New Generation of Argentine Cooperatives for development and real democracy: The Case of Initia

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 Arnaldo T. Soltermann is Development Laboratory Director, for the Chemistry Department, Rio Cuarto National University. Republic Argentina. He is also President of Initia Workers Cooperative of Argentina. Professor Soltermann is currently on a short visit to the Chemistry Department at UIUC to engage in research (from May to September).

“Cooperatives are a reminder to the international community that it is possible to pursue both economic viability   and social responsibility.” United Nations Secretary-General Ban Ki-moon.

The General Assembly of the United Nations declared 2012 as the International Year of Cooperatives to raise awareness about their importance, promote expansion of the model, and to establish proper cooperatives’ creation and development policies. US co-operators made history on May 4th of 2012 when 150 of their leaders from across the country attended a national briefing at the White House. It was the first-time such a wide ranging number of co-op leaders had attended an event of its kind.

Cooperatives are autonomous associations of persons united voluntarily to meet shared economic, social and cultural needs and aspirations through a jointly and democratically controlled enterprise. Each cooperative is a company, as it is an organized entity that operates in the market, however, the aforementioned features differentiate cooperatives from other types of organizations and companies controlled by capital or the government. Furthermore, organizing principles include: self-help, democracy, equality, equity and solidarity — have proved to reduce poverty, create jobs and promote social integration.

Cooperatives employ over 100 million people worldwide and the 300 most important cooperatives generated over 1.1 billion dollars during 2008. The cooperative agricultural movement emerged in Argentina by late nineteenth century, as a result of the association between European immigrants arriving to the country to work and produce food to export to Europe, in need for an increasing amount of food as a consequence of the industrial revolution. Some of them still exist today and are more than hundred years old. In Argentina today, there are more than 9.3 million coop members distributed across14,000 associations. In recognition of their significant role, The Argentina National Agricultural Technology Institute, noted that, “cooperatives linked to the agricultural sector will play a leading role in the technological change in Argentina.”

Evolution of the Argentine Cooperative System
During the last few years a new generation of Argentine cooperatives has begun to emerge. According to specialists, cooperatives “traditionally played a key role in primary production to benefit the producer, but a new generation of cooperatives are also progressing to transform the primary product and bring it closer to the market.” Aside from adding value to the product, these “new generation” associations draw upon a modern outline of capitalization of profits with an effective return of 50 percent at the end of the annual cycle. In addition, they generate indirect economic and social benefits such as comprehensive territorial development on site that helps increase the demand for labor employment, education, and infrastructure of towns and cities within the country and improve the quality of life of residents. The increasing number of producers and cooperatives adding value to their products, translates into increases in regional resources. This can help prevent generational flight to big cities and favor local development in an environmental sustainability and social equity scenario.

The Inter-Cooperative Agricultural Confederation indicates that there are over 500,000 people depending directly on the agricultural cooperative system; expanding from small communities, where they operate directly, to the shelves of supermarkets and seaports. In turn they account for over 1.7 million dollars per year; exports exceed 0.7 billion dollars and contribute to six percent of the gross domestic product. Agricultural cooperatives not only play an important role in the production and distribution of food but also enforce the food security of nations.

A Case in Point: Initia
Waste from oil industries presents a number of problems in Argentina including storage and potential pollution. Its productive use could enhance the existing oil industry, solving at the same time the environmental problem.  In 1999 at the Chemistry Department of Universidad Nacional de Rio Cuarto (UNRC), Argentina established the Development Laboratory to explore a variety of scientific, commercial, and social issues. This interdisciplinary research group began its work by analyzing the technical and economic possibilities of establishing an oleo chemical development centre-an oil-waste repurposing system, in the southern province of Cordoba. The group identified advanced production technologies to handle this waste that also result in production of added value products (Vitamin E, fatty acids, liquid soap, etc.) using as feedstock oilseed industry waste. The industrial processes were supported by original, well-proved scientific and technological development combined with a respective business plan and a patent application.

The liquid soaps that are produced in the waste-repurposing process could provide a cheap source of cleaners for purchase by public sector organizations focused on the health of vulnerable populations. In fact, negotiations with government agencies regarding this use have begun. Another residual of the processing, tocopherol acetate (Vitamin E) can be useful in several industries. The business plan included plants which would have a strong  production capacity, and would be easily replicable with relatively low initial investment.

In 2011, ten individuals including myself and some other members of the Development lab decided to launch Initia, an autonomous, technology-based worker cooperative. We  decided upon an organizational form based on principles of Cooperative Capital. We bring together our different skills and abilities to carry out shared objectives. We expect that our  connections with the university and the community will allow for significant impact on the local economy and on the local university culture (that is sometimes reluctant to participate in specific production processes). Our journey from research to market has given us new ways of thinking about interconnections and possibilities across multiple arenas.

About Arnaldo Soltermann

Arnaldo T. Soltermann is Development Laboratory Director, for the Chemistry Department, Rio Cuarto National University. Republic Argentina. He is also President of Initia Workers Cooperative of Argentina. Professor Soltermann is currently on a short visit to the Chemistry Department at UIUC to engage in research (from May to September 2012).

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