Module I Concepts, Principles, Types of Cooperatives
Module 1: The Concept, Principles, Types of Cooperatives<br />By: ARD Jo B. Bitonio CDA Dagupan Extension Office<br />
OBJECTIVES:<br />When you finish the module, you should be able to:<br /> be aware of the state of the cooperative movement, <br /> its prospects and challenges ;<br />2. understand the general concept of cooperatives;<br /> differentiate cooperative from other form of business;<br />3. appreciate the cooperative principles; and<br />4. ascertain the types of cooperatives <br />
Worldwide, some 1 Billion people (ICA, 2011) are members of cooperatives, and it is estimated that cooperatives employ more than 100 million jobs worldwide. The United Nations estimated in 1994 that the livelihood of nearly 3 billion people, or half of the world's population, was made secure by co-operative enterprise. These enterprises continue to play significant economic and social roles in their communities. Below are some facts about the Movement that demonstrate their relevance and contribution to economic and social development.<br />
Self-Administered Question (SAQ) 1<br /><ul><li> What is your analysis of the state of the cooperative movement of the Philippines?
What are the strengths/weaknesses of the cooperative movement?
How would you help your cooperative to increase its membership, assets and capitalization?</li></li></ul><li>Prospects<br />Prospects for the cooperative movement is bright. Sibal (2011) in his paper diagnosed the prospects of the movement:<br /> a) No less than the President of the Republic Benigno S. Aquino III (2010) made a pronouncement that cooperatives have played a crucial role in democratizing opportunities, capital, and investments in the country by complementing the efforts of government to alleviate poverty and achieve social justice <br />b)Multi-purpose coops increased by 8 folds, service coops by 4.5 folds, and coop federation by 4 folds. Marketing coops increased by 3 folds and producers coops by 2 folds this manifest that cooperatives have engaged in high value operations dramatically and their number increased higher than credit coops;<br />
Prospects<br />Prospects<br /> c) increased total assets of the coop movement;<br />d) intensified campaign of the CDA to increase cooperative membership to 20 million (2011 -2013); <br />e) “Big brother, small brother” cooperation among cooperatives will further the growth of the coop sector. This means more intensive Federation and union work and advocacy that will not compete but will strengthen the operations of the primary coops; <br />
Prospects<br />f) The coop group within the party list bloc in Congress should play its cards well. Although in the minority bloc, the coop legislators are actually representatives of the marginalized sectors of society which comprise the majority of the country’s population; and <br />g) strengthening of partnership with all the development partners of the CDA from the NGAs, LGUs, NGOs and Councils at the national/regional/provincial/city and municipal.<br />
Prospects<br />Challenges<br /> From more than 80 researches which assessed the growth and development of coops from 1989 to present, Sibal (2011) listed the following challenges: <br />majority of the cooperatives are young and start up cooperatives (CDA, 2010); <br />with globalization, small, medium and big coops are exposed to strong competition; <br />
Prospects<br />Challenges<br />c. unionization in some medium and big size coops continues. This implies that the coop management practices in some cooperatives are still very reactive and less participative <br />agri-based cooperatives like those in the agrarian reform communities and plantations are not showing improvement in productivity; and <br />e) the mentality of relying state protectionism, parochialism and close-doorism still prevails among many cooperatives.<br />
Challenges<br />Challenges<br />As the global economy reels under the financial crisis, the cooperative movement is not immune to it. The primary impact of the financial crisis on coops is that it has led to a significant decrease in much needed capital by members/clients as many of them depend on its for resource economic demands. The long term effect of the financial crisis on coops would be: more stringent lending policies, tighter filtering of clients, liquidity shortages and increasing costs of funds amidst declining economies (Llanto et al; 2009). The deposits of coops members/clients are expected to decrease due to the increase in food and fuel prices that are dwindling as coops struggle with low profit margins. <br />
Reference:<br />CDA Statistics www.cda.gov.ph<br />Prof. Jorge V. SibalThe Philippine Cooperative Movement: Problems and Prospects (1986 – present)<br /> UP-Diliman<br />RA 9520<br />4. ICA 2011<br />Mr. Bob BurltonMidcountiesCo-operative, United Kingdom, Aug. 2006 <br />