11 Nov 2021

The aim of the Citizen Enterprise Development Agency (CEDA) cooperatives product launched yesterday is to plug identified gaps in cooperative financing 

Officiating at the  launch in Gaborone, Investment, Trade and Industry Minister, Mmusi Kgafela said the financial product would include training and capacity building of cooperatives. 

He said most cooperatives in Botswana were under-capitalised which negatively affected their working capital.

“It constrains them from responding competitively to market challenges and opportunities,” he said. 

Mr Kgafela said as cooperatives sought ways of resuscitating their economic activities, CEDA financing had been availed to assist in the efforts. 

“The product therefore has come handy to close this gap by providing the appropriate seed capital to newly registered cooperatives as well as additional working capital,” he said.

 Minister Kgafela  said continued efforts were needed to encourage cooperative societies to explore viable ways of recapitalising, including increasing the share capital that members contributed as subscription. 

He said the launch of the CEDA product was a culmination of efforts to bring to the market a product that could address the challenges faced by cooperatives in Botswana. 

Minister Mmusi said since independence, government had been instrumental in the development of cooperatives, as an effective rural economic development strategy. 

He said it was evident that although cooperatives had operated in Botswana for many years, their economic impact was mixed. 

“While many of them are successful, there are equally many others, which are less successful. Government developed the Co-operative Transformation Strategy for Botswana in 2011 to resuscitate, revamp and redirect the development of cooperatives into globally competitive businesses with a human face,” he said. 

Elaborating on the product, CEDA chief executive officer, Mr Thabo Thamane said to initiate it, consultations were made with relevant stakeholders. 

He said CEDA also undertook a benchmarking exercise in Kenya and Israel exploring value chains in the agricultural sector prior to formulating the product.

 “I believe that cooperatives can sustain and even give more to the local economy like they used to do in the past,” he said. 

He said the product guidelines were available in English, Setswana and Braille. 

“As per CEDA guidelines the funding will be from P500 to P50 million,” he saidadding that funding would be extended to registered cooperatives.   

Mr Thamane said it was unfortunate that cooperatives, which were once the go-to places and sustained the economy, had become white elephants. 

He attributed the state of affairs to the  fact cooperatives were overtaken by developments and had to contend with challenges they were never designed to deal with. 

Meanwhile, Botswana Cooperatives Association chairman, Mr Thatayotlhe Mpule said its membership numbered 305. 

He said the CEDA funding had come at an opportune time and would go a long way in bettering the livelihoods of rural communities. 

“It will go a long way in helping cooperatives realise their dream of addressing the needs of the less privileged,” he said. ENDS