Co-ops to be new growth engine

Co-ops to be new growth engine


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PUTRAJAYA: Cooperatives can ease the burden of inflation by offering lower prices than regular retailers, the prime minister said.

Datuk Seri Abdullah Ahmad Badawi said cooperatives could offer discounts as they were run mainly by their own members.

He said cooperatives had helped consumers fight stagflation in the 1960s, and would be able to shelter the people again in the present climate of higher fuel and commodity prices.

"Cooperatives, especially those involved in food production and other consumer goods, can help to reduce inflationary pressures.

"They normally don't use middlemen so they can sell at cheaper prices," he said yesterday at the launch of the Malaysian Cooperatives Commission (SKM), which replaces the Cooperatives Development Department under the Entrepreneur and Cooperative Development Ministry.

Abdullah also called on cooperatives, which collectively own RM43.6 billion in assets and conduct RM6.1 billion in annual sales turnover, to contribute more to the national economy.

"Cooperatives began in 1922 mainly as a means to fight poverty and rural debt, but now they have the potential to be an engine of economic growth and to create more jobs."

He said cooperatives could be considered the fourth engine of growth after services, manufacturing and agriculture. Abdullah said he wanted to see cooperatives being set up in the economic corridor projects to give more opportunities to the local population.

He said this should be done through the new Koperasi Bela Rakyat (Kobera) programme which aims to set up one cooperative, meant for the very poor, in every state constituency. Each cooperative will receive a seed grant of RM30,000 to be distributed among its shareholders.

Earlier this month, Entrepreneur and Cooperative Development Minister Datuk Noh Omar had announced the setting up of Kobera.

Noh said cooperatives currently contributed one per cent to the country's gross domestic product, and the ministry's aim was to increase the figure to 10 per cent by 2020.

Abdullah later presented letters of appointment to the SKM board of directors.

SKM is headed by executive chairman Datuk Mangsor Saad, a former Entrepreneur and Cooperative Development Ministry secretary-general.

Abdullah also presented awards to last year's 10 best cooperatives.

He announced that the government would contribute RM70 million this year to the cooperative revolving fund, which currently had RM251.5 million.