Enabling rural cooperatives and producer
organizations to thrive as sustainable business
enterprises
Collection of contributions received
Discussion No. 82 from 12 July to 3 August 2012
Global Forum on Food Security and Nutrition
www.fao.org/fsnforum
TABLE OF CONTENTS
Introduction to the topic ..............................................................................................................................................4
Contributions received .................................................................................................................................................6
1. Chris Cook, Nordic Enterprise Trust, UK.........................................................................................................6
2. Khaled Abbas, INRA, Algeria ................................................................................................................................6
3. Nishadi Somaratne, freelance consultant, Sri Lanka ..................................................................................7
4. Georges Bazongo, Self Help Africa, Burkina Faso [first contribution] ................................................7
5. Peter Steele, independent consultant, Italy [first contribution] ...........................................................8
6. Subhash Mehta, Devarao Shivaram Trust, India [first contribution] ............................................... 10
7. Enoque Albino Manhique, Agricultural Research Institute of Mozambique ................................. 12
8. Abdou Yahouza, Projet Sécurité Alimentaire ARZKI, Niger ................................................................. 12
9. Annalisa Melandri, Dominican Republic [first contribution] .............................................................. 14
10. Waled Mahmud, Knowledge Discovery, Bangladesh ............................................................................ 15
11. Moises Owiny, Women of Uganda Network (WOUGNET), Uganda ................................................. 16
12. Walter de Oliveira, FAO, Sierra Leone.......................................................................................................... 16
13. Annalisa Melandri, Dominican Republic [second contribution] ....................................................... 18
14. Subhash Mehta, Devarao Shivaram Trust, India [second contribution] ........................................ 19
15. John Millns, Meden Consultants Ltd, UK ..................................................................................................... 21
16. Edward Mutandwa, RDA, Rwanda................................................................................................................. 21
17. Subbash Mehta, Devarao Shivaram Trust, India [third contribution] ............................................ 22
18. Christopher Mulindwam, Pig Production & Marketing Uganda ltd, Uganda ............................... 23
19. Dismas Biringanine, APRODEA, Democratic Republic of the Congo .............................................. 24
20. Rabiu Auwalu Yakasai, Trans Sahara Global Foods Investments ltd, Nigeria ............................. 24
21. Georges Bazongo, Self Help Africa, Burkina Faso [second contribution] ...................................... 24
22. Christian Chilese, 3C Development Management & Entrepreneurship Experts, Zambia ...... 26
23. Facilitators’ feedback, John Rouse and Janos Juhasz ............................................................................. 28
24. Subhash Mehta, Devarao Shivaram Trust, India [multiple contributions] .................................. 29
25. Peter Steele, independent consultant, Italy [second contribution] ................................................. 30
26. Janos Juhasz, facilitator - on Peter Steele’s contribution .................................................................... 31
27. John Rouse, facilitator - on Peter Steele’s contribution ....................................................................... 32
28. Lisa Kitinoja, The Postharvest Education Foundation, USA [first contribution] ........................ 32
29. John Rouse, facilitator - on Lisa Kitinoja’s contribution ...................................................................... 33
30. Agnes Luo Laima, Zambia National Marketeers Credit Association, Zambia .............................. 33
31. Lizzi Igbine, Nigerian women farmers association, Nigeria................................................................ 35
32. Peter Steele, independent consultant, Italy [third contribution] ..................................................... 35
33. Alber B. Mukundane, Cooperative Agribusiness Management Specialist, Uganda ................... 37
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34. Fabrice Larue, Fondation pour l’agriculture et la ruralité dans le monde (FARM), France .. 38
35. John Rouse, facilitator - on Fabrice Larue’s contribution ................................................................... 39
36. Joseph Musuya, Women for women international, Kenya [first contribution]........................... 39
37. Facilitators’ feedback, John Rouse and Janos Juhasz ............................................................................. 40
38. Abbas Khaled, INRA, Algeria ............................................................................................................................ 42
39. Jacques Berthelot, Solidarité, France............................................................................................................ 42
40. Bhubaneswor Dhakal, Nepal ............................................................................................................................ 46
41. Joseph Musuya, Women for Women International, Kenya [second contribution].................... 46
42. Reema Nanavaty, SEWA, India ........................................................................................................................ 47
43. Moisés Gómez Porchini, Mexico ..................................................................................................................... 48
44. Danilo Beloglavec, Slovenia .............................................................................................................................. 50
45. Olivia Muza, consultant, Zimbawe ................................................................................................................. 51
46. Lisa Kitinoja, The Postharvest Education Foundation, USA [second contribution] .................. 51
47. Food for the Cities multi-disciplinary initiative secretariat, FAO, Italy ......................................... 52
48. John Rouse, facilitator ......................................................................................................................................... 53
49. Michael Riggs, FAO, Italy.................................................................................................................................... 53
50. Edwin Tamasese, Soil Health Pacific Ltd, Samoa ..................................................................................... 53
51. Nora Ourabah Haddad, FAO, Italy.................................................................................................................. 54
52. Joint final comments by John and Janos, facilitators............................................................................. 54
Additional contribution received..................................................................................................................... 58
53. Emile N. Houngbo, University of Abomey-Calavi, Benin ...................................................................... 58
54. Jacques Berthelot, Solidarité, France............................................................................................................ 61
3
Introduction to the topic
Dear Forum members,
Rural cooperatives and producer organizations play a crucial role in the eradication of hunger
and poverty, in the promotion of social harmony and in the achievement of more equitable
economic growth.
In the context of the International Year of Cooperatives 2012 , FAO, in close collaboration
with the International Fund for Agriculture Development (IFAD) and World Food Programme
(WFP), is taking the lead in promoting agricultural cooperatives. The Rome-based Agencies
(FAO, IFAD and WFP) are committed to strengthen the capacity of rural cooperatives and
producer organizations, as well as encouraging governments to establish favorable policies,
legal frameworks and participatory processes to promote their growth and sustainability.
Following the interest in cooperatives and rural organizations, “Agricultural cooperatives – key
to feeding the world” has been chosen as the theme of the 2012 World Food Day, to highlight
the role of cooperatives in improving food security and contributing to the eradication of
hunger.
Since one of the weaknesses of many cooperatives promoted by outsiders is their overdependence on government or donor support, the purpose of this online discussion will be to
share your experiences in this field and help identify the ideal external business, legal,
policy, etc. conditions that will enable these member-based organizations to become
more self-reliant and sustainable business enterprises.
For the purpose of this three-week on-line discussion, participants are invited to refer, enrich
and discuss the elements of the pillars listed below:
1.
Business environment: Economic incentives and business conditions which promote
the development of more self-reliant, sustainable and effective cooperatives and other
producer organizations; including incentives to invest in agriculture and environmentally
sustainable production processes; and access to local, national and international markets, etc.
2.
Legal framework: Legal, judicial, fiscal and administrative legislation that facilitates
and/or encourages the formation of more autonomous cooperatives and other producer
organizations.
3.
Introduction of information systems that more effectively assess the direct and
indirect economic and social benefits of cooperatives and other producer organizations at
different levels - member, community and country.
4.
Policy: Policies that promote and sustain producer organizations (eg. Tax and credit
incentives for small scale processing investments by cooperatives and other producer
organizations funding for training or capacity building, incentives to facilitate access to credit
for cooperatives).
5.
Consultative and participatory processes: Consultative mechanisms or arenas for
dialogue between the government and cooperatives in place ensuring an active role and voice
in the formulation of policies affecting small farmers and their organizations.
6.
Capacity development and information programs: include a set of training,
information, communication and extension programs specifically tailored to different
organizational forms of joint self-help action, informal as well as formal.
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7.
Cultural norms and customary rules: Socio-cultural characteristics can facilitate or
impede the development of cooperatives and other producer organizations (eg. Difficulty of
women to associate and be involved in cooperatives, norms prohibiting the right to
association).
The outcome of the online discussions will feed into the global, regional and national debates,
as well as policy actions and future Plan of Action of the International Year of Cooperatives
2012 under the theme “Cooperative Enterprises Build a Better World”.
For the purpose of this discussion, we use the term “rural cooperatives” to cover agriculture,
fisheries and forestry and we refer to the seven Cooperative Principles, adopted by the
International Co-operative Alliance in 1995: 1. Voluntary and Open Membership; 2. Democratic
Member Control; 3. Members' Economic Participation; 4. Autonomy and Independence; 5.
Education, Training and Information; 6. Cooperation among Cooperatives; 7. Concern for
Community.
A brief word about ourselves: we are both been working on issues directly related to
cooperatives and rural organizations. John Rouse is the former head of the FAO Cooperatives
and Rural Organizations Group and Janos Juhasz is the former FAO Cooperatives and Rural
Organizations Officer with extensive field experience in Central and Eastern Europe.
We look forward to a lively and interesting exchange!
John Rouse and Janos Juhasz
5
Contributions received
1.
Chris Cook, Nordic Enterprise Trust, UK
There are two key tools necessary, I believe.
Firstly, a consensual two-way framework agreement valid both domestically, and across
borders. This creates no new organisations, but is simply a framework for self organisation to a
common purpose.
I have coined the name 'Nondominium' for such a neutral platform.
https://blogs.ucl.ac.uk/resilience/2011/10/04/nondominium-establishing-c...
Secondly, there is the ability for producers to issue credits which may be cleared and redeemed
within such a framework agreement, and to agree with service providers - on a
revenue/production sharing basis - how to get products to market.
Using such a collaborative architecture - which requires no change in any law - unnecessary
financing and funding costs and other rent-seeking such as compound interest become
unnecessary, and stakeholder interests are aligned through creating networked co-operatives
of co-operatives.
2.
Khaled Abbas, INRA, Algeria
[ contribution in French]
A cette occasion très forte et très significative pour le développement agricole et rural
durables, nous avons eu le privilège d'organiser en mars dernier à Sétif (Algérie)une journée
nationale sur les coopérative agricoles. D’imminents spécialistes ont rapporté l'histoire de
cette forme d'organisation en Algérie, les avantages qu'elle offre, ses performances dans le
monde et ont analysé la situation des coopératives agricoles en Algérie. La journée a connu en
outre, un riche débat sur la question pour aboutir à des recommandations très intéressantes
qui incitent à la mise en œuvre d'un programme spécial de réhabilitation des nombreuses
coopératives en état d'arrêt des activités et de mise à niveau managérial des coopératives en
activité. Nous avons aussi mis le doigt sur certains aspects réglementaires et juridiques
constituant des blocages notamment au niveau de leur juste application et démontré le bienfait
du regroupement des coopératives en fédérations afin de leur permettre d'évoluer hors de leur
territoires....
je suis prêt à répondre aux questions des intéressés
salutations
Khaled Abbas
[English translation]
At this very important and significant time for sustainable agricultural and rural development,
last March we were privileged to organize in Sétif (Algeria) a national day on farming
cooperatives. Distinguished specialists reported on the history of this kind of organization in
Algeria, the advantages offered, their performance elsewhere in the world; and also analyzed
the situation of farming cooperatives in Algeria. The day also saw an engrossing debate on the
matter leading to some very interesting recommendations which advocate the implementation
of a special program for the rehabilitation of several no longer operating cooperatives and to
bring presently active cooperatives up to managerial standards. At the same time, we touched
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on some regulatory and legal aspects which constitute barriers, in particular in respect of their
fair application and demonstrated the beneficial effect of grouping cooperatives in federations
so that they can develop beyond their own territories....
I am happy to answer questions from anyone interested.
Regards.
Khaled Abbas
3.
Nishadi Somaratne, freelance consultant, Sri Lanka
It’s very important to discuss this topic, as rural cooperatives have the potential for poverty
alleviation and food security. In my experience as a specialist in rural community
Development, two main factors impede the progress and maintainability of rural cooperatives:
1) They usually depend on donors or governments and rarely develop to the level of selfreliant rural organizations, because, their stock of collective assets (that has capacity to
reinvest in order to make more profits) developed at the end of the project period is too small,
as well as their reinvesting capacity (analyzing profitable ventures and ability of risk taking
with proactive measures taken against possible risks) is not sufficiently developed during the
project. Therefore, carrying a "Strategy for self-sustainability " needs to be a key area in rural
cooperative development projects, and this strategy needs to be included with development of
more collective asset base for the organization as well as development of capacity for business
analysis and risk taking.
2) Another factor that commonly impede the success of rural cooperatives is, they being
isolated in its business operations mostly in their communities and not having resourceful
(useful) contacts and networks beyond their community. Therefore, their resource base
especially in terms of human and social capital is limited, and it in turn limits the scope of
ventures and ability of the cooperatives progressing in a sustainable manner. Therefore, the
projects that focus on development of rural cooperatives need to be having strategies to
develop social capital- connections to useful people and networks beyond their community.
Wish you all the best for the discussion
Nishadi
Nishadi Somaratne (PhD)
Consultant (freelance) in Gender, Social Capital, and Rural Community Development
4.
Georges Bazongo, Self Help Africa, Burkina Faso [first contribution]
[contribution in French]
Le développement agricole pour une sécurité alimentaire effective en Afrique passe
nécessairement par l’émergence/dynamisation des coopératives/groupements agricoles ayant
des capacités avérées pour s'insérer dans les filières agricoles et prendre leur place dans la
chaine des valeurs. mais il faut reconnaître que cela passe par une législation favorable dans
nos Etats et une liberté d'organisation effective.
Pour ce faire, les acteurs doivent de démarquer de la mise en place de coopératives "acquises"
et qui ne vivent que le temps d’existence d'un projet, programme Etatique ou ONG. Cela a été
malheureusement le cas en Afrique subsaharienne depuis les indépendances.
Pour remédier afin à cela,
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Il faudra au préalable une bonne campagne d'information sur la législation et aussi la
différence entre les coopératives actuelles et celles qui ont existé dans le passé avec leurs
corolaires de mauvaises expériences (pas de spécialisation et mauvaise gestion financière et
administrative) sur lesquelles on se base pour avancer/corriger.
les coopératives doivent être mise en place par les structures compétentes de l'Etat avec
un processus participatif et démocratique même s'il faut l'accompagnement des autres acteurs
tels les ONG et projets de développement pour éviter toute filiation compromettante
Enfin, il faut que les acteurs acceptent d'investir pour le renforcement des capacités
techniques et organisationnelles de ces coopératives afin de leur donner des compétences pour
offrir des services à leurs membres et s’enserrer convenablement dans les filières agricoles.
Georges BAZONGO
Agronome-Environnementaliste
Chargé des programmes
Self help AFrica - Afrique de l'ouest - Ouagadougou - Burkina Faso
[English translation]
Agricultural development for effective food security in Africa must depend on the
appearance/stimulation of farming cooperatives/associations which have demonstrated
capacities to become part of the farming sector infrastructure and take their place in the value
chain. However, we have to recognize that the latter depends on favorable legislation in our
countries and practical freedom to organize.
In order to achieve this, the participants must distance themselves from installing "acquired"
cooperatives which only last as long as a project, state program or NGO. Unfortunately, this has
been the case in Sub-saharian Africa after independence.
To put an end to that,
To start, it will be necessary to have a thorough campaign of information about the
legislation and, also, about the difference between today’s cooperatives and those that existed
in the past with their corollaries of bad experiences (no specialization and bad financial and
administration management) which will provide a basis for progressing/correcting.
the cooperatives must be put in place by the competent organs of the state with a
participative and democratic process, even if it is necessary to have the participation of other
stakeholders like NGOs and developmental projects to avoid any compromising relationships
Finally, it is necessary that the stakeholders are ready to invest to strengthen the
technical and organizational capacities of these cooperatives in order to give them the skills to
provide services to their members and to become properly part of the agriculture
infrastructure.
Georges BAZONGO
Environmentalist Agronomist
Head of Programs
Self Help AFrica - West Africa - Ouagadougou - Burkina Faso
5.
Peter Steele, independent consultant, Italy [first contribution]
Colleagues,
Considering producer groups in the context of agro-industrialization of rural
communities
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Great subject - people focussed development is always challenging - but 'Agricultural
cooperatives key to feeding the world'; that's almost a title too far. Not so much that
collectivization of people is not important - wherever they may be within the value chain - but
the contradictions between 'cooperatives' by definition and their role within 'feediing the world'
quickly become apparent when you consider the worldwide social (-economic) trends of the
current day - urbanization, industrialization, the scamble for natural resources, inequalities
between countries, people and regions (and within these groups). Link this into global macroissues of climate management, energy alternatives and expanding populations with people
everywhere demanding higher living standards, and the role for 'cooperatives' becomes less
easy to appreciate. 'Small is not always beautiful' and small producers remain highly
vulnerable.
Then too, there are contradictions between 'cooperatives' and 'sustainable businesses' that are
not always easy to understand, for example, with the former servicing members and promoting
shared (even democtratic) principles of equality, and the latter servicing profits and
shareholders. And, should you want to explore these issues further there is an excellent
booklet published by FAO 'Mobilizing Capital in Agricultural Cooperatives' that dates from
2004; and was co-authored by one of the sponsors of the current discussion. If you had to
summarize the booklet in a few words, it would be one whereby the more sustainable the
business models within the cooperative, the greater the shift from 'cooperative'; with the
cooperative becoming simply one more agro-business company (albeit a successful one).
Whether cooperative or agro-business, the first principle of either entity must be one of
making profits/surpluses that ensure continuity in that particular market sector.
Enterprise longevity is always a challenge in the less well-informed rural communities wherever they may be. This is referred to in the lead in to this discussion (this thing about
external support from the public sector, NGOs, development agencies and others). Remain in
the development business long enough and you are sure to come across cooperative societies
that started well, received ever diminishing support (you name it - economic, technical,
financial and more), became high jacked by cliques within the community and/or, worse still,
became channels for political motivated development movements (sure you can mention a
handful of countries, particularly from the period 1960-1990s).
The key issue is not so much that 'cooperatives' are inadequate per se, but that they may not
necessary be the right kind of collective group required by that particular
community/region/industry. Other groups may have equal value - and more so in the modern
era with that earlier reference to 'competition for resource's. Search the Internet and follow the
international and regional agro-industrial companies that are contracting for land in places
where it may be plentiful, where rural people living on the same land have limited options and
where national decision-makers can continue to make choices that focus on minority interests
(usually, but not always, from self-interest).
Cooperatives in rural communities will typically focus upon agro-production; hoping to exploit
markets for the crops, livestock and materials produced. There is that famous picture of
several thousand turkeys all facing the same way and looking into the distance; with the
caption 'Now that we are organized, what shall we do?' No point in starting mid-point in the
value chain then - this is more a case of identifying markets and working back to the kinds of
materials, standards, quantities, delivery schedules, competitors and more that will be
essential before organizing the agro-producers concerned. Herein is the role of the
entrepreneur with her/his information, contacts, access to resources (including finance and
agro-producers) that will be essential. Sure, this can be done by groups of people - but small
agro-producers, for example, are notorious for their lack of business acumen. Bring in that
well-meaning public sector? Useful, true, and particularly if they are able to provide start-up
finance, technical information, equipment and more at competitive/subsidized rates, but
9
public servants typically stop work late afternoon and rarely work over the week-end. Not so
good if you're in business.
Working with an industrial crop some years back we introduced what was called at the time an
'Authority'; combining the resources of the relevant ministries - typically 'Agriculture' and
'Cooperatives' together with a quazi-government marketing board. Existing cooperative
societies responsible for individual processing centres and grower communities were
dissolved; they had been defunct for a number of years, with the marketing board taking ever
greater responsibilities (but coming up against contradicting mandates - of how best to support
two competitive groups within the industry). The Authority took responsibility; managing
existing field staff, established advisory groups of growers with community responsibilities,
contracted for services including sales to the marketing board, and renovated factories and
built new ones. Simple, but tranparent, systems of payment for processed crop were devised
based on trends forecast for crop markets for later in the year; with a two tier system involved.
First payment on delivery to factory, and second payment on receipt of prices in distant
markets. Industry-wide, everyone knew who was in-charge.
The key to the level of the second payment was that of quality of crop sold; and this tended to
vary between managent at the different factories. Everyone from manager to factory labourer
was trained in the same way; but output quality varied on the basis of attention to detail - from
the ripeness of the incoming crop, washing, fermenting, drying, sorting, bagging and more
(even the newness of the bags and evenness of the stitches counted) . Cleanliness remained
supreme; and then we published annual feedback from buyers as a result of samples tested
from the individual factories, and factory managers/staff were able to compare their
work/performance with others. The industry never looked back - as people became
competitive, and quality and income climbed.
Management of the Authority was more autocratic than that possible from the earlier
cooperatives responsible for production and quality, and the latter always lacked the resources
to make a difference.
For an early contribution to this debate then, consider the role of the agro-producer group
within the industrialization of the agro-communities involved. Working recently with agroindustrial planners in a small SE Asian country, we put together proposals for a road-map for
industrializing agriculture. A statement concerning agro-producers summarized findings as:
'Working to establish rural communities as service providers for farmers, traders and
factories, the key role of farmers groups will be established; and, further, these groups will
be captured within contract farming practices that will service trading markets and
processing networks'.
The approach to agro-industrialization in this particular case can be explored further should
sufficient interest exist.
All strength to those involved with the wider issues of this potentially interesting debate.
Peter Steele
Rome
6.
Subhash Mehta, Devarao Shivaram Trust, India [first contribution]
Backward and Forward Linkages of the poor smallholder producers in rural agriculture
communities
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The Government of India, realising the problems faced by the Cooperatives and Societies, being
a department of the State Governments, legislated the Producer Company (PC), amendment IXA of the Indian Companies Act 1956, as a sustainable local community enterprise institution of,
for and by the smallholder farmer/and rural producers. The PC has the features of an
enterprise and will be driven by the cooperative and societal spirit of the community. This local
institutional intervention, staffed by professionals, will serve as a single window through
which their members (smallholder farmer/ rural producers) will transact with various
external forces by taking over the risks and responsibilities, viz., management, finance,
banking, imparting knowledge/ training and capacity building, product development, factor
market, capital market, research-extension services, value addition, delivery of government
programmes, logistics, etc.. It will also be responsible for all internal management of the
smallholder farmers/producer viz., integrated agricultural production for meeting their own
need of nutritious food and at farm gate prices, planning, budgeting, value addition, women
empowerment, nutrition, health, education, increasing purchasing power and net incomes,
ensuring safety, quality, livelihood improvement of the small holder farmer/producer families
and their communities and a positive 'cash to cash cycle'.
To be able to put up such a farmer led and professionally managed local institution, public
funding towards overheads, working capital, basic infrastructure, technical and managerial
support need to be provided for the first 5-8 years, depending on the nature and type of
agricultural communities. An example of such a Producer Company can be viewed at
navajyoti.org.
The Funding and Loan Projects considered by the Financial Institutions must not only directly
fund the PC intervention as the PEA but also make such an intervention compulsory, before
sanctioning any project, as it takes over all risks and responsibilities from its mostly illiterate,
resource poor members, other than on farm activities. The Governments of developing
countries need to make huge investment in this area for not only correcting the mistakes made
in the past but also for feeding their populations and ensuring economic growth, but also to get
back the small holder farmer / rural producers at the centre of sustainable farming activities.
Briefly, the functions of the Producer Company (PC) will be:
PCs will be set up by competence and capabilities of the rural producers, staffed by
unemployed educated youth trained to become GPs in agri 'culture'/ professionals to take over
all risks and responsibilities other than on farm activities, requiring handholding by the village
elders, CSO/ NGO working with the community, till break even ( about 5 years)

Increase net incomes and purchasing power of members by focussing on the local
successful integrated agriculture producing to meet their own nutrition, food and health needs
at farm gate prices, surplus sold in the vicinity for meeting their cash needs, achieving long
term sustainability

Impart now how/ training of the successful integrated farming in the area, especially
on farm production of quality inputs and water conservation

Contracting successful farmers, for training on their model farms and wide replication
of their integrated agriculture system, to meet their nutrition, health, food and cash needs

Arrange with financial institutions (IFAD, NABARD, etc.) the annual limits for capital,
seed capital and working capital needs

Primary and secondary value addition to increase shelf life of produce/ products,
minimizing post harvest losses and increasing net incomes

Plan, budget and market produce/ products at farm gate price to members/
communities, for meeting their nutrition, food and health needs, surplus first stored as
reserves for emergencies and balance converted to cash in the vicinity (food miles)

Empowerment of women by fully involving them in the planning, budgeting, decision
making and Governance of the PC

Convergence of Government programmes and schemes for delivery to members

Etc.

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Prior to setting up the PC by the rural producers in that community, they need to be given all
the information about the features of the PCs and the benefits that would accrue to them by
their NGOs and the local Government bodies. The role of NGOs will be vital as the rural
communities have lost faith in the mainstream agriculture systems, having been driven to
hunger and poverty, if we are to succeed in the execution of the project during its formative
period. It is understood that their role would be confined to organizing communities, creating
cadres, building trust, developing skills and overseeing the professionals staffing the PC, etc.,
important role in ‘hand-holding’ until the business breaks even, the staff has the confidence to
manage the ‘cash to cash cycle’, thereafter keeping an eye on the professionals and thus
ensuring that the interests of the resource poor illiterate members are protected.
Subhash Mehta, Trustee,
Devarao Shivaram Trust,
NGO Association for Agricultural Research Asia Pacific (NAARAP),
Hegenahalli PO,
Devanahalli Taluka,
Bangalore Rural North,
7.
Enoque Albino Manhique, Agricultural Research Institute of Mozambique
Dear Member and Forum coordinator
Thank you very much for exposing this topic for discussion, however I think that rural
cooperative have done something quite positive as they are already organised in such
associations. Now to become sustainable they should identify more members and form a
clusterisation groups whereby they can identify dynamic markets and commercialize in a close
and open circle all their produces. Additionally they should work hard to have certification of
their products, this mean be more engaged in GAP (Good Agricultural Practices), therein they
will be able to conquer internal and external markets. Of course this is not easy but with more
effort they can firstly push their government attention and while getting the support or
assisted by public institutions their vision can grow farther.
Thanks
Enoque Albino Manhique
DVM, MSc in Agricultural Development
Agricultural Research Institute of Mozambique
8.
Abdou Yahouza, Projet Sécurité Alimentaire ARZKI, Niger
[contribution in French, English will be available soon]
Bonjour chers collègues du FSN, merci pour cet important sujet ci-dessous
Les coopératives ont des rôles importants à jouer dans la croissance économique, la sécurité
alimentaire et l'amélioration des conditions de vie dans les pays en développement. Toutefois
ces coopératives n'ont pas bénéficié des appuis nécessaires pour bien jouer ces rôles. En effet
le Programme d'Ajustement Structurel a fait désengager les Etats et devraient permettre aux
coopératives rurales de prendre en charge certains services. Malheureusement le PAS a été
très vite signé sans pour autant avoir préparé et renforcer les capacités des paysans et leurs
coopératives à prendre en charge ces services. Il y'a eu des lois permettant la création de
coopératives, mais beaucoup de coopératives ont été créées sans pour autant être bénéfiques
12
pour ses membres, pour l'Etat et pour la communauté. En effet dans la majorité de
coopératives on peut constater:

le manque de structuration, de plan d'action et de plan d'affaire

le manque de financement: faible mobilisation des ressources internes et externes. Dans
les lois des finances nationales il n'y a aucune ligne budgétaire qui concerne les coopératives
rurales; peu de coopératives disposent de capital fonds de roulement et d'équipement.

le manque d'encadrement technico-organisationnel et de suivi des coopératives rurales.

la méconnaissance des opportunités, droits, avantages et devoirs dans leurs milieux
respectifs

des difficultés d'accès aux intrants, aux crédits,

difficultés de commercialisation des productions

des taxes à l'exportation

les droits aux exonérations à l'importation ne sont pas effectifs.
Donc pour avoir un monde meilleur il faut soutenir les coopératives rurales:

conduire une analyse diagnostic et une typologie de toutes les coopératives rurales

relire et harmoniser les textes régissant les coopératives

renforcer les capacités techniques, organisationnelles, financières des coopératives
rurales

rendre effectifs les droits aux exonérations à l'importation des intrants et équipements
de production et de transformation

réduire les taux d'intérêts des emprunts aux coopérative

appuyer les coopératives à développer des plans d'affaires, des circuits
d'approvisionnement des producteurs et des circuits de commercialisation des productions
agricoles

créer les dialogues directs entre les coopératives et les gouvernements

inscrire des lignes budgétaires d'appui financier aux coopératives dans les lois des
finances nationales

instituer un système de suivi et évaluation des activités des coopératives pour
l'amélioration continue.
Merci
Abdou Yahouza
Projet ARZIKI – Niger
[English translation]
Dear colleagues of FSN,
Thank you for raising this important issue.
Cooperatives have important roles to play in economic growth, food security and improvement
of living conditions in developing countries. Nevertheless, these cooperatives have not enjoyed
the support needed to fulfill these roles properly. Indeed, the Structural Adjustment
Programme has caused the States to stand back and should have allowed the rural
cooperatives to take charge of some services.
Unfortunately the Structural Adjustment Programme has been signed in a rush without having
at least prepared and strengthened the capabilities of farmers and their cooperatives to take
charge of these services. Laws have been passed to allow the setting up of cooperatives, but
many cooperatives have been created without really being of benefit to their members, the
State or the community. Indeed, in most cooperatives we can witness:
13
• the lack of organizational structure, action plan and business plan
• the lack of funding: little mobilization of internal and external resources. In the national
financial legislation there is no budgetary line which covers rural cooperatives; few
cooperatives have working capital and funding for equipment.
• lack of a technical-organizational supervision and follow up of rural cooperatives.
• the ignorance of opportunities, rights, advantages and duties in their respective
environments
• difficult access to inputs and credit,
• difficulties selling produce
• export taxes
• rights to exoneration on imports not applied.
Therefore to have a better world, it is necessary to support rural cooperatives by:
• carrying out a diagnostic analysis and classification by type of all rural cooperatives
• revising and harmonizing the regulations applying to cooperatives
• reinforcing the technical, organizational and financial capabilities of rural cooperatives
• making effective their rights to exoneration on imports of inputs and production and
transformation equipment
• reducing the interest rates charged to cooperatives
• help cooperatives to develop business plans, producer supply networks, and selling
networks for agricultural produce
• creating direct dialogues between cooperatives and governments
• including budgetary financial support lines for cooperatives in national financial
legislation
• instituting a system of follow up and assessment of cooperatives’operations for
continuous improvement.
Thank you
Abdou Yahouza
ARZIKI Project- Niger
9.
Annalisa Melandri, Dominican Republic [first contribution]
[contribution in Spanish]
Es muy interesante y creo que verdaderamente las cooperativas agrícolas puedan ser
herramientas para el superamento de la pobreza 'rural' o sea de las zonas rurales.
Lamentablemente, con la poca experiencia que tengo en ese sector puedo solo decir que el
desafío mas grande esta en la difusión del latifundio. Vivo en la Republica Dominicana y me
este aspecto parece un obstáculo grande a que campesinos o pequeños trabajadores del campo
puedan organizarse en cooperativas. Cuando tengo más datos los voy a compartir.
Saludos y gracias por la oportunidad.
[English translation]
It is very interesting, and I believe it sincerely, that agricultural cooperatives can be tools for
escaping from poverty in rural areas. Unfortunately, with the little experience I have in this
domain, I can only say that the biggest challenge is in the abundance of large estates.
14
I live in the Dominican Republic and for me this seems a huge obstacle to small farmers or farm
workers to organize themselves into cooperatives. Should I have more information, I will share
it.
Greetings and thanks for this opportunity.
10.
Waled Mahmud, Knowledge Discovery, Bangladesh
What conditions can enable rural cooperatives and producer organizations to become
successful and sustainable business enterprises?
In the rural areas, farmers provided their best efforts for maximizing food production not only
to serve the people, but to get higher margin from financial perspective. They are not the
enterprises or entrepreneurs. This is the vital business stage that avail maximum opportunity
by collecting foods from the farmers and resale to the wider markets including participating on
government food stock activities. They enjoy the maximum profit by exploiting the farmers. It
is very common in Bangladesh. Therefore, the farmers are always depriving from getting the
actual or expected price from their produced foods.
Promotion of forming cooperative and producer organizations might be an alternative option
where the farmers may also play the role of entrepreneur. It means the farmers will get the
opportunity to search market for selling their own produced foods. In Bangladesh, there are
successful such practices, which is practicing in south-eastern part of Bangladesh; the name of
the district is “Comilla”. BIRD is the main organization for promoting such initiative.
At the grassroots areas in Bangladesh, there is a constitutional provision of serving the people
through establishing GO-NGO network. It is considered as the entry point to organize farmers
in formation of a cooperative or in other form, the producer organization. NGOs can take
initiative to organize the farmers for adopting such type of opportunity in formation of
cooperatives or producer organizations by maintaining close collaboration with the local
government organization. NGOs have direct access among the general people. So, active
initiative of NGOs in organizing farmers can be an effective initiative. Because the farmers
haven’t the process and knowledge of cooperatives and producers organizations, therefore,
NGOs may provide technical cooperation to the farmers in this regards by transforming
knowledge. Different types if capacity building and ignition initiatives can be taken for
promoting farmers.
Mr. Abdul Hakim is the main and successful initiator in Bangladesh of experiencing such type
of practices. Bangladesh Academy for Rural Development (BARD), Comilla, Bangladesh is the
organization which established by the renowned person. You may visit the official website:
http://www.bard.gov.bd/ for getting results of various types of researches and studies.
Major considering factors are mentioned below:
 Policy framework
 Consultative and discussion processes
 Apply Community Based Participatory Approaches
 Capacity Building initiatives: message dissemination in different forms, campaign,
rally
 Networking among different stakeholders
 Favorable business environment: ensure open market situation
With best regards,
15
Waled Mahmud
Management and CBO Expert
Executive Director
Knowledge Discovery,
11.
Moises Owiny, Women of Uganda Network (WOUGNET), Uganda
I like the idea of Cooperatives having worked with rural women farmers in Northern Uganda
who produce large quantities of agricultural produce such as simsim, groundnuts, maize,
cassava, beans, millet and many other crops. The challenge with rural farmer groups is that,
even when they get together and produce such large quantities, normally there are few buyers
of such produce or else they would sell them to small scale retailers who eventually end up
cheating them. Lack of market opportunities, linkages with buyers, input suppliers and all
those aspects necessary across the value chain is seriously lacking and hence the farmers
access to markets or good prices for the crops they would have produced remain a great
challenge.
In one of the women groups in Apac District in Northern Uganda under the project on
Promoting and improving access to Agricultural Information using ICTs by WOUGNET; we
have women farmer groups each consisting of 30 members. One of my experience as a Project
Officer by that time around 2008 was that one of our groups had decided to take on the
production of Maize as a priority crop and eventually embarked on the production of large
quantities. In that year, there was bumper harvest of maize across the region and the prices per
kilogram fell drastically. The farmers had huge stock of maize in store whom we thought the
price would increase but never again and eventually, disappointed as the farmers and us as the
project staff, they had to sell them cheaply as efforts to get good price tag or even negotiate
better prices from medium to large scale buyers was extremely difficult by that time.
So in such instances, where the overall aspects of linkages with potential and large scale buyers
are lacking, farmers end up producing and selling their crops cheaply. The idea of linkages
between farmers and medium buyers for instance is necessary for a sustained mutual and long
term relationship in which both of the parties support each other in achieving desired
outcomes. Also because farmers would want to satisfy household demands, the produces
cannot stay in store for long and of course coupled with other factors such as lack of storage
facilities in rural areas and post harvest management of crops for example. I later thought of
the idea that if we already had identified some of the buyers and linked them to farmers and
introduced some element of value addition, we would have fared well in this example.
Also, Uganda had a strong cooperative base in the early 80's supported by Government and
relevant legislation. Today, the whole aspects of cooperatives have dwindled only left for rural
farmers, small Government entities and NGOs to support in some instance farmers to form
groups/associations to try to achieve certain objectives. Government has abandon the idea of
cooperatives and left the market economy to thrive at the expense of cooperatives which could
have boosted the market driven economy.
12.
Walter de Oliveira, FAO, Sierra Leone
Dear Moderator,
I would like to bring the discussion towards the role of the public sector investment in rural
development with an example of an approach, currently being implemented in Sierra Leone
with the support of FAO. The approach is enabling small-scale farmer organizations to succeed
as sustainable business enterprises.
16
The Smallholder Commercialization Programme (SCP), under the Global Agriculture and Food
Security Programme (GAFSP) is setting the basis for the development of an enabling
environment for pro-poor agricultural growth in the country. It is a nationwide investment
plan for agricultural growth and food security involving government, private sector and
development partners.
The SCP, covering the years 2010-2014, is implemented by the Ministry of Agriculture,
Forestry and Food Security (MAFFS) and composed by six inter-linked components:
Component 1-Smallholder Agriculture Commercialization: Production Intensification,
Diversification, Value Addition and Marketing: improving smallholder production and
commercialisation by setting up 2,750 FBOs and building 650 Agricultural Business Centres
(ABCs) nation-wide;
Component 2-Small-scale Irrigation Development: developing small scale irrigation to boost
rice production on 18,000ha of land;
Component 3-Market Access Expansion through Feeder Road Rehabilitation: improving access
to markets by rehabilitating and maintaining 4,000km of feeder roads;
Component 4-Smallholder Access to Rural Financial Services: providing better access to
financial services specifically tailored to rural farming groups or individuals through the
creation of 130 Financial Services Associations (FSA);
Component 5-Strengthening Social Protection, Food Security, and Productive Social Safety
Nets: providing a social protection safety net to vulnerable households to increase food
security and nutrition for 1,5 million people and;
Component 6-Planning, Coordination, Monitoring and Evaluation: implementation and
support.
The establishment of Agriculture Business Centres (ABCs), under component 1, is intended to
boost small-scale farmers’ productivity and improve access to agricultural support services
(inputs, post-harvest technologies, extension services and technical advice) and rural markets.
By the end of 2011, a total of 193 ABCs were established and equipped at different level of
operations.
The ABCs are farmer owned multi-purpose form of cooperatives providing rural communities
with a place to trade goods and services and acting as an interface between famers and service
providers, thus enhancing access to markets and technologies.
The ABC is a process that started with the Farm Field School (FFS) approach, organizing
smallholders into Farm Based Organizations (FBOs) with technical and managerial capacity to
manage the ABCs.
Each ABC is planned to deliver services to around 400 members, covering approximately
110,000 smallholder farmers in the country. The services include micro-credit, sale of inputs,
rental of labour-saving equipment, storage of seeds and crops to reduce post-harvest losses,
and the transport of harvests to markets.
One of the key objectives of the ABCs is, amongst others, to provide a one-stop point where
farmers can access a total service package for their production activities, facilitate mobilization
of human and material resources, provide some forms of functional education, improved seeds
and chemicals and ways of generally improving agricultural activities.
17
The ABC is also aimed at resolving problems related to diseconomies of scale faced by
smallholders in accessing credit, extension services, input supply and access to markets, as
well as in facilitating the dissemination of information on new technologies and
environmentally friendly practices, in a rapid and more cost-effective way through the FBOs.
I believe this can be an example where public sector investment in smallholder farmers, with
appropriate policy, institutional and technical support are critical to ensuring that the
smallholders organizations can effectively carry out their functions.
In this way, the public support is creating an investment climate conducive to rural growth,
and empowering the poor to share in the benefits of that growth.
Thank you
Walter
13.
Annalisa Melandri, Dominican Republic [second contribution]
[contribution in Spanish]
Veo que hay aportes y experiencias interesantes que en el marco del cooperativismo se están
llevando adelante en Africa por ejemplo. Retomando lo que estaba comentando ayer y por
explicarme con más claridad, quería llevar como ejemplo algo que vi en Honduras en la región
del Bajo Aguán donde hay un conflicto por la tierra muy fuerte y violento. Algunos campesinos
lograron retomar posesión de unas tierras que de una forma u otra(sea por medio del uso de la
violencia que con algunas formas solapadas de créditos agrarios que obligaron los campesinos
a vender sus tierras) potentes terratenientes les habían quitado. En esta zona es muy
desarrollado el cultivo de palma africana. La que mal llamaron “reforma agraria” a principios
de los 70 entregó a los campesinos tierra con la obligación de sembrarla a palma africana. Fue
el principio del fin para ellos. Esta forma de monocultivo ha acabado con las pequeñas
producciones locales y si los campesinos ahora quieren comer yuca, frijoles o cebollas tienen
que comprarla a los supermercados. Es una historia que se repite a lo largo y ancho de toda
América central y AL. Toda la economía agrícola y los sectores relacionados, comercio,
transporte etc viven alrededor de este modelo productivo estrechamente vinculado con la
políticas económicas neoliberales. Lo que me llamó la atención fue que los campesinos que por
fin lograron reconquistar sus tierras (hasta con legalización de eso en el marco jurídico) a
precio de muertos y enfrentamientos violentos con las guardias privadas de los latifundistas y
que tenían finalmente la posibilidad de juntarse y ponerse a producir algo que sustentara sus
familias o que beneficiara directamente sus comunidades al fin y al cano no tienen otra opción
que seguir cultivando palma africana para la producción de aceite porque la tierra no da para
más nada, porque toda la economía lo que pide y hace rentable es la palma africana, y porque
los mercados nacionales y extranjeros están al servicio de esa producción. “Eso es lo que da
dinero y eso es lo que el mercado pide”, me dijeron los campesinos del Aguán. En Republica
Dominicana pasa y el sector agropecuario está en crisis por falta de inversiones y por los altos
costos de producción. La pequeña producción nacional no recibe incentivos y hay que importar
hasta las cebollas. Los campesinos del Aguán están condenados a seguir con el monocultivo
sabiendo que ese tipo de producción es la que tanto daño ha llevado a sus comunidades, a la
tierra y al producción agrícola del país. Si quieren yuca, habichuelas o lo que sea, algo muy
sencillo, lo tienen que comprar en los supermercados. Me imagino que la situación sea igual en
toda AL. Eso para decir que si no se hace algo a nivel de políticas nacionales y de modelo
económico que estas persiguen veo un futuro difícil para las cooperativas rurales o agrícolas.
Importante el caso de Haití, se sabe por cierto que en Haití se están focalizando las miras de los
18
grandes grupos económicos para implementar políticas neoliberales que seguramente no irán
a favorecer la población local, ¿como se está moviendo en este contexto por ejemplo la FAO?
Reciban un cordial saludo.
[English translation]
I see that there are interesting ongoing contributions and experiences within the cooperatives’
framework, for example in Africa. Going back to yesterday’s comments and, with the purpose
of explaining myself more clearly, I would like to share an example of a situation lived in the
Lower Aguán region in Honduras, where there a very intense and violent land conflict is taking
place. Some farmers were able to regain land which, in one way or another (either with the use
of violence or with several agricultural credits that forced the farmers to sell their land) had
been taken away by powerful landowners.
In this area, the cultivation of African palm is highly developed. The inappropriately named
"agricultural reform" in the early 70's provided land to farmers with the obligation of growing
African palm. It was the beginning of their end. This form of monoculture has destroyed small
local productions and if farmers now want to eat cassava, beans or onions, they have to buy
them at supermarkets.
The same story is repeated throughout the entire Central and Latin America. All the
agricultural economy and related industries (trade, transport, etc.) depends on this production
model closely linked to the neoliberal economic policies. What caught my attention was that
farmers who finally managed to regain their land (even with a legalization under the legal
framework), at the cost of deaths and violent confrontations with the private guards of the
landowners, and who finally had the possibility of grouping together and producing something
that would support their families or benefit their communities directly, have in the end no
choice other than continue cultivating African oil palm because the land cannot yield anything
else. Because the whole economy requests African Oil palm and makes it profitable, and
because the domestic and foreign markets are oriented to that production.
"This is what makes money and what the market wants", the Aguán farmers told me. This
situation takes place in Dominican Republic and the agricultural sector is in crisis due to the
lack of investment and the high production costs. The small domestic production does not
receive any incentive and even onions must be imported.
The Aguán farmers are condemned to continue with monoculture knowing that this type of
production has caused so much damage to their communities, to the land and to the
agricultural production in the country. If they want cassava, beans or any other simple food,
they have to buy it at supermarkets. I imagine this situation will be the same throughout Latin
America. If no action is taken at the level of national policies and economic model, I foresee a
difficult future for rural or agricultural cooperatives.
The case of Haiti is important as large economic groups are focusing their interest in this
country to implement neoliberal policies that, probably, will not benefit the local population.
For example, what is FAO’s approach in this context? Best regards.
14.
Subhash Mehta, Devarao Shivaram Trust, India [second contribution]
Dear John and Janos,
In response to the contributions made I am adding to my earlier contribution for further
clarity.
Differences in Structure, Functions, Relationships & Purposes between the Producer
Company(PC)/ Farmer Organizations and the Industrial Corporations/ Companies under the
Indian Companies Act 1956
19
Issues relating to costs, taxation policy, legal requirements, structure deficiencies & purpose in
developing countries:
1. The central and state taxes, duties, etc., to be paid by the Farmer’s Rural PC/Farmer
Organizations, Self Help Groups, Societies and Producer Cooperative, etc., formed by
smallholder and marginal farmer producers should be exempted.
2. Inability and relevance of the Rural Producer groups to be able to absorb the cost of
registration, various taxes, duties, etc.,, that maybe applicable.
3. Type of documents required and procedures to be followed are difficult even for the
educated entrepreneurs and thus beyond the competence and or means to be produced by the
smallholder producers to register themselves as a PC.
4. Ability of the small and marginal producers to provide the different types of documents for
registration of the PC.
5. Equity (seed capital) required for formation of a producer company/cooperative and its
feasibility for marginal producers to come together on this.
6. Tax benefits available to producer companies/cooperatives vis-à-vis other large business
houses, should be need based
7. Type of subsidies available to industrial organizations/private business enterprises vis-à-vis
producer companies/cooperatives should be much more as it serves public interest
8. Provisions for grant and seed capital available for producer companies/cooperatives should
be liberal
9. Provision for producer companies/cooperatives (formed by a group of farmers/producers)
to avail the various schemes and departmental programmes of the government that individual
farmers are eligible for be converged and accepted as the promoters contribution/ margin
10. Ownership structure of producer companies formed needs to be of the rural farmers/ other
producers but staffed by professionals, to meet all the needs of their members by filling in all
the gaps
11. Different types of formal and informal sources of credit developed for the small and
marginal producer orgs could be sourced
12. Types of credit required by the small farmers/producers could all be sourced by their PC
13. Type of credits and flexibility offered by the money lenders to the small producers could be
taken over by the PC and at low rates of interest
14. No documents required to be produced by the farmers to borrow loan from the
government system of formal credit system as the PC would provide the colateral.
15. Challenges faced by small and marginal farmers in borrowing money from the formal credit
system is enabled with the PC intervention and supported by the financial institutions/
Government.
17. Amount of money borrowed by the PC intervention to meet the needs of their members,
namely, marginal and small farmers and other rural producers becomes possible and at very
low rates of interest from the formal credit systems.
20
18. Capital available in the future from the savings made by the small and marginal producers
Warm regards
Subhash
15. John Millns, Meden Consultants Ltd, UK
Please find attached a paper I recently completed:
Policies and Programmes to Support Farmer and Rural Organisations in Central and
Eastern Europe.
http://www.fao.org/fsnforum/sites/default/files/resources/John_Mills_Paper_cooperatives_0.
doc
Best regards,
John
16.
Edward Mutandwa, RDA, Rwanda
Dear FSN Coordinator,
Thank you for this very interesting and relevant topic. Although cooperatives are often touted
as a viable way of promoting agricultural and rural development, the debate about the “best
bet” approach to improving rural livelihoods remains wide open on global forums. Rwanda
provides a good example of how cooperatives can be used to stimulate rural transformation
through coordinated action.
In Rwanda, the government crafted the Vision 2020 policy document which is anchored on six
pillars including the need to transform agriculture from subsistence orientation to commercial
agriculture. The country is small with an estimated surface area of 26,338 km sq. Given land
bottlenecks, all farmers in the country are usually encouraged to form cooperatives. It is
because it will be easier to support farmers through coordinated actions.
Cooperatives are not only seen as vehicles of development but also means of reconciliation and
promoting social cohesion after years of war. Thus they are important means of nation
building. The basis of their formation largely depends on friendship and gravitation towards
common objectives. Evidence from two studies we conducted with farmers in the Northern
Province showed that farmers’ decision to join and participate in cooperatives depends on
perceived social and economic benefits.
In my view and experiences from the field, there are necessary conditions which are important
for cooperatives to be successful. There is need for an effective policy environment and
institutional framework. Although governments can play the major role, there is also need for
public and private partnerships which will complement public policy actions in the sphere of
agricultural production. Several tea producing cooperatives in the country are being supported
through various PPP initiatives. In Rwanda, the Rwanda Cooperative Agency is responsible for
coordinating all activities related to cooperatives. Support is critical but may not necessarily be
financial. It is true that without the necessary support especially in the initial stages of
formation, cooperatives may fail. Many members of cooperatives are poor rural farmers
without the requisite agricultural knowledge, financial resources and assets for use in
agricultural production. It is therefore logical to support them so as to build human and
technical capacity. The government supports cooperatives through frequent trainings and
21
meetings. Major constraints usually facing many cooperatives are related to management and
governance issues.
To ensure that cooperatives are sustainable platforms of rural development, it is also
important to ensure complementary policy actions. For example the government implements
its programs of land use consolidation and crop intensification through them. The cooperative
model used in Rwanda has seen quantum changes in agricultural productivity through
coordinated support from the government thus leading to better livelihoods.
Edward Mutandwa,
RDA, Rwanda
17.
Subbash Mehta, Devarao Shivaram Trust, India [third contribution]
This is Subhash Mehta again in response to Edward's contribution.
Steps of Evolution:
1. All families of the community who produce some agriculture, forest, horticulture, animal
husbandry, poultry, art, craft, etc. are eligible to become producer members / shareholders /
owners of the company.
2. The local unemployed educated youth to be trained to become general practitioners (GPs) in
agriculture, volunteers / community workers / facilitators / employees of the producer
company (PC) or any other community enterprise system to take over all risks and
responsibilities other than on-farm activities.
3. The PC/community enterprise system aims to complement the strength of the local
community and to integrate all the facilities in a community towards building trust,
cooperation and higher quality of life.
4. All producer-members have equal say in management decision on price, policy & profit
sharing, etc., but management is left to the professionals
5. Profit of the company after providing for reserves will be shared proportionately among the
producer-members at the end of every season depending on their contribution of produce/
product.
6. Collection, sale and profit distribution of the produce shall be:
Level 1: Base price paid as agreed at the time of contracting
Level 2: Profit distributed every year after providing for reserves.
7. Stages of building a sustainable community owned enterprise system.
a. Registration of the company
b. Election of a board of directors under the guidance of a respected father figure who
will continue this role till the enterprise starts making a profit
c. Selection of professionals to staff the PC
d. Macro (5 yrs) and one year micro plans and budgets along with marketing plan for
surplus produce/products submitted to all concerned institutions for seed capital,
funding and or financing
e. Contracting a successful farmer of the area as the model for wide replication of
member farms, transfer of know-how for integrated agriculture, production of inputs,
primary value addition to increase shelf life to minimise post harvest losses and
storage of seeds for the next year
f. Farm management plan/annual calendar for each member farm/enterprise
g. Create central facilities for storage, production of inputs, need based primary and
secondary value addition facilities to increase shelf life of the produce to minimize
post-harvest losses and logistics for marketing
h. Create the required infrastructure on each farm for water harvesting and or recharging of wells/tanks and or tube wells
22
i. Create the required facilities to store produce for meeting emergencies
j. Create the required office and training facilities for members, unemployed educated
youth, etc.
h. To take over responsibility from the local government/banks/etc., the delivery of all
services meant for, and or required by, members and the community
Subhash Mehta, Trustee,
Devarao Shivaram Trust,
NGO Association for Agricultural Research Asia Pacific (NAARAP),
Hegenahalli PO, Devanahalli Taluka,
Bangalore Rural North
18.
Christopher Mulindwam, Pig Production & Marketing Uganda ltd, Uganda
My name is Christopher Mulindwa from Uganda. I am one of the directors of Pig Production &
Marketing Uganda Limited and the chairman of Watubba Pig Farmers Association. I do my
work with rural farmers and mostly those involved in piggery.
My discussion here will mainly focus on co-operatives in my country Uganda.
Farmer organisations are very important to both farmers and community development. United
farmers can share ideas, are easy to help and can combine efforts to work out tasks that are
difficult to a single farmer like bulk production, input purchase, mechanisation, transportation
and many others. Collective savings enables them mount a certain amount of money which can
be used to extend credit facilities to themselves escaping the tuff terms and conditions of banks
and money lenders. Therefore before governments, NGOs, companies and any other body think
about extending grants, loans and any other assistance to farmers must first think about how
to get farmers organised.
The major reason as to why most rural farmers in Uganda live in poverty is because they are
poorly organised. This has been caused by development bodies poor approach to agriculture
development, they have not emphasised the importance of unity among farmers.
For purposes of creating/strengthening farmer organisations, concerned bodies should create
an environment where farmers don't get into organisations to receive donations, assistance or
support from them.
In case of shortages, such co-operatives will collapse. Let farmers first understand the
importance of co-operatives, create them, sustain them for some time and then assistance
comes later. With this approach, farmers contribution towards their own organisations can be
easily traced and all farmers will be equally responsible for their groups hence their
sustainability.
The fact that most farmers here are not educated and yet should be responsible for their
organisation management make us think about management capabilities. Training facilities
should be extended to farmers, the introduction of adult education in rural areas would be a
right approach to this. Am not in any way recommending strangers to take part in farmer
organisations leadership, it is farmers who know who should manage their co-operatives.
Information access is another serious issue, most development bodies provide reading
materials in foreign languages for example English which most farmers cannot read and
understand. Efforts should be combined together among donors, implementers and farmers to
translate all useful literature into local languages that can be read and understood by farmers.
This literature should be highly simplified, easy and interesting to read. Expressing
information by use of pictures and diagrams would be a right approach.
The use of mobile phones is greatly becoming a cheap and easily accessible means of
information. Different innovations should be brought to space in relation to this in order to
easy communication and information sharing among farmers.
According to what I have observed, most people here especially the youth regard farming as a
failure's job because it is farmers who are living a very poor life, there is few commercial
23
farmers in Uganda.
Subsistence farming is the common activity and also not practiced to its fullness because some
farmers may even fail to produce what is enough for their families. Co-operatives would be
good actors in eroding this perception out of youth minds, previous census stated that most of
the Ugandans are youth making close to 19 Million of total population so they would have been
the largest food producers in our country. The best approach here would be training farmers
from their respective local councils in partnership with their local administration.
For the countries like Uganda whose backbone is agriculture, the government should be more
concerned about implementing policies that favor co-operative development. The issue of
corruption and embezzlement of funds will be no more if government policies involve farmers
in decision making. Farmers will know how to fight for their rights and eliminate wrong
characters.
Regards,
Christopher Mulindwa
19.
Dismas Biringanine, APRODEA, Democratic Republic of the Congo
As APRODEA, NGO working in South Kivu/DR CONGO, we work with 32 72O smallholders
gathered into 20 agricultural cooperative.
To enable them: we organize them into cooperatives around each crop
- we form training of trainers (TOT) on how to manage, to fertilize, in organic agriculture
- we give them seeds and other tools
- we give them fund as credit in order to produce more after they will reinburse crops or
money.
We help them to access local, national and international markets. The problem is to get
certification in order to export their products.
We would like to works with you in partnership with FAO in order to implement some
projects.
Looking forward the responses. God bless you richly.
20.
Rabiu Auwalu Yakasai, Trans Sahara Global Foods Investments ltd, Nigeria
Dear FSN Forum,
It is a good timing for this particular topic at least for us in Nigeria because it presents
opportunity for everyone in the policy corridors to see the global trend affecting cooperative
societies. May be that would trigger action in the direction most considerate for the required
cooperative development.
Kindly check the attachment “Public Sector-Driven Cooperatives (PSDC)” for my contribution:
http://www.fao.org/fsnforum/sites/default/files/resources/PSDC_4.pdf .
21.
Georges Bazongo, Self Help Africa, Burkina Faso [second contribution]
[contribution in French]
Toutes les contributions aussi intéressantes les unes que les autres montrent la pertinence de
l'émergence de sociétés coopératives agricoles fiables et capables de répondre aux attentes en
matière de sécurité alimentaire et nutritionnelle de nos Etats africains. Self help Africa forte de
son expérience en Afrique (de l'Est, du Centre et de l'Ouest) d'environ 30 ans a développé une
approche de renforcement des capacités des coopératives à travers ses partenaires d'exécution
axée principalement sur:
24
- La spécialisation des coopératives autour d'un maillon d'un filière agricole car la clarification
des uns et des autres sur leur domaine d'actions prioritaires permet d'éviter d'avoir des
coopératives consciente de leur rôle dans la filière indiquée et son interrelation avec les autres
maillons de la filières (approvisionnement en intrants, production, transformation,
commercialisation/exportations).
- L'amélioration de la gouvernance au sein de ses coopératives est un gage de leur crédibilité
vis à vis des acteurs et aussi des potentiels adhérents car cela favorise et consolide la confiance
mutuelle. Pour se faire, l'accent est mis sur les capacités en matière de management
administrative et financière et aussi de services offerts aux membres;
- L'amélioration des compétences techniques et professionnelles des coopératives selon leur
domaine d'action afin qu'elles mieux participer aux fonctionnement de la filière tout générant
de revenus pour leurs ménages respectifs. Afin de transférer durablement ces compétences
l'approche des "Leads farmers" est développée afin de doter ces cooperatives de personnes
compétentes à même de fiare le transfert de compétences aux autres membres de la
coopérative, d'appuyer pour le suivi des actions et l'élaboration de compte d'exploitation ou de
plan d'affaires adaptés à leurs réalités;
- La mise en relation de ces coopératives avec d'autres acteurs de la filière dans laquelle elles
évoluent ou avec de potentiel partenaires financiers tels les instituts de micro finance pour le
financement de leurs activités et susciter l'envi de s'informer afin d'être informer sur les
opportunités qui se présentent, les lois, politiques et stratégies qui pourraient les intéresser ou
influencer leurs actions afin de pouvoir saisir les opportunités qui se présentent et ausii
s'impliquer dans le plaidoyer.
* Cette approche est souvent influencer par les défis de la disponibilité de structure de
communication de proximité, le niveau d'alphabétisation/scolarisation des acteurs, et le
financement du secteur agricole par les banques en Afrique. Quelles sont les situations dans les
autres pays concernant ces défis???
Georges BAZONGO
Self Help Africa
Burkina Faso
[ English translation]
All the equally interesting contributions show the relevance of the emergence of reliable
agricultural cooperative organizations capable of meeting expectations in terms of food
security and nutrition in our African states. Self Help Africa, with solid experience of about 30
years in Africa (East, Central and West), has developed an approach of reinforcement of
cooperatives’ capabilities through its operating partners, targeted mainly on:
- the concentration of cooperatives around one link in an agricultural sector because the
clarification between one and another’s spheres of priority action makes it possible to avoid
having cooperatives unconscious of their role in the given sector and their interrelation with
the other links of the sector (supply of inputs, production, transformation,
commercialization/exports).
- The improvement of management at the heart of cooperatives is an assurance of their
credibility with respect to other operators and also potential members because that will favour
and consolidate mutual confidence. To bring this about, emphasis is placed on administrative
and financial management abilities and also, on the services provided for members;
- The improvement of the technical and professional competences of cooperatives according to
their field of action with the object that they participate better in the operations of the sector
while generating revenues for their respective households. In order to effect a durable transfer
of these competences the approach "Leads farmers" has been developed to provide these
cooperatives with prepared people capable of effecting the transfer of competences to other
cooperative members, to support the follow up of actions taken and the preparation of
operating accounts or a business plan adapted to their realities;
25
- The connection of these cooperatives with other stakeholders of the sector in which they are
developing or with potential financial partners such as micro finance institutes for the
financing of their activities and to create the urge to seek information in order to be aware of
the opportunities arising, laws, policies and strategies which could be of interest or could
influence their actions with the objective of grasping available opportunities and also of being
involved in the appeal process.
* This approach is often influenced by the challenges arising from the availability of a nearby
communication infrastructure, the level of literacy/schooling of stakeholders, and the financing
of the agricultural sector by the banks in Africa. What is the situation in other countries in
relation to these challenges?
Georges BAZONGO
Self Help Africa
Burkina Faso
22. Christian Chilese, 3C Development Management & Entrepreneurship Experts,
Zambia
Greetings,
In the several years that I have spent with rural producer and other groups, including
cooperatives, I have been brought to a point of deep reflection on what it will take to help them
break through to a level that will set them on a path to success (as defined by themselves).
I live in a country where cooperatives have been part of our development agenda for at least
close to 50 years. Many people know about cooperatives from encounters, not from a
conceptual perspective. We therefore have major differences in how they are perceived, even
amongst political and other decision-makers. Continued changes in the country's political
economy have left our cooperatives in disarray.
I think that, in our quest to obtain the results that cooperatives can bring to especially rural
development, we have tended to forget or overlook some fundamentals that underpin their
success.
I put forward four specific thoughts for our consideration, some of which may sound like book
stuff. But then, I think this is one of those instances when theoretical principles really matter,
especially when they are defined within relevant context.
1. Cooperatives are substantially a social institution that has potential to produce
economic and political benefits. So people organising themselves into cooperatives is largely
a matter of them (and any facilitator) understanding the current and ideal sociological
circumstances.
If so, to what extent do cooperators allocate space to clearly reflect on their current
sociological circumstances and on what they perceive as ideal? Or do we start with only
economic benefits in view, overlooking key process aspects that could help us get there?
2. Cooperatives are about how people organise themselves (not organised by outsiders)
to respond to various specifically or broadly defined opportunities.
To what extent, then, is effort devoted towards developing a common vision, mission and
objectives. I am not referring to the development of a strategic plan (which is often largely
developed by an outsider anyway), but to an ongoing institutional process that reinforces
locally grown vision, mission and objectives.
26
3. The members will already have been socialised in some way and this comes with them
into this new social group.
How much space exists for cooperators to reflect on how their social backgrounds may
positively and/or negatively affect the new institution? Could there be need for some
"resociolisation"?
Two quick examples may help to illustrate this point:
Ordinarily, cooperatives will adopt a horizontal form of collectivism - a devolved democratic
structure where ownership is held in common. Most rural African communities have been
socialised in a vertical structure where authority (and all that is perceived to go with it, e.g
wisdom of the ancestors rests, etc) rests in particular hands and the rest take instructions.
Some of the most practical challenges I have faced have actually been around this aspect!
Another example could be with cooperators dealing with the concept of "group business" in an
environment where group activities have not been perceived to have a strong economic
dimension to them
4. What mechanism are being employed to identify and tap into individual members
competencies, and to work with this to build strong internal structures? What bases are
used to determine who does what or holds what position? This is one area when gender
(amongst other issues) arises.
Notice that there above core aspects require cooperators themselves to deal with, not an NGO
or government. The role of external players is to facilitate a process leading to realisation and
action by cooperative members.
How can this be done?
Well, it is certainly more than running training workshops (which are generally found to be a
convenient intervention in many respects!). It involves multi-faceted conversations that
engages the group, key individuals, community players, local & central government, NGOs, etc
to ensure the particular society is, as much as possible, moving in a generally common
direction (or at least leads to minimal to no resistance).
In Zambia's earlier years, cooperatives become (albeit unintentionally) structures for receiving
government support (e.g agric subsidies) and not enterprises. This has been difficult to shake
off, and at some point, a previous government decided to simply ignore cooperatives. There is
now fairly serious thought on how cooperatives could become part of especially rural
development efforts. But I don't think many people know how this can be done, and if they do, I
am not sure if they are prepared walk the long road of re-orientation (which may very well be
heavily sociological and deal with the issues raised above, amongst others).
In the wake of a looming food and nutritional crisis, I don't think we should lose more time. My
main challenge is to the enlightened citizens of developing countries. There is a lot that we
know we can do. How much of this have we done? What world will we leave for our
grandchildren? What will we be remembered for?
It is time to focus on dealing with the underlying issues and not just the symptoms. This is
tough, but such is life! So let's get going with it . . .
Christian Chileshe
Principal Consultant
27
3C - Development Management & Entrepreneurship Experts
Lusaka, Zambia
23.
Facilitators’ feedback, John Rouse and Janos Juhasz
Dear Forum members,
First of all we want to thank all of you for your very useful initial comments on this important
topic.
In order to keep our discussions as focused as possible we think it is critical that we all are
clear on what we mean by the term "rural cooperative and producer organization". By this we
mean: "any independent, member-controlled, primarily member-financed business enterprise
whose profits are either reinvested to increase the business's capital base or redistributed to
members according to their use of the group business' services". As Millns rightly points out in
his first intervention, the definition is sufficiently broad to include a wide range of informal as
well as formal group enterprises serving their rural producer members.
We notice that many of the comments so far have centered on the problems that governments
or donors have encountered in promoting these types of organizations in rural areas. These
include:
- Over-dependence on government support and excessive government or political interference
in the running of the cooperative (Bazongo, Somaratne, and Yakasai);
- Problems in mobilizing internal capital (Millns and Yahouza);
- And weak business profitability and financial self sufficiency (Somaratne and Steele).
Others have commented highlighting government successes in promoting cooperatives and
producer organizations in India, Bangladesh, Nigeria, Burkina Faso and Sierra Leone (Mehta,
Mahmud, Yakasai, Bazongo and de Oliveira); however, what seems to be lacking in these
presentations of successes so far is a more detailed analysis of the extent to which these
organizations have achieved authentic self-reliance and sustainability-which as you know is
the main topic of this debate. Yakouza and Mehta have both mentioned the need to collect
more analytical data on individual cooperatives that have achieved financial and technical selfsufficiency in order to identify some of the enabling conditions (business activity focus,
management, capitalization policies, etc) as well as external conditions that have influenced
this success.
If participants know of individual cases of cooperative success in achieving self-reliance and
sustainability and the key factors that led to their success, I am sure the rest of us would be
interested in learning more about these cases. In addition to collecting more analytical data on
individual cooperative success in achieving financial and technical self-sufficiency, Somaratne
goes one step further and suggests that both governments and donors should link their
assistance to recipient achievement of specific self-sufficiency targets or milestones which
could be used to monitor progress in this direction. Do you think this would be a good idea?
Several participants (Mulindwam, Bazongo and Yakasai) mentioned member illiteracy, the
geographic isolation of many rural coops and coop managers lack of computer skills and
business skills as major constraints to developing cooperative self-reliance. Could the new
information technologies including the more widespread use of mobile telephones be useful in
bridging this gap? Here are some other questions to ponder: Should cooperatives be granted
special taxation exoneration privileges or subsidies to encourage their development, or would
this discourage them from achieving full self-sufficiency? Are cooperatives organized to get
donations? Bazongo mentions what he calls "project cooperatives" I.e. coops that are organized
28
only for the durations of a project. Once the project ends so does the cooperative. What do you
think? Are cooperative principles to be strictly observed or can some flexibility contribute to
more business efficiency? (Millns, Steele).
We look forward to your response to the above points or any other points raised in the
discussions to date.
John Rouse and Janos Juhasz
24.
Subhash Mehta, Devarao Shivaram Trust, India [multiple contributions]
Dear Colleagues,
The attached doc is the report submitted by me to FAO in 2007 on the producer and
institutional producer orgs.
I felt it fair to share it with all participants for them to use it as a base to build on not having to
re invent the wheel.
Warm regards
S
ubhash
Producer Company (PC) / Institutional Producer Company (IPC): Empowering farming
Communities, by Subhash Mehta
http://www.fao.org/fsnforum/sites/default/files/resources/SM.PC%20doc%209%2012%20
07.doc
Dear John,
I am giving a brief introduction to COA Producer Company Ltd, please see:
http://www.chetnaorganic.org.in/, for more information. I will be happy to send the case study
direct to you as it is 2.5 MB.
Warm regards Subhash
'The formation of COAPCL is aimed at providing the member farmers with a fair business
alternative so as to enable them to:
i) get the best possible price for their produce and
ii) enjoy the benefits of a fair and transparent transaction.
As a farmer-owned producer company, COAPCL is specifically involved in the following
activities:-Sensitizing and training existing farmer groups for participating in value addition of
their produce and collective marketing for better margins; Managing the organic cotton
marketing process of member farmers, hitherto managed by COFA; Oversee the certification
process of farmers pertaining to organic certifications, fair trade certification and any other
that the organization may feel the need to subscribe to from time to time; Organize marketing
of non-cotton crops of farmers, wherever possible as organic and fair trade, otherwise in
alternative formats; Business planning for local level farmer co-operatives/societies and
providing expert inputs on conducting such businesses/local level economic activities;
Facilitate fund raising for farmer’s co-operatives/societies to conduct above mentioned
business/local level economic activities; Conduct/organize/facilitate suitable research and
advocacy activities – in collaboration with COFA - that are in the benefit of its member farmers;
Assist farmers of partner projects of FFID, COFA in marketing activities and/or undertake
marketing activities on behalf of such projects.
29
Dear John,
Your request for successful producer orgs. I had given the link,www.navajyoti.org, a successful
producer org case study, set up by smallholder producers in one of the poorest areas in the
State of Orissa, North East India. The hand holding is being done by Prof Dr AKJ Nayak, assisted
by some colleagues at the Xavier Institute of Business Management, Bhubaneshwar, Orissa.
They have also developed a curricula for women and mostly rural unemployed educated youth,
for being trained as general practitioners (GPs) in agriculture (entrepreneur professionals),for
staffing the PCs to take over all risks and responsibilities from the members, other than on
farm activities.
Warm regards
Subhash
25.
Peter Steele, independent consultant, Italy [second contribution]
Colleagues,
Thinking Big
Half-way into the debate and no one has, as far as can be seen, made an attempt to shift the
debate to larger-scale cooperatives and, importantly, introduced the highly successful agroindustrial models that exist for all kinds of enterprises, crops, products and markets. Why is
this? Are contributors restrained by their background and experience - typically national-,
rural-, historic-, small-scale- and/or subsistency-based; and further constrained by parallel
issues of safety nets, social networks, community food security and, not least, the platform
provided by FAO/FSN?
Then too, there is the power and prestige of the academic debate with language that quickly
shifts into the finness of interpretation; and which can be difficult to understand.
If 'cooperatives' are to continue to find a role with producer/industrial organizations, there is
little point in continuing to look backwards to the euphoria of the post-colonial cooperative
movement , for example, with the shared opportunities that were promoted at the time. And
there is absolutely no point in continuing to see the national government as a potential source
of investment funds, expertise and more in support of cooperatives. Success or failure,
cooperative enterprises will have to succeed in the private sector.
This contribution then draws your attention to Fonterra New Zealand - a dairy cooperative
company that has become the largest producer-processor food company of its kind in the
world. You can check out this cooperative at www.fonterra.com and search the supporting
pages but, in summary, it is owned by >11,000 dairy farmers (>95% of all national dairy
farmers) with assets of the order >US$13B and an annual turnover of >US$15B. It is the largest
company in New Zealand and, remember, this is a small country of <5M people that is quite
simply miles (i.e x1.6 km) from just about everywhere. The cooperative buys >97% of all fresh
milk in the country and exports and sells into >140 countries worldwide. Click on their live
world map and follow the joint ventures in a host of other countries; they may have an office
close to where you live. Check them out.
The issue is not so much to promote the success of Fonterra but to introduce opportunities that
thus far may have not been considered, for example, to focus on what you do best, to produce
for quality, to seek regional and/or global partnerships and to think outside of the usual
restrictions. Sure, this is difficult; you may be in upcountry Uganda (like Christopher
Mulindwa producing pigs or Moises Owiny growing maize) or in Zambia (like Christian Chilese
30
consulting on agro-enterprises/business) but many of the same issues apply when seen from
grass-roots level - lack of just about everything, markets awash with surpluses, costs spiralling
out-of-control and a home and family to feed.
Whoever you are and wherever you are you are likely to have a not inconsiderable wealth of
community resources - people and their assets; and, if this is insufficient, then you need to
mobilize others. There is simply nothing to be gained by waiting for people/assets/resources
to come to you. Check out the Fonterra strategy and see how this one cooperative is seeking
and developing partnerships worldwide; other agro-food companies are doing much the same.
And, if dairy products are not your forte, then follow those producing cereals, beverages, roots
& tubers, medicinal crops and more. The larger companies are always seeking new
opportunities; search the databases and find those close to where you may be - and then make
contact with them.
And, should you consider that you and your community/industry/resources are too small,
target your public sector for agro-industrial planning/development on national/regional scale
that you may be able to find a niche within the portfolio of national resources that are available
- for those investments that can be mobilized and channelled to assist you.
There are an estimated 700M people in Africa and the continent has >20% of the land resouces
of the world - much of this highly productive with good soils and sufficient water available, and
infrastructure is improving by leaps and bounds. Travel the length of the continent by road 15,000 km - from Cape Town to Cairo and marvel at the agricultural potential of this
little known and poorly managed continent. If you are reading these words in south, central
and eastern Africa - even North Africa - you are quite literally living in the world's food basket
of the 21st century.
Now there's a role for cooperative ventures and their management teams.
Peter Steele
Rome
26.
Janos Juhasz, facilitator - on Peter Steele’s contribution
Just a short note on Peter Steele’s latest contribution.
Peter raises the question why nobody shifts the debate to larger-scale cooperatives or better to
say cooperative companies. The issue of “thinking big” is, no doubt, valid and important. In
addition to Fonterra New Zealand a long list of successful large cooperative structures could be
given by each of us mainly in the US and Western Europe and in practically any sector of the
economy. There is only one thing Peter seems to forget about: all those large-scale
cooperatives started small and it took them many years of struggle and development to
become large and strong. Cooperatives’ institution building is typically bottom-up. Normally
local cooperatives are organized to meet local economic needs. Nevertheless, the importance
and need for various forms of inter-cooperative associations, the establishment of secondary
and tertiary cooperatives or even international cooperative organizations have always been
high on the cooperative agenda precisely for reasons of enhanced business efficiency and
competitiveness. In other words, cooperators do think big, but they see large-scale
cooperatives as a means and not as a goal in itself. The question, therefore, is whether
cooperatives can skip some phases of development and come into being as large-scale
organizations from the very outset. Large-scale organizations can, of course, be established in
both the public and the private sectors and you may even call them cooperatives, as it was the
case in the CEE countries under the centrally planned system. But this is a top-down exercise
by definition. What would then ensure that the organizations created that way are owned and
31
controlled by their members which are basic requirements for a cooperative? Who would
manage them if not the few privileged having power and management skills in, say, “a poorly
managed continent”? To what extent and in what ways would they develop the technical,
entrepreneurial and management skills of the small-scale, sometimes illiterate, producers?
All the above, of course, is not to say that cooperatives are a panacea for and exclusive means
of agricultural and rural development. Other organizations, private or public, may also prove
efficient and successful, but I think that is a theme for another discussion.
Janos Juhasz
Budapest, Hungary
27.
John Rouse, facilitator - on Peter Steele’s contribution
Thinking Big or Thinking Different?
My colleague Janos' response on Peter Steele's provocative comment was right on-target.
Successful self-reliant cooperatives businesses are built from the bottom-up, not the top-down- and that takes time. It's a step-by-step group learning process in which rural producers, often
with little or no experience in doing business together, learn how to cooperate and run a group
business, accumulate capital and make it grow. "Thinking Big" can sometimes be part of the
problem, not part of the solution. One has only to look at the dismal performance of many of
the large federated cooperative structures set up in many African and Asian countries during
the early post-independence period to understand this. They thought "big" but not "different"-to steal a phrase coined by Apple co-founder Steve Jobs.
John Rouse
Rome, Italy
28.
Lisa Kitinoja, The Postharvest Education Foundation, USA [first contribution]
I spent several years working with the University of California, Davis as Project Director for the
USAID El-SHAMS project in Egypt.
Many farmers organizations/associations/cooperatives were developed and nurtured during
the life of the project, and we got the chance to go back to Egypt in 2009 to reassess the
outcomes and long term impacts.
Here is a case study we developed with some lessons learned. Overall we found that the farmer
associations "need longer term technical assistance for improved organizational development,
to establish and maintain good business practices, manage links with buyers, and to learn to
properly manage and maintain their postharvest facilities" in order to be successful over the
long term.
LK
Dr. Lisa Kitinoja
The Postharvest Education Foundation
PO Box 38, La Pine, Oregon 97739 USA
Website homepage: www.postharvest.org
************
Case Study:
32
Linking Smallholder Horticultural Farmers with Lucrative Export Markets
Project name: Agricultural Exports and Rural Incomes - Enhanced Livelihood from Smallholder
Horticultural Activities Managed Sustainably (AERI- EL SHAMS)
Years of operation: 2003-07
Country and region: Upper Egypt
Purposes: To increase rural income in Upper Egypt by building the capacity of small and
medium sized farmers to improve their production, processing and marketing of horticultural
products. To enhance the livelihoods of smallholders in Upper Egypt by enabling them to
participate in the high-value export chain for fruits, vegetables and medicinal and aromatic
plants.
Implementer(s): CARE, UC-Davis, ACDI/VOCA, NVG and EQI
Donor: USAID
Link to the final evaluation report which contains the case study:
BMGF Appropriate Postharvest Technology Project (WFLO 2009-10)
http://ucce.ucdavis.edu/files/datastore/234-1847.pdf
29.
John Rouse, facilitator - on Lisa Kitinoja’s contribution
The case study mentioned by Lisa Kitinoja "Linking Smallholder Horticultural Farmers with
Lucrative Export Markets" raises several other issues not yet touched in the discussions,
namely:
1) governments and donors need to understand that the promotion of sustainable cooperative
businesses is a long-term educational/training process that requires technical assistance over
a longer period than the typicalm2-3 year development project allows. I would also add to this
point the one raised earlier by Nishadi Somaratne that such assistance should be linked to the
assisted cooperative's achievement certain well-defined business performance and selfsufficiency targets.
2) such assistance should primarily focus on trading to enhance member business skills, not
just cooperative managers business skills and farmer members should be treated as "agribusiness people" rather than just as farmers.
3) the primary aims of the training should focus on increasing the profitability of the
cooperative business, investing in business growth and increasing member benefits
4) another important lesson learned from the study is the usefulness of small informal group
approaches in business skill training, especially in larger cooperatives where the gap between
members and cooperative leaders is greatest.
5) evidence demonstrates that rural women are better savers and accumulators and often have
better micro-business management skills than men. That being the case, the increased
participation of women in cooperatives and at middle and higher levels of management should
be encouraged.
30.
Agnes Luo Laima, Zambia National Marketeers Credit Association, Zambia
As stated, it is important to consider logistical solutions that aim at boosting and facilitating
rural cooperatives and producer organization.
33
However, the cooperatives have played an important role since its inception but they may need
some modification and introduction of some new policies that will enable producers reach the
maximum of productivity and profit realization.
Producers in many countries in Africa have cooperatives that are in operation but little is being
done to help the producer realize their maximum rate of productivity.
(1) Not educating farmers on key areas that can boost their production where as
cooperatives are just helping in one way that buying from farmer and provision of input to the
producers. So if cooperatives can join forces with Agriculture engineers and professionals then
most farmers will learn on how to have the production increase because there will be
consultants to give technical advice to the farmers.
(2) The legal framework must recognize farmers as important component of the National
industry and that they are part and parcel in the National development of the country.
Governments need to recognize farmer to be entitled in accessing loans. Also that capital
investment by government most also go into establishing young farmer to increase capacity in
their Agro business. Loan facilities should include machinery livestock, cash and other
important input. Most cooperatives have only facilitated the agro farmer in transportation, and
buying of the produce. But does not look which farm producer should receive loan of what
kind. Cooperatives are best placed at positions where they have data of all producers and how
much each is able to sell from this statistics. They will be in the position to link farmers to
banks and connect farmers to loan facilities. Also to give advice to farmer on having savings
account which, will enable them to access loans from bank. Cooperatives should harness
farmers as a mother body that mediates farmers who are producer to have direct link in
accessing incentives that will promote producers to have maximum productivity and receive
good profits from their label. It is also important to understand that farmers need constant
education of their business. New policies and incentives must be passed on the farmers
through brochures and through various forms of media communication as in case of farmer in
the remote areas. Cooperatives should establish a centre which has to educate farmer on
certain methods of farming. Through education, sensitization and equipping farmers with
knowledge that will empower farmer do the right thing at the right time. This program if
introduced by cooperatives they will no challenge faced by farmers and how those challenges
can be solved.
(3) In cultures which have cultural norms that dominate, Agriculture should also be address
to remove ignorance and cultural impediment to food security e.g. people who aim at having
animals as a basis of making name where as they may not sale even if animal have multiplied in
number due to their cultural understanding.
(4) Producers must also have access to have their produce exported through cooperatives
which will make them sell their produce at much better price this marketing strategy can be
organized by cooperative to facilitate their sales.
The cooperative should extend their marketing strategy by finding and accessing external
market where as they would sale produce on behalf of the farmer and then the money would
be deposited in the individual farmer accounts.
Then the shares would be according to the rate produced by each farmers. These external
markets include exporting produce to neighbouring countries. It is therefore the duty of
cooperative to source for foreign markets, where the commodity is needed. Cooperatives
would just levy a small service charge to farmers for conducting business on their behalf.
Agnes Luo Laima
Zambia National Marketeers Credit Association (ZANAMACA)
34
31.
Lizzi Igbine, Nigerian women farmers association, Nigeria
Enabling rural cooperatives and producers organizations to thrive is to enable the rural
population feel the presence of governance and thriving means improvement in their living
standard.
Most of the time this group is forgotten and abandoned, the only aspect they are remembered
for is producing cheap foods which are consumed by urban dwellers and the reward is low
income of farmers. The high prices of food in the urban goes to sharp practices of middlemen.
To have an enabled rural cooperative is a good project that if supported will go a long way. The
term cooperative have been a functional aspect of community life , ie self help but the issue is
how effective , and at what capacity are they operating.
It then means that this aspect should be exploited to the benefit of all parties, including the
rural farmers and the food consumers. How can this be done?
Research has proven that farmers if encouraged always do more. It is well known that major
challenge of farmers especially in rural areas is low funding and low capacity.
This issue has been a long standing one and should be addressed if we are ready to feed the
world’s population.
Enabling rural cooperatives should be a priority in Agriculture Governance, and this could be
tackled by:
a) Adequate knowledge of the Farming population in a particular area.
b) Proper organisation of the farmers into separate cooperatives.
c) Training and education of the cooperative groups.
d) Government promulgation of laws to encourage savings with good returns and low
interests for cooperative , agricultural loans.
e) Proper management and disbursement of funds budgeted for agriculture and timely
and honest practice from politicians, their aids, civil servants and all who manage
agricultural funds.
Cooperatives if properly harnessed will put not only money in the hands of farmers but
POWER and wellbeing.
I am an advocate of farmers cooperative and open and good governance in Agricultural funding
and Farmers integration to Agriculture as a Business.
Lizzy Igbine (mrs)
National President
Nigerian women AA farmers association.
32.
Peter Steele, independent consultant, Italy [third contribution]
Colleagues,
Seeking Novelty and Success - Potato Producers in Uganda
The moderators were seeking information to describe cooperatives and other producer groups
that may warrant further scrutiny for the value of their models, modus operandi and
performance.
Towards the end of last year we prepared an appraisal: 'Irish Potato Production in East Africa'.
This was sub-titled 'Appraisal of the prospects and requirements for improved food industry
value addition and technical efficiency of the regional Irish potato industry'. Sure, that's a
mouthful, but this was the description contained in the ToR for the work required.
35
We explored production in six East African countries and came up with an action plan for
boosting regional production - co-ordinated, more efficient use of resources, marketorientated, profitable, etc. You can ballpark the criteria involved but, for the current debate
focused upon 'cooperatives', our findings may have some value. The action plan contained six
sub-programmes of which sub-programme 1 entitled: ‘Strengthening potato value chain'
contained the following key outcome points:
•
•
•
Growers linked to markets.
Innovation captured and linked to growers.
Information shared.
In support of these key points we listed a number of activities that should be followed/adopted
- separated in two parts:
1. Improve value chain performance
•
Indentify the main players in the value chain.
•
Encourage the main players to form groups.
•
Put groups in contact one with the other.
•
Establish permanent linkages between groups.
•
Promote the intentity/reality of the value chain.
2. Develop market prices information systems
And listed five key activities that should be followed.
Out study highlighted the relative productivity of smallholder production (particularly in
Rwanda & Kenya), but the paucity of marketing skills, information and dexterity when selling
surpluses. There were deficiencies throughout the production/processing chain, much of
which could be re-evaluated/improved with the promotion of producer groups. That is - these
groups and those who finance them take on the role of industrial entrepreneurs; organizing
production, and meeting the requirements of processors/consumers.
National industries are sufficiently small-scale to enable potato-growing communities to
provide the resources with which to boost productivity throughout the chain. To provide one
example, explore the performance of the Nyabyumba United Farmers (NUF) of Kabale,
Western Uganda with their links into a commercial fast-food outlet in Kampala: supplying >7
tonnes high quality bagged ware potatoes on a bi-weekly basis over a period of >5 years, and
boosting returns on investment by members of the order 70%.
These are 120 ex-farmer field school small-scale growers who formed a producer organization,
chased contracted demand 300 km from home and delivered the quality and quantity required
on the basis of little more than enthusiasm and a light truck; and met delivery schedules. You
can source their story at:
http://www.asareca.org/tuusi/index.php?option=com_tuusiviewbestpractice&act=view&Item
id=42&project=41. It's entitled: 'Linking smallholders to remunerative markets: how smallholder
potato producers in a remote district of Uganda market their potatoes to NANDOS in Kampala'.
Potatoes are the ideal East African food crop - high nutritional value, high productivity, etc. and
importantly, they can be grown throughout the region, and match the changing demands of
urban lifestyles for foods that are novel, quick and easy to prepare, and which project a sense
of modern change. Walk the streets in most East African towns/cities - after school, during the
evening 'rush hour' or at the week-end and count the number of kiosks, shops and outlets
selling crisps, fried potatoes and other potato snacks. Sometimes it seems that everyone you
can see is walking and eating potato foods.
36
Cooperatives may be a means to an end - and not an end in itself - but you have to produce to
meet market requirements, and those markets are largely neutral to the kind of
production/delivery systems that may evolve. The issues then become those of choice.
We can explore the potato industry/markets reporting further in the context of producer groups
if this is of interest.
Peter Steele
Rome
33.
Alber B. Mukundane, Cooperative Agribusiness Management Specialist, Uganda
Please consider this poem for brain storming on cooperatives:
OH COOPERATIVES
………………………..
(By Mukundane Albert)
The foundation of aspiring investor
The line joint for mechanisation struggles
The powerhouse for the nation
Oh Cooperatives
The string base of every cooperation
The growing strength for development
The social joint for every sector
Oh Cooperatives
The political base of every politician
The economic pusher for the citizen
The search light for every researcher
Oh Cooperatives
The matching boaster for the nation
The halter of poverty hazard
The centre for social gathering
Oh Cooperatives
The business entity that pushes the nation
The pusher of farmer’s produce
The best arrow for liberalised economy
Oh Cooperatives
The rural trainer and educator
The banker of every saver
The financial of field operations
Oh Cooperatives
The democratic set institution
The voluntary associate of membership
The autonomous independent entity
Oh Cooperatives
37
The merger of persons
The vanguard of social transformation
The hard nut for private competitors
Oh Cooperatives
Mukundane. B. Albert
Box 1340, Kampala
34. Fabrice Larue, Fondation pour l’agriculture et la ruralité dans le monde (FARM),
France
[French original]
Depuis 2008, la fondation FARM accompagne des organisations de producteurs dans plusieurs
pays d’Afrique de l’Ouest (Bénin, Togo, Mali, Burkina Faso), afin qu’elles développent des
services économiques viables et qui répondent aux besoins de leurs membres :
approvisionnement en engrais, commercialisation en commun des produits agricoles, crédits
de campagne, etc.
Plus les organisations de producteurs (OP) accèdent à un niveau de professionnalisation élevé,
plus leur viabilité et leur expansion dépendent de l’accès au financement. La capacité de ces
organisations à emprunter à des conditions acceptables, en volume et en taux, conditionne la
modernisation de l’agriculture africaine et l’augmentation de la production agricole.
Les institutions financières sont donc des partenaires stratégiques des OP. Dans les projets que
nous soutenons, il s’agit de banques coopératives, membres de la Confédération des
Institutions Financières (CIF) de l’Afrique de l’Ouest. L’expérience montre que les relations
commerciales entre les OP et ces institutions doivent évoluer d’une simple prestation de
service entre une entreprise et un client, à un réel partenariat. L’analyse du partage des risques
entre l’OP et l’institution financière doit être menée au cas par cas. Lorsque les organisations
de producteurs développent des outils de gestion des risques, cela doit être apprécié et intégré
dans l’analyse de risque des institutions financières.
Ainsi, certaines OP ont construit des bases de données qui leur permettent de suivre
efficacement l’historique de leurs membres en termes de respect des engagements de
remboursement de crédit et de livraison de produits agricoles, ce qui leur permet de faire une
catégorisation et une présélection de leurs membres. Ces organisations internalisent donc, en
quelque sorte, les premières étapes de l’analyse du risque que les institutions financières
devraient réaliser. L’amélioration de la professionnalisation des organisations de producteurs
est une nécessité, mais les avancées réalisées doivent être reconnues par les institutions
financières. Il incombe à ces dernières de mettre en œuvre des outils d’analyse du risque mieux
adaptés aux activités agricoles des OP auxquelles elles prêtent, de mieux former leurs agents et
leurs analystes de crédit aux spécificités du secteur agricole et de s’engager dans des
partenariats favorables au développement des services économiques des organisations de
producteurs. Déjà, les résultats fructueux obtenus entre des OP et des institutions financières
démontrent l’importance de l’amélioration de leurs relations commerciales et invitent à
l’innovation.
[English translation]
Since 2008, the Foundation for World Agriculture and Rurality (FARM) accompanies
producers’ organizations in many West African countries (Benin, Togo, Mali, Burkina Faso) so
that they can develop feasible economic services which answer to the needs of their members:
supply of fertilizers, joint marketing of agricultural products, seasonal loans, etc.
The more the producers’ organizations (PO) reach a high level of professional ability, the more
their sustainability and expansion depend on access to financing. The capacity of these
38
organizations to borrow on acceptable terms, in amount and rate, is decisive for the
modernization of African agriculture and the increase of agricultural production.
Financial institutions are, therefore, strategic partners of producers´organizations. In the
projects supported by us, these are cooperative banks, members of the Confédération des
Institutions Financières (CIF) de l’Afrique de l’Ouest [West African Confederation of Financial
Institutions]. Experience shows that the commercial relationships between the producers’
organizations and these institutions must evolve from the simple provision of service businessto-customer, to a real partnership. The analysis of risk sharing between the producers’
organization and the financial institution must be conducted case by case. When producers
organizations develop tools for risk management, this aspect should be appreciated and
integrated in the risk analysis by financial institutions.
Thus, some producers’ organizations have built databases which enable them to follow
efficiently the record of their members in terms of honoring undertakings to repay credit and
to deliver agricultural products, which allows them to do a ranking and pre-selection of their
members. Therefore, these organizations perform in-house, in a way, the first stages of risk
analysis which the financial institutions must carry out. The improvement of the professional
abilities of producers’ organizations is a necessity, but the improvements carried out should be
recognized by the financial institutions. It behooves the latter to put in place risk analysis tools
better adapted to the agricultural activities of the producers’ organizations to whom they lend,
to give better training to their staff and credit analysts in the specifics of the agricultural sector
and to get involved in partnerships that favor the development of the economic services of the
producers’ organizations. The fruitful results achieved between the producers organizations
and the financial institutions already show the importance of improving their commercial
relationships and encourage innovation.
Fabrice Larue
Fondation pour l’agriculture et la ruralité dans le monde (FARM)
France
35.
John Rouse, facilitator - on Fabrice Larue’s contribution
A question that begs answering.
Why do rural credit and savings cooperatives seem to be more successful at achieving
sustainable business self reliance than other types of rural cooperatives? What methods and
incentives do they use to attract member savings and capital to invest in the cooperative
business? Can some of these methods be adapted for use in other types of cooperatives? What
do you think?
36.
Joseph Musuya, Women for women international, Kenya [first contribution]
Why Rural SACCOS are more successful than Rural Cooperatives.
I think rural SACCOs (Savings And Credit Co-operatives) are more commercially inclined than
Rural Cooperatives which unfortunately in many cases seem to be stuck as being social
enterprises, who don’t seem to grasp well concepts of ‘doing business’. Rural cooperatives are
have a lot of the yesteryear illusions of state subsidies, funding and cheap capital, which
unfortunately it is no more. The rural SACCOS on the hand, being commercially driven are
innovative to create business for the benefit of their members. They consider their members,
equally as investors too who want to earn profit. As a result they have adapted and developed
business networks outside the traditional cooperative movement which they tap into, and
leverage more resources for their members.
39
Historically, rural cooperatives have had an external hand, be it in the form of
state/government subsidy ( even if at district or local level), they have had political inclinations
at times and also their focus on service combine to make them less business oriented. The
SACCOS, always have this dedicated group of a few people who have a sense of a customer
friendliness to grow their business. Across Africa, the financial requirements of the people are
not homogeneous and often vary according to the local conditions and circumstances. The
rural SACCOs succeed here through customization of credit packages, which they base also on
the nature of activities the credit is to support.
The rural SACCOS that are successful also dues to necessity divert into different financial
products, including savings mobilization, short, medium and long term loans, loans in kind and
even transfer services.
The rural cooperatives, which have are mainly single commodity based, tend to operate
‘‘seasonally’’. Their activities peak at times of say harvesting and marketing and getting inputs.
They get accustomed to this cycle and have no room for innovation or adaptability. They cease
to be a model for doing business. Vital part of any cooperative organization is its members and
their active participation in and loyalty to the cooperative is integral for its success. With a
season to season patronage of the service of the cooperative this can be tested to the limit. It
can affect their attitude towards the cooperative negatively.
37.
Facilitators’ feedback, John Rouse and Janos Juhasz
This past week's conference discussions have highlighted a number of important points
regarding the topic of cooperative self-reliance and sustainability.
Encouraging farmers to save more.
Agnes Luo Laima (Zambia) argues that governments should create conditions and incentives
that encourage farmers to accumulate more savings. We agree that this is critical. It is well
known that rural rates of cash savings and investment are too low in many developing
countries to support sustainable rural development. Furthermore, evidence shows that
farmers with cash savings are more likely to be self-reliant than those without. The same is
true with cooperatives. Cooperatives that succeed in accumulating surpluses and attracting
member capital to invest in the cooperative business also tend to be more self-reliant and
sustainable. Joseph Musuyu points out, rural SACCOs (cooperative credit and savings
cooperatives) in Kenya have been relatively successful in mobilizing farmer savings, and the
government is now encouraging more SACCOs to be organized alongside existing coffee
cooperatives in the hope that this will encourage more sustainable coffee cooperative growth.
Is continuous business turnover a factor in cooperative success?
Joseph Musuya (Kenya) seems to think so He says it's a factor explaining the success of rural
SACCOs in achieving self-reliance in his country. Interestingly, dairy cooperatives (which
generate more daily transactions per member than other cooperatives engaged in marketing
seasonal crops)in many developing countries have also done relatively well. What do you think
about this? How might this help in achieving cooperative self-reliance?
Cooperatives are businesses
Christian Chileshe (Zambia) states in his otherwise excellent contribution that "cooperatives
are substantially social institutions that have the potential to produce economic and political
benefits". We have to disagree with Christian on the over-emphasis that he gives to the social
function of cooperatives. Cooperatives are primarily economic organizations that seek to
satisfy the economic needs of their members. They may also address other social and other
needs of their members, but their primary function and purpose is an economic one. Joseph
40
Musuya (Kenya) further adds that farmers need to run cooperatives as a business, not as an
end in itself. We would have to fully agree with Joseph on that point, because if cooperatives
are not managed as a business, they will surely fail.
The pros and cons of vertical integration
Several participants (Igbine-Nigeria; Luo Laima-Zambia; and Steele-Italy) have raised the
question of where cooperatives should position themselves within the marketing chain. It's
well known that profit margins per unit sold are highest near the top of the marketing chain
rather than near the bottom. That would seem to be a powerful argument favoring the vertical
integration of cooperative marketing structures to capture these margins. However, it's
important to realize that not all vertically integrated cooperative structures are self-reliant and
sustainable and the ones that are are built upon a sound foundation of self-reliant primary
cooperatives at local level who help capitalize the structure and to protect their member equity
stake in the enterprise, ensure that higher level management of the structure is responsive to
their member needs. Unfortunately, many of the federated cooperative union structures one
finds in Africa have changed little since colonial times and remain top-down structures, heavily
controlled and financed by the government rather than by base members and, as a result, are
neither democratically run nor self-reliant .
An interesting case study
Peter Steele mentions the case of smallholder potato producers in Nyabyumba, Uganda, where
a 120 member marketing association of potato producers was formed from six smaller Farmer
Field School groups. The case would seem to be a good example of a bottom-up approach to
self-reliant cooperative and rural producer organization development. However, the case study
lacks data on that one important point. The association earns a profit but it's not clear on the
extent to which the organization has reached technical and financial self-reliance. is such
information available?
Laws and policies that encourage self-reliant cooperatives
Lizzy Nneka Igbine (Nigeria) recommends that the promotion of self-reliant and sustainable
cooperatives be made a government priority and presumably set down in legislation or formal
government policy. We think that formalizing this as an objective of government might help. It
certainly wouldn't hurt.
Areas of cooperative action
In her contribution Ms Igbine, Nigeria complains that “high prices of food…go to sharp
practices of middlemen”. This raises the issue of the potential areas for cooperatives activities.
Experience shows that in agriculture, in addition to primary production, cooperatives have
great potential and are most needed in the up-stream and the down-stream sectors, i.e. in the
supply of farm inputs and in the processing and marketing of farm products. These are the two
sectors of the product chain take the overwhelming share of the consumer dollar spent on food
and this is the money farmers should aim to get access to through cooperation.
Financial partnering with rural producer organizations and cooperatives.
Fabrice Larue (France) mentions in an interesting contribution that progressive financial
institutions need to think more seriously about business partnering with some of the more
mature rural producer organizations where sound investment opportunities exist, but to do so,
they will have to improve their understanding of how these organizations work and analyze
their investment risk. We couldn't agree more. But at the same time, cooperatives and other
producer organizations also need to better understand how these financial institutions analyze
investment risk and what are the expected costs and benefits of risk sharing between the two.
We forgot to remind you of one thing
41
We would like to remind all participants that a whole list of useful publications and manuals is
available for downloading on the conference's main page in the rightmost column. Take a look!
You might find something useful.
We look forward to your response to our comments.
John Rouse and Janos Juhasz
38.
Abbas Khaled, INRA, Algeria
[original in French]
Bonjour;
lors du séminaire que nous avons organisé cette année sur les coopératives en agricoles en
Algérie, il est apparu que parmi les facteurs de réussite d'une coopérative (COOPSSEL de Sétif:
coopérative spécialisée des services d'élevage), figurent surtout: la facilitation de l'accès au
crédit de campagne auquel beaucoup de petits éleveurs ne sont pas éligibles ainsi que la
valorisation du lait par sa transformation et sa commercialisation. Cette coopérative a en effet
innové par la création d'une laiterie fonctionnant uniquement avec le lait de vache. Les petits
ateliers laitiers des éleveurs dont la fonction a souvent été l’approvisionnement de la
trésorerie servant à l'achat d'intrants et auparavant peu viables pour approvisionner les
grandes laiteries étatiques, se sont vus devenir plus importants du fait de la progression de
l'attractivité du produit et la souplesse de sa commercialisation (pas de délais dans la
facturation et le payement, facilité de se faire payer en intrants)qui constituent des services
parmi d'autres disponibles pour les adhérents de la coopérative.
salutations
K. Abbas
[English translation]
Good day!
During the seminar that we organized this year in Algeria on agricultural cooperatives, it
appeared that the main success factors of a cooperative (COOPSSEL de Sétif: coopérative
spécialisée des services d'élevage - Cooperative Specializing in providing livestock services, at
Setif, Algeria) are: the facilitation of access to seasonal loans, for which many small herders are
not eligible, as well as the increased valuation of milk through its processing and marketing.
This cooperative has indeed innovated by the creation of a dairy which uses only cows´ milk.
The small dairies belonging to the herders, the function of which has often been to provide
funds for buying inputs and which were not really viable in the past as suppliers for the big
state dairies, have become more important due to the increasingly attractive product and the
flexibility of its commercialization (no delays with invoicing and payment, easiness of payment
in kind) which constitute services, among others, available for the members of the cooperative.
Best regards
K. Abbas
39.
Jacques Berthelot, Solidarité, France
We should not idealize the cooperative model
42
There are profound contradictions between, on the one hand, small scale Northern and
Southern agricultural cooperatives proritizing a strategy of food sovereignty centered on
domestic food needs, agro-ecological and labour intensive farming systems and, on the other
hand, large-scale Northern cooperatives. Taking the case of the EU – where cooperatives
represent 60% of the turnover of the collection, processing and marketing of agricultural
products –, the largest cooperatives pursue a strategy similar to the large private agroindustries, creating capitalist subsidiaries abroad and prioritizing the competitiveness of the
cooperative business over the prices paid to farmers. To maintain their farmer members'
competitiveness they agree with the necessity to enlarge the size of farms with input intensive
production systems despite their negative impacts on farm employment and the environment.
On the trade side, the EU apex cooperative body, COGECA (Cogeca, Brochure - Agricultural
cooperatives in Europe - main issues and trends, 24 November 2010, http://www.copacogeca.eu/Main.aspx?page=Papers&lang=en&id=20125), pleads to maintain an efficient
import protection within the EU although some large cooperatives prefer a freer trade, but all
deny the trade-distorting impact of the huge direct payments received by the EU farmers so
that they don't care about their dumping effect and import-substitution effect.
The evaluation by Rainer Kühl of the EU cereals cooperatives concludes: "The larger the size
(in turnover or number of members) of the cooperative becomes the more the institutional
governance of cooperatives deviates from the traditional cooperative model. More and more
the board of directors or the management takes the final decision and there is a growing
separation between the member relationship functions, which are assumed by the regional
councils and the operational functions, which are assumed by the management. The
procedures of internal governance in these cooperatives become more and more similar to
those of investor-owned firms. This observation could be made for nearly all cooperatives in all
sectors that were analysed"
(http://www.lei.dlo.nl/wever.internet/applications/leirapporten/images/sp...).
H.H. Hansen, speaking particularly of Danish cooperatives, is more precise: "Both cooperatives
and capital owned companies usually have the objective to ensure owners the highest possible
earnings… Profits of member of a cooperative will come through dividends and through more
favorable sales or purchase prices… Among the 100 largest food companies in Denmark, 52 per
cent of the turn over comes from cooperatives, and 48 per cent from capital owned
companies… In recent years, Danish cooperatives have been very focused on global off shoring
of production and the use of foreign commodities. For several large cooperatives production
abroad now exceeds exports based on the members’ own production… Globalization of
cooperatives in the form of foreign members, increased use of foreign commodities,
investments in foreign production, etc. will imply a shift of paradigm for many cooperatives"
(Henning Otte Hansen, Agricultural cooperatives and globalization: A challenge in future?,
2009, http://www.ifmaonline.org/pdf/congress/09_Hansen.pdf).
This globalized strategy can also be seen in France. The French sugar and cereals cooperative
Tereos distributed the 13 September 2011 to each of its 12,000 sugar beet Members 180 euros
for each of their 173,700 hectares as dividends paid by its private subsidiaries Guarani in
Brazil and Companha Sena in Mozambique producing sugar cane and ethanol. Which
corresponded to an average dividend of 2,600 euros per cooperative Member
(http://www.tereos.com/rapport-annuel-2011/Tereos_rapport_annuel_2011.pdf) but the
average revenue of each cooperator from his average 14.5 hectares of sugar beet was of 50,600
euros (including dividends, additional prices and interest on the cooperative shares). However
the average beet producer has a farm of around 100 ha – of which about 75 hectares of cereals
and 10 hectares of oilseeds and pulses – which generates a decoupled direct payment (the
Single Payment Scheme) of around 350 euros per hectare, adding 35,000 euros of revenues per
cooperator. And this without taking into account the revenues from high market prices for
their cereals, oilseeds and pulses. In other words these sugar beet cooperators are among the
richest French farmers.
43
In September 2011 21,909 employees (excluding the sugar beet cooperators) of Tereos
International were working in Brazil and Mozambique or 82.2% of the total 26,657 employees.
Tereos annual report for 2008-09 stresses the "cooperative spirit" motivating its actions:
"Since its creation, Tereos has drawn from its cooperative origins a specific approach of its
development… Tereos begun as soon as the 1990s a diversification allowing it to enlarge its
field of activities in new zones (European Union, Brazil, Africa, Indian Ocean)… under the
status of subsidiaries of its hard core constituted by the cooperative. This successful
diversification is a response to markets globalization and the critical size of its customers and
competitors… Thus Tereos' historical activities, its international development and its
diversification continue in obeying to the cooperation values – transparency, solidarity and
equity –, but with a modern and prospective vision. Tereos is built owing to its cooperative
members but also its 13,500 employees who share a well agreed mutual interest, anchored on
the various territories" (http://ligaris.dokineo.eu/Tereos).
However, the employees of its sugar factory Sena in Mozambique do not seem to "share a well
agreed mutual interest" with the 12,000 Tereos cooperators, as they were periodically on
strike. In early July 2008, 7,000 cane cutters accused Sena for not paying the work made on
public holidays and not providing the boots and protection equipment required by law
(http://ligaris.dokineo.eu/Tereos). The 8 August 2009, 3,000 cane cutters began a strike for 4
days and burnt 150 hectares of sugar cane to protest against the too low wages – the minimal
wage in the sugar sector in Mozambique was of 54.3 dollars (38.9 euros) per month in 2009 –
and the lack of protection equipment requested the previous year. The 18 September 2009, as
the company did not fulfill its commitments to raise wages, the striking employees burnt an
ambulance and six of them were injured after police intervention (Na Companhia de Sena:
Falta de diálogo precipitou a greve - conclui ministra Helena Taípo,
http://macua.blogs.com/moambique_para_todos/2009/09/na-companhia-de-sena...). The
situation worsened in 2010 when Brazilian replaced the Maurician managers: the transport
premium was suppressed and some employees must walk 10 kilometers, with wages reduced
in case of late arrival to the factory (http://portaldesena.blogspot.com/2011/03/maurelacionamento-na-companhia...). On the other hand the population of Marromeu, where the
factory is situated, complains that the ground water is polluted by the leakage of the irrigation
water, full of pesticides and fertilizers, and the effluents of the factory (Rodrigues Gaspar, A
população de Marromeu preucupada com a agua potavel, 3 de Setembro de 2009,
/2009_09_01_archive.html; http://macua.blogs.com/moambique_para_todos/2011/03/maurelacionamento-n...). Such a situation would likely worsen as Tereos intends to raise the
irrigated area from 7,000 ha in 2011 to 10,000 ha in 2014 and finally 30,000 hectares later on,
given the irregularities of pluviometry.
On the other hand the control of Sena by Tereos is a good example of the land grabbing going
on all over Sub-Saharan Africa. Tereos International, which controls 75% of the Sena company
capital, received a concession of 98,000 hectares for 50 years, renewable, with a possible
extension of 15,000 hectares. According to Tereos, producing sugar and ethanol in
Mozambique presents three advantages: the land belongs to government (what about the
traditional land rights?), there are large tax exemptions (reduction of income tax by 80% and
total exemption of taxes on dividends) and duty free-quota free exports to the EU, Mozambique
being a less developed country benefitting from the EU "Everything but arms" decision of 2000
(http://www.mzweb.com.br/tereosinternacional/web/arquivos/20100608_Tereos...).
According to the World Bank (World Bank, Rising Global Interest in Farmland, Can It Yield
Sustainable and Equitable Benefits? 7 September 2010, page 30 :
http://www.responsibleagroinvestment.org/rai/node/692), investment in the sugar-ethanol
chain in Mozambique values the land price at 9,800 dollars per hectare whereas it is rented by
the State at 0.6 dollar per hectare per year for 50 years. Such an increase in value implies a
profitability rate of 21.4 % per year (0.6 dollar invested at that rate would generate 9,800
dollars after 50 years).
44
Let us add that Tereos, which produces 40% of the EU sugar, received 117.9 million euros of
export refunds for the marketing year from 16 October 2008 to 15 October 2009
(http://news.smh.com.au/breaking-news-world/eu-sugar-companies-big-winner...), plus 12.7
million euros received by its subsidiary of the French overseas department La Réunion, la
Sucrerie du Bois Rouge. Incidentally, given also the predominance of cooperatives in the EU
cereals and dairy sectors, they were also the main beneficiaries of the EU export refunds, at
least before 2010 when they were discontinued.
To conclude we should not be obsessed by the cooperative statutes, in the North or the South.
Cooperatives can be the best or worst types of enterprises and it is not necessary to adopt
these statutes to put in practice the spirit of cooperation and solidarity. What is clear is that in
the EU as in the other Western countries cooperatives share the same profit maximizing
objective for their shareholders cooperators as private companies and do not claim to change
the CAP rules and the WTO trade rules even though they are unfair for developing countries
farmers. In fact COGECA, the coordination body of all EU cooperatives, is closely linked with
COPA, the coordination body of the EU mainstream farmers unions which tend to defend the
interests of the largest farmers, first of those of arable crops. As most COPA leaders are also
national leaders of large cooperatives, they have a clear tendency to defend CAP rules
prioritizing the interests of large cooperatives, which are almost the same as the private agroindustries. Which helps to understand why the EU leaders of COPA-COGECA and their national
colleagues have no appetite to change the CAP rules and the WTO Agreement on agriculture
(AoA) rules, despite their unfair impact on DCs farmers, and to rebuild them on the food
sovereignty principle.
In West Africa there are presently few formal cooperatives within the ROPPA network of
national platforms of family farmers associations ("organisations paysannes"). Legal statutes
much more flexible than cooperatives, as those of "groupings of economic interest"
("groupements d'intérêt économique" or GIE), were largely adopted in Senegal
(http://news.smh.com.au/breaking-news-world/eu-sugar-companies-big-winner...), at least to
run the economic activities not implying foreign trade. But all these small farmers
organizations belong at the same time to national platforms, members of ROPPA (Network of
peasant organizations and agricultural producers of West Africa), which defend clearly the
necessity to rebuild their national agricultural policies on the promotion of small family farms,
agro-ecological production systems and to rebuild the AoA on food sovereignty, a principle
they also defend against the Economic Partnership Agreement (EPA) that the EU pressures
them to sign. The same positions are shared by the other regional platforms of African farmers
organizations – EAFF (East African Farmers Federation), PROPAC (Regional platform of
peasant organizations of Central Africa), SACAU (Southern African Confederation of
Agricultural Unions), UMAGRI (Farmers Union of Maghreb) –, grouped together in the PFAOP
(African platform of peasant organizations). It is this political dimension which is lacking in
Western cooperatives which have lost the spirit of solidarity which characterized the founders
of the cooperative movement in the 19th century, all viewing cooperatives as a means to build
socialist economies.
At a joint conference on 24 April 2012, organised by Euro Coop (consumer co-operatives) and
COGECA in Brussels, entitled ‘Co-operatives working towards a fair and competitive food
supply chain’, Claire Bury, Director at Directorate E (Services), backed the idea of integrating
co-operative values and principles into the supply chain. Ms Bury said: “The founding fathers of
the Equitable Pioneers, in Rochdale, who founded the principles of co-operative movement,
brought social conscious into business, which echoes very loudly into the world. These
principles are still relevant and make business sense”
(http://2012.coop/en/media/news/creating-fair-food-chain-co-operation). For sure but this
social consciousness into business should not stop at the EU frontier.
45
Jacques Berthelot (jacques.berthelot4@wanadoo.fr)
Former lecturer in agricultural policies at universities of Tananarive (Madagascar), Lomé
(Togo) and Toulouse.
PhD thesis on Les coopératives agricoles en économie concurrentielle, Editions Cujas, 1972.
40.
Bhubaneswor Dhakal, Nepal
Dear Moderator and members in FSN Forum
Cooperative and Digital Divides in Nepal’s Rural Communities
Evidence shows that some farmers take advantage of digital technology through cooperative.
Many Nepalese commercial vegetable farmers have formed cooperative. Some cooperative
representatives live in Kathmandu and sell the products sent by farmers from countryside.
They also send instant market price information to farmers on mobile. Based on the
information farmers decide whether to harvest their vegetable on the day or wait for a few
days. The information also helps them whether sell the product to local brokers or send to
Kathmandu. Some farmers used mobile to call cooperative manager and ask availability of
fertilizers. Greater number of farmers depends on radio based information of market prices.
Some of cooperatives representative put some information in internet and access to members
only. Internet based information are used only by brokers and a few rich commercial farmers.
Some farmers do not want to be members in cooperative. When the agricultural inputs are
shortage in the market the cooperative often do not sale the inputs to non-members. These
evidences indicate there is cooperative as well as digital divide in farming communities. A good
extension and training supports to farmers would reduce the digital technology divide and
help to utilised potential benefits of cooperative and digital technologies. It is interesting that
the people managing extension division and field workers know little about the problem of
digital divide and areas for interventions.
Thank you.
Bhubaneswor Dhakal
41.
Joseph Musuya, Women for Women International, Kenya [second contribution]
Sustainability of cooperatives and SACCOs (Savings And Credit Co-operatives), can be looked as
well as from the evolution over time of the economic, financial and market conditions of the
cooperatives. The original model of a savings and credit society was to mobilize savings from
members and pool the same for on lending to the borrowing members. This model worked
well, for a while, until foreign parameters like investing in non-core businesses and borrowing
from commercial organizations, was introduced in the equation.
The dilution of the cooperative model and function came with burden of high cost of capital,
which over the years has enslaved the once vibrant sector into an emasculated sector with
little innovation to excite the members. Some societies collapsed, further worsening the bad
situation.
This has meant that for cooperatives and Saccos to survive, they must enhance current and
seek more viable financing models that will support both on lending and capitation
requirements. In a world where standards and compliance matter the cooperatives. Must have
capacity requirements to meet the requirements set by both the regulators and the financiers
in order to drive toward a self-financing Cooperative
Example of Kenya - Prior to the Sacco Societies Act of 2008, the lack of regulation was the main
reason for Saccos stagnating: brought by issues of mismanagement, poor structure risk and
46
mismanagement. The setting up of a strong legal and institutional regulatory framework has
led to several reforms creating order, sustainability, stability and growth in the sector.
However, under the regulation framework, mandated by Ministry of Cooperatives and
enforced by Sacco Societies Regulatory Authority (SASRA), Saccos MUST meet the legal
requirements in key capital adequacy in the sector and liquidity ratios to achieve growth and
sustainability while operating efficiently.
When cooperatives and Saccos reform, and as the member’s confidence with them grows, they
will support them through savings, shares and deposits. This is the stage where the
cooperatives and Saccos start running from their internally generated funds from the
members.
Joseph
42.
Reema Nanavaty, SEWA, India
VANLAXMI WOMEN TREE GROWER’S CO-OPERATIVE, GANESHPURA
Due to rapid industrialization and in the absence of the necessary backward-forward linkages
for inputs and marketing, the small and marginal farmers and agriculture workers in Mehsana
district were slowly losing most of their land and assets. In particular, excessive irrigation
from bore wells dramatically reduced the water table and rendered the remaining water high
in fluoride content; thus, irrigation became exorbitant and without dependable rains, many
small and marginal farmers were forced to either migrate or take up casual labour. Women
agriculture workers were even harder hit: they could find no alternative work and often had to
walk miles to collect the necessary fodder and fuel.
SEWA organized the women agriculture workers into a co-operative. They demanded and
eventually received government revenue land. However, it was not an easy process as the
existing, disjoint laws in both departments led to a tricky struggle. As per the Co-operative Act,
the cooperative could be registered only if the members own land. However, as per the
Revenue department, the revenue land could be allotted only to a cooperative.
The struggle dragged on for two and a half years, until finally, with SEWA’s continued
intervention, the Revenue and the Co-operative department came to a mutually agreeable
alternative: the landless agriculture workers had to be registered as a tree growers’
cooperative rather than as an agriculture workers’ cooperative. They were able to form a
cooperative for growing trees on government revenue wasteland. Only then, on registering the
cooperative, could the revenue wasteland be allotted.
Through the cooperative, the women systematically planned how to make optimum use of the
available land employing a multi-faceted approach. Through partnering with the local Research
Station of Gujarat Agriculture University for technical assistance, they were able to maximize
production and income by using scientific agriculture practices, including horticulture, agroforestry, drip irrigation, compost pits, and rainwater harvesting techniques. They utilized lowcost methods of boosting productivity such as designing cropping patterns to enrich the soil.
For example, the mung plant’s root increases the soil’s nitrogen content; therefore, strategic
placement and alternation of mung augments subsequent crops. In all activities the
47
cooperative encouraged participation of all village communities and women in their efforts. A
green house is also developed at the Centre and the women are trained in raising of crops in
the green house and its maintenance.
The members of the Vanlaxmi cooperative developed the wasteland into cultivable land
through access to various trainings and agricultural inputs. They have been trained in farm
planning and farm management also. These members take 3 crops in a year and use the farm
planning techniques to decide on which crops to grow in which season and multi cropping. All
this helps the women in improving the productivity and thereby helps tin increasing their
income. Also the members grow vegetables, pulses & grains and medicinal plants at the
cooperative. This is done with a view to ensure that a family can get the required vegetables,
pulses and medicines from the Centre only.
Today, the Vanlaxmi cooperative stands as a model for the entire district of how the landless
poor can successfully implement collective agriculture. Women who used to earn just Rs. 15 as
agricultural day labourers and, who never engaged themselves in matters of yield, sale,
expenditure or market, are now recognized as farmers. They now meticulously manage their
land, tracking each and every cost. The cooperative has acquired improved equipment such as
a power tiller, thrasher, and a drip irrigation system. The plan also ensures full employment for
the members and the land meets the fodder and fuel needs of the village. As it has been
licensed as an authorized seed distributor by the Gujarat State Seed Corporation Ltd., the
cooperative also provides timely and reasonably priced quality seeds to not only their own
village, but to the entire area.
For the past two years the farm is has been developed as a demonstration centre for awareness
raising and education to the communities from the other villages and the other districts. This
site has been developed as an eco tourism centre; which not only helps in awareness
generation among the community at large, but at the same time will also generate income for
the women farmers. This is not only be helpful to the rural communities but at the same time
students from schools, younger and older generations, private companies from cities and
urban areas can also see and learn from the women of the Vanlaxmi Co-operative. The visitors
enjoy the day in the calm and serene surroundings of the farm and enjoy the clean atmosphere.
The trip starts from Ahmedabad. The tourists are welcomed by a traditional welcome ritual.
This is followed by serving the guests breakfast and beverage. This is followed by a tour of the
farm. A sumptuous lunch is served thereafter. The evenings are reserved for a local
entertainment program followed by a trek back to the city.
As a result of the Vanlaxmi Cooperative, 20 women, who are the members of the
cooperative, get an income of Rs 4000-6000 per month through various activities
including agriculture. SEWA’s approach has been to treat agriculture also as an industry
so that agriculture moves from subsistence to becoming viable and profitable.
Reema Nanavaty
Economic and Rural Development Director
SEWA, India
43.
Moisés Gómez Porchini, Mexico
[original contribution in Spanish]
48
En México, el cooperativismo ha pasado por diferentes etapas, dependiendo de la inclinación
política de los gobernantes en turno. Así, han pasado de tener un gran apoyo gubernamental a
ser éste prácticamente nulo en diferentes ocasiones. Sin embargo, ni el gran apoyo de un
régimen ha significado el éxito de las cooperativas ni la falta de apoyo ha llevado realmente a
su extinción.
Las principales medidas por parte del estado que han fomentado la creación de las
cooperativas han sido el reservar durante más de 60 años la pesca de las principales especies
marinas exclusivamente para las cooperativas y el exigir este tipo de asociación para poder
tener acceso a una serie de programas de apoyo, incluyendo créditos o financiamiento a fondo
perdido.
Hasta antes de la revolución mexicana de 1910, la pesca en México se llevaba a cabo por medio
de “Concesiones masivas”, por medio de las cuales se otorgaba la exclusividad de un área o de
una especie a determinada compañía, las cuales en ese momento eran extranjeras por regla
general. Al triunfo de la revolución, se cambio diametralmente el esquema, reservándose las
especies de valor para el aprovechamiento exclusivo ahora de las cooperativas. Aunque en los
90s cambió este esquema, de cualquier manera fue determinante para que la mayoría de las
cooperativas del sector primario estén dedicadas a la pesca.
En lo que concierne a la producción propiamente dicha, tanto agrícola como ganadera, es casi
nula la existencia de cooperativas, pues aunque se fomentaron igualmente, la mayoría no logró
sobrevivir. Sin embargo, actualmente han surgido como una buena opción para la
transformación y la comercialización de productos agropecuarios, constituyéndose las
cooperativas como uniones de productores, en donde cada quien maneja su propia unidad de
producción pero se asocia para tener acceso a maquinaria, financiamiento o mercados que de
otra forma no conseguiría. En el caso del frijol, maíz, sorgo, etc, esta figura se utiliza para el
establecimiento de la empresa acopiadora y comercializadora, Para los pequeños productores
de café, les ha dado oportunidad de participar en la comercialización más allá de la simple
entrega, pues les permite contar con laboratorios y certificaciones que de manera individual,
por su tamaño como productores, es imposible. En todos estos casos, es la exigencia por parte
del estado de que se constituyan como sociedades cooperativas para tener acceso a los apoyos
lo que ha impulsado la creación de estas sociedades.
En el caso de las cooperativas de ahorro y crédito en la agricultura, éstas han recibido un gran
impulso en los últimos años, ya que el estado no trabaja directamente con los campesinos, sino
que utiliza intermediarios a los que llama “Dispersores financieros”, siendo ellos los
encargados de dar la atención directa en crédito y asesoría a los pequeños productores. Ahora
bien, estas “cooperativas de ahorro“ en realidad son empresas que no cumplen con la esencia
de la organización cooperativa, pues de ninguna manera se toman en ellas las decisiones de
manera democrática, sino que son manejadas por individuos a manera de “dueños”, trabajan
con empleados que en los hechos solo reciben su sueldo y no actúan comprometidos con la
comunidad, ya que encarecen en forma desmedida el crédito.
En el punto anterior considero que se encuentra el principal obstáculo para el establecimiento
de cooperativas en México, pues el tomar las decisiones democráticamente entra en conflicto
con el deseo de manejar e incluso de apropiarse de la organización por parte de uno o varios
socios, lo cual ha dado lugar a una gran cantidad de fraudes o bien al manejo político clientelar
de estas agrupaciones.
Saludos cordiales desde México
Moisés Gómez Porchini
[English translation]
In Mexico, cooperativism has gone through different stages, depending on the Government
political orientation. Hence, political support has been significant or virtually null depending
on the situation. However, neither the strong support of a regime has led to the cooperatives
success, nor the lack of support has motivated their extinction.
49
The main governmental measures fostering the establishment of cooperatives have been
keeping aside the main marine species for them during more than 60 years, and requiring this
type of association to gain access to several support programs, including non-repayable credits
or financing.
Until the 1910 Mexican revolution, fishing in Mexico was undertaken with "massive
concessions" that granted the exclusivity of an area or a species to a particular company, which
at that time was usually foreign. After the triumph of the revolution, the scheme was
completely modified, keeping aside the valuable species for the exclusive use of cooperatives.
Although this scheme changed in the 90s, it was essential for enabling the dedication of most of
the primary sector cooperatives to fishing.
Regarding agricultural and livestock production there are almost no cooperatives because,
although promoted, most of them did not survive. However, they have currently emerged as a
good alternative for the processing and marketing of agricultural products, constituting
themselves as producers partnerships in which each party runs its own production unit but
groups together to gain access to equipment, financing or markets that would otherwise be
unachievable. In the case of beans, corn, sorghum, etc., it is used to establish the collecting and
marketing company. For small coffee producers, it has given them the opportunity of
participating in marketing beyond the simple delivery, as it provides them with laboratories
and certifications that, given its size as individual producers, would be otherwise unachievable.
In all these cases the governmental requirement of constituting themselves as cooperative
societies to have access to aid has driven the establishment of these societies.
In the case of savings and credit cooperatives in agriculture, they have received a significant
boost in recent years, as the Government does not work directly with farmers, but uses
intermediaries called “Financial Dispersers" who are responsible of assisting and giving advice
to small producers. However, these “savings cooperatives” are in fact companies that do not
comply with the essence of a cooperative organization, as decisions are not made
democratically but are undertaken by individuals who act as "owners", and their employees
only receive a salary and are not committed to the community, as they make the credit much
more expensive.
In my opinion, this aspect is the main obstacle for the establishment of cooperatives in Mexico,
as democratic decisions clash with the desire of one or more partners of managing and even
taking over the organization. This has led to several frauds or to the political patronage
management of these groups.
Best regards from Mexico
Moisés Gómez Porchini
44.
Danilo Beloglavec, Slovenia
Dear John and Janos,
Thank you for the invitation for an online discussion. First I would like to congratulate for the
good idea to bring forward the idea of rural cooperatives. I am sure that the consultants will
analyze the answers of the questionnaires. I want to submit here only three points that are not
new.
1) My personal view is that the most important factor that the coops can succeed and become
sustainable is the human factor. If the personal interests of the administration, board members,
staff and members are not compatible with their personal ambitions no rules, subsidies or
training can substitute it. Unfortunately an efficient manager wants to be well rewarded. If not
he has to mismanage (steal), find another job or create his enterprise that will very often
compete with his previous coop.
50
2) The members have to have a real advantage from their coop. Only in that case they will not
sell their best products to private enterprises and the second class to the coop. Naturally the
coop has to pay in time and not 9 to 15 months late.
3) The management has to improve the productivity and quality of their members. In this since
during my time with FAO very little was done and many donor sponsored large scale projects
were not sustainable without outside help and benefited the donor industry and larger scale
farmers in developing countries.
I know that is nothing new, and is easier to write model coop rules, legislation an new
workshop than to find products that are requested by the market at a standard quality and
a competitive price.
Best regards
Danilo Beloglavec
Former FAO Senior RURAL Development Officer
Slovenia
45.
Olivia Muza, consultant, Zimbawe
This is a very topical issue and the basis on which most of the rural development solution lies.
Strengthening the operation of rural cooperatives and producer organisations improves
business etiquette in general and increases accountability at various level of rural
development.
Rural cooperatives should address rural savings, business development, investments, capacity
and sustainability issues which are the missing links in current development initiatives.
Cooperatives should address the complete rural development challenge. Sectoral based
policies and initiatives that address fragmented development issues will simply not work.
At the same time, producer organisations should come up with a complete value chain
developmental approach that not only seeks to increase production but also to improve
markets, relationship building with buyers, product development, packaging, agro-processing
and value addition.
The relevant infrastructure is critical for both rural cooperatives and producer organisations
development. Combined with the latest technology there is need to develop avenues for
increasing and effectiveness for rural development.
Thanks
Olivia Muza
46.
Lisa Kitinoja, The Postharvest Education Foundation, USA [second contribution]
Dear FSN Forum members,
following my earlier post regarding the AERI EL SHAMS project in Egypt "Agricultural Exports
and Rural Incomes - Enhanced Livelihoods from Smallholder Horticultural Activities Managed
Sustainably", I found a few key documents in my files from our literature review that will
provide more details.
The Chief of Party was Tom Herlehey -- he prepared a summary "Lessons Learned" (linked)
presentation that did a good job of covering the basics.
51
Burt Swanson wrote an article (linked) about the project from the extension education angle
for a conference held in 2004.
LK
47.
Food for the Cities multi-disciplinary initiative secretariat, FAO, Italy
Dear FSN moderator,
As FAO Food for the Cities multi-disciplinary initiative secretariat we would like to contribute
in the current discussion on enabling cooperatives and producer organizations. It is very
important that the 2012 World Food Day (WFD) is giving recognition of the role cooperatives
play in improving food and nutrition security and contributing to the eradication of hunger.
Since 2007 half of the world population lives in urban areas and these people are active players
of the food systems as consumers and/or food producers or processors. When looking at the
role of cooperatives into the agriculture and food sector, it should be avoided to focus only on
rural areas. We also have to consider how cooperative interact with cities and contribute to
stronger urban-rural linkages.
In 2007, the FAO “Food for the Cities” multi-disciplinary initiative has produced the “Urban
producer’s resource book” (http://www.fao.org/docrep/010/a1177e/a1177e00.htm). Some
key issues have been identified with regards to group organization as an – overriding and
essential - prerequisite to accessing resources, providing a voice and lobbying power and to
increase the legitimacy and image of Urban and Peri-Urban Agriculture (UPA).
Organization of urban producers can help to access the resources of production – land, water,
inputs, tools, markets, training etc. In urban setting financial availability – credit and loans
allowing investment in better, safer and more profitable UPA activities can be an issues. A bank
can provide a single large loan to the group rather than individual small loans to each member.
Seed, fertilizer etc. can be bought in bulk for all members and produce can be marketed
together, cutting the costs. The policy and regulatory environment – to acknowledge the
demand and need for UPA and to support and regulate urban agriculture for the benefit of all is
crucial. Local government and institutional support – through extension departments, water
and health authorities, city planners, NGOs and other support organizations to provide the
information, training and assistance needed to better integrate UPA into the cities needs to be
ensured. Environmental and food quality/safety standards – to ensure health, safety and
environmental concerns are met and hence also to combat the negative view of UPA can be
much easily claimed.
Finally, analysis of the above mentioned issues from a gender perspective – focusing on the
constraints faced by women urban producers and their group strategies for overcoming them
needs always to be considered. Often there is a gender division in terms of activities with, in
many cases, women being the main group involved in processing and marketing, whilst men
are involved in production. By working together, a group can take advantage of the skills of
different members especially in urban context where division of labour can be more important
than in rural areas. Some people may be good at figures, some are good with their hands, some
are very quick to learn technical things and others are good with people. Members can also
learn from each other. Groups give members, especially women, more self-confidence and
status. People are usually more willing to try something new if they are not alone, or can at
least ask others what they think.
In urban areas as well as in other settings, it is also important to consider the consumer’s role
within the food system. Multi-stakeholder platforms around the food and agriculture issues at
52
local level, such as the establishment of food councils, can contribute in empowering
cooperatives of small producers, processors or retailers in small, medium and big size cities all
over the world.
With kind regards,
Francesca Gianfelici and Julien Custot
FAO Food for the Cities multi-disciplinary initiative
www.fao.org/fcit
48.
John Rouse, facilitator
Financial self-reliance versus technical self-reliance:
Much of the discussion so far has been on how to promote better cooperative financial selfreliance. Not much has been said on how best to promote more cooperative technical selfreliance. For example, how do you help cooperative members and leaders become successfully
manage the cooperative business without the need for continued external assistance. In the
past governments have tended to address this problem by temporarily assigning trained
officers to help manage the cooperative business, but this approach hasn't worked very well. It
has only created more cooperative dependency on outside support. Some governments feel
uneasy about promoting greater cooperative independence from their support. How do you
think this problem should be addressed?
49.
Michael Riggs, FAO, Italy
Dear all,
Farmer organizations work better with information and communication technology (ICT). This
is not only a catch phrase, but the title of an in depth module about the role of information and
communication tools and processes that can support cooperatives in developing countries.
Coordinated by the World Bank, this resource brings together good practices, relevant impact,
and means to address challenges. It is available online at
http://www.ictinagriculture.org/ictinag/sourcebook/module-8-farmer-organ...
In November of this year, the World Bank will be hosting an online discussion about recent
advances in the use of ICT to support cooperatives, and persistent challenges in the field. The
discussion will take place on the e-Agriculture community platform (www.e-agriculture.org),
with more details available as the time approaches.
50.
Edwin Tamasese, Soil Health Pacific Ltd, Samoa
The most important thing for a cooperative to work sustainably is not to form it from the
outset. Cooperatives form on common need. When a cooperative is formed too early in the
piece it does not allow the participants to gain relevant insight into why, how and into what
areas they can work together. Creating a cooperative based on common need it therefore
critical. Too many times cooperatives get formed for political rather than common need
reasons. Yes, pooling resources together is a much more effective method of ensuring good
wealth distribution, but this must be combined with the ability to work with the natural
psychology of participants which is personal benefit. The key is creating a group vision where
the individual identifies personal benefit in a forum which creates group benefit. I am currently
53
building this with several groups in Samoa. End of the day, results will speak for themselves,
but the best way to test a theory is to put it into practice.
Regards,
Edwin Tamasese
Managing Director
Soil Health Pacific Ltd
Apia,
Samoa
51.
Nora Ourabah Haddad, FAO, Italy
Dear FSN Participants,
After three weeks of intense discussion and fruitful exchanges, I would like to take the
opportunity of the closing of the FSN discussion on "Enabling rural cooperatives and producer
organizations to thrive as sustainable business enterprises" and to thank our facilitators John
Rouse and Janos Juhasz for their valuable contribution. Indeed, we are very grateful for their
accepting to avail their time and long standing experience on cooperatives and producer
organizations to ensure the success of this discussion.
We also thank our participants for their insightful inputs and in-depth contributions
throughout these last weeks. Our team will compile them and use them to enrich upcoming
discussions and debates during fora and events to be held as part of FAO's awareness-raising
initiatives related to the International Year of Cooperatives (IYC, 2012) and the World Food
Day (16 October 2012) on the theme of agricultural cooperatives. Most importantly, we expect
to integrate all these inputs and contributions in the Global Plan of Action being prepared by
the Rome-based agencies and the UN interagency coordination for the IYC and Beyond.
We would also like to thank our colleagues from FSN secretariat team, in particular Renata
Mirulla, for her precious support to our Team in organizing this successful FSN.
Please feel free to contact us directly at FAO, for any request or information regarding followup to this FSN Discussion or information relevant to FAO's initiative on the International Year
of Cooperatives (2012) and Beyond. Please send your query directly to me:
nora.ourabahhaddad@fao.org and also to: rosalud.delarosa@fao.org.
We look forward to your continued support in strengthening the role of agricultural
cooperatives and producer organizations to reduce poverty and achieve food security in the
world.
Nora Ourabah Haddad
email: nora.ourabahhaddad@fao.org
52.
Joint final comments by John and Janos, facilitators
The majority of contributions to this final week of discussions seemed to have focused on two
main themes: (1) extension and training methodologies aimed at strengthening the
profitability and self-reliance of rural producer cooperative businesses and organizations, and
(2) new approaches in the use of ICT to promote cooperative business self-reliance and
growth.
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Extension and training methodologies.
Reema Nanavaty (India) highlighted the case of women agricultural workers in Gujarat, who
after years of effort and partnering with SEWA and professionals from the Research Station of
Gujarat Agriculture University finally succeeded in establishing a successful and profitable tree
growers business cooperative
Danilo Beloglavec (Retired FAO Officer) in his contribution emphasized the importance of the
human element in cooperative business success, arguing that cooperative trainers need to not
only focus on strengthening the individual business management capacities of members but
also educate them in how to identify and select leaders and managers based on their business
and collective decision-making skills and motivation, and ensure they are adequately
compensated for their performance.
Olivia Muza (Zimbabwe) added that cooperatives trainers and extensionists need to adopt a
complete “value chain” approach to building cooperative business self-reliance but with a
strong emphasis on promoting rural member savings.
Lisa Kitinoja (USA) provided the most comprehensive case study of the use of a value chain
business approach to strengthening rural producer organization self-reliance. She did so by
highlighting the successful USAID-CARE funded Agricultural Export for Rural Income (AERI)
Project in Egypt. According to the report she attached, the aim of this multi-million dollar pilot
project has been to enable research and extension staff, partnering with private sector firms
and farmer associations, to assist small farmers in supplying on a profitable basis key markets
in the European Union. According to the author of one report, several factors led to the
capacity building project’s success:
 Research and extension first focused on identifying high-value export crop market niches
in European Union countries, including the food quality standards, input requirements,
processing, storage and transport standards for each of those niches
 Farmer training concentrated providing farmer association members and leaders with a
comprehensive understanding of the roles and responsibilities of all players at each
level of the international supply chain and then comparing alternative supply chains for
supplying specific markets with different products.
 The introduction of contractual instruments that allow the selected farmer associations
(FAs) to contract with one or more exporters, and in turn to contract with each of
its members.
Food for the Cities multi-disciplinary initiative Secretariat (FAO, Italy) emphasizes that
capacity building efforts should not just focus on rural cooperatives and producer
organizations, but also build the capacities of urban and peri-urban agricultural producers,
many of them women, who are engaged in the production of high-value perishable agricultural
products for the domestic and international markets.
The use of new information and communications technologies to improve coop and
farmer access to market information, to facilitate social capital building and to improve
coop business info systems.
Michael Riggs (FAO Italy) provides convincing case study information on a wide range of
successful initiatives focusing on use of new Information and Communication Technologies
(ICT) to improve rural cooperative business profitability and governance. Especially worth
examining is the World Bank’s “ICT in Agriculture Sourcebook” that Riggs attaches to his
contribution. The sourcebook provides a mass of new case studies on how appropriate ICT
55
technologies can improve cooperative and rural producer organization business performance
and self-reliance. Interestingly included in the sourcebook is mention given to an FAO funded
project in Kenya implemented in collaboration with the Department of Cooperatives that
resulted in the successful computerization of the Tulaga Dairy Cooperative and provided the
basis for the development of an FAO guidelines manual on cooperative computerization. Also
worth mentioning is the successful introduction of the FrontierSMS system in El Salvador,
China and Indonesia which involves the establishment of computer-mobile phone networks in
farmer associations. These networks help link farmer association members together and
provide them with up-to-date SMS-based information on market prices, product shipment and
delivery dates, meetings dates, etc.
Closing participant comment on the online discussion
Edwin Tamasese (Samoa) who happens to work out a brilliant closing comment for this online
discussion on enabling rural cooperative and producer organization and self-reliance.
Tamasese argues that the most important feature of successful and self-reliant cooperatives is
that they are formed from the outset to address a common member business need. We two
facilitators completely agree with him on this point. Much too often cooperatives get formed
from the top-down and for political reasons rather than common economic need reasons. Yes,
pooling resources together is an effective method for ensuring financial self-reliance
independence and sustainability, but the key factor according to him is creating a group vision
where the individual member identifies his or her personal business benefits in a forum that
creates group business benefits. Tamasese says that he is currently doing this with several
groups in Samoa. We wish him good luck in his work and thank him.
Facilitators closing comments
The over 50 interventions made during the three week duration of the online discussion on
enabling the development of more self-reliant cooperative businesses and producer
organizations highlighted a number of important sub-themes, namely:
 The promotion of increased rural savings and cooperative capital. Several participants
mentioned the importance of strengthening the internal savings capacities of
individual rural cooperative members and encouraging them to collectively invest
more in their cooperative business. It is the view of the two facilitators that more case
studies of successful methods of member rural savings and cooperative capital
formation need to be conducted to better understand which methods and mechanisms
are the most productive.
 Almost all participants highlighted the need to further strengthen cooperative member
business and cooperative business management capacities aimed at improving
business profits and sustainability. The underlying principle that should guide the
capacity building process is that cooperatives are businesses and their sustainability
and operational autonomy depend on the ability to earn a profit and invest part of it to
finance business growth.
 There was considerable discussion on how to efficiently deliver cooperative business
management training and skill development services to cooperative members
and managers. Three skill areas that should receive greater emphasis in cooperative
business training programs include: improved strategies for mobilizing member capital
to finance cooperative business growth; the advantages and disadvantages of using
new ICT technologies to collect and monitor business cooperative performance.
 The pros and cons of vertical integration of cooperative business structures within or
alongside existing agricultural product value chains was also discussed. However, there
56
was consensus that most successful vertically integrated cooperative businesses were
built slowly from the bottom up and not from the top down.
 Virtually all participants seemed to favor the introduction of new laws and policies
that give value to and encourage the mobilization of cooperative member capital and
savings to strengthen cooperative self-reliance. One participant suggested that one of
the best ways to ensure greater rural cooperatives self-reliance would be to require
both donor and governments providing aid to cooperatives to monitor recipient
cooperative progress towards technical and financial self-reliance.
 Participants presented a number of useful case studies on allegedly successful
cooperative business development. However, no clear verifiable evidence was
presented on the degree to which these cooperatives had achieved technical and
financial self-sufficiency.
 Another popular topic discussed was the potential role that ICT technologies could play
in strengthening rural cooperative business self-reliance. Of particular interest was the
presentation of the World Bank guidelines manual on ICT in Agriculture and its specific
mention of two cases: one involving the development of a PC-based mobile phonenetwork for collecting and quickly disseminating market price and supply price. The
other involving an FAO-supported pilot project that succeeded in computerizing a
Kenyan dairy cooperative in Tulaga. The Facilitators might add that the experience
gained from the implementation of this latter pilot project served as an important input
in the development of FAO’s own guidelines manual on cooperative computerization.
In closing we would like to thank all of the participants for their useful comments on topic of
how to promote increased rural cooperative and producer organization self-reliance and hope
that you have found our facilitation of the discussions stimulating. One thing for sure is that it
has generated a number of questions and recommendations regarding follow-up to the
conference that we would like FAO and its member governments to consider:
A list of questions
Do cooperatives deserve special taxation treatment (e.g. tax exemption, capital injections) by
the state/government or should they be treated as ordinarily?
Should coop principles to be strictly observed or can some flexibility contribute to business
efficiency? In this respect, we should emphasize that in addition to formal cooperatives we
consider all forms of member owned and controlled self-help rural economic organizations
“cooperatives” in a broader sense.
Rural cooperative businesses suffer from a range of problems hindering business efficiency
and sustainability as pointed out in the discussions: poor organization and management
capabilities, problems in accessing national and international markets, dependence on donors
(the typical “when the project is closed the cooperative also disappears), isolation in own
communities, lack of capital, lack of consistence product quality and supply, lack of
entrepreneurial thinking and capacities of farmers, too small size of cooperatives and lack of
integration into larger associations/secondary cooperatives. How can these broad issues
affecting cooperative self-reliance be more effectively addressed by outsiders without creating
more dependence on external support?
How can the new ICT technologies be used to strengthen member access to agricultural and
other information, to improve cooperative business accounting systems and to forge working
links with other rural and urban organizations and private sector agencies active in rural
areas?
57
Our final recommendations
To member governments:
There are many more successful cases of self-reliant and sustainable rural cooperative
business enterprises in developing countries that meet the eye. More objective case studies of
these cooperatives need to be done so that government, donors and NGO agencies promoting
cooperatives gain a better understanding of the key internal (member capitalization, business
management and member governance) and external (legal, policy, financial and extension and
training) conditions that have influenced that success.
Financial and technical aid to cooperatives and rural producer organizations should be tied to
the assisted cooperative’s achievement of well-defined, measurable self-sufficiency indicators.
ICT can help bridge communication gaps. Appropriate ICT is the answer.
Proposals for FAO:
Given the need to provide technical advice and field assistance to FAO member countries on
how to create a more vibrant, self-reliant and sustainable network of independent farmer
organizations to support more equitable and sustainable rural development, FAO should give
serious consideration to establishing a special technical unit on cooperative and producer
organization development staffed with experienced personnel in the field of cooperative
business and producer organization development. To that end, FAO should urgently reestablish one or two full-time positions for officers in charge of cooperative development and
reorganize some kind of cooperative unit/team.
FAO should devote resources (capital and human) to become once again an authority in
agricultural/rural cooperative development.
FAO’s approach should be down-to-earth, realistic and practical. The organization should not
enter into high-level academic discussions on principles and definitions, it should focus on the
selection and promotion of tangible, efficient and sustainable business solutions for and
training cooperatives and other rural self-help organizations.
To start with, FAO should carry out a stocktaking action on what it had done in the past and
what it has to build upon in terms of ideas, programmes, projects, guides, training materials,
etc.
Based on the above a draft - at least medium-term – cooperative development
programme/work plan/road map should be prepared for discussion, revision and approval at
an international workshop with the participation of all potential collaborating partners,
counterparts, cooperative practitioners and experts.
John Rouse and Janos Juhasz
Additional contribution received
53.
Emile N. Houngbo, University of Abomey-Calavi, Benin
English version
58
Agricultural cooperatives are a priori a credible alternative to address agricultural
development problem facing Africa. Cooperatives are useful to face the problems of excessive
land fragmentation and precariousness in which farmers live. The farmers, who have
individually some very small portions of land, would find relief by putting together their
production factors: land, labor and capital. This pooling within cooperatives must enable
cooperators for example:
i) To adopt land conservation farming practices and modern production techniques that could
not be applied under conditions of scarcity of land. Cooperatives are then able to create the
conditions for introduction of improved fallow technologies (Mucuna pruriens, Aechynomene
histrix, Acacia auriculiformis, Gliricidia sepium, Senna siamea, etc) and natural fallow in order
to control land degradation. With the production factors available to cooperatives, the use of
tractors for example and such the farming systems diversification must also be facilitated.
ii) To achieve economies of scale through the optimal use of production factors and reduced
unit cost of the productions. This would allow cooperatives to improve their profit margins and
thus to reduce poverty of the cooperators.
Cooperatives are then for the producers, a relevant way to address the agricultural risks which
are: farming risks (yields falling), economic risks (prices falling, poor sales…), biological risks
(plant and animal diseases, pests,) and climatic risks (drought, flooding, inadequate exposure,).
In fact, the problem of agricultural development in Africa is mainly linked to risk management,
especially if we take into account the fact that agriculture still dominantly rainfed in this region
of the world.
However, we must recognize that cooperation does not systematically deal with all risks. It is a
way to face the first two types of risks: the farming risks and the economic ones. This means
that agricultural cooperatives formation is not a panacea.
Indeed, all these virtues recognized to cooperatives cannot be achieved without a judicious
intervention of the State. The role of the State remains important because the biological risks
and the climatic ones do not find systematically their solution through the cooperatives
formation. Even at the level of economic risks, the role of the State remains also crucial. The
State must be able to get involved in supporting cooperatives by the definition of good
agricultural policy, such as supply chain organization. It is this policy which would allow
producers to better profit of the advantages mentioned above, and thus, the State also could
make back revenue through taxes that may be collected on the productions.
A second kind of intervention also returns to the State, the supervision of cooperatives. The
Government must insure capacity building to the cooperatives. These are the actions to be
taken so that the cooperatives can recognize the importance and develop mutual trust, efficient
organization of the activities and active participation of all the cooperators in the work.
Experiences show that these qualities are not always present in the cooperatives without
external support. The Cooperatives of Rural Development (CAR) initiated in Benin in the '60s
for especially the palm oil sector development are almost all blocked some decades ago,
operationally speaking. But we must recognize here that the initiative of the CARs creation
came from the State; what raises the question of the necessity of a spontaneous and voluntary
cooperatives constitution by the co-operators themselves, and the free choice of the crops they
could judge useful and appropriate to their conditions. The CARs were created in Benin by the
law 61-27 of August 10, 1961 on the Statute for Agricultural Cooperation; law that received
minor amendments, especially the Order 60/PR/MDRC of December 28, 1966 and the
amendment of 1969.
In short, cooperatives are important to meet the challenge of declining production resources in
Africa and to support family farming which remains primarily a way of life for the farmers
59
before being a business. But, it still requires a good agricultural policy of the State. Two critical
levels of action are concerned: the necessary support to cooperatives to enable them to face
climatic and biological hazards, and the necessary support to facilitate the creation of a good
climate of trust between the cooperators, the efficient organization of the activities and the
active participation of all of the cooperators. But, moreover, a voluntary association of
cooperative members should be preferred Agricultural cooperative promotion in Africa, and
then agriculture development, depends largely on the macroeconomic policies and strategies
of the different States.
Dr Emile N. HOUNGBO
Agricultural Economist & Sustainable Development Specialist,
University of Abomey-Calavi (UAC),
National Higher School of Agriculture, Ketou (ENSTA-Ketou),
Head, Department of Rural Economics and Sociology,
Cotonou (Republic of Benin)
French version
Les coopératives agricoles constituent a priori une alternative crédible pour faire face aux
problèmes de développement agricole que rencontre l’Afrique. Les coopératives s’avèrent
utiles pour contourner les problèmes d’émiettement excessif des terres et de précarité dans
laquelle vivent les producteurs. Ceux-ci qui n’ont que de très petites portions de terres
individuelles, trouveraient un soulagement par la mise en commun des facteurs de production :
la terre, le travail et le capital. Cette mise en commun au sein des coopératives doit pouvoir
permettre entre autres aux coopérateurs :
i)
d’adopter des pratiques agricoles de conservation des terres et des techniques modernes
de production qui ne sauraient s’appliquer dans des conditions de rareté de terre. Les
coopératives sont à même de réunir les conditions d’introduction des technologies de jachère
améliorée (Mucuna pruriens, Aechynomene histrix, Acacia auriculiformis, Gliricidia sepium,
Senna siamea, …) et de pratique de la jachère nature naturelle en vue de la limitation de la
dégradation des terres. Avec les moyens de production à disposition des coopératives,
l’utilisation de tracteurs par exemple et la diversification des systèmes de production doivent
être aussi facilitées.
ii)
de réaliser des économies d’échelle par une utilisation optimale des facteurs de
production et une réduction du coût unitaire des productions. Ceci permettrait aux
coopératives d’améliorer leurs marges bénéficiaires et donc de réduire la pauvreté des
coopérateurs.
Les coopératives sont ainsi pour les producteurs, un moyen pertinent pour affronter les
risques agricoles que sont : les risques de production (chute des rendements), les risques
économiques (chute des prix, mévente, …), les risques biologiques (maladie des plantes et des
animaux, pestes, …) et les risques climatiques (sécheresse, inondation, insolation
insuffisante,…). En fait, le problème de développement agricole en Afrique est principalement
lié à la gestion du risque, surtout si nous prenons en considération le fait que l’agriculture y
demeure à dominance pluviale.
Toutefois, il faut reconnaître que la coopération ne permet pas systématiquement d’affronter
tous les risques. Elle s’avère un moyen pour résister aux deux premiers types de risques : les
risques de production et les risques économiques. Ce qui veut dire que la constitution des
coopératives agricoles n’est pas une panacée.
60
En effet, toutes ces vertus reconnues aux coopératives ne sauraient se réaliser sans
l’intervention judicieuse de l’Etat. Le rôle prépondérant de l’Etat demeure du fait que les
risques biologiques et climatiques ne trouvent pas systématiquement leur solution à travers la
constitution des coopératives. Même au niveau des risques économiques, le rôle de ’Etat reste
déterminant. L’Etat doit donc pouvoir s’impliquer dans l’accompagnement des coopératives
par la définition d’une bonne politique agricole, telle que l’organisation des filières. C’est celleci qui permettrait aux producteurs de tirer meilleur profit des avantages cités plus haut, et
ainsi, l’Etat aussi pourrait réaliser en retour des recettes grâce aux prélèvements qu’il pourra
effectuer sur les productions.
Un second volet d’intervention revient aussi à l’Etat ; celui de l’encadrement des coopératives.
L’Etat doit assurer le renforcement des capacités des coopératives. Il s’agit des actions à mener
pour que les coopératives puissent reconnaître l’importance et faire régner en leur sein la
confiance mutuelle, l’organisation opérationnelle des activités et la participation active de tous
les coopérateurs aux travaux. Des expériences montrent que ces qualités ne sont pas toujours
présentes au sein des coopératives si des appuis extérieurs ne leur sont pas portés. Les
Coopératives d’aménagement rural (CAR) initiées au Bénin dans les années 60 pour le
développement notamment de la filière palmier à huile sont presque toutes bloquées dans leur
fonctionnement depuis des décennies. Mais, il faut reconnaître ici que l’initiative était venue de
l’Etat ; ce qui pose ainsi la question d’une constitution spontanée et volontaire des
coopérateurs eux-mêmes et le libre choix des spéculations qu’ils jugent utiles et adaptées à
leurs conditions. Les CAR avaient été créées au Bénin par la loi 61-27 du 10 Août 1961 portant
statut de la Coopération Agricole; loi qui a été modifiée par des amendements mineurs,
notamment l'Ordonnance 60/PR/MDRC du 28 Décembre 1966 et l'amendement de 1969.
En somme, les coopératives sont d’importance pour relever le défi de l’amenuisement des
facteurs de production en Afrique et pour soutenir l’agriculture familiale qui demeure avant
tout un mode de vie avant d’être une activité économique. Mais, cela nécessite toujours une
bonne politique agricole de l’Etat. Deux niveaux essentiels sont concernés : le soutien
nécessaire aux coopératives pour leur permettre de faire face aux risques biologiques et
climatiques, et l’appui nécessaire pour faciliter la création d’un bon climat de confiance entre
les coopérateurs, l’organisation efficiente des activités et la participation active de tous les
coopérateurs aux travaux. Mais, au demeurant, l’association volontaire des coopérateurs doit
être privilégiée. La promotion des coopératives agricoles en Afrique, et donc du
développement agricole, dépend largement des politiques et stratégies macroéconomiques de
des différents Etats.
54.
Jacques Berthelot, Solidarité, France
Les coopératives agricoles européennes promotrices de la mondialisation inégale
The European agricultural cooperatives, promoters of the unequal globalization
61