Neoliberal reforms had for long recommended large scale corporate agriculture as the way forward; small scale peasant agriculture was considered as a hindrance to the capitalist progress of developing countries. However, crises that have befallen countries like Uganda, especially poverty and food crises have heightened the pressure and questions about the whole philosophy of corporate agriculture and food production, shifting the attention of policy makers towards the need to boost the incomes of smallholders through collectivization. In Uganda, for instance, the state's need for poverty reduction and increased food supplies, the national development framework, Poverty Eradication Action Plan (PEAP) and its successor, the National Development Plan (NDP) called for the organization of the peasantry and smallholder farmers into collective units commonly referred to as Savings and Cooperative Organizations (SSACO) through which rural producers would be organized and assisted. This would also aid government’s effort to eradicate poverty and hunger in the broader interest of achieving Millennium Development Goal (MDG) number one. In some parts of the country this collectivization program has entailed bulking smallholders' lands into collective farms not only to enhance productivity and food security but also benefit from local, national and regional markets, heralded by the coming in place of an East African Customs Union. This article seeks to question the orthodoxy, logic and anticipated success of this new form of collectivization in the face of declining and/or absent social capital and trust as well as weak institutions. Moreover, societies with a low degree of social trust are less likely to create the flexible and prosperous business organizations that can compete in both national regional economies.   Key words: Social capital, collectivization, farmer groups, neoliberalism.

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