I. Why Capital, Why Cooperatives?

   This document has been made available in electronic format
          by the Committee for the Promotion and
            Advancement of Cooperatives (COPAC)

                    REPORT OF THE MEETING


The nature and role of capital in cooperatives has been of
interest ever since modern cooperatives were first
established.  The subject has an inherent fascination because
it illuminates a distinguishing difference between
cooperatives and other forms of business organizations, i.e.
as member user-owned rather than as investor-owned firms. 
Today, a number of developments have occurred that give new
importance to the question of cooperative capital.  These
include: (a) the dissolving of the bi-polar world composed of
two competing ideological and economic block systems and the
resulting transition of many economies from centralized
control to market orientations, and (b) the related
globalization of markets through trade deregulation and
liberalization, privatization and structural adjustment. 
These changes are operationalized through withdrawal of
government, removal of subsidies and the opening-up of
national markets to broader local and foreign competition. 
In agriculture, a fast-moving technological revolution is now
underway in the industrialized countries.  This aims at the
industrialization of major farm production activities on a
huge scale and the creation of a vast volume of low-cost
standardized food products for global markets.  It is made
possible by new bio-technology permitting substantial
increases in yields, uniformity of product, and
computerization of high volume operations.  This is a highly
capital-intensive development which is likely to drive
traditional producers and many agricultural cooperatives out
of business.