The Phata Cooperative

Noticing that a neighbouring community was thriving by growing sugarcane, a community in the poor region of southern Malawi discussed with their elders if they too could do it. They approached an agricultural management firm for guidance. The firm identified a source of funds to buy the irrigation equipment: a grant facility of the EU. The government had given grants and loans to many communities but not all of them had succeeded. They could get 3.2 million dollars grant, but they had to contribute half a million dollars, which they did not have. A social impact investor came to their help. With the agricultural management firm managing the collective farm, the cooperative could repay the loans and offer income to its members several folds greater than what they earned from cultivating rainfed crops. A case to consider whether outsourcing management is an option to make smallholder cooperatives successful.