UAE’s Ministry of Economy (MoE) and the International Cooperative Alliance (ICA), the largest global cooperative organisation, will work together to develop the over AED3.1 billion ($840 million) national cooperative sector.
A Memorandum of Understanding (MoU) signed between the two entities forms part of the ministry's strategy to improve the performance of the country’s cooperative sector and increase its contribution to the national economy.
The MoU was signed by Abdullah Al Saleh, Undersecretary of the Ministry of Economy, and Balasubramanian Iyer, Regional Director of the Alliance, on behalf of the ICA.
Raising work environment
Al Saleh said that the partnership will help raise the work environment in the country's cooperative sector to new levels. He explained that under the framework of the MoU, joint actions will be taken along with the ICA to contribute to the development of flexible and proactive legislation that will further empower the cooperative model and regulate its governance.
This in turn will enhance the readiness of the UAE’s cooperative work environment and increase its contribution to the growth of the country’s non-oil GDP.
In addition, he pointed out that this MoU serves the MoE’s objectives and integrated strategy to achieve qualitative development in the cooperative sector to enable it to play a direct role in the diversification and competitiveness of the national economy.
He added: “The cooperative sector plays a pivotal role in achieving the UAE’s sustainable economic and social development goals and is an important asset to the competitiveness and diversity of the national economy. In line with the wise leadership’s vision for the future and the principles and Projects of the 50, the UAE Government has adopted a new vision for this vital sector aimed at improving its performance in accordance with international best practices and enhancing its role in the country's new economic model. The country has achieved regional leadership in developing the cooperative model and establishing a favourable environment and policies that drive its growth.”
Al Saleh further noted that the UAE is one of the first countries in the region to allow the regulation and trading of cooperative shares in its financial markets, a move that enhances the leadership and competitiveness of the UAE cooperatives regionally and globally. It enables the activation and deepening of its role in providing economic sectors in the country and supporting its shareholders.
Drivers of diversity
“We continue our efforts today to complete the cooperative sector development strategy in order to enable the sector to take its rightful role as one of the drivers of diversity, sustainability, innovation, high productivity, and transition towards a future economy in the UAE,” he added.
Meanwhile, Iyer said: “Through this agreement, we aspire to provide the UAE’s cooperative sector with the highest international practices, following the footprints of leading examples from countries all over the world. Our strategy is to promote the development of the current cooperative system in the UAE, raise awareness, and encourage the participation of youth and women, and build capacities.
“This strategy is set to increase the contribution of cooperatives in supporting the country's economy as it is an important focus area in achieving the objectives of the UAE Centennial 2071 and supports the country’s efforts to establish a diversified economic model.”
The MoE aspires to set a first-of-its-kind comprehensive strategy to develop the cooperative sector in the UAE shortly. This strategy includes training for the entities that supervise the cooperative sector and acquainting them with the latest international practices and methods.
It is also set to launch a joint committee with the membership of cooperatives, as well as federal and local entities that supervise the sector, to oversee the implementation of the strategy, in collaboration with the Ministry. It will promote joint efforts by the Ministry and its partners to promote the national cooperative sector. The development strategy is divided into three stages.
Stage one includes the development of the UAE’s cooperative sector and assessing the current state of the sector. This will be conducted by establishing teams from the MoE and the ICA to collaborate in developing the jurisdictional system of cooperatives as well as promoting the research and development activities.
This stage will further include training workshops that are open to everyone as these focus on introducing the significance of the sector, its role in supporting the national economy, and exploring ways to establish more cooperatives in the UAE.
The second stage is set to conduct comprehensive studies on the development of the cooperative sector, promote opportunities, identify challenges, and the means to diversify priority sectors in which the cooperatives practice their activities in collaboration with partners.
Also, the second stage will oversee the development of an effective strategy to increase the sector’s contribution to the country’s GDP to five per cent by the year 2031.
The third phase will focus on qualifying the people working in the cooperative sector, raising their awareness on the best practices followed globally. It will also focus on developing the human capacities of the local entities and departments in the UAE concerning policies, law enforcement, and monitoring the performance of cooperatives.
This will be achieved through conducting training programmes, launching initiatives, and business incubators to accelerate the growth of the next generation of cooperative entrepreneurs. Also, there will be developed training and academic curricula for students.
These curricula aim to consolidate cooperative thinking that addresses cooperative principles and launch campaigns and awareness programmes across the UAE to raise awareness about the cooperatives and their importance, in cooperation with the concerned local and federal government entities and the private sector. The partnership will last for 18 months.
By the end of 2020, the number of cooperative societies in their various forms in the UAE reached nearly 42, including 20 consumer societies, 13 for fishermen, 7 societies in other fields, two cooperative unions, and 200 outlets and branches all over the country. The total value of the cooperative sector amounted to AED3.1 billion ($840 million), and its net profit amounted to more than AED1 billion at the end of the same year, while the number of shareholders in cooperatives amounted to about 97,000 contributing members until the end of 2020.-- TradeArabia News Service