Exploration of the Role of Ethiopia Cooperative Unions in Rural Development and their Challenges

Abstract

The study is designed to investigate the role of Ethiopian cooperative in rural-urban development and exploring the challenges. The study used in-depth interview, extensive discussion and observation for data collection from sample cooperative unions. Secondary data also used for analysis of the contribution of cooperative in development.It is found that cooperative development instigated in 1960s in Ethiopia and progressed from time to time now reaching 71,249 primary cooperative with members of 12.8 million, cooperative unions initiated in 1990s and now attaining 353 and their capital has grown from 9.9 million to 12.3 billion Ethiopian birr. These flourished cooperative unions; second level of cooperative movement in Ethiopia are grown to serve members from both urban and predominantly rural community by establishing and running 499 industries and factories in different towns of the country that serving and maintain linkage among towns and rural communities. The result reveals those cooperatives creating 181,133 salaried and 621,619 self-employment opportunities for both for urban and rural citizen of the country. Cooperative mobilized 12.3 billion birr capital through promoting thrift, mobilize membership share capital and retained earnings from business which are re-invested in urban area for benefiting members which also contributing for urban development. Besides these cooperative promoting democratic management through application of international cooperative principles and accepted cooperative governance pillars; accountability, transparency, participation and integrity from which the urban development shared experiences.