During my studies at the University of Padjadjaran in Indonesia in the 1960s I was actively involved with the students’ movement, especially during the Civic Mission program of the university in rural areas. The mission was to help farmers in rehabilitating irrigation systems in many villages of West Java Province to increase rice production. That was a time before high-yielding varieties of rice production was introduced during the ‘green revolution’ in the 1980s. While doing so, I was genuinely provoked by witnessing the unscrupulous practices of moneylenders and loan sharks from urban areas who charged sky-high interest rates on loans to these poor farmers who could not afford to pay their basic needs and thus were trapped in a cycle of indebtedness. On top of that, villagers were drawn into playing what they called “Judi Buntut” at that time, an illegal form of gambling organized by trader bosses to further manipulate the poor.
How did you get interested and involved in cooperatives?
This call for justice truly inspired me to start a simple savings and loan society, and a frog-raising co-operative, in the village of Manggahang, West Java Province, in the mid 1960s. l learned from these initiatives that “education” and “opinion leaders” were vital ingredients to build long-lasting institutions such as cooperatives. The fact that villagers had limited education and no exposure to working in a cooperative at that time, these initiatives did not take off the ground. Hence the lesson learned is that education is unquestionably vital before trying to build any institutions among the disadvantaged, such as a credit union or a cooperative. Basic understanding of financial literacy, as well as fundamentals of co-operation, ought to precede the establishment of a democratically run cooperative. This learning on the ground prompted me to write my thesis on “opinion leaders and education” for my university degree where I highlighted the case study of the “Manggahang experiment”. I also wrote many articles related to cooperatives in two most prominent Indonesian news media at that time, the ‘Kompas’ and ‘Indonesia Raya’ Newspapers.
My firm commitment was to promote and develop credit unions, as the new era in the late sixties was conducive to doing so with the runaway inflation held in check. With guidance and mentorship of a Jesuit priest, Rev. Karl Albrecht S.J., we established a Credit Union Counselling Office (CUCO) and started to promote credit unions in Indonesia. 1970 was the year we both pioneered and founded the credit cooperative movement in Indonesia. Father Albrecht led CUCO for one year as Director, then decided to become a member of the Board of Trustees and handed over its leadership to me as its Managing Director. It was such an enriching experience to spend time in rural areas supporting people in communities to help them develop the habit of thrift and to create family budgets, and then organize their own “village bank’ on a self-help basis.
From 1970 to 1980, it took ten years of active work to build the momentum around credit unions in Indonesia. The transformation was from a Self-Help Promotion (SHP) entity, the Credit Union Counselling Office (CUCO), into a democratically organized Self-Help Organization (SHO) called the Credit Union Central Organization of Indonesia (CUCO-Indonesia. This pioneering stage happened at a time when the “New Order” government under President Suharto was promoting KUDs (Koperasi Unit Desa) as multi-purpose cooperatives in rural villages and their surrounding sub-districts. The New Order regime considered credit unions as small and insignificant. As a result, CUCO was under relentless pressures by government officials to merge and fuse the incipient credit unions into the structure of the KUDs. However, CUCO’s leadership and credit union members refused to be part of the KUDs due to its top-down make-up. As a result, legal recognition was not granted to all credit unions operating in rural areas.
In 2020, 50 years later, the credit union movement in Indonesia has over three million members with assets of over US$3 billion, all based on self-help efforts of the poor. Many KUDs, on the other hand, failed to proliferate, and a great number collapsed upon cessation of government supersessions and subsidies. It has been my view that the government should focus more on good regulations and policies, and not to engage in capital participation – in order to create a more self-reliant and sustainable cooperative movement. During the entire process, my prevailing view was aligned not just with the universal credit union principles introduced by CUNA International, but also the then six ICA Cooperative principles and the ILO Co-operatives (Developing Countries) Recommendation, 1966 (No. 127), which was later replaced with Promotion of Cooperatives Recommendation, 2002 (No. 193).
Following my tenure at CUCO I was recruited by the Asian Confederation of Credit Unions (ACCU) in 1981 to become a training specialist to promote credit unions in South Asian countries, namely Sri Lanka, India, Nepal and Bangladesh. I spent two years with ACCU, operating out of Seoul, Korea, with intermittent stays in Indonesia, as I was also elected Chair of the Board of Directors of the newly organized CUCO-Indonesia. In 1983 I was offered an opportunity to work as Asia region Director of the Cooperative Development Foundation of Canada (CDF) under the auspices of the Cooperative Union of Canada (CUC), based in Ottawa, Canada. CDF-CUC was keen to expand their international cooperative development program not just in Africa and Latin America, but also with sound partners in the Asia region at that time. CUC amalgamated with the Cooperative College of Canada to become the Canadian Cooperative Association (CCA) in 1987.
Throughout my tenure with CUC and CCA, a number of sole-sourced bilateral programs under sponsorship of CIDA were established to bolster incipient cooperative movements in Asia, namely in Indonesia (with multiple cooperative partners), the Philippines (with NATCCO) and Sri Lanka (with SANASA). Oilseeds development program with NDDB India was one of the largest overseas programs of CUC, whereas medium sized projects sponsored with CDF-CCA funding, and matched by CIDA, were developed with partners such as SEWA (India), CICETE (China), Credit Union League of Thailand, and with regional organizations such as ACCU, AWCF (Asia Women Cooperative Forum), and ICA ROAP.
In 1993 an offer came from the International Cooperative Alliance to support its Regional Office for Asia Pacific (ICA ROAP) in New Delhi, namely to assist its Regional Director in the public policy domain. I moved from CCA to ICA ROAP in 1993 to become its Senior Policy Advisor, advocating and lobbying governments in the region to promote the autonomy and independence of cooperatives. Under the guidance of the Regional Director I also conducted Regional Consultations, followed by Cooperative Ministers’ Conferences in the Asia Pacific Region. In 1996 I was designated by ICA to become its Regional Director for Asia Pacific, replacing Mr. G.K Sharma. Being the first Regional Director from outside the South Asia Region, my earlier role of public policy development was understandably augmented into managing needs and aspirations of members in the region as a whole.
While consistently and resolutely maintaining New Delhi as the Regional Office of ICA Asia Pacific based on historical and practical grounds, the need and aspiration of members from the South East and East Asia Sub-regions was a challenge to be accommodated. A consensus reached by all sub-regions was to set-up a Business Office in a strategic location to ease potential inter-cooperative trade and business interactions from all over the Asia Pacific region. The Business Office was successfully established in Singapore in 1999, and ICA ROAP staff from Japan, China and the Philippines were operating from this Business office. The first Regional Open Forum was also initiated during my tenure, and this was held in Singapore in 2000 with Vice President Megawati Sukarnoputri as its Chief Guest.
After retiring in 2002, I continued my active involvement in cooperatives and international development, with consultancies for the Canadian International Development Agency (CIDA), NTUC-Income (Singapore), Ministry of Foreign Affairs (MFA-SNCF-Singapore), ILO, UNDP, the Asian Development Bank (ADB), and voluntary engagements with the ICA and the Canadian Cooperative Association. In early 2005, I was named ICA Special Envoy for Post-Tsunami Cooperative Reconstruction programs in Asia, primarily in Aceh (Indonesia) and Sri Lanka. From 2006 to 2009 I worked primarily in Aceh for the Asian Development Bank’s Livelihood and Micro Finance Support Program in association with BRR (Agency for Rehabilitation and Reconstruction of Aceh and Nias) and assisted the Regional Development Bank (BPD) of Aceh to develop its microfinance facility. I initiated the establishment of the Aceh International Society (School) of Microfinance (AISMIF), operating under the auspices of the University of Syiah Kuala, in the Syariah Province of Aceh (Indonesia). I held various Board chairs and memberships in Canada, UK, Australia, and Indonesia throughout my professional tenure.
In 2011, I was appointed Chief Advisor of the Karl Albrecht Foundation in Indonesia to introduce new generation cooperatives with a multistakeholder concept. More recently I pioneered and founded the National Association of Strategic Socio-Economic Cadres (NASSEC) and the National Federation of People-Based Cooperative Enterprises of Indonesia in 2016 (INKUR). The latter is now a full member of the ICA. I was Commissioning Editor of the International Journal on Cooperative Management in the UK, and am currently actively engaged as Editorial Board member of a major book to be published by Elsevier, along with others from Hosei University (Japan), Mysore University (India) and New Castle University (Australia). I continue my active engagement with the Indonesian diaspora in Canada, ICA Asia Pacific Regional Office, as well as cooperative movements in Indonesia and other Asian countries.
Could you tell us more about your collaboration with the ILO on cooperative development across the years?As indicated above, government control over cooperatives remains quite pervasive in the Asia Pacific region, be it readily obvious or somewhat hidden. Debates around “de-officialization” and “de-bureaucratization” was a common theme when we discussed the transformation process from ILO Recommendation 127 to Recommendation 193. I had the pleasure to contribute to these deliberations as an ICA representative working with colleagues from ILO COOP. Likewise, the involvement of (the late) Mr. K.K. Taimini as an ILO CoopNet coordinator based in India was also essential. ICA ROAP was closely consulted during his write-up on “Cooperatives in Asia: from reform to reconstruction”. Across the years ILO COOP colleagues participated actively at ICA’s Regional Consultations and Ministers’ Conferences. We all brought to bear a common spirit in making sure governments do not only recognize, but also integrate, the ICA’s Cooperative Identity Statement of 1995 into their cooperative legislative agendas.
Notwithstanding, the weight of market-oriented and neo-liberal policies adopted by most governments in the Asia Pacific Region made it difficult to pursue the development of cooperatives on a level playing field with other private sector institutions. To this end, the discussions towards the enactment of ILO Recommendation 193 in 2002 was most helpful insofar as ICA’s advocacy work was concerned. This was especially discernable during the Cooperative Ministers’ Conference in 1999 when ICA supported the work of ILO in promoting the shift from R. 127 to R. 193, stressing the fact that “Cooperatives in their various forms promote the fullest participation in the economic and social development of all people” in any given country. Indeed, the expected changes in the regulatory processes vary from country to country, depending on where the State positioned itself in the ladder of State control to independent cooperatives. I was privileged to have used R. 193 as a powerful reference and an instrument during the Judicial Review of the Cooperative Law no.14/2012 of Indonesia at the Constitutional Court, together with (the late) Dr. Ian MacPherson. As two expert witnesses we managed to contribute to the annulment of this very lopsided cooperative law, that was totally oriented toward corporate underpinnings in definition and structure. Most recently, I have briefed both cooperative law experts Prof. Hagen Henry and Prof. Dr. Hans Muenkner on this very issue. As a matter of fact, I sought Prof. Hans Muenkner’s views during the time serious debates occurred at the Constitutional Court of Indonesia in 2012.
K.K. Taimni was an ardent cooperator and Coop-Net coordinator who strongly believed in member-driven cooperatives, and thus worked closely with ICA-ROAP to urge governments to undertake regulatory reforms. With his sudden passing, Mark Levin filled his position with another strong grassroots cooperator Teresita de Leon. Teresita, popularly known as Tere, came at a time when the debt-based micro finance model promoted by Mohammad Yunus was very much in vogue. Tere and I were the only two persons arguing the advantages of savings-based cooperatives at a global conference on microfinance organized by OECD at their headquarters in France. We also travelled together to Fiji in November 1999 on the invitation of ILO in Suva-Fiji (Messrs. Henry Hatton and Rob Zegers), together with a representative of Workers’ Cooperatives in Japan, to facilitate a Planning Seminar for the Development of Cooperatives in the Pacific sub-region.
ICA ROAP was also working very closely with the then International Confederation of Free Trade Unions Asia and Pacific Regional Organization (ICFTU-APRO), with myself and Mr. Noriyuki Suzuki as General Secretary of ICFTU-APRO promoting decent work for formal and informal workers in the region. On 18 – 20 October 2000, ICFTU-APRO and ICA ROAP conducted the Regional Workshop on Employment Generation, Poverty Alleviation & Human Resource Development in Southeast & East Asia. The regional workshop came up with three concrete recommendations for both trade union and cooperative sectors to pursue, in an effort to bring these two member-based movements into closer and effective collaboration when addressing common social and economic issues. One of the three recommendations was for both trade unions and cooperatives to forge a common position on the revised ILO Recommendation 127, which would be deliberated on at the International Labour Conference in June 2001.
In November 27-28, 2003, I had the opportunity to work hand in hand with Mr. Juergen Schwettmann in facilitating a Seminar on Cooperative Policy and Development in Asia Pacific, sponsored by ILO and All China Federation of Supply and Marketing Cooperatives (ACFSMC) held in Fuzhou, China. This event provided an excellent opportunity for the ILO to explain to cooperative leaders in Asia and the Pacific on the recently adopted R. 193, and to show the changing context of R. 127 to R.193, and how ICA could help promote this Recommendation for governments in charge of cooperatives in Asia Pacific, and bring the text to the attention of other relevant national authorities.
In 2005, ILO COOP facilitated my engagement as a Cooperative Expert representing the ILO on a seven-week mission in Bangladesh. The mission was organized by UNDP, through its CHT Development Facility (CHTDF), together with the Government of Bangladesh (GoB) and particularly the Ministry of Chittagong Hill Tracts Affairs (MoCHTA). I undertook a critical assessment on Economic Opportunities in the Chittagong Hill Tracts of Bangladesh, from 6 November to 22 December 2005.
After retiring from my post-Tsunami work in Aceh and Sri Lanka, I also had the pleasure of reconnecting with ILO and meeting old friends (Messrs. Hagen Henry and Juergen Schettmann), and meeting Simel Esim, on the occasion of ILO’s Cooperatives and World of Work Research Conference in Antalya, Turkey in 2015. My engagement with ILO COOP has been rich and fruitful, to say the least. It was further enriched with current ILO COOP Manager’s participation as member of the editorial team which I chaired during the Regional (Policy) Consultations held in Jakarta and Kathmandu, and as member of the Drafting Committee which I chaired during the Cooperative Ministers Conference in Hanoi, Vietnam, in 2017.
You have worked on cooperatives in different countries and in different capacities across Asia and the Pacific region. What have been key challenges for cooperative development in the region?The Asia and Pacific region is very diverse and complex. Cooperative development has been tried by each and every country in the region for almost 80 years, and evolved under different socio-cultural and socio-economic conditions. In most cases the role of government has been pervasive, yet heterogenous, to the extent that government interferences depended on the level of understanding of the Minister or Ministry in charge of cooperative development. One could witness intermittent successes and failures on the one hand, and a great number of successful and mature cooperatives on the other. A book on “Waking the Cooperative Potential in Asian Countries” by Elsevier is coming out in June 2020 and will hopefully shed a brighter light on good practices – and the role of respective governments - in the region.
The more the cooperative movement in the region could demonstrate good practices and effective governance, the greater opportunity it has to influence positive reforms in cooperative legislation, hence creating an enabling environment for cooperatives to grow and develop sustainably. On the other hand, there is ample evidence in the Asia Pacific region that subservient cooperative movements in post-colonial environments that rely on government support and subsidies, will only further exacerbate government control and dominance. The pursuit by ICA Asia Pacific and ILO COOP to promote better cooperative legislation and governance is an ongoing challenge and yet an opportunity at the same time.
Within the context of the diversity of the Asia Pacific region, there are growing numbers of people entering the workforce in populous countries of the region. These young people entering the workforce are a demographic dividend. Coupled with declining fertility, the young become a potential force to boost economic productivity. But demographic dividend as a precondition of potential high growth is not enough. Cooperatives must play a role, with regulatory support from the governments, to close the ever-increasing disparity gap. They need to empower people-based development to avoid falling into the middle-income trap.
Unfortunately, women and youth involvement in cooperative development is still lagging behind. In most developing countries in the region hierarchical structures still prevail with residues of patrimonial legacies of the colonial past. Rather then being inclusive, cooperative leadership in many Asian is still very much motivated by political expediencies rather than development motivations. As such, regeneration of leadership is often mired with transactional compromises rather than genuine democratic procedures. Voices and insights of women and youth are often neglected or compromised, to the extent that older male leadership prevails.
The International Conference of Cooperative Women Decision Making held in Tagaytay, Philippines, 7-9 May, 1997, and repeated in 2016 by the ICA AP addressed pertinent concerns about the lack of gender equality in leadership despite the already broad recognition of women’s contribution in cooperative development in this region. Even with the onset of a vocal and forceful leadership change in the ICA AP Women’s Committee in late 2016, the drive toward achieving gender balance on the Regional Board of ICA AP has not yet materialized. There are silver linings in the (old) male dominated leadership clouds in the Asia Pacific region, which will hopefully brighten the leadership shrouds within the cooperative movements by embracing and electing more women and youth in the region in the not too distant future.
There is a prevalence of process-oriented rather than result-oriented cooperative training programmes in the Asia Pacific region. More often than not subsidies provided by governments for cooperative training and education actually inhibit innovation and perpetuate conventional training methodologies that simply uphold the status quo. Although the importance of the 5th Cooperative Principle is never in doubt, conventional ways of training and education by government agencies as well as cooperative trainers inhibit cooperative growth and innovation. Thus, skill enrichment to empower members and leaders must be designed in such a manner that will result in the actual establishment of a cooperative or measured and verifiable development of existing cooperative in each and every sector. Technological means must also be adopted where applicable.
Governments must support cooperatives to enhance their people-based development through educational excellence and enact appropriate regulation to avoid falling into a middle-income trap. Cooperatives can play a key role in bridging the disparity gap if and when governments provide a good regulatory framework to support their genuine growth.
Sub-regional compulsions are ever present with the consolidation of sub-regional groupings such as ASEAN, SAARC, and the Gulf Economic Unity and Pacific Islands sub-regions. Cooperative movements in Asia Pacific cannot be immune from the compulsion generated by the recently established ASEAN Economic Community (AEC); the newly formed AEC will be a highly competitive economic region, hence efficiency and competitiveness of cooperatives are called for, where decision making and business transactions must be simplified through the use of information and communication technology that could lower the costs for both producers and consumers.
New cooperative approaches must be firmly built on knowledge-based economy, which is a shift from traditional forms of doing business. The impact of free-trade mechanisms within the AEC would undoubtedly be felt in the SAARC and Gulf Sub-Regions as well. Cooperatives within the AEC will be forced to invent new ways of doing business in view of the seamless movement of investment, skilled labor, business persons, and capital; Hence digital technology with new cooperative platforms are deemed important to raise cooperative competitiveness and to carry out joint activities among cooperatives in the diverse landscape of Asia Pacific.
Currently, global food production is adequate to meet overall human nutritional needs, but problems with the distribution of economic resources and foodstuffs mean that millions of people in many populous countries in Asia remain undernourished. Although world food production is still rising, several trends will make it more challenging to feed a growing world population, especially in populous countries of Asia. The rate of increase in the yields of major grain crops is slowing down, and post-harvest losses remain high. Especially at this very moment when the outbreak of COVID-19 in countries like India and Indonesia made it difficult for the poor to sustain their livelihoods, resulting in food scarcity combined with lack of social services and basic necessities. In order to access basic services such as food, social and financial services, there is a dire need to empower people to control land, production & marketing, with the right pricing policies for farmers. Cooperatives are ideal vehicles to undertake the latter, whereas governments must provide an enabling environment for these cooperatives to play a critical role in respect.
The Asia Pacific region consumes over half of the world's materials and emits over half of the world's greenhouse gas emissions. Environmental health emergency is felt most acutely in the Asia Pacific region, causing an alarming five million premature deaths with huge social and economic costs. The region’s high vulnerability to natural disasters and adverse impact of climate change adds to these social and economic challenges. Governments in the ASEAN and SAARC regions must not undermine the vast number of cooperative members in the region who could be trained in understanding the green economy, an economy that brings about an improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities. In the Philippines the government has engaged cooperatives in waste management, and practice recycling as a profitable business. They are also trained to have a zero increase in use of chemicals/pesticides, and have shifted to undertake organic agriculture, and started developing solar cooperatives. Governments must prudently engage cooperatives in the Green Economy.
Southeast Asian countries are key contributors of migrant workers to other well-off nations, but are at the same time destinations for labor migrants within the region. There is evidence of mass exploitation among thousands of migrant workers, especially among migrant women. The Philippines has been a strong advocate for its overseas workers, negotiating 12 bilateral labor agreements with receiving countries. Cooperatives can play an important role in organizing and managing remittances from migrant workers overseas to their families in the sending countries and accept returnees as members. Governments within the ASEAN Economic Community (AEC) and SAARC Regions should adopt the ILO Conventions protecting migrants’ rights in order to limit or abolish the exploitation of migrant workers. It is likewise important for cooperatives in the Gulf Region to advocate to their respective governments the need for positive treatment to migrant workers coming from ASEAN and SAARC member countries.
Economic growth in Asia Pacific also reveals the ever-expanding economic disparities within developing countries. In an attempt to mobilize adequate resources to fund the SDGs, cooperatives and civil society organizations can attract private sector funding for well-managed and profitable development projects. Governments and cooperatives as stakeholders must share information and collaborate openly in innovating new approaches to fund development projects based on the relevant targets of the SDGs. Cooperatives could offer innovative ideas through their best member practices and government agencies could tap new ideas from the human and social capital espoused by cooperatives to promote positive change. While the P3 approach is usually meant to build public infrastructure, arrangements between government and cooperative enterprises could be geared specifically towards building social infrastructure, i.e. socio-economic services such as inter-cooperative trading and educational activities. With the establishment of ‘Convergence’, a global network for blended finance, cooperatives can play a role by obtaining the right data and intelligence to create deals with private sector investment in developing countries. Through blended finance mechanisms, public-private partnerships have the potential to crowd in private resources at sufficient scale to materially narrow SDG funding gap.
What do you think are the best ways to overcome these challenges?The above challenges are naturally multifaceted and could only be addressed by way of multi-strategies with optimum network collaboration. With ODA funding declining, ILO can draw partners such as ICA, sister UN Agencies, Bilateral and Multilateral agencies, to operate more on an adaptive system that can be improved towards meeting the SDGs. Cooperatives are tangible and people-based entities that could accelerate the attainment of the SDGs, but these cooperatives ought to be the genuine ones and not those that are virtually handmaidens of governments. To this end, ILO and ICA could pursue the blended finance option by advocating best-practices of cooperatives to private enterprises at the national and global levels.
From an Asia Pacific regional perspective, working with sub-regional grouping such as ASEAN and SAARC is sensible, because civil society is now becoming more active as associate members within these sub-regional entities. The propensity to perpetuate top-down decision making should be transformed into partnerships wherein opportunities and results of development efforts could be shared in a transparent manner and agreed plans to be implemented in a concerted action.
ILO Recommendation 204 concerning the Transition from the Informal to the Formal Economy is highly relevant for cooperatives to take part in. In the era of rapid urbanization, cooperatives can and should play an important role to ensure that decent work and sustainable economic activities are created for the unorganized workers in the informal sector economy, and that these workers can thereby gradually move towards the formal economy and formal employment; Cooperative platforms such as introduced by COLAB and currently activated by its regional office in Mysore could help cooperative movement organize many informal workers such as street vendors, tricycle drivers, waste pickers, etc. using digital technologies and in the form of workers’ cooperatives.
Changing mindsets of cooperative leaders in traditional and conventional cooperative models can be difficult at times. These leaders may not always be supportive of innovation and may even create roadblocks for women and youth to be empowered.