United Nations Welcome to the United Nations. It's your world.

Presentation on the Cooperative Movement in Guyana at the Commission for Social Development Side Event

Tuesday, 19 February 2019
Premanent Representative of the Co-operative Republic of Guyana to UN, Ambassador Rudolph M. Ten-Pow
New York

Thank you for the opportunity to share some information on the cooperative movement in Guyana. As you just heard, Guyana is the only country in the world where the development model of cooperativism is captured in the official name of our country, the “Co-operative Republic of Guyana”.

There’s a story behind that name and it goes back a long way in our history, to the period just after slavery was abolished in 1834 and slave labor on the sugar plantations was replaced by indentured labor. Portuguese workers from Madeira, Chinese, Indians, and more Africans from Africa and the Caribbean. The freed slaves pooled their resources and bought a number of plantations which they began to operate and manage. History has recorded how they took the money they had managed to save in wheelbarrows to pay their purchases. These plantations bought by ex-slaves in the 1830s and 1840s were the first cooperatives in Guyana.

Many of the plantations eventually failed because their new owners lacked access to financing from the banking system to build farm to market roads and to maintain the expensive drainage and irrigation systems. The cooperative members also lacked access to the technology that was needed to upgrade and maintain the sugar factories. And, of course, the planters who continued to produce sugar using indentured labor did everything they could to prevent the former slaves from becoming successful and competing with them.

But what is important to note is not that most of these cooperative plantations failed and reverted to subsistence farming, but the spirit of cooperativism that prompted former slaves to establish their cooperatives in the first place. It was that spirit of community, the pooling of capital, labor and skills, joint ownership of the enterprise and sharing in the profits. It was that spirit, the ethos of cooperativism that led Guyana in 1970, four years after our independence from Great Britain in 1966, to create the world’s first Cooperative Republic, based on the spirit and values of cooperativism as an economic model that had the potential to empower the marginalized and promote social inclusion while remaining viable business enterprises.

 In the first decade or so after 1970, hundreds of cooperative societies were established in Guyana in such sectors as small- and medium-scale farming, agro-processing, consumer marketing, and the transportation sector and a number of national institutions were created to support them. These included a Cooperative Bank, the Guyana National Cooperative Bank, which provided capital to cooperative societies. A Cooperative College, the Kuru Kuru Cooperative College, which was established in 1973 to strengthen the cooperative movement by providing inter-disciplinary outreach and extension programs that addressed the business aspects of cooperatives, including organization, financing, management, and marketing. What is more, legislation was enacted, such as the Small Businesses Act, under which 20 per cent of all funding for small businesses was allocated to the cooperative sector.

Unfortunately, after that period which lasted about a decade, the cooperative sector in Guyana began a relative decline. There were a number of reasons for this decline. One was that cooperatives were not immune to the economic forces that led to a general and sustained decline in economic activity in Guyana in the 1980s. Among these factors was the sharp and sustained decline in the world price for sugar, which at the time was one of the two main foreign exchange earners for Guyana, the other being bauxite. Another factor were the oil shocks that the world experienced in the period after 1973. At that time, Guyana was 100 per cent dependent on imported energy. It still is today, but our economy is now much more diversified and energy imports represent a smaller share of economic output. Of course, many of you are no doubt aware that Guyana’s fortunes are about to change and that we will soon become a major oil producer following the recent discovery of large offshore deposits of oil and gas.

Another factor for the general economic decline in Guyana in the 1980s and therefore for the decline in the cooperative movement was the loss of skilled Guyanese to outward migration. This brain drain has always been a problem, but it was exacerbated by the deteriorating economic conditions. Guyana even today has one of the highest rates in the world of outward migration of persons with skills. Over 80 per cent of Guyanese with tertiary education are thought to be living in the diaspora. And cooperative societies are after all businesses and depend on the business skills of its members in order to be successful.

As a result of the decline of the cooperative sector from 1,440 cooperative societies in 1989 to 1,268 in 2016 the Cooperative Bank and some of the other state institutions that had been set up to support the co-operative movement ran into difficulties. And in fact, the Guyana National Cooperative Bank was sold in 2002 to a commercial bank.

 Happily, however, the Cooperative College survived this period and in recent years there have been attempts to revive the cooperative movement in Guyana. Thrift societies have been reintroduced in schools at both the primary and secondary levels to help rekindle the spirit of cooperativism in young people and last year, 2018, four new model co-operatives were launched with funding from the Caribbean Development Fund as part of a Rural Agricultural Infrastructure Development programme. Our hope is that these model cooperatives will succeed as businesses and that their example can be replicated in other sectors and geographic locations.

 One of the factors behind this revival of the cooperative sector in Guyana is our recognition that the spirit and practice of cooperatives are aligned with the United Nations Sustainable Development Goals with their emphasis on social inclusion, gender equality, the economic empowerment of social groups that might otherwise be excluded and marginalized, and in general the people-centered ethos of cooperatives. The United Nations, through UNDP and the UN country team in Guyana is assisting the Government of Guyana in integrating and mainstreaming the Sustainable Development Goals into our National Development Plan, which recognizes the role of cooperatives in the economic and social development of our country.

I think the global environment is now also favourable to a resurgence of the cooperative movement in Guyana. There are organizations and structures in place, such as the International Cooperative Alliance, that promote the sharing of experiences, of best practices and even of resources. The worldwide cooperative movement today represents by some counts nearly 12 per cent of global economic activity. We have examples of highly successful cooperatives, such as the Credit Agricole in France, which has evolved from its historical roots as a farmers’ cooperative to become a full-service banking business. Here in the United States, we have the successful example of State Farm, in the insurance sector. And even closer to where we are meeting here today, we have the example of the United Nations Federal Credit Union, of which I have been a member and shareholder for over 30 years, and which has met all my banking needs during that time.

 I think it is generally recognized that the cooperative sector has huge potential for growth and that cooperatives could make a significant contribution to the achievement of the Sustainable Development Goals. Guyana, the Cooperative Republic of Guyana, looks forward to developing closer ties with the global movement so we can share experiences and continue to build on our past successes and continue the process of revitalizing the cooperative sector of our national economy as one of the means of achieving our national development goals.

 Thank you.