Co-operatives collaborating with local money
In the mountains of western Costa Rica lies the district of Alfaro Ruiz, in which four co-operatives are active. Together they achieved a considerable improvement of the local standard of living in the last decades. Trade channels already exist and now STRO is introducing the concept of local money. Since Alfaro Ruiz is an isolated location, STRO has the opportunity to get a clear picture of how regional money circulates.
Costa Rica is the country of co-operatives, because its legislation offers co-operatives legal and financial opportunities. The quality of education is good and there is little crime. Essentially, Costa Rica is a stable country located in a traditionally turbulent region. In Zarcero, the capital of Alfaro Ruiz, nearly every inhabitant is member of at least two co-operatives, being the electricity co-operative and often one or two of the other co-operatives.
Introducing the four co-operatives of Alfaro Ruiz:
CoopeCar
This saving and credit co-operative started nearly 40 years ago with 68
local residents. This co-operative provides various financial services,
for example they give people the opportunity to contract a loan or to
take a course. Participants also have some tax benefits. Decisions
within the co-operative are taken democratically and at present (2007),
it has more than 4000 members.
The Cooperativa de Electrificacion
The Cooperativa de Electrificacion dates from 1972 and has nearly 6000
customers. If customers decide to become a member of the co-operative,
they receive a share of its profit. This co-operative supplies
electricity at lower rates compared to the state company.
Cooperativa AgroMultiple
Cooperativa AgroMultiple is an agricultural co-operative, which was
initiated in 1969 to give farmers the possibility to invest jointly in
agricultural machines. These farmers also collaborate in the
agro-industrial production with a factory that either preserves or
freezes vegetables and fruits. Furthermore the co-operative leases
agricultural engines and sells sowing seeds, manure and ploughs.
CoopeBrisas
CoopeBrisas is a milk factory. This region is famous for its excellent
milk, which is the result of the quality of the grass that grows at
that height in the Alfaro Ruiz district. CoopeBrisas also has a small
supermarket and a shop for agricultural materials.
The introduction of local money
The question is whether something can be added to the sound economic
structure of these four co-operatives? Certainly, the introduction of
local money considerably increases the internal flow of money within
Alfaro Ruiz. An increase in demand for local products generates more
employment within the region. The inventory of the four co-operative is
used as security for the local money. In order to invest in management,
necessary purchases outside of Alfaro Ruiz can be made with the
national currency the Colon.
Local money is introduced into society in four ways:
- By paying wages or wage advances;
- By granting loans to members (farmers);
- By payment of services or goods;
- With bonuses: sharing profit among its members.
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