IPB University urges cooperative modernization inspired by global giants

Indonesia is at a moment when cooperatives can reclaim a central role in the people’s economy and rural development, according to IPB University agribusiness lecturer Rahmat Yanuar.

Speaking at the university’s Strategic Discussion Series 3 in Bogor, Rahmat said cooperatives could not merely try to survive as technology changes and global competition intensifies. They need to become modern and professional business entities while preserving their member-based foundation.

He said cooperatives historically emerged to address unequal bargaining power and market failures that disadvantaged small businesses. But integration across value chains and the technology revolution now require them to adapt rather than remain static.

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This theme is especially relevant as Indonesia is once again positioning cooperatives as an important instrument for developing the people’s economy and strengthening the rural economy.

Rahmat pointed to Fonterra in New Zealand, Amul in India, Raiffeisen in Germany and Mondragon in Spain as examples of cooperatives that have become major economic organizations without abandoning their identity. These groups retained cooperative principles while developing stronger governance, financing, management, technology and business models.

“The main question in our discussion may no longer be whether cooperatives are still relevant, but how Indonesian cooperatives can become modern, professional and competitive without losing ownership, control and benefits for their members,” Rahmat said.

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The main question in our discussion may no longer be whether cooperatives are still relevant, but how Indonesian cooperatives can become modern, professional and competitive without losing ownership, control and benefits for their members.