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

Nishadi Somaratne Sri Lanka
13.07.2012
Nishadi  Somaratne

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 self-reliant 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