Peasants mean business: Cooperatives are in bloom
Last modified: 2010-04-27 18:35:40
JAKARTA. Cooperative is a form of business unit which best suited to democratic economic principles. The main characteristic that distinguish cooperative with other business entities is that cooperative members have dual identity. Dual identity means that member of the cooperative are the owner and user as well. In cooperative there is no employee or employer, all people work together for their common goal (Hatta, 1954). Generally, cooperative is controlled jointly by all members, in which every member has equal rights in any cooperative decision making. Its profit sharing is usually calculated based on members' contribution, for example by distributing divident based on purchases or sales made by the members.
Cooperative was introduced by R. Aria Wiriatmadja in Central Java on 1896. He established a credit cooperative to help people who trapped in debt with loan sharks. Indonesia's first Vice President, Mohammad Hatta, also one of the figure that encourages cooperative to become the basic of people's economic system of Indonesia.
One of the efforts of Serikat Petani Indonesia (SPI) for the peasants' economic empowerment is to develop cooperative until basis (village) level. Here will be described some examples of successful SPI cooperative that becomes the fundamental of its member's economy in Bukit Kijang Basis, Asahan regency, North Sumatra, Indonesia. Several other common units have also been initiated by other SPI basis members in Asahan, Langkat, Padang Lawas and Bogor Regency in West Java.
Successful reclaiming and the aftermath
In the 1980s, one of local latifundia, Miskamto, claimed to own the land tilled by those peasants, based on an unknown certificate. Various repressive actions conducted by Miskamto through the hands of the military and police various level. The actions were conducted to drive peasants out of the land. However, peasants remain on the land where they worked.
On January 27 1992, the peasants struggled to form peasants' groups with the local name Tani Jaya. In 1994 Tani Jaya peasants group together with some peasant groups from several districts in North Sumatra declared the North Sumatra Peasant Union (now SPI provincial chapter).
Struggle to obtain rights over land continued. During the process, it is known that the land certificate was legally flawed. Luckily, between 1993 - 1996 repression and eviction of farmers through military, police and paramilitary diminished gradually. Until now farmers have been cultivating the land without any threat from anyone.
Land ownership was distributed equally around 1.5 to 2 ha per family. The village is divided around 1 ha for settlement with 27 houses, and a mosque for religious use. Soon, the rest of the area (around 100 ha) became Tani Jaya's plantation. In 1993, peasants planted their land with palm and some for food crops.
For several years of planting and waiting for the harvest, Tani Jaya peasants began to think and design an economic model that will be able to exercise. In 1996, they set up an effort by forming economic institution (LKP) "Kijang Mas". Activities in the LKP mainly consist of savings and loans with principal deposits of IDR1,000, compulsory savings IDR500, as well as voluntary savings in accordance with members' capacity. LKP existence helps peasants financing their business.
Along with increasing income from several harvests, the amount of principal and mandatory savings also improved. This allowed some development of business units owned by Tani Jaya peasant groups. In 2006, from the embryo of LKP, Kijang Mas cooperative was formed and obtained legal status.
Kijang Mas cooperative also making business by selling groceries and household needs. Parallel to this process, the cooperative was looking to develop business on selling palm oil produced by its own members. This was in response to middlemen and price problems-so the goal was to get better price by doing the selling themselves. In 2006, the cooperative started to market organic rice from another SPI member and also agricultural production tools for members. All in all, Kijang Mas cooperatives turnover in 2006-2007 reached more than IDR 2.4b.
Meantime, the peasants realized common mistakes: great business has a great risk of going private and foster individual competition. Collectivity of the movement should be maintained. Therefore, they setup collective land right when the business blossoms. In 2002, Kijang Mas cooperative members started the arrangement and setup collective land. The group agreed to increase the land area by allocating cooperative profit sharing. In 2006, peasants' build organizations secretariat building. Until the year of 2007, the collective land reached a total number of 14.92 ha.
Now the peasants receiving benefits from their hard work: profit sharing from cooperative and also from its business units, health support from the organization. In addition, there is this incentive for members' housing in a form of grant from the cooperative. Acceptance of this grant is scheduled to rotate among all members.
Kijang Mas cooperative is one example of success story from SPI basis member in empowering rural economy. Before the reclaiming, the peasants were agricultural workers and therefore are landless. After having the right and access to 1.5 to 2 ha per household, their income increased from IDR878,000 to IDR3,000,000 per month. Their average household income are now three to four fold higher than the plantation workers.
Another form of joint effort business that has been running is at SPI Training Center in Bogor, West Java. This joint venture has 106 members that spreads over 5 bases in Bogor regency. Peasants sell to the coordinator (in this case the center is managed by the Training Center) and then coordinator sells the products to several places such as 2 local Dept. Stores: Yogya Surakencana and Yogya Cimanggu, Giga Farm Cibinong (agents), and Sesawi Jaya. The collective decision making between the producers and consumers set remunerative prices for the products. The margin is used to cover marketing costs, transport, communication and advance to cope with some reject products. Several groups will soon evolving to the form of cooperatives.
Source, references, bahasa Indonesia Serikat Petani Indonesia
Keywords: Indonesia, organic, cooperatives, organik, koperasi, SPI, Sekikat Petani Indonesia