CHAPTER ONE

INTRODUCTION

1.0        BACKGROUND OF THE STUDY

In Nigeria today, poverty has become a major problem facing the country. The question has been asked, how can this problem of poverty, which is effecting our economy be alleviated. Several government bodies have been set up to find solution to that. However, it is important to find out what poverty is all about and the meaning of cooperative by different scholars, and merge the two together for us to have a clearer of the purpose of this study.

According to Oxford dictionary, poverty is a state of being poor. It is inability of a household to generate adequate income for the maintenance of the house members. That is to say, it can be defined from the point of view of income, and that is the general intake by which poverty can be evaluated. A Poor person means a person who is unable to find a job, obtain adequate income, unable to own property, and maintain a good healthy condition. This is the sign of poverty we are talking about.

On the other hand, cooperative is a phenomenon that denotes any form of working together voluntarily by persons or individuals to achieve common goals. To narrow it down cooperative refers to the activities of an association of persons with similar social, cultural and economic needs who willingly come together to

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satisfy these need in solidarity. In other words cooperative was born as a result of reaction against capitalism, competition and injustices that associated with them. Cooperatives is a purely service oriented to their members rather than profit oriented.

The cooperative members integrated their resources, for the satisfaction of their members identified need. Beside, a tree cannot make a forest; people from different places can come together and pool their resources together to satisfy their expectation.

However, based on these, cooperative is the best way of tackling the perennial economic problem of a developing country like Nigeria where a greater percentage of people live below poverty level. This is probably what informs the Federal Government in 1979 to formulate a policy guideline, that at least 25% of Nigerians should become cooperators.

The Danish people saw in cooperative as easier way of improving their national economy, especially after the war with Germany and their humiliating defeat which contributed to national poverty. They went into promotion of the economic interest of their people (Okechukwu 2001). Swedish people embraced cooperation because of the need to improve the economic interest of their people. Everybody was made to participate in one form of chosen economic activity or the others.

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In Africa, particularly in Nigeria this has made the Federal Government to have several poverty alleviation schemes such as National Agricultural Food Production Programme (NAFPP), River Basin Development Authority (RBDA), Agricultural Development Programme (ADP), Operation Feed the Nation (OFN) National Directorate of Employment (NDE), Agricultural Credit Guarantee Scheme (ACGS), National Poverty Eradication Programme (NAPED), National Economic Empowerment Strategy (NEEDS) Family Support Programme. (FSP), Better life for Rural Women, family Economic Advancement Programme, and others. Some state government, were not left out in trying to find out how poverty could be alleviated. Cooperatives as socio-economic institutions through their activities are could be a potent tool for poverty alleviation particularly in fighting poverty and unemployment. This could be in the area of agriculture, provision of infrastructural facilities and education.

Therefore in Kaduna State, particularly in Kaduna South Local Government Area, the research activity is conducted so as to know the level or the impact of cooperative in reducing poverty.

1.1        STATEMENT OF THE PROBLEM

Cooperatives are at work in almost every country and economic sector. It is generally recognized that cooperatives respond effectively to the ever-changing needs of people. For example, in response to the effects of globalization, people

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continue to choose cooperatives to address their needs. In a number of countries, people are starting new cooperative enterprises in such areas as social care and information technology. Women and youth are also choosing the cooperative form to start enterprises of their own, thus creating new jobs and opportunities. The cooperative advantage extends to the users of cooperatives and indeed to the communities in which they operate. Cooperatives set industry standards by putting into practice their values and ethics. In some countries, cooperatives are seen as leaders in promoting food safety and security, and in protecting the environment. Still in others, cooperatives are building peaceful societies by promoting understanding and collaboration among people of different cultural and income backgrounds. Indeed there is a conventional reasoning that cooperative presents the most viable channel out of poverty in developing countries.

It is in the light of the above understanding that led the Nigerian Government at all levels to promote the use of cooperative in poverty reduction efforts. Nevertheless cooperatives in Nigeria are still known to be bedeviled with problems including, lack of capital, lack of access to credit facilities, poor management, misappropriation of funds, etc. While efforts are being made by stakeholders of cooperative in Nigeria to remove and/or reduce these problems, there is an apparent consensus that the need for adequate and sufficient knowledge of the role of cooperatives in poverty alleviation still exists. For example there is a need to identify and analyse in sufficient details those cooperative activities and functions

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that bear directly on the economic empowerment of members, as well as identifying factors that could promote and enhance cooperative efforts in poverty reduction. Unless these issues are known and appreciated, the emphasis on cooperative as a poverty alleviating platform may continue to be unrealistic.

1.2        OBJECTIVES OF THE STUDY

Generally, the objective is to find out how cooperative societies in Kaduna South Local Government Area (LGA) are used as a tool for poverty alleviation.

The specific objectives include:

1.                  Examine the personal characteristics of members of cooperatives in Kaduna South LGA

2.                  To find out the type of poverty prevalent in the Kaduna South LGA.