Analyzing the contribution of higher learning institutions on rural development in Rwanda: case of the study SPREAD-NUR and Abahuzamugambi Coffee Cooperative Maraba

2.4. Rural Banks, Credit Cooperatives, and development of rural markets

A second approach to the problem of providing rural areas with sufficient capital for development is to establish rural banks or credit cooperatives that will lend to farmers. In traditional agriculture a farmer has only two sources of credit: members of this family and the local moneylender. Because their location, urban banks lack the knowledge and skills necessary to operate effectively in rural areas.

On the other hand, local moneylenders know the reliability of the people to whom they are lending and the quality of land put up as collateral. Individuals without land, of course, have difficulty getting money even from local moneylenders. (Malcolm Gills, et al. ; 1987).

Credit cooperatives set up by the small farmers are one potential solution to this problem. The idea is that each farmer is capable of saving a small sum, and if these sums are pooled, one or two farmers can borrow a substantial sum to buy a new thresher or pump.

The next year it will be another farmer's turn and son on. In the meantime those who put their money in the cooperative will draw interest, thus encouraging them to save more. But this approach has flaws.

Farmers' savings tend to be small, and hence the cooperative tend to be financially weak. More seriously, farmers in developing nations have little experience relevant to the effective operation and management of cooperatives. In addition, economic, social, and political conflicts within the village may make it possible to decide something as simple as who get the next loan. (Malcolm Gills, et al.; 1987)

There are virtually no areas of the world today where substance farming in its purest form still exists. Economic of development is usually accompanied by the increasing size and sophistication of this rural marketing network, and in turn that improved net work has an important impact on productivity in agriculture. The key to an increasing role for the market is specialization, and specialization depends on economies of scale, low - cost transport, and acceptable risk. (Malcolm Gills, et al.; 1987)

2.5. Development actions

Rural development actions mostly aim at the social and economic development of the areas. These programs are usually top-down from the local or regional authorities, regional development agencies, NGOs, national governments or international development organizations. But then, local populations can also bring about endogenous initiatives for development. The term is not limited to the issues for developing countries. In fact many of the developed countries have very active rural development programs. ( www.wikipedia.org)

2.6. Mission, Vision, Commitment Of Higher Learning Institutions

Universities were originally set up as a response to certain needs of society which no other institution or group could meet. However, this role, which clearly differentiated the functions and activities of universities, has become blurred. With the passage of time, other institutions have begun to concern themselves with research and teaching, sharing these functions with universities or on occasion even surpassing or substituting them.

For these reasons, universities today must rethink their social function. In order to do so, they must explain questions such as their `mission', the `vision' of this mission and their institutional `commitment' towards society. Something which was considered obvious for a long time must now be reformulated and may be the cause of comparative and competitive advantages between universities, since, for the first time in their history; these institutions face a profound questioning of the principles which have governed them up to now. (Eduardo Ramos and María Del Mar Delgado; 2005).

The `mission' of the university is linked to intellectual excellence developed through the three essential components of university life: research, teaching and influence (Marcovitch, 2002). This mission must adapt to the process of change of the society in which we live, although not all universities are capable of achieving this to an equal degree. The tendency to fall back on themselves and the need to do so in order to solve budgetary problems often explains the difficulty of university institutions in responding to new demands.

However, at the present time, this mission must be capable of going beyond the most local or localist approaches so as to respond to the needs that arise from the greater interaction between sectors and territories, which is a part of globalization. In the process of formulation of the mission, which can be explicit or implicit, different components are involved, among which the search for an independent model and the vision of the future role of the university stand out. In this process, teachers play, as they must, a fundamental part, together with the other groups which make up the university community. (Eduardo Ramos and María Del Mar Delgado; 2005).

The `commitment' of the university means its active participation in the development process of society. This role involves on occasion the expansion and the improvement of the relationship of the institution with society, but at other times it requires a profound revision of the mission of the university so that its lost role can be recovered. In order to ensure that the part the university plays is as active as possible, it must be directed towards teaching skills (the function which many universities have been fulfilling almost exclusively for over a century), providing an education in values, and building the capacity to reflect on the future (functions which have been eroded with the passage of time). Therefore, the university's commitment represents a kind of `contract' between the university and its surroundings, which is one of the best ways for the university to establish and carry out its real `social role'. (Eduardo Ramos and María Del Mar Delgado; 2005).

The `vision' of the university is the consequence of both its mission and commitment since this can refer to the way society perceives the role of the university, or the way the university intends to do what it does and how this is understood. (Eduardo Ramos and María Del Mar Delgado; 2005).