11th UN International Day of Cooperatives, 2 July 2005

"Microfinance is OUR business! Cooperating out of poverty"

Messages -- Background to the theme -- Cooperatives and Microfinance

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Messages Message from the Food and Agriculture Organization of the United Nations (FAO) English (pdf version) -- English (html version) -- Français (version pdf) -- Español (versión pdf) Message for the International Co-operative Alliance (ICA) English (pdf version) -- Français (version pdf) -- Español (versión pdf). The ICA message is also made available in other languages by its members. See ICA website for more information. Message for the International Federation of Agricultural Producers (IFAP) English (pdf) - Français (version pdf) -- Español (versión pdf). Message from the Director-General of the International Labour Office (ILO) English (pdf) -- Français (version pdf) -- Español (versión pdf) Message from the United Nations Secretary-General (UN) English pdf -- See also UN observance: "Panel discussion on the role of cooperatives and microfinance in poverty reduction"
Background This year the theme of the International Day links to the United Nations International Year of Microcredit. Access to finance and to financial services is essential to reduce poverty. Poor people need easily accessible, trustworthy, sustainable and economically viable institutions to which they can entrust their savings, which offer loans at affordable conditions, and which provide a safety net through basic insurance services. Amongst the most successful micro-finance institutions worldwide are are member-owned institutions and in particular savings and credit cooperatives, insurance cooperative and cooperative banks. Savings and credit cooperatives (or credit unions) were pioneered by local leaders such as Friedrich Raiffeisen and Hermann Schulze-Delitzsch in the 19th century as a means to reduce poverty and overindebtedness among small farmers and craftsmen in urban and rural areas. Today, they exist and strive in every region of the world, and have been able to adapt to very different socio-economic environments. Some cooperative banks in the industrialized world have become powerful financial institutions. In fact in many high income countries cooperative banks are often the only banking type with a braod branch network ensuring proximity to clients. Despite their commercial success they managed to stay close and committed to their original client base. Cooperative banks are also involved in the promotion of credit unions in the South. Credit unions and similar financial cooperatives have demonstrated that micro-finance services can be delivered to the poor in a sustainable way. Being rooted in local communities and managed by local people, such cooperatives can take advantage of social capital in situations where financial capital is scarce. Capacity building for the poor in money management, saving approaches and enterprise planning have proven to be essential building blocks for effective and sustainable cooperatively managed microfinance. Cooperatively managed micro-finance institutions enable the poor to pool their resources so that they can be used for productive investments and job creation. The social control and democratic management style that is proper to cooperatives generally secure savings and ensures repayment of loans. Cooperatives thus provide the poor with appropriate financial solutions that enable them to collectively work themselves out of poverty.

Information on Cooperatives and Microfinance

• Role of microfinance should be in the post-disaster context: Anne Gaboury, President and CEO of Dééveloppement international Desjardins (Canada) notes ..." to ensure sustainable access to financial services, local financial institutions must be set up that are owned by the community they serve and which work on their behalf. As part of the community’s collective assets they help the community to progress, and in the process they contribute to strengthening local leadership and democracy. All around the globe, networks of savings and credit cooperatives and other microfinance institutions are being set up and are growing in order to reach more people and offer them financial services which meet their needs. They play a central role in increasing the accessibility of financial services throughout the world."
• International Year of Microcredit: Desjardins Component Works to Boost Access by Poor to Financial Services (25 January 2005)
• World Council of Credit Unions (WOCCU)
  WOCCU is world's leading advocate, platform for innovation, and development agency for credit unions.
• Asian Confederation Credit Union (ACCU) Microfinance Programme
  Goal: Reach 5.2 million poor who do not have access to financial services by the year 2005
• International Year of Microcredit: Swiss Development Assistance to savings and credit cooperatives
  Swiss project "CREAR" concentrates on training the management of the supported co-operatives, assisting them in developing new services for their clients and delivering these services more efficiently. Over the past five years, the supported co-operatives have applied their enhanced know-how with great success. They not only survived the recent financial crisis in Ecuador, but managed to increase substantially their portfolios, client base and profitability.
• International Year of Microcredit Launched in Nepal: Cooperative Leaders selected as Most Successful Enterpreneurs
• New York Times Editorial: Dollars Without Borders (13 May 2004)
• International Herald Tribune: Sending a Lot of Money Home (13 July 2001)
• IFAP: Given Credit to Women Farmers (pdf) -- FIPA: Donner du crédit aux femmes rurales (pdf)
  Includes proposals for credit cooperative action.

Events for Year linked to Cooperatives

• ICA Public Lecture mark the International Day of Cooperatives on 2 July 2005 (information soon to be available)
• Contest "Building the Future Now!", 31 January - 31 March 2005
  Highlighting the Global Impact of Microfinance: During International Development Week (30 January- 5 February 2005), Développement international Desjardins (DID) in partnership with Radio Canada International launched Building the Future Now! an international youth contest in addition to a series of radio spots aimed at making young people around the world aware of the importance of microfinance in improving the living conditions of the poor.

Materials provided by COPAC to past celebrations of the UN International Day of Cooperatives:

• 2004: Cooperatives for Fair Globalization: Creating Opportunities for All, 3 July 2004
• 2003: Co-operatives Make Development Happen! The contribution of co-operatives to the United Nations Millennium Development Goals, 5 July 2003
• 2002: Society and Co-operatives: Concern for Community, 6 July 2002
• 2001: The Co-operative Advantage in the Third Millennium, 7 July 2001
• 2000: Co-operatives and Employment Promotion, 1 July 2000
• 1999: Public Policy and Co-operative Legislation, 3 July 1999
• 1998: Cooperatives and the Globalization of the Economy, 4 July 1998
• 1997: The Co-operative Contribution to World Food Security, 5 July 1997
• 1996: Co-operative Enterprise: Empowerment for People-centred Sustainable Development, 6 July 1996
• 1995: 1st UN International Day of Cooperatives: The ICA Centennial and the Next 100 Years of International Co-operation, 1 July 1995

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Updated: 12 October 2005