Home Business & Tech Rwandan Cooperatives Challenged to Transform into Profitable, Professional Business Entities

Rwandan Cooperatives Challenged to Transform into Profitable, Professional Business Entities

by Edmund Kagire
2:49 am

Many actors in the cooperative sector recognize a serious lag within Rwandan cooperatives in embracing Good Management and Leadership practices needed for the cooperatives to move from the conventional ways of running and managing their businesses to full professionalism.

In addition, cooperative organizations need to make adaptations as regard to the legal framework which recently underwent considerable changes including the 2020 National cooperative strategy and the 2021 new cooperative law.

The 4-day Cooperative Leadership Seminar themed ‘Enhancing performance of Rwandan Cooperatives’ was organised by Venture37’s USAID-funded Cooperative Development Activity 4-CD4 in collaboration with Rwanda Cooperative Agency (RCA) and the Rwanda Institute of Cooperatives, Microfinance and Entrepreneurship (RICEM).

The seminar, the second of its kind, was aimed at equipping leaders of at least 100 Rwandan cooperatives with innovative leadership, managerial and business development skills needed to transform their cooperatives into profitable and professional businesses, in line with the new law.

The cooperative organizations were sensitized on the new law N° 024/2021 of 27/04/2021 governing cooperatives in Rwanda and they were trained on cooperative governance, particularly on strategic leadership, professional management, resilience, recovery from COVID19 and financial planning and budgeting, among other aspects.

The seminar also touched on capacity building in cooperatives, audit and internal controls, access to markets as well as challenges and opportunities.

Speaking at the closing ceremony of the seminar on Friday, December 10, 2021, Willy Nyirigira, the Land O’Lakes Venture37 Deputy Chief of Party, said that the annual activity was aimed at sensitizing cooperatives on the law as well as professionalizing what they do for improved outcomes.

“This activity was aimed at equipping leaders of cooperatives from across the country with key skills and knowledge to make their cooperatives more professional and profitable, to spur growth for the members,”

“As indicated in the new law governing cooperatives, the Government of Rwanda wants to see cooperatives become more organised and profitable ventures, operating in a formal and accountable manner,” Nyirigira said.

Nyirigira said that the vision of the government and partners is to see cooperatives become a vehicle of development, not just for the individual members but also for the country’s socio-economic development.

Nyirigira called on cooperatives to utilise the skills attained and transform their cooperatives into profitable organisations.

He reminded the cooperative representatives who attended the seminar to share the knowledge and skills learned and recalled the cooperative leaders to be the champion of cooperative transformation. He emphasized on applying good management and leadership practices and lessons learned during the seminar in their respective cooperative organizations.

Representing the Ministry of Trade and Industry, Aimee Marie Ange Tumukunde, the Cooperatives Policy Specialist at MINICOM said that the new law, coupled with the new skills, will make the sector more efficient.

“We have no doubt that this training will contribute greatly towards the growth of your cooperatives. You have been equipped with the skills and knowledge and you now understand what the law requires of you,” Tumukunde said.

“The Government of Rwanda values the contribution of cooperatives in the socio-economic development of the country but it also understands the need to improve and empower further the cooperative sector, to fully tap into its potential,” she added

Tumukunde, representing MINICOM, said that the government considers Coops drivers of socio-economic development.

“It is for this reason that the Government started the process of amending the law governing cooperatives to make it more effective and enforce principles of accountability and professional management,”

The Director General of RCA, Prof. Jean Bosco Harelimana, urged cooperatives to adhere to the requirements of the new law, which came to streamline the way they operate, enforce accountability and responsibility and ownership, as opposed to how they were previously run.

“From this training, we believe you have everything it takes to go and overhaul the way you operated and introduce structures in your cooperatives that will ensure that you are accountable to your members,”

“The Government of Rwanda believes that if you do what is expected of you by the law, you will not just develop yourselves as members but it will also have a trickle-down effect on the economy. This means that you have to be more efficient and effective in what you do,” Prof. Harelimana said.

Prof. Halerimana said the Government revised the law to overhaul the Coop sector, which was performing below par.

The RCA head said that the new law eased the requirements of registering a cooperative, introducing special categories of people that can registered with a fewer number of people that previously required.

The special categories include women, youth, people living with disabilities, demobilised members of the armed forces and Rwandans in diaspora, who can now register a cooperative with a minimum number of 5 people instead of the usual 10.

Prosperity awaits

Jean Claude Uwitonze, RICEM Program manager, pointed out that the new law is timely and comes at the time when the management of cooperatives needed to be overhauled, to make them more beneficial to the members.

“The law leaves no loopholes of mismanagement, redundancy and lack of accountability, which has previously impacted the performance of the cooperative sector. All this has to change by law,”

RICEM vowed to continue with sensitisation and capacity building mechanisms to make the coops more adherent to the law which is expected to usher in prosperity and development, emanating from effective and efficient management.

Uwitonze from RICEM said more capacity building is needed to further improve the performance of cooperatives.

Members of the Cooperatives said the training help them gain much needed skills to transform their activities for the better.

Peninnah Mutuyimana, representing Cooperative Kama, located in Shangasha sector, Gicumbi district said that during the four days, they were able to learn what the new law governing cooperatives will offer more benefits for coops.

“From the training opened our eyes to things which we never paid attention to before yet they hampered our progress and held us back. There are cases where committees are not accountable to members and take unilateral decisions,”

“In other cases, the mandate of the committee would end and they would just stay put without informing members. Under the law, this will change. The law is very clear and it will help reform the sector,” Mutuyimana said.

The Rwandan cooperative sector continues to grow at a high pace. Current data shows that there are more than 10,000 registered cooperatives, bringing together around 4 million cooperative members.

However, shortfalls in the sector have been registered in the past, including lack of accountability and ownership, which often left members counting losses due to mismanagement and misappropriation of resources.

The law, which is complemented by the 2020 National Cooperative Strategy is aimed at strengthening the cooperative sector and make it more transparent to safeguard members against losses.

The training, which was held at RICEM Kabusunzu Campus brought together over 100 representatives of cooperatives

The law N° 024/2021 of 27/04/2021 governing cooperatives in Rwanda, which was published in the Official Gazette on 14/05/2021, is expected to transform the cooperative sector in the next few years and make it more lucrative for members.



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