Cooperative economy gets rid of “a new wine in an old bottle” situation.

Cashew breed of Phu Vinh Cooperative

Transformation of cooperative economy structure

In Dong Nai province, the cooperative economy has really made great changes in both the consciousness and management quality since it carried out the slogan “Keeps on innovating and enhancing the effect of collective economy” basing on the Resolution of the 5th Central Party Committee and the Resolution of the 9th National Party Congress. Accordingly, the target of the province in period from 2003 to 2010 is to build up and develop the cooperative economy in modern model, increase the gross domestic product (GDP) of this sector from 5-10% to 20- 25% in the total GDP of the province. After 3 years developing in the new cooperative economy model, by June 2006 there are 148 cooperatives in the province (including the old ones and newly established ones). 54 of which is agriculture cooperatives and agricultural services cooperatives; 19 commercial cooperatives, 2 construction cooperatives, 17 transportation cooperatives, 14 industrial cooperatives and handicraft co-operatives, 20 people’s credit funds, 8 fishery co-operatives, 7 environmental cooperatives and 8 porter co-operatives. It has changed in both quality and quantity in comparison with the time before implementing the Central Resolution. Particularly, in comparison with that of 2000, there were only 80 cooperatives with the average charter capital of 80 billion VND for each. But now there are 148 cooperatives with the charter capital of 80 billion VND for each

The important thing is that the cooperatives operated basing on the new model has got rid of “a new wine in an old bottle” business as before. It means that the cooperatives have changed management, operation and organization system. Previously, cooperatives are places for people who have small capital and run small business. But now they have individuals, households, farmers and enterprises. It is the cooperation in becoming large-scale economic organization has enhanced the ability to manage and operate cooperatives and attracted more people having the big capital resource. As a result, cooperatives have become more and more effective.

Typical new-model cooperatives

According to Cooperative and Non-state owned Enterprise Union of Dong Nai, there still have cooperatives which operate ineffectively because they are not enough competitive ability to compete with other economic sectors and their capital resource is low, their management is weak, their technologies are backward, and their approaches to market and to advertisement strategies do not keep pace with the time. But cooperatives with good business increases more and more, making up of about 70% of the total cooperatives in Dongnai province. These good cooperatives have made better use of the encouraging policies of the government as well as the strength of each field to build up best production and business strategies. Take Phu Vinh agriculture cooperative in Tan Phu district for example. It was established in 2002 with just 30 people, and the charter capital of 500 million VND. But its executive board knows how to do business. They built up the cooperative in a multi-functions and multi-industries. It receives service works and simultaneously provides material for production. It helps its members to raise animals, to run transport business or to produce handicrafts and export products…etc. Therefore, presently it has not only provided jobs for 100 members to work in Donafood Company but also helped 50 members to gain high income by selling breed cashew trees to Donafood Company. 

Another typical new-model cooperative is Xuan Tay Cooperative in Cam My district. It is the first one in the province to “integrate” farmer, governor, entrepreneur and scientist into one. By cooperating with entrepreneurs to buy and sell agricultural products and agricultural materials, it has brought benefits to its members, especially helping them to approach and apply scientific and technological advances and the new seed variety. ,  the Dong Tien Transport Cooperative in Tan Phong ward of Bien Hoa city is another typical cooperative in field of public transport. Although the price of fuel has been increasing, the cooperative has concentrated on innovating, upgrading the vehicles, enlarging the routes and seeking for the contracts to apply for the demand of the customers and work effectively. Presently, it is the cooperative which has largest number of vehicles (over 200) and its annual income reaches 3- 4 billion VND. As for rattan and bamboo weaving cooperatives such as Ho Nai, Hiep luc, Tan hiep have made great use of their strengths on rattan and bamboo weaving products for export to expand their business and to bring high income for their members (the average income of a worker is 1.2- 1.4 million VND per month) 

According to the program to support cooperative economy from now to 2010, Cooperative and Non-state owned enterprise Union will focus on solving the shortcomings of cooperatives such as: management system, professional skills and abilities, the market especially foreign market…etc. Mrs Nguyen Thi Tuyet, Chairperson of Cooperative and Non-state owned enterprise Union pointed out that “due to some shortcomings of the policies to develop cooperative economic some cooperatives which produce and trade specialized products and use craftsmen find it difficult to apply tax polices, welfare polices…etc. Presently, the Union is inspecting the production abilities and business situations of some cooperatives as to point out the weaknesses and shortcomings in training management cadres, propaganda activities to popularize the policies of Party and Government, making use of cooperation program between relevant agencies, etc.

(Translated by THKC)