Celebrating the Philippine Cooperative Centennial along with the Cooperative Development Authority’s (CDA) 25th anniversary, CDA Officer-in-Charge and Administrator Dr. Eulogio T. Castillo shares how the agency continues to work hard assisting local cooperatives to become instruments of social economic change in an increasingly modernized world.

“Give a man a fish and you feed him for a day. Teach a man how to fish and you feed him for a lifetime.”

Not many people may realize this, but there are 24,652 cooperatives registered in the Philippines based on a December 2014 report from the CDA. What that means is, with the 15 regional offices, and one headquarter, Dr. Castillo sees that there’s so much room for growth – if only people would recognize the potential of cooperatives.

“The numbers are’nt balanced,” Castillo says.

Learning more about local cooperatives

“Our cooperatives are classified into four – micro, small, medium, and large. Micro is composed of cooperatives with assets three million and below, then small is classified with 15 million and below, medium is 100 million and below, and large is 100 million and above. But in these 24,652 co-ops, the distribution based on assets is not normal. It’s abnormal because only two percent are large and 76 percent are micro – with assets of three million and below. Therefore the large majority is very poor.”

Dr. Castillo is saddened by the thought as these micro cooperatives is largely composed of people who support the economy, by means of production – farmers, fishermen, and agrarian reform beneficiaries. “Many call them the ‘backbone of society’, because they provide food, employment, and control the large land holdings in the Philippines.”

”Now, what will happen if they do not improve their situation? Then, they will not become very effective in supplying the necessary food that the whole population needs, and we will be at the mercy of the international markets. Do we want to do that? CDA is mandated to look after these cooperatives that is why we’re giving this technical assistance to them. We cannot abandon them and give up this role.”

CDA as a tool for development

“The main function of the CDA is ‘development’.” Dr. Castillo explains, “Why development? Because cooperatives basically focus on the less-privileged members of the society. So the target of cooperatives is to uplift the livelihood, welfare, economic, and social status of the less-privileged members of our society that’s why we have to develop them. We are pro poor. We are tasked to put them in the socio economic mainstream so that instead of becoming a burden to society, they will become an active player in nation building. In order to do that, we have our technical assistance program, which is primarily composed of capacitating the human resources in the development world, particularly those who are belonging in the micro and small cooperatives, the capacity building is in terms of training. We have to train them on what cooperatives is all about, it is very awkward to put them in the cooperatives world if they do not understand it. They have to at least understand what the cooperative principles is all about and the cooperatives laws because if they do not understand these, they will not be able to comply with the legal requirements that all cooperatives satisfy.”

This is because when cooperatives are able to satisfy such legal requirements, they will be able to enjoy certain incentives from the government such as tax exemption.

As such, Dr. Castillo stresses on the importance of always upholding the principles of cooperatives, “Cooperatives should be institutions that are owned, managed, controlled and should be patronized by the members. As an organization, it should be self help, the people should put in the necessary requirements for the business including the capital. As the owner of the capital, you should manage it, and as manager of the capital you should be controlling it by putting the people who can handle the business, and after having the business and the practice of the business, cooperatives have a very basic cardinal rule in order to be called a ‘cooperative’. Whatever are the benefits of the cooperative, it must be divided among the members in accordance to their patronage, unlike with corporations, wherein the profits of the corporation go to the owner of the capital.”

Cooperative organizations are a voluntary organizations initiated by the people, as it is a “self help”“People should seek it because they see a use for it”, shares Dr. Castillo, which is why as much as they can, they educate people on the benefits of cooperative organizations, more so, if they are able to make it grow. “People should be taught of the world and its businesses. The serious ally of poverty is ignorance,” says Dr. Castillo. Take for example the farmers, if they are not able to better take care of their interests through a cooperative organization, the playing field against corporations will never be balanced. And what Dr. Castillo wants is for people to become better educated to be able to compete well in the market.

How can we improve

Dr. Castillo says that in terms of the number of cooperatives, the agricultural regions are the ones that have a lot of cooperatives. Meanwhile, the non-agricultural region , NCR, is where the large cooperatives are based, as these cooperatives are institutional, which means they have been developed by companies and institutions. Among the top five cooperatives in the Philippines is from the military. Some of the non-institutional cooperatives were developed by churches. However, in terms of number, the number of cooperatives is on the decline.

Dr.Castillo is saddened by this as he sees great potential in cooperatives. When used wisely, it could bring a lot of economic benefits not just to those involved in the cooperatives, but the country as well.

To be clear, the number of cooperatives is increasing per year, however the growth is cancelled out by the number of cooperatives that are closing or being dissolved, hence, it is limited to a yearly 5 percent growth.

As for the coming ASEAN Integration, Dr. Castillo sees it is as an advantageous for the government if cooperatives are successful. “By virtue of the principles of start-ups then the people shall be doing what the government should be doing for the people. So it is a substitution. It is a cost-saving strategy for the government to help the people. And that is the reason why cooperatives are given tax exemption. Especially now we are engaging in the free flow of goods, capital, services, and human resources within the 10 countries of the ASEAN.”

“We have to compete. How? We have to teach our farmers to produce more but at less the cost, for them to be able to offer it at the best price, without compromising the quality. And CDA is at the core of it, as the government’s arm in educating people for this.”

Likewise, the CDA maintains its ties with international organizations as much as they can as it is important that they have linkages with international cooperatives especially now that the world is getting “smaller” because of free trade. He says that the

recent visit of their Malaysian counterparts is a clear indication of how aggressive other countries are in promoting cooperatives – something that he also wishes for the CDA, should they get more support from the government.

In the meantime, the CDA continues to fulfil its mission by aggressively promoting cooperatives in the country, especially this year as they hope to create buzz for the Philippine Cooperative Centennial – a year-long celebration, which they’ve packed with activities. In relation to this, they are also commemorating the 25th anniversary of the CDA, wherein they will be looking back on their successes starting with the fact that out of the 15 regional offices that they have, 14 are all ISO certified – except for one office, which was ravaged by Typhoon Yolanda and is still being rehabilitated.

Looking back while also looking forward to what’s ahead, Dr. Castillo continues to challenge people in fulfilling their potential through the celebration of the Philippine Cooperative Centennial especially if we want to develop as a people. He remains positive that people will eventually follow suit, given the right knowledge as well as of course, the right attitude.

To learn more about the Cooperative Development Authority, you may visit cda.gov.ph.

Source: The Philippine Star | FEATURE.  Published March 10, 2015