MAMSERA, Tanzania – In the foothills of Mount Kilimanjaro, the single-storey building housing the Mamsera Rural Cooperative Society is at the heart of community life in this coffee-growing village. Here, villagers bring their harvest of coffee beans to be weighed and graded and then taken down the unmade road to the town of Moshi, where the coffee auctions take place.

Inside the coop's office, Mr Camili Mariki, the assistant secretary, points to his mobile phone which, he explains, keeps him in touch with current coffee prices at the market. It enables him and his colleagues to try to ensure that the village's coffee beans are taken to market at the best possible time. Typically, coffee will fetch between 1,500 and 2,000 Tanzanian shillings a kilo (around US$1.50), though the coop has on occasion received more than US$2 a kilo. Current prices are chalked up each day on the large blackboard outside the coop building for all to see.

Mamsera's cooperative has about 1,100 members who meet once a year, usually in March or April, to discuss the budget for the year ahead and to agree the mark-up the coop will take to cover its overheads. The day-to-day management is delegated to an elected nine-person Board, who in turn oversee the work of the five employees.

"We're standing on our own feet," says Mr Mariki with pride, adding that the coop has built up over 30 million shillings ($28,000) in bank deposits. The strength of the enterprise means that Mamsera's coop can expand its horizons: one idea currently being discussed is to sell coffee direct to the European market, eliminating some of the costs involved in selling through Moshi. The coop has already learned that it has to be ready to adapt. Coffee production has declined in recent years, and to compensate the coop has diversified its activities by beginning a small-scale brick manufacture business. The coop also operates two local shops as well as acting as agent for agricultural fertilizers, pesticides and seeds.

A model of reform

It's a success story which unfortunately is not universally the case in Tanzania. "Some neighbouring cooperative societies have nearly collapsed," Mr Mariki says, pointing to the financial problems they have suffered from being over-dependent on a single primary crop.

Tanzania's cooperatives have a long and proud history which goes back to the early 1930s. In the first decade of independence, the movement was particularly strong, with a complex structure of primary coops, secondary coop organizations and a national cooperative bank. Since then, however, the story has been less happy. For a period, coops became a tool for top-down governmental policies and were effectively integrated into state structures. By the time trade liberalization was introduced in the 1990s, the cooperative movement had become unresponsive to its members' needs and was unprepared for competition from the private sector.

A turning point came in the year 2000, when a special Commission was established by the then Tanzanian President Benjamin Mkapa to investigate what could be done to rejuvenate the country's cooperative sector. The Commission was blunt in its critique of the movement, which it said suffered from a lack of capital, unwieldy structures and problems with poor leadership, misappropriation and theft.

Since then, a series of concerted steps have been taken to overcome this legacy. New coop legislation, which among other things aims to strengthen member participation and democracy, was passed in 2003, whilst last year the government approved an overarching initiative, the Cooperative Reform and Modernization Programme (CRMP). Designed with assistance from the ILO, the CRMP has, in its own words, the objective of a "comprehensive transformation of Cooperatives, to become organizations which are member owned and controlled, competitive, viable, sustainable and with capacity for fulfilling members' economic and social needs". Member empowerment and commercial viability are seen as the two central themes of this reform agenda.

Whilst Mamsera's example demonstrates the advantages which agricultural coops can bring in rural areas, manufacturing coops are also a feature of urban areas of Tanzania. In Dar es Salaam, for example, Dasico (Dar es Salaam Small Industries Cooperative) is a thriving venture, currently with 398 members, which engages in a range of activities including carpentry, metalwork, paper bag manufacture and welding. Dasico members have access to health facilities in the workplace and the coop provides insurance protection against sickness and death.

More significant, perhaps, is the network of credit unions, known in Tanzania as Savings and Credit Cooperative Societies, SACCOs. There are about 1,400 registered SACCOs, ranging from community-based initiatives recruiting members working in the informal economy to workplace-based SACCOs. One of these is Posta na Simu, Tanzania's largest coop, which provides savings and loans services to employees of Tanzania Telecommunication Company, Tanzania Postal Company, the Postal Bank and the Communication Regulation Authority. Posta na Simu is also aware of the need for coops to adapt to changing times: with widespread redundancies a current feature of the telecoms sector, the SACCO is changing its approach so that, among other things, it can assist members who want to set up their own businesses.

Seeds of change

Implementing the Cooperative Reform and Modernization Programme, which is intended to run from 2005-2015, is an ambitious task which has already attracted some Tanzanian government funding but which will probably also require donor finance if it is to be successful. A start has been made, however, at the grassroots, in moves which aim to reinvigorate the democratic principles of cooperation.

Each coop in selected regions of the country has recently been required to call a special general meeting of members at which new Board elections take place. Candidates for these leadership positions submit themselves to their coop in an election process which is carefully monitored by Tanzania's Registrar of Cooperatives and his staff. Would-be leaders who have been associated previously with maladministration or corruption, or who possess insufficient experience and skills, are ineligible to stand.

The election process has yet to be extended to coops throughout the whole of Tanzania.

Still, Dr Anacleti Kashuliza, Registrar of Cooperatives, says the elections have acted as a clear signal both to old-guard leaders and to coop members themselves that the old ways are changing. He describes the atmosphere at one lively election meeting held recently for a coop in the Shinyanga region as typical: "1,000 coop members turned up to elect the leadership. You feel, there's something happening here," he says.