Cooperative Bank ushers in new era for agriculture

DODOMA: TANZANIA has taken a decisive step towards revitalising its cooperative societies and significantly boosting agricultural financing with the inauguration of the Cooperative Bank Tanzania (CBT) in Dodoma on Monday.

This pivotal moment, a result of collaboration between the government and the private sector, signals a strong commitment to empowering the nation’s agricultural sector.

Speaking at the launch, President Samia Suluhu Hassan emphasised the CBT’s crucial role in supporting underserved communities, particularly the nation’s small-scale farmers, by providing them with the affordable financial tools needed to overcome challenges and thrive in their agricultural endeavours.

Supporting smallholder farmers makes sound economic sense: They contribute over 75 per cent of Tanzania’s total agricultural output.

They dominate the which accounts for over a quarter of the country’s GDP and which provides livelihoods for a significant portion of the population.

Furthermore, it plays a vital role in national food security, supplies 65 per cent of the raw materials needed by the industrial sector and accounts for 30 per cent of the nation’s exports.

We therefore view the establishment of the CBT as a critical milestone in the broader strategy to boost growth of the agricultural sector.

The inauguration of the bank evokes nostalgic memories of the late 1960s, a golden era when Tanzania proudly possessed the largest cooperative movement in Africa and was the third largest globally in terms of agricultural export market share.

Historical studies reveal the remarkable reach of the cooperative movement in Tanganyika during that period, with cooperatives managing 49 per cent of the country’s annual exports.

Only Israel and Denmark had cooperative systems that handled a greater proportion of their nations’ overseas trade.

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Further research highlights the success of Tanzanian peasant cooperatives in effectively organising markets for their members and providing essential inputs at affordable costs, leading to a significant boom in both cash and food crop production.

Remarkably, between 1954 and 1968, Tanganyika stood out as the only African state that consistently achieved a food production growth rate exceeding its population growth.

We are optimistic that the CBT will act as a powerful catalyst in the ongoing efforts to revive cooperative societies and inject much-needed financing into agricultural activities.

We hope newly launched Cooperative Bank will be a crucial cog in this broader cooperative drive, providing the financial engine to reignite that era of agricultural prosperity of the 1960s.

Echoing President Samia’s wise counsel, it is paramount that the CBT operates with the same diligence, transparency and adherence to regulations as any other reputable financial institution, fully complying with the Bank of Tanzania’s (BoT) guidelines to guarantee its long-term sustainability and profound impact on the nation’s agricultural landscape.