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Re: Enabling rural cooperatives and producer organizations to thrive as sustainable business enterprises

John Rouse Italy
21.07.2012
John

First of all Janos and I want to thank all of you for your very useful initial comments on this important topic. In order to keep our discussions ass 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 orndonors 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 Yakas) Problems in mobilizing internal capital (Millns and Yakouza) 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, Yakas, 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 self-sufficiency 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. END OF PART ONE (To be continued)