At #7 in the world, Kenya's co-op sector is a model for African economies

Written by Sarah Crozier/NCBA CLUSA

NCBA CLUSA’s Alex Serrano addresses attendees at Nairobi’s Uhuru Park during International Day of Cooperative celebrations.NCBA CLUSA’s Alex Serrano addresses attendees at Nairobi’s Uhuru Park during International Day of Cooperative celebrations.NCBA CLUSA’s Alex Serrano addresses attendees at Nairobi’s Uhuru Park during International Day of Cooperative celebrations.At one of the largest International Day of Cooperatives celebrations worldwide, over 25,000 co-op members and supporters gathered at Uhuru Park in Nairobi July 1, 2017 to celebrate the importance of co-ops in the Kenyan economy.

Known locally as Ushirika Day, the annual observance day is a chance to reflect on the achievements of the cooperative movement. During the celebration, the Cooperative Alliance of Kenya released its revamped The Co-operative Magazine, featuring the commitment of Kenya’s President Uhuru Kenyatta to the cooperative movement in the country. 

Part of that commitment includes channeling funds for women, youth and other vulnerable groups through cooperative financial institutions like credit unions—or, as they are known locally, Savings and Credit Cooperative Associations (SACCOs). This is a priority for the government’s Commissioner of Co-op Development Mary Mungai, who attended International Day of Cooperatives celebrations and is the first women elected to the position.

Savings and co-operative societies currently control more than 30 percent of Kenyan national savings and contribute over 40 percent of the country’s Gross Domestic Product. According to local Kenyan news outlet The Star, two-thirds of Kenyans benefit directly or indirectly from the country's cooperative movement. 

“This has led to the Kenya's cooperative movement being rated seventh in the world and number one in Africa,” Ali Noor Ismail, Principle Secretary of the State Department of Co-operative Development, said in an interview with The Star ahead of the event.

“My government is therefore counting on the cooperative enterprises to drive the economic development agenda of this country beyond what we have achieved so far,” said the Cabinet Secretary for Trade, Industry and Co-operatives Adan Mohamed, in a speech read on behalf of President Uhuru.

NCBA CLUSA’s Alex Serrano and Steve Otieno were on hand at Uhuru park as major partners in this government support. NCBA CLUSA’s Cooperative Development Project, funded by the U.S. Agency for International Development (USAID), signed an MOU earlier this year to support Kenya’s co-op sector. Support of the Cooperative Alliance of Kenya was formalized with an MOU on July 1. 

During his address, Serrano congratulated Kenyan cooperatives for their effort to apply cooperative and community-owned solutions to current problems. Kenya’s role in increasing the awareness of the cooperative business model and working with youth—helping them to use co-ops to access jobs, services and skills—is impressive, Serrano said. He also applauded the spirit of the cooperative movement in Kenya, noting that representatives from all sectors travelled great distances to attend the celebration.

This partnership will help ensure a positive role for cooperative societies in achieving the country’s development objectives under Kenya’s Vision 2030. To date, the movement has mobilized savings of over 600 billion Kenyan shillings. The State Department for Co-operatives has registered over 22,000 co-ops with a total membership of 14 million. The sector employs more than 500,000 Kenyans. This partnership will seek to unlock the potential of the co-op sector through inclusive economic growth and improved livelihoods for Kenyans more broadly.