By Alice Marks, @alicemarks0
The International Day of Cooperatives is the perfect time to celebrate the power of pulling together in the face of adversity. Working together can create social capital that enables individuals to achieve goals that they may not be able to achieve alone. Although ‘Social capital’ might sound like something intangible, it has a huge value. It is a measurement of connections between people – the glue that binds people and the reason to work towards common goals. In other words, it’s the value of ‘who you know’ rather than ‘what you know’ and evidence shows that communities with high social capital are more able to become economically and sustainably prosperous.
A group of people that is cohesive, value each other and stick together through hardship, is more able to work together to overcome challenges. The ability to do this is particularly important for communities with low incomes, limited education and few physical assets because it can create a social safety net that helps mitigate shocks or stresses. This is where cooperatives can come in and form a framework through which people can unite under shared needs and aspirations. Agricultural cooperatives work in a number of ways that can be beneficial to individuals and communities. A group of farmers make a more attractive customer than a single farmer because they spread risk amongst them, so facilitating access to finance, agricultural inputs and external markets.
Cooperatives support one another
For example, the Association pour la vision des Eleves de Nyonirima (AVEN) is a group of twelve young men and women from northern Rwanda. The AVEN members decided to form a cooperative after participating in Technoserve’s STRYDE training program, which equips school-leavers with training in business management skills, financial literacy and personal development, then links them to financial services.
The AVEN cooperative received an initial loan of US$2000 to start their business, which produces improved seed potatoes. This is far more money than any individual could have hoped to procure on their own because few of them owned any assets against which a loan could be guaranteed. However, as a group and equipped with a solid business plan, they became an attractive customer. The cooperative managed to pay off the initial loan and now hopes to obtain further financing to acquire more land and a warehouse to store crops for sale at both local markets and national markets.
Not only have the AVEN members benefitted collectively, but also as individuals. After the initial loan was paid back, they were able to split their profits and gain further credit against their now-larger assets. This made it possible for each of them to start their own business depending on their varied interests, including growing garlic, running a bar, providing mobile banking services and owning a bull. One girl used the money to invest in her own future by paying her way through college, which she hopes will widen her future prospects. Importantly, even if the potato seed business takes a hit one season, each of them has other income sources to rely on, as well as support from each other.
Cooperatives enhance natural resources
Climate change and a growing population can put pressure on natural resources, creating an instability that can lead to conflict. However, when groups work together to protect, even improve, natural resources, livelihoods are more stable and people can build their assets.
For example, a group of farmers in Kiambwa, Kenya, worked with the Water Project to build a sand dam and shallow well. Before the sand dam was built, during the dry periods people typically dug deep scoop holes, averaging 1.5 meters deep, and queues at these scoop holes meant waits of over 4 hours per day to collect water, often of poor quality. The time spent collecting water severely limited the farmers’ ability to engage in other agricultural or economic activities.
With the sand dam, the water is more easily available and cleaner. In addition, time taken to collect water is reduced to 30 minutes per day, which has enabled other activities. For example, Hellen Munini, a member of the group, said “We don’t buy vegetables such as kale from the market anymore, because we can now grow it ourselves, thus putting the money to other use.” Once the sand dam was completed, the group of farmers could engage in other projects to improve their natural resources, such as tree planting and building terraces to prevent soil erosion.
Cooperatives ensure better jobs
The Goal 8 of the Sustainable Development Goals aims for everyone to have access to decent work and economic growth. Cooperatives can help to realise this by enabling farmers to achieve better working conditions, for example through safety training, as well as wielding much greater bargaining power, thus being able to argue for better prices for the members when produce is sold.
For example, Kibinge Coffee Farmer’s Cooperative was founded in 1994 by four farmers in Uganda, and now has more than 2000 members. The cooperative employs democratically elected ‘promoter farmers’ that train farmers in best practice, including labour-saving techniques and the safe use of inputs, as well as feeding back to the cooperative headquarters about the needs and requests of the members. At the end of the season, the cooperative buys coffee from the farmers at a good price, as guaranteed by the cooperative’s Fairtrade certification, and sells it on their behalf. Because of the volume of coffee that they sell, as well as the benefit of more experienced salespeople, the cooperative can bargain for a much better price than a farmer could alone.
We can all learn from cooperatives.
Here are highlighted only some of the benefits that being part of a cooperative can offer. For example, the fact that cooperatives are based on democratic principles can mean that vulnerable people are able to find a voice. In addition, the existing framework that cooperatives provide can enable NGOs working in other sectors to reach rural or vulnerable groups more easily, for example to offer healthcare or training programs. Of course, no system is perfect and issues such as corruption, greed, and the exclusion of some vulnerable groups can, and do, occur.
However, on this day, let us celebrate those transparent, well-run cooperatives that empower members and help each other become prosperous. They remind us that when people work together everyone can benefit – let us not forget this lesson, even from afar.