Determinants of the Performance of Farmers' Cooperatives in Ethiopia

Farmers' cooperatives play a crucial role in Ethiopia's agricultural development by enhancing market access, providing inputs and financial services, and improving smallholder farmers' bargaining power. Despite their potential, many cooperatives struggle due to economic, governance, and environmental challenges. While various studies have explored these issues, an up-to-date and comprehensive synthesis of the literatures is essential to aggregate those findings and explore the common themes towards the key determinants. Therefore, this review synthesizes over two decades of researches to explore the determinants of the farmers’ cooperative performance in Ethiopia, focusing on economic, institutional, social, environmental, and technological factors. Access to credit, effective governance, and social cohesion emerge as critical determinants of cooperative success. Additionally, external support and technological adoption enhance their growth, while environmental factors such as climate variability present significant risks. Then, the review concludes, most of the cooperatives perform below the expected, that collaborative work between the members themselves and the government is invaluable for increasing the efficiency of cooperatives, and in turn, achieves the ultimate goals of improving the farmers overall wellbeing. Hence, the review would like to provide policy recommendations such as strengthening cooperative governance structures, enhancing credit access, promoting adoption & technology provision, and encouraging sustainable land management practices which would increase resilience and productivity of cooperative members.