Inadequacies of cooperatives in the Northern Central Highlands

SGGP 06/06/2023 10:58

There are many cooperatives in the Northern Central Highlands, but their operations are not true to their nature. Some cooperatives even operate only on paper.

Ia Kenh Agricultural and Commercial Service Cooperative is classified by the locality as average, but in fact has stopped operating for many years.

Inefficient operation

In the list provided by the Gia Lai Provincial Cooperative Union, Ia Kenh Agricultural and Commercial Service Cooperative (Mo Nu village, Ea Kenh commune, Pleiku city, Gia Lai province) was established in 2017, operating in the agricultural sector, and ranked in 2022 as average. However, according to a representative of the Ea Kenh Commune People's Committee, this cooperative has stopped operating for a long time. In reality, the cooperative's headquarters (lent by the Commune People's Committee when it was established) is currently abandoned and overgrown with grass. Mr. Tran Van An, Director of the Cooperative, said that he took over the position of director from his predecessor 2 years after the cooperative was established. At that time, the cooperative had not yet conducted any business activities. Mr. An said that he initially planned to trade in seedlings and fertilizers, but the Covid-19 pandemic has paralyzed the cooperative since then. He has no intention of reviving the cooperative's operations and may hand it over to someone else to manage.

Chu Prong District, Gia Lai Province has 31 cooperatives. Of which, Bau Can Agricultural and Service Cooperative (Bau Can Commune) was established in 2022, specializing in purchasing agricultural products, pesticides, and agricultural materials. This cooperative has 7 members, currently has no headquarters, and is renting a kiosk of about 30 square ^meters to purchase passion fruit. According to Mr. Tran Van Hanh, Director of the Cooperative, the unit is facing difficulties due to limited land fund and difficulty in accessing loans. The cooperative has called for more members to participate, but people are not interested...

Chu Prong District Party Secretary Dinh Van Dung said that of the 31 cooperatives in the area, 30% are profitable, 40% are breaking even, and the rest are doing poorly and at a loss. In general, production cooperatives are fragmented and backward; the connection with producers and consumers is weak; competitiveness in the market is limited in many aspects, so profits are not high; management capacity, capital, and coordination are limited, which are the reasons for the weakness of cooperatives.

In Kon Tum , the number of cooperatives has also increased rapidly. If in 2013, the province had 96 cooperatives, by 2021, this number was 194, but only 69/194 cooperatives operated effectively.

Activities… on paper

Although the cooperative has ceased operations, the locality still classifies it as operating. This incident occurred in Kon Tum province. Specifically, from August to September 2022, the Provincial People's Council's Supervisory Delegation monitored the operation of cooperatives in the area. Kon Tum city reported that 2 cooperatives had ceased operations, but in reality, 16 cooperatives had ceased operations; Sa Thay district reported that 3 cooperatives had ceased operations, but in reality, 5 cooperatives were monitored; Dak To district reported that 3 cooperatives had ceased operations, but in reality, 6 cooperatives were monitored.

According to the results of the Kon Tum Provincial People's Council Supervision Delegation, many cooperatives do not operate in accordance with the nature of the 2012 Cooperative Law, such as: many cooperatives contribute capital in name, but in reality the charter capital is contributed by 2 to 4 members, the remaining members contribute labor or assets; the activities of some cooperatives under supervision are actually joint groups, cooperative groups... In addition, many agricultural cooperatives have not been able to rent land for headquarters, factories for production and business. Some cooperatives also borrow houses and land from members or enterprise headquarters, border control stations to use as headquarters, place signs. Some cooperatives still produce and do business outside the registered business lines...

In Gia Lai, Mr. Nguyen Mau Phong, Permanent Vice Chairman of Gia Lai Cooperative Union, said that by the end of the first quarter of 2023, Gia Lai had 391 cooperatives, of which 70 cooperatives had stopped operating due to inefficiency and had not been converted according to the law; the remaining 321 cooperatives were operating, and through assessment, it was estimated that the cooperatives were profitable at 35%, the rest were at even capital and at a loss.

Proposal to put credit institutions into operation soon

According to Mr. Nguyen Mau Phong, there are many reasons why cooperatives in the area are not operating effectively, such as lack of capital; limited management skills of cooperatives; lack of formal training. To revive cooperatives, the Gia Lai Provincial People's Council recently passed a resolution to establish a State-owned credit limited liability company. This organization is like a credit unit specializing in preferential loans for cooperatives, currently has a unified apparatus and charter capital of 20 billion VND. The Gia Lai Cooperative Union hopes that departments and branches will help cooperatives build product brands to increase value and expand the market.

Source: https://www.sggp.org.vn/bat-cap-hop-tac-xa-o-bac-tay-nguyen-post692585.html