficulties.
In the 1970s, the Lesotho Co-operative Union was founded, and acted not only as an apex body such as Co-operatives UK, but also a central supply and marketing organisation. Sadly it was dissolved in the huge political and economic changes that beset Lesotho throughout the 1980s and 1990s, and the movement struggled to maintain cohesion.
As in so many other parts of the world, the destruction of apex organisations in the so-called ‘liberalisation’ or ‘structural adjustment’ period of the 1990s did not extinguish the flames of co-operation. Whilst central Co-operative Unions disappeared, some of the stronger primary level co-operative societies survived. Following the return to democracy greater priority was given by the Government to strengthening the co-operative sector led by the Department of Co-operatives within the Ministry of Trade, Industry, Co-operatives and Marketing.
The Lesotho Co-operative College operates as the education and training division of the Department, with other divisions for audit, savings and credit, legal and entrepreneurship development. The divisions dealing with education, training and entrepreneurship development show the commitment of the Government not simply to regulate co-operatives, but to support their development. This process is led by a team of extension officers who develop member education and provide village based courses to support co-operatives, together with short residentials, often held at the Co-operative College.
The Department of Co-operatives recently completed work with the ICA Regional Office to update its data to try to accurately determine the size and vibrancy of co-operatives across the country. It categorises co-operatives as either active, which are vibrant and have active member participation, or dormant societies that may still have members but do not appear to hold members meetings or have regular income from their core activities. They also separately categorise new co-operatives, those less than a year old, for which it is difficult to obtain accurate data.
The initial findings, with about 80% of the research complete, can be interpreted in different ways. If you were a pessimist you would be to say that 80% of the co-operatives were found to be dormant. If you were an optimist you would say that the research found that there were at least 247 active co-operatives in Lesotho. In the capital Maseru 63 co-operatives were active in a city of just over 200,000 people.
It is also encouraging that there are active co-operatives in every part of the Kingdom. There are 36,000 members of co-operatives in Lesotho, 11,000 plus (just over 30%) in the active societies, of which 60% are women and 41% men. Co-operatives still operate in a range of sectors, with multi-purpose co-operatives being the strongest, 159 active in total. Probably the most influential co-operatives are the savings and credit co-operatives (SACCOS) with 20 active. These are crucial tools for poor people who use small savings for small business needs, to fund education (secondary education is not free) and for medical needs. Other co-operative sectors include handicrafts, agriculture, service providers and industrial co-operatives.
Lesotho Co-operative Handicrafts operates in Maseru. It is a secondary co-operative dating from the 1970s marketing ethnic handicrafts made by primary co-operatives around the country. The 18 primary co-operatives produce a range of handicrafts including basket weaving, pottery making, and mohair tapestries which are sold both inside and outside the country, with particularly strong markets in Germany and the United States. 90% of the co-operatives membership is women, and one of the challenges they face as they try to develop the business is that many of the traditional handicrafts are a cash income generator that is effectively a second job after members tend to their agricultural needs.
The co-operative has overcome serious difficulties in the past, and remains one of the longer established co-operatives in the capital.
The Thulare Dairy Farmers Co-operative Society is located in a rural area about 50 kilometres from the capital. It developed through outreach adult education provided by a school, with the help of the Co-operative Department. Founded in 1994, it now has over 280 members organised into local farmer associations. It provides vocational training to help the development of the local associations, and has had an innovative programme of peer education to get farmers to share good practice with other farmers, to raise standards and improve income generation.
The membership includes poultry farmers, vegetable producers and pig producers, and its services include training workshops, a revolving loan fund, and a small credit scheme.
The Thulare Co-operative recognises the critical importance of training and raising standards, and has arranged visits to other farming societies to gather experience, particularly from South Africa, but also to the Netherlands. It also helps farmers associations to market surplus produce, taking advantage of events and activities to sell bottled fruit and other produce, including the recent International Co-operative Day celebrations. It also sells products such as milks and eggs to local schools.
Under inspiring leadership from the school, it has used funding it obtained as a prize in a national competition to establish a cell phone system to enable communication to all of the associations in membership, something critically important in the remote mountainous communities. It also has visions for future income generating activities, and now runs classes in yogurt making, and is seeking to gain experience in cheese making so that farmers can add value to their products.
The Lesotho Township Co-operative Credit Union was founded in 1964. It was developed with support from the Canadian Credit Union movement and today has over 1,400 members, mostly women. Most of its members are street vendors in the busy streets of Maseru, including sewers, knitters and small businesses. Members use the SACCO to save for investments to develop their businesses, to pay school fees, as although the fees are modest for secondary education, they are still prohibitive to many families. Other key reasons for loans include building homes, buying seeds and fertilisers and medical costs. The SACCO now has its own building, something its members are immensely proud of.
The credit union has clearly learnt from the difficulties experienced in both Lesotho and other parts of the world, and a prominent sign on the wall reads “The greatest threat to the survival of a credit union is the Board of Directors”, a lesson many other co-operatives around the world could learn.
The people of Lesotho are immensely proud of their co-operative movement. They have survived serious setbacks, and remain a powerful tool to lift and keep people out of poverty. They remember with great affection the role played by the UK in establishing co-operatives in their country. In opening the Student Co-operative Forum, the Minister specifically referred to Bert Youngjohns, the first Commissioner of Co-operatives in Lesotho and the role he played in supporting co-operative development the newly independent state as the process of decolonisation took place.
It is far too early to say there is a flourishing co-operative sector in Lesotho, and there are clearly enormous challenges in rejuvenating the membership of the co-operatives that have survived. What is clear is that there is an imaginative and supportive infrastructure from the Department of Co-operatives, and a real desire to use self-help as a vehicle to alleviate poverty. The spirit of co-operation remains alive in Lesotho and deserves nurturing so that its benefits can be fully realised.
Mervyn Wilson
July 2007