NCBA Trip to Singapore and Indonesia

This past October I participated in the biennial General Assembly of the International Cooperative Alliance (ICA) in Singapore, followed by a tour of coffee and micro-finance cooperatives in North Sumatra and Aceh, Indonesia. How did I get to be so lucky? Last June an ad appeared in the National Cooperative Business Association (NCBA) Cooperative Business Journal inviting members to “Visit Indonesia in October” and also attend the ICA General Assembly.

The purpose of the trip was to get NCBA members to learn more about the organiation’s overseas cooperative development projects in Indonesia. Two-thirds of the expenses would be covered by NCBA’s Cooperative Development Program and the Cooperative Development Foundation’s NCBA fund. I applied, was accepted, and the next thing I knew, I was filling out an application for a visa!

Singapore

Day one in Singapore started with a hasty meet-and-greet gathering of our 14-member U.S. delegation, which consisted of three NCBA staff members, three representatives from retail food co-ops (myself and two from La Montanita), and the remainder representing the credit union and finance arenas, all of whom were present or former NCBA board members. But food co-ops were even better represented than these numbers indicate: four were Minnesotans with ties to Twin Cities co-ops, one was a member of Harvest Co-op in Boston, one was a founding member of North Coast Cooperative in Arcata, California, and one was Walden Swanson of Cooperative Development Services.

The rest of the first day was taken up by ICA “sectoral” meetings. For me, this meant attendance at Consumer Cooperatives Worldwide (CCW) where I gave a presentation on my co-op’s urban farm (See p. 22.) and student marketplace community programs as part of a larger workshop session on “living our cooperative values.” Fellow cooperators back in Philadelphia were happy to learn when I returned that our little store has now achieved international acclaim!

Over one thousand delegates attended the General Assembly. As we watched the opening ceremony hoopla, I realized, “We’re all here for the same purpose: learning how we can work better together to further our ends and meet our members needs, which are, in many instances, common-especially on big issues such as sustainability and global warming.” Alas, there were no simple answers. But there was a good deal of networking and sharing of information about best practices.

There were three areas of focus: the Global 300, internal restructuring, and accounting standards. The Global 300 is a list of the 300 largest cooperatives in the world. It is an effort by the ICA to publicize the role played by cooperatives in the world economy. For example, I heard that the aggregated annual sales of all consumer co-ops are larger than Wal-Mart’s; and that the annual sales of all co-ops are about the same as the GNP of the eighth largest country in the world. See www.global300.coop for more information.

The ICA restructuring effort is designed to allocate resources more efficiently within the international body and among its regional components. In short, there will be less control at the international level and more at the regional levels. The most controversial part of the emerging new plan involves membership fees, with co-ops from poorer regions worried that their cost of membership would go up and co-ops from more prosperous countries concerned that they might have to pay more than their fair share. Final implementation of the new structure is scheduled to be voted on at a special convocation of the General Assembly next year.

The reports on international accounting standards struck at a vital part of what it means to be a cooperative. One of the standards deals with whether or not member equity must be considered a liability on financial reports, which in turn affects a business’s access to capital. The ICA, NCBA, and other cooperative trade organizations are advocating to maintain this important distinction that is part of our cooperative advantage.

Indonesia

Upon arrival in Indonesia we met our host, Sam Filiaci, an American who has lived in Indonesia for 30 years and leads the NCBA cooperative development projects there. We boarded two small sightseeing planes, and flew to Lake Toba, a 50-mile-wide crater that resulted from the largest volcanic explosion of the last 3 million years. From there we took a long bus ride back toward the coast. On the way we got our first glimpse of the growing Indonesia economy: homes with satellite TV and cell phone towers seemingly everywhere. Cooperatives are plentiful. Apparently Suharto (President and military dictator from 1968 to 1997) liked them-perhaps as a means of limiting foreign investment. The government even has a ministry of cooperatives.

Visits to coffee farms along with briefings from the cooperative farmers impressed us with the huge impact that cooperative development has had in Indonesia. In Aceh during the 1980s and especially the 1990s, an independence movement led to fighting between rebels and the Indonesian military. Many farmers who moved from the highlands because of the conflict were later hit by the tsunami in December 2004. Farmers returned to their land following a peace agreement in 2005. Thanks to agro-forestry nurseries started by the local coffee cooperative, Koperasi Baitul Quiradh Baburayyon (KBQB), with the help of the NCBA, over one million coffee seedlings will be used to rehabilitate farms damaged or destroyed by the conflict. Over four thousand farmers are now members of this cooperative, with many waiting to join when the processing facilities are expanded.

The average family farm is one hectare. When fully productive, it can yield $2,300 U.S. per year. KBQB has a unique structure that enhances its social benefit. Members are required to join both the coffee and credit cooperatives. The credit is needed to rehabilitate farms and also to provide a means of forced savings so that farmers have money available year round rather than spending it all at once. Thanks in no small part to the tremendous increase in the international demand for organic, fair trade, specialty coffee, thousands of farmers can now look forward to a level of economic security that could not be reasonably expected in the past.

In Banda Aceh we visited several women’s micro-finance cooperatives. On the way from the airport we passed a mass grave where over 48,000 tsunami victims are buried. The cooperatives were started with NCBA funding received from the U.S. Agency for International Development, which accounts for about 70 percent ($16 million) of NCBA’s annual budget. About 11,000 women (typically 10 per co-op) have received small loans averaging $450 U.S., mostly to restart businesses, such as child care, sewing, and household sundries, that were ruined by the tsunami.

Co-ops have improved the quality of life for the entire region. In addition to bringing much needed income into the lives of local families and improving the economy, the cooperatives have used profits to build health care clinics. Staffed by government-paid doctors and nurses, these clinics provide much needed services, including immunizations and prenatal care.

In addition to the reward of getting to know my fellow travelers, this trip was a learning adventure. I learned that cooperatives can make a tremendous difference in people’s lives, and that the international cooperative movement is not merely alive and well, it is vibrant and flourishing. To learn more about ICA, visit “www.ica.coop.” To learn more about NCBA, visit www.ncba.coop.

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Bob Noble is former president of the board of directors at Weavers Way Co-op in Philadelphia (bobnoble@msn.com).