July 6, 2013 marked the International Day of Co-operatives, a type of organization that is integral to development and one of the most common institutions at village level in Africa. The International Day of Co-operatives was created to “increase awareness of co-operatives and promote the movement’s successes and ideals of international solidarity, economic efficiency, equality, and world peace,” according to the International Co-operative Alliance’s website.

Co-operatives are membership-based organizations owned by the people who benefit directly from the co-operative’s goods and services. The International Co-operative Alliance defines a co-operative as “an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.” In essence, co-operatives are business enterprises owned and controlled by the very members that they serve.

Co-operatives come in all forms, ranging from consumer to producer organizations, and they help promote ethics and values in business and economics as they are run directly by those using their services. Snake-charmers in Ethiopia or village credit co-operatives are two diverse examples of co-operative organizations.

Self-help projects are often pursued through co-ops, enabling small farmers or labor groups to pool resources to gain a strong bargaining power and lower the prices of goods and services. There are over 1 billion members of co-operatives around the world. Given the power that co-operatives yield to consumers and producers alike, they are crucial for development and empowering the poor.

This is why the UN created the International Day of Co-operatives, and why last year was also the International Year of Co-operatives. Co-operative organizations help organize the informal economy in the developing world and, like labor unions, unite members of the developing world in a way that gives them more bargaining and purchasing power. As United Nations Secretary-General Ban Ki-Moon said, “Cooperatives are a reminder to the international community that it is possible to pursue both economic viability and social responsibility.”

– Martin Drake

Sources: The Guardian, ICA, UN
Photo: IFAD