Co-ops encouraged to diversify activities

Co-operatives will have the support of the government if they diversify activities. (PATRICK CASTILLO)

The Abu Dhabi Council for Economic Development has called on co-operative societies to stop being mere outlets for food and consumer commodities and to go for wider horizons of activity.

The council stressed that co-operatives will find all sorts of support and incentives from the government if they start new activities.

They should seek to serve the economy and the society, it said. In a comprehensive study circulated on Saturday on the holding of the second forum on co-operatives in Abu Dhabi, the council said societies in the UAE have a role to play in the economy in the light of sharp rise in the prices of food in the UAE over the past months.

They stressed the increasing importance of the issue of food security at local and regional levels amidst the crystallisation of features of the world food crisis. The study said those developments have shed a light on the vital role of co-operative societies inside the UAE as important outlets for major food and consumer commodities and as institutions with social and economic objectives that highly exceed those of mere commercial institutions which aim to achieve maximum profit.

The study said however that a number of societies have recently sold food items at cost prices within coordinated efforts to curb inflation and food price rises.

The council said co-ops are important in curbing price hikes through turning into important tools to achieve the UAE's strategy of food security. It also called on co-operative societies to take the option of importing food items directly from producers within long-term contracts and deals to avoid the risk of supply disturbance and congestion. The council said the convening of the second forum in Abu Dhabi today, with the participation of some 500 delegates from 27 countries, is a rare opportunity for co-ops in the UAE to explore and follow up the option of direct import of major food items through contracts with productive cooperative societies in exporting countries.

Such option can give cooperative work in the UAE a new activity with big economic and commercial feasibility for co-ops since it spares them the costs of dealing through mediators and importers. It will also ensure a higher degree of stability of food and consumer supplies. The council also said cooperative societies in the UAE can go beyond that in performing their social and economic message of supporting the country's food security through knocking on the doors of investment in agricultural produce of producing countries.

 

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