aBy: Bruce Thordarson

During the banking crisis in the U.S. in 2008, American credit unions found that their membership increased rapidly.  In Europe, where many of the major banks were also facing large speculative losses, the cooperative banks reported stable earnings because of their more locally-oriented investments.  Across Asia, micro-finance institutions of all kinds have flourished in spite of (or perhaps because of) a difficult economic environment.

What these three phenomena have in common, of course, is the fact that ordinary people place their trust in locally-oriented institutions over which they have some degree of control.  This concept was the very origin of the cooperative movement in the 19th century.  It is perhaps even more relevant today, as people around the world realize that large national and multinational corporations do not always operate in the interest of their users.  The Occupy movement, in spite of some questionable characteristics, also shares this concept of local empowerment.

In order to be successful, however, cooperatives need more than local orientation.  They need strong and capable managers who understand the special nature of cooperatives as democratically-controlled institutions, and who are also technically knowledgeable in their field of work, whether it be financial, consumer, agriculture, etc.

This is why the management training programmes currently being undertaken by YAKA are so important.  They are providing specialized training for credit union and co-operative leaders who will soon be (and in some cases already are) key players in the socio-economic sphere of their communities. I was privileged to participate in recent training sessions in Jakarta/West Java and West Kalimantan, where I saw first-hand the many excellent leaders who are coming up through the ranks of the Indonesian cooperatives.  This augurs well for the future of the movement.

Another theme being encouraged by YAKA is cooperation between credit unions and consumer (unions) cooperatives.  Cooperation among cooperatives is, of course, one of the fundamental cooperative principles.  As competition becomes stronger in all sectors, the ability to develop alliances and economies of scale will be especially important for the future success of cooperatives.

Credit unions and other cooperatives in Indonesia have already accomplished much, and have the potential to do much more in the future in the interest of their members.  The success of the cooperative model has already been demonstrated around the world for almost two centuries.  It shows that self-help really does work. []

*Bruce Thordarson, Director General, International Cooperative Alliance (1988-2000)