Cape Verde - The Status of Co-operation, INFO-COOP, July, 1996

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    This document has been made available in electronic format
         by the International Co-operative Alliance ICA 
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                         July, 1996

    (Source: INFO-COOP, Issue No.9, July, 1996, p.11-12)

                         CAPE-VERDE
                The Status of Co-operation
                              by
                    Joao Gomes Mendoca
          President, National Co-operative Institute(INC)
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Just like other areas of the country's economy and social
life, the co-operative movement, today, is at a turning point
in its history. The transition the country is going through
has significantly affected co-operative organizations, which,
in the beginning, seemed to be falling apart. However, we now
note a steady upturn in co-operative activity, despite the
constraints faced by the sector, which will be addressed
later.

We now need to examine what is happening between consumer
co-operatives and production co-operatives. The general
situation today, has changed, and with it, the status of
consumer co-operatives.

Today, only the co-operatives which were well-organized and
ready to take up the challenge have been able to survive and
cope with the effects of economic liberalization. Most
consumer co-operatives were not able to, or did not know how
to withstand competition from the more lucrative private
sector trade in supplies for the people. We are witnessing a
dramatic rise in the number of production co-operatives in
various sectors of economic activity.

Indeed, quite apart from the support received from INC, civil
society has been organizing itself to seek solutions to
well-defined common problems. As we all know, well-structured
co-operative units are more likely to attract support, and
eventually, funding and direct technical assistance.

In examining the differences in the behaviour of the people
with respect to the usefulness of co-operatives, we come to
the conclusion that the renewed interest to set up
co-operatives, is more with the economic prospects in mind,
than the social prospects, as was the case in the past.

In Cape Verde, the trend is now moving toward productive
co-operative units rather than consumer or social-type
co-operatives.

>From 1991 to 1995, 62 co-operative units were set up, with 11
in the agricultural and animal husbandry sector, 18 in the
semi-industrial sector, 22 fishery units, 4 housing units, and
only 7 consumer co-operatives.

We see from the current situation that the trend is moving
toward development of new productive areas which make for a
more dynamic integration of that sector into the country's
economic fabric.

With this new direction in the Cape Verdean co-operative
movement, we need to formulate a new co-operative policy, so
that the sector would fall in line with the current
socio-economic developments in the country. With the
ever-changing economic situation, coupled with the slightly
outmoded legal framework with respect to the current nature of
the co-operative movement in Cape Verde, we need to institute
regulatory measures in order to cope with the new economic
situation, while maintaining the co-operative units' own
peculiar characteristics.

Most members of the co-operative movement do not have a high
level of education and their social and cultural habits leave
a lot to be desired. All these adversely affect the
co-operative units in their capacity as business concerns.

People are more prone to put their personal interest before
the interest of the co-operative as a whole. This may lead to
a weakening of the culture of association, which has hitherto
been deeply entrenched in daily life of Cape Verdeans.

Finally, the co-operatives lack a reserve fund to cover
contingencies and ensure their credit-worthiness.

Furthermore, we cannot cut away Cape Verde from the rest of
the world and thereby jeopardize our economy. What is
happening in our country today is only a reflection of the
situation world-wide. The co-operative movement in Cape Verde
is experiencing the same constraints as those in other parts
of the world. Pondering therefore, over the future of the
co-operative movement in Cape Verde would be tantamount to
wondering about the outcome of co-operatives in the whole
world. Better still, we should consider the co-operative
movement more as a whole, than from the association standpoint
alone. We feel that everyone ought to have faith in Man's
innate urge to live in a community and socialize with his
peers, although such behaviour ought to be cultivated.

Often, when we question ourselves about what would become of
the co-operative movement, our minds go back to the model we
had been using from 1975 up to the early 1990s. This model
should however not serve as a yardstick.

INC is currently conducting a country-wide study to find out
if the co-operative movement is well-received, and the best
sectors in which co-operatives may be set up. Although the
final results of the study have not yet come out, based on the
first few accounts, we can confidently say that the outlook is
promising for the co-operative movement. Indeed, the point at
issue was how the co-operative movement would be set up and
not merely the fact of having co-operatives per se.

After the final results have come out, we would be able to
assert whether Cape Verde would be open to having associations
in general, and co-operatives in particular. We should also be
able to know the potential of this sector of the social
economy.

The findings of the study will be disseminated widely, and
various specialized establishments will be called upon to give
their points of view, to help further the studies on the
potential of associations in Cape Verde.

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Name:               Institut National des Cooperatives 
Acronym:            I.N.C.    
Address:            BP 218 PRAIA - CAP-VERT  
Telephone:          (238) 61-41-12/ 61-38-15 
Fax:                (238) 61-39-19 
Operational Zone:   Nationwide     
Chairman of the 
Management Committee: Joao Gomes MENDOCA     

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