Cooperative turnover of RM64 billion largely contributed by cooperative banks - Ewon

5 June 2024

By AVV

KUALA LUMPUR: The cooperative movement in the country is robust and has made a substantial impact on the national economy, generating a turnover of RM64.6 billion in 2023, with 15,809 registered cooperatives and over 7.2 million individual members, representing 20% of the country's population.

Minister of Entrepreneur Development and Cooperative Datuk Ewon Benedick said in terms of its contribution to the national GDP, the cooperative movement in Malaysia, however, currently only accounts for 3%, lagging behind Indonesia at 4.5%, Vietnam at 4%, Singapore at 5%, Thailand at 13%, and the Philippines at 12%.

He said on a regional scale, the cooperative movement has generated over 11 million job opportunities and the objective is to enhance this figure by at least 20% by 2030 through a range of cooperative development initiatives at local, regional, and global levels.

This target can be realized through strategic collaborations with the ASEAN Co-operative Organization (ACO) and the International Cooperative Alliance Asia & Pacific (ICA-AP), according to him.

He was speaking during the conclusion of the "Financial Inclusion and Digital Transformation" Conference organized by the International Cooperative Alliance Asia & Pacific (ICA-AP), the ASEAN Cooperative Organisation (ACO), and the Malaysian National Cooperative Movement (ANGKASA).

He shared the significant role of cooperative banks in fostering economic empowerment and social development, with a specific emphasis on two notable institutions: Bank Kerjasama Rakyat Malaysia Berhad (Bank Rakyat) and Coop-Bank Pertama Malaysia.

According to him, Bank Rakyat, established in 1954, stands as Malaysia's largest Islamic cooperative bank. With assets totaling RM117.33 billion as of December 2021, Bank Rakyat has shown remarkable financial performance. with 148 branches and over 5,800 employees nationwide, Bank Rakyat has been a pillar of stability and progress in Malaysia's financial landscape.

He mentioned that Coop-Bank Pertama had also shown impressive growth as its assets grew to RM6.1 billion with 33 branches nationwide and a dedicated team of 554 employees, Coop-Bank Pertama has played a crucial role in driving economic prosperity and social cohesion in Malaysia.

Governments across the Asia Pacific region should prioritise cooperative banks in their development agendas as cooperative banks serve as champions of inclusive economic growth, strongly emphasizing financial inclusion.

Ewon said through the provision of banking services, credit, and investment opportunities, they cater to the needs of underserved communities and small-scale entrepreneurs.

Cooperative banks play a vital role in supporting cooperative enterprises by recognizing and addressing their distinct needs and obstacles, he said adding that through the provision of customised financial products and services, these banks facilitate the growth, expansion, and sustainability of cooperative businesses. By offering specialized assistance and resources, cooperative banks act as enablers for the advancement and prosperity of cooperative enterprises.

Across Asia, cooperative banks have played a pivotal role in driving economic growth and social advancement. In India, the Indian Farmers Fertiliser Cooperative Limited (IFFCO) and the Gujarat Cooperative Milk Marketing Federation have revolutionized agriculture, empowering farmers and setting standards for cooperative success, he said adding that in Japan, Zenkyoren and Zen-Noh have modernised agriculture and protected farmers' interests, while in South Korea, the National Agricultural Cooperative Federation (Nonghyup) has championed agricultural resilience and prosperity.

These institutions exemplify the transformative impact of cooperative banks in promoting resilience, sustainability, and shared prosperity.

“As we celebrate their achievements, let us renew our commitment to championing their cause and advocating for their recognition on the regional and global stage. He said that cooperative banks are facilitating access to capital and financial services, enabling individuals and communities to engage in economic activities actively,” he said.

He reiterated that Cooperative banks are pivotal in driving economic development, social advancement, and sustainable growth in the Asia Pacific region and therefore governments must acknowledge the significant potential of cooperative banks and allocate resources and support accordingly.

According to him, by leveraging the capabilities of cooperative banking, new avenues can be created for progress, empower communities, and foster a more inclusive and prosperous future.