Cooperatives and the Millennium Development Goals By Johnston Birchall Cooperative Branch & Policy Integration Department International Labour Office, Geneva Committee for the Promotion and Advancement of Cooperatives Copyright © International Labour Organization 2004 First published 2004 Publications of the International Labour Office enjoy copyright under Protocol 2 of the Universal Copyright Convention. Nevertheless, short excerpts from them may be reproduced without authorization, on condition that the source is indicated. For rights of reproduction or translation, application should be made to the ILO Publications Bureau (Rights and Permissions), International Labour Office, CH-1211 Geneva 22, Switzerland. The International Labour Office welcomes such applications. Libraries, institutions and other users registered in the United Kingdom with the Copyright Licensing Agency, 90 Tottenham Court Road, London WIP 9HE (Fax: +44 171436 3986), in the United States with the Copyright Clearance Centre, 222 Rosewood Drive, Danvers, MA 01923 (Fax: +1 508 750 4470), or in other countries with associated Reproduction Rights Organizations, may make photocopies in accordance with the licences issued to them for this purpose. Birchall, Johnston Cooperatives and the Millennium Development Goals Geneva, International Labour Office, 2004 ISBN 92-2-116148-X The designations employed in ILO publications, which are in conformity with United Nations practice, and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the International Labour Office concerning the legal status of any country, area or territory or of its authorities, or concerning the delimitation of its frontiers. The responsibility for opinions expressed in signed articles, studies and other contributions rests solely with their authors, and publication does not constitute an endorsement by the International Labour Office of the opinions expressed in them. Reference to names of firms and commercial products and processes does not imply their endorsement by the International Labour Office, and any failure to mention a particular firm, commercial product or process is not a sign of disapproval. ILO publications can be obtained through major booksellers or ILO local offices in many countries, or direct from ILO Publications, International Labour Office, CH-1211 Geneva 22, Switzerland. Catalogues or lists of new publications are available free of charge from the above address. Photocomposed by the International Labour Office, Geneva, Switzerland Foreword This book has been commissioned to highlight the significant contributions that the cooperative model of enterprise can make to achieving the Millennium Development Goals. The United Nations Millennium Declaration and its goals set out issues that must be addressed if we are to strengthen the foundations of a more peaceful, prosperous and just world. These Millennium Development Goals today are the focus of the world’s development agenda with multi and bilateral organisations, governments and civil society all seeking to find innovative ways to reach the goals by 2015. However, many are not taking into consideration the unique contribution that cooperatives can make, due in part to the fact that cooperatives have had a mixed history and the lack of visibility of the cooperative model. The author of this volume, Johnston Birchall makes an important point : the past record of those so-called cooperatives set up and controlled by government, and which miserably failed to lead to any economic and social development, are not part of the legacy of cooperatives as these are not true cooperatives. Thus, there exists the ever-important need to showcase what real cooperative enterprises have been and are capable of. The Cooperative Branch and the Policy Integration Department of the International Labour Office (ILO), and the Committee for the Promotion and Advancement of Cooperatives (COPAC) are pleased to jointly publish this book that highlights the accomplishment of cooperatives both in so-called developed and developing economies. Dr Birchall shows both conceptually and practically that cooperatives can be, and are, thriving enterprises which contribute in significant ways to reducing poverty, promoting gender equality, providing health care services, tackling the HIV/AIDS pandemic, ensuring environmental sustainability and working through partnerships with a wide range of actors. However, this study also shows that cooperatives are not yet involved as fully as they could be in the formulation and implementation of the Poverty Reduction Strategy Papers. Thus, efforts are still required by multi and bilateral agencies, governments, and civil society to ensure that people-centred, self-help enterprises – cooperatives – have an opportunity to participate fully in the development process. The review and case studies included in this book also benefited from discussion with development specialists from cooperative organisations, iii Cooperatives and the millennium Development Goals development agencies, United Nations agencies and the World Bank at a COPAC Open Forum on “Cooperatives and MDGs” which was held in Washington, DC (USA) in May of this year. With a movement that reaches over 800 million individuals, this book makes the case that the cooperative movement can be a key partner to reach the MDG targets. Cooperatives are improving the lives of people by raising their economic conditions, by promoting social integration and ultimately creating just those conditions that the Millennium Declaration foresees as being fundamental to building peaceful societies. We would like to acknowledge the patience of Mr. Huseyin Polat, ILO- COOP, and Mr. Graeme Buckley, ILO-INTEGRATION/NPG, in reviewing and editing this book. We would also like to thank Ms. Claire Piper, ILO COOP, for the cover design and the formatting of the text. Azita Berar-Awad Jürgen Schwettmann Maria-Elena Chavez Hertig ILO Integration/NPG ILO Cooperative Branch COPAC iv Table of contents FOREWORD ..........................................................................................iii ABBREVIATIONS...................................................................................vii INTRODUCTION ..................................................................................... 1 1. COOPERATIVES AND DEVELOPMENT .................................................. 5 1.1 Cooperative Principles.................................................................................. 5 1.2 How important is the Cooperative Sector?................................................... 6 1.3 The use and misuse of the term ‘Cooperative’ ...........................................14 1.4 A New Framework for Understanding Cooperatives .................................17 1.5 Conclusion..................................................................................................21 2. COOPERATIVES AND THE MILLENNIUM DEVELOPMENT GOALS .......... 23 2.1 Will the Millennium Development Goals be achieved? .............................24 2.2 The potential contribution of cooperatives to the MDGs ...........................25 2.3 The UN’s Millennium Project and the Task Forces ...................................36 2.4 The relevance of cooperatives to the UN agencies’ work on the MDGs....38 2.5 A new partnership between the ILO and the ICA.......................................42 3. COOPERATIVES AND THE POVERTY REDUCTION STRATEGIES........... 45 3.1 Opportunity, empowerment, and security...................................................46 3.2 Shortcomings of the PRSP process.............................................................48 3.3 The country PRSPs.....................................................................................49 3.4 How far is the cooperative sector involved with the PRSP process?..........52 3.5 The work of cooperative development agencies.........................................54 3.6 What do cooperative development agencies do?........................................57 3.7 Cooperatives and the PRSP process – the future........................................59 4. CASE STUDIES ................................................................................ 63 5. CONCLUSION .................................................................................. 95 5.1 What should happen now?..........................................................................96 BIBLIOGRAPHY.................................................................................... 97 v Abbreviations ACOPAM................................. Appui associatif et coopératif aux initiatives de développement à la base BITO .................................................Bakun Indigenous Tribes Organisation CBO ............................................................ Community Based Organisation CDA....................................................... Cooperative Development Agencies CICOPA ...........................International Organisation of Industrial, Artisanal and Service Producers Cooperatives COPAC ....Committee for the Promotion and Advancement of Cooperatives DFID................................. Department For International Development (UK) FAO .......................................................Food and Agricultural Organisation GDP..........................................................................Gross Domestic Product ICA ......................................................... International Cooperative Alliance