ETHIOPIAN COOPERATIVES 23
The main constraint faced by the Cooperative is the dearth of appro- priate financial resources. Because of the lack of appropriate storage and transportation, the organization is forced to sell outputs in May instead of waiting for higher prices in September. Although there are several potential partners operating in the woreda (such as the Rural Financial Intermediation Program and World Vision, an international NGO), the Cooperative has not yet been able to secure credit to invest in needed equipment.
Source: Key informant interviews conducted by the authors as part of ECS (2006).
Box 2.2
Awara Cooperative
The Awara Cooperative is located 8 kilometers from Aje, capital of the remote woreda of Siraro. The organization was created in February 2005 to help farmers get timely access to seeds and fertilizers. The organi- zation significantly benefited from initial help from the woreda office of the regional BoCP, which gave members training on the importance of cooperatives in helping smallholders. Immediately after its establish- ment, the Cooperative received 127 quintals of fertilizer on credit from the woreda office of the BoARD.
The organization also aims to provide marketing services to its mem- bers, buying from them at higher-than-market prices after the harvest and selling on the market when prices are more favorable. Safe storage is ensured through renting appropriate local warehouse facilities (1,000 birr per year for 214 quintals of maize). Price information is collected on the nearby markets of Shashemene and Aje through an informal net- work of individual traders who are known to the members. In 2005 the Cooperative purchased maize from its members at 105 birr per quintal at a time when the market price was 100 birr per quintal. Members are not forced to supply all their produce to the Coopera- tive; in the future, however, dividends will be paid according to the volume of grain supplied. To date, nonmembers have not been permit- ted to sell their produce to the Cooperative; this should change once the organization’s financial capacity is stronger.
Membership in the Cooperative is open to anyone, provided he or she is free of debt and can reliably repay a loan. Initially the registra-
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