World Council & Swaziland to Host 5th Africa SACCA Congress

February 16, 2004

Madison, WI—The 2004 location of the African SACCA Congress was announced during the National Congress of the Swaziland Association of Savings and Credit Cooperatives (SASCCO). World Council of Credit Unions, Inc. (WOCCU) and SASCCO will co- host the 5th Africa SACCA Congress in the Kingdom of Swaziland, September 20-24, 2004.

The Africa SACCA Congress has become the annual regional congress for credit union (SACCO)leaders in Africa, attracting on average 250 participants from all over the continent. In previous years the congress has been held in South Africa, Kenya, Ghana and most recently Uganda.

SASCCO's president, Absalom Dlamini and chief executive, Bongani Masuko along with 135 participants of the National Congress, expressed their enthusiasm and commitment to co-hosting the 5th Africa Congress in their country. SASCCO represents 36 SACCOs, serving approximately 28,000 members with $27 million in savings, $23 million in loans and $33 million in assets.

Arthur Arnold, WOCCU president and CEO was one on the keynote speakers, along with the Honorable Obed Dlamini, member of Parliament and the former Prime Minister. During his presentation SACCOs are the Engines for Growth Arnold presented four recommendations to the National Congress:

1. Opening up the common bond (34 out of the 36 SACCOS are employer based SACCOs) to achieve further growth and outreach. Growth is limited because of retrenchments/lay-offs as well as the impact of HIV/AIDS. However, there are a number of issues to be addressed when opening up common bond SACCOs.

2. Financial discipline by using WOCCU's monitoring system, PEARLS, improving the soundness and safety of the SACCOs in Swaziland.

3. Reaching out to the rural areas expanding existing SACCOs and forming new SACCOs in those areas, at the same time providing rural finance products and services.

4. Addressing the impact of HIV/AIDS -- 1 out of 4 people of Swaziland is infected by the disease. In one of the SACCOs that Arnold and Eric Sile, WOCCU technical officer visited, 25 members of the 600 (more than 4 %) died in 2003 because of AIDS. It is expected that these numbers will grow in 2004 and the following years. Members, board members, management and staff of SACCOs will die in the coming years, creating enormous challenges for SACCOs to survive.

In his closing remarks, Arnold complimented the SACCO leaders for the overall combined sound Loans to Savings ratio of 85 %, demonstrating the strength of savings mobilization and the prudence in lending of the SACCOs in Swaziland (the Loans to Savings ratio stands at an unsustainable rate of 104 for the whole of Africa). The high degree of active participation by the participants, including by many young SACCO leaders present, was very encouraging.

In separate presentations, Sile took the audience through 15 key ratios of the PEARLS system for two SACCOs in Swaziland, comparing the figures to the PEARLS benchmarks.

Arnold also presented WOCCU's first approach to Good Governance Best Practice Principles, a subject that the Swazi themselves had identified as a major issue in their movement. Arnold stated, "Good governance is the best way to fight enemy number one of development and obstacle number one for growth--Corruption!"

At the close of the meeting Arnold and Sile met with the Commissioner for Cooperative Development, Wilson Ginindza, responsible for the supervision of SACCOs and part of the Ministry of Agriculture. Arnold emphasized the need for minimum prudential standards for SACCOs, as financial cooperatives, which at present are lacking in Swaziland. The present SACCO law is from 1964. Arnold continued, "Running a financial cooperative is a very different business from running an agricultural cooperative."

World Council of Credit Unions is the global trade association and development agency for credit unions. World Council promotes the sustainable development of credit unions and other financial cooperatives around the world to empower people through access to high quality and affordable financial services. World Council advocates on behalf of the global credit union system before international organizations and works with national governments to improve legislation and regulation. Its technical assistance programs introduce new tools and technologies to strengthen credit unions' financial performance and increase their outreach.

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