Co-operatives in Africa have been given a significant boost this year, with legislation now in place to serve as a guide and an advocacy tool for the development and review of co-operative legislation – and the opening of the African Cooperatives Centre (ACC) in Midrand, South Africa.
The ACC was launched in September at the Pan-African Parliament (PAP) in Midrand, South Africa. During the opening event, Lindiwe Khumalo, PAP clerk, highlighted how the centre “will serve as a continental hub for knowledge exchange, best practice exchange, capacity building, training and advocacy for co-operatives and other SSE entities to learn from each other, and collectively address the challenges facing social protection in Africa.”
Earlier in the summer, the PAP adopted a Model Law on Cooperatives for Africa, which aims to harmonise co-operative legislation and practice across Africa, providing a reference point for those looking to incorporate best practices in their co-operative laws.
The process began in 2019, when conversations between the International Cooperative Alliance – Africa (ICA Africa) and the PAP Monetary and Financial Affairs Committee explored the possibility of adopting a model law on co-operative enterprises for African countries. In November 2022, the PAP Plenary approved a proposal by the Committee on Monetary and Financial Affairs to develop the law. As part of the consultation process, a meeting was organised in August 2023, in Nairobi, Kenya, by the PAP Committee on Monetary and Financial Affairs in collaboration with the ICA Africa. The meeting brought together various stakeholders who reviewed the proposed draft model law, with the aim of enhancing its comprehensiveness and relevance.
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“The African Union recognises co-operatives as private business organisations that are unique in that their owners democratically control and benefit from them,” the PAP wrote at the time. “They are value and principle-driven organisations that put the social and economic interests of their members at their core. Given their nature, these co-operatives are ideal for fighting poverty and bringing about social cohesion.”
The PAP added that the proposed Model Law stemmed from “the realisation that for co-operatives to play their role effectively, they must operate in enabling environments that foster their growth.” The enabling environment is usually created by national laws that set out regulatory frameworks and other matters related to the setting up and operation of co-operatives.
The problem here, according to ICA Africa’s 2023-2033 Strategy ‘One Africa – One Co-operative’, is that until now, “most co-operative policies, legislation and strategies are the offshoots of colonial Africa. They have maintained provisions which restrict autonomy and dynamism in the co-operative business.” And because of this, “the African co-operative movement is challenged in terms of identity promotion and preservation”.
To address this, the strategy focuses on three areas: the promotion of co-operative identity, co-operation among co-operatives, and institutional capacity for effective service delivery. Could the new model law help to achieve this?
ICA Africa sees it as a vital moment for the future of co-operation in the region.
“In a legal framework study in 18 African countries, supported by the ICA-EU partnership, it was revealed that there are patterns of enabling and disabling legal provisions for co-operatives across countries,” said an ICA-Africa spokesperson. “Some of the main challenges include overregulation, political interference into co-operative affairs, the existence of co-operative legislation that does not adhere to co-operative values and principles, and ineffective regulatory bodies.
“It is, therefore, crucial to have an adequate enabling environment for co-ops – but this requires legislative frameworks that acknowledge the specificities of co-operatives and their unique identity, and facilitate the translation of the co-operative definition, values and principles into laws that guide actions taken by co-operatives.”
ICA-Africa believes the model law could be an important tool for pushing “uniformity and harmonisation” of co-operative legislation in Africa – and would be particularly helpful for revising outdated co-operative legislation.
“We also look forward to the formation of a complementary regional binding treaty or a similar instrument in the near future,” said the spokesperson, adding that the law is also an opportunity to “address well-documented challenges faced by co-operatives and establish a clear guideline that can enhance their formation, operation, and governance.”
During the adoption event in Midrand, the committee made recommendations to adopt the Model Law and continue sensitisation and capacity-building activities. “The Committee, under the Bureau’s leadership, will also promote endorsement, use, and dissemination by African Union member states,” said Mohammed Mubarak Muntaka, chair of the Committee on Monetary and Financial Affairs. “We request members of the Pan-African Parliament to pioneer the domestication and use of the Model Law on Co-operatives in their respective parliaments.”
In adopting the Model Law, MPs called on members to introduce and implement the law in their respective countries.
“This is a game-changer for the African co-operative sector,” said High Chief Ayeola, president of ICA-Africa. “This law will strengthen the co-operative identity in Africa by providing a common legal foundation, enhancing governance, transparency and accountability.
“We are proud of the collaborative process that led to the development of this law. It is a true reflection of the co-operative spirit. The collaboration between the Pan Africa Parliament, ICA Africa and the invaluable input from co-operative stakeholders culminated in a legal framework that reflects the needs and aspirations of co-operatives across the continent. The Model Law provides a solid foundation for the growth and development of co-operatives across the continent.
“As we celebrate this victory, we recognise that the real work begins now. We must now focus on implementing this law effectively and ensuring that its benefits empower co-operatives even at the grassroots level.”
Dr Chiyoge Sifa, regional director, ICA-Africa, agreed that the adoption of the Model Law is a significant step forward for the co-operative sector in Africa. “It is a blueprint for harmonising co-operative legislation, ensuring consistency and fairness for co-operatives operating in different countries in Africa,” she said.
“This will foster a level playing field, enabling co-operatives to grow and contribute more effectively to Africa’s economic and social development.
“By providing a clear roadmap for co-operative governance and operations, the Model Law empowers co-operatives to better serve their members and communities. We are particularly excited about the potential of this law to strengthen the co-operative identity and build a stronger, more united co-operative movement in Africa.”
Main photo: Delegates at the opening of the African Cooperatives Centre (image: Pan African Parliament)
