Jakarta Launches Multi-Ministerial Pact To Power Red And White Rural Cooperatives
Table of Contents
- 1. Jakarta Launches Multi-Ministerial Pact To Power Red And White Rural Cooperatives
- 2. Key Facts At A Glance
- 3. Evergreen Perspectives
- 4. >Technical Assistance HubEstablish a multi‑agency Rural Cooperative Support Center in Bulacan.Recruit 30 agronomists, accountants, and ICT specialists by March 2026.Policy HarmonizationAlign tax incentives, land‑use regulations, and export facilitation for cooperative members.Draft a joint circular for the Department of Finance by August 2026.Digital Platform LaunchDevelop “CoopConnect” – a cloud‑based portal for inventory, sales, and member education.Pilot in 10 provinces (Ilocos, Central Luzon, Visayas) by December 2026.Monitoring & Evaluation (M&E)Quarterly performance dashboards and impact assessments.appoint an autonomous M&E firm (e.g., Asian Advancement Institute) by July 2026.Benefits for Red‑white Rural Cooperatives
Breaking from Jakarta on December 23, 2025, a landmark memorandum of understanding was signed to elevate the role of red and white rural cooperatives as drivers of local economic growth. The ceremony brought together six senior officials to chart a collaborative path for cooperatives nationwide.
The signing ceremony in Jakarta featured Cooperatives Minister Ferri Juliantono alongside the Minister of Micro, Small and medium Enterprises, Maman Abdulrahman; Forestry Minister Raja Julius Anthony; Minister of Higher Education, Science and Technology Brian Iuliarto; Deputy Minister of Immigration Viva Yogi Moradi; and the president of the Health and Social Security Management Agency, Ali Gufron Mukti. The agreement outlines a coordinated approach to strengthen rural cooperatives as engines of community wealth.
under the pact, the ministries and agency will pursue a multi-pronged strategy designed to expand market access, boost innovation, and deepen social protections for cooperative members.Officials stressed that the collaboration is aimed at turning a nationwide network of cooperatives into a robust supply chain for small, medium, and micro enterprises (UMKM).
Key commitments include developing the red and white rural cooperatives into a large-scale market for UMKM products across Indonesia. With tens of thousands of cooperative stores already in operation, the plan envisions leveraging a cooperative-led e-commerce platform to prioritize UMKM goods, ensuring they reach wider consumer bases.
Another pillar focuses on leveraging research and higher education resources to fuel cooperative progress. The collaboration will back university student cooperatives and thematic social practise programs (KKN) aligned with rural cooperative initiatives, using scientific findings to inform policy and practice.
In the forestry sector, the agreement calls for stronger institutional building and human resource capacity within cooperatives, especially to support social forestry business groups in forming standardized cooperative entities. The effort aims to create greater accountability and scalable governance in rural forest economies.
Resettlement areas are also in the crosshairs of the pact. The collaboration with the Ministry of Immigration aims to promote the establishment of cooperative enterprises that can manage productive economic activities for communities in transition, enabling resilient local livelihoods.
Health sector coordination is another cornerstone. the Health and Social Security Governance (BPJS Kesehatan) will pursue data exchanges and raise awareness of the National Health Insurance Scheme, with a vision to integrate cooperative health service outlets, such as pharmacies and clinics, into the NHS ecosystem.
MSME Minister Maman Abdulrahman highlighted the strategic value of the alliance, noting that cooperatives can serve as an integration platform for local MSMEs. He announced plans to classify clusters in areas where red and white village cooperatives operate, identifying UMKM with growth potential and tailoring support accordingly.
as a practical outcome, officials anticipate about 80,000 cooperative stores becoming active sales channels for UMKM products, underscoring the scale of the initiative and its potential economic impact across rural communities.
Key Facts At A Glance
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Evergreen Perspectives
Cooperatives have long been seen as steadfast vehicles for inclusive growth, especially in rural regions where access to markets and capital remains uneven. by combining market access with research-driven development, the alliance seeks to turn local cooperatives into scalable economic ecosystems. The success of such models typically hinges on strong governance, clear data sharing, digital adoption, and consistent public-private collaboration. If executed well, the program could offer a blueprint for other countries aiming to empower small producers through coordinated policy support and innovative service delivery.
What lies ahead will depend on local implementation: seamless coordination among ministries,robust monitoring of UMKM outcomes,and continuous adaptation to evolving market needs. The initiative could reinforce resilience in rural livelihoods by linking production, education, and health services within a single cooperative framework.
Readers, how do you see this model affecting rural economies in the coming years? Are cooperative networks the best path for empowering small producers in your region?
For further context on cooperative development and inclusive growth, explore analyses from international labor and development organizations that highlight how cooperative ecosystems can complement formal markets and social protection programs.
Note: Information reflects the announced framework and participants as of the signing date. Programs and outcomes may evolve with budgetary and policy updates.
Learn more about cooperative development from the ILO
>Technical Assistance Hub
Establish a multi‑agency Rural Cooperative Support Center in Bulacan.
Recruit 30 agronomists, accountants, and ICT specialists by March 2026.
Policy Harmonization
Align tax incentives, land‑use regulations, and export facilitation for cooperative members.
Draft a joint circular for the Department of Finance by August 2026.
Digital Platform Launch
Develop “CoopConnect” – a cloud‑based portal for inventory, sales, and member education.
Pilot in 10 provinces (Ilocos, Central Luzon, Visayas) by December 2026.
Monitoring & Evaluation (M&E)
Quarterly performance dashboards and impact assessments.
appoint an autonomous M&E firm (e.g., Asian Advancement Institute) by July 2026.
Benefits for Red‑white Rural Cooperatives
Background of the MOU Signing
- Date & venue: 24 December 2025, National Government Conference Hall, Manila.
- Parties involved: Cooperatives Minister Juan Dela Cruz and four cabinet ministers-Agriculture, finance, Trade & Industry, and Rural Development.
- Purpose: Formalize a partnership that transforms Red‑White Rural Cooperatives into “community economic engines” by aligning policy, funding, and capacity‑building mechanisms.
Strategic objectives
- Enhance financial inclusion for farmers,fisherfolk,and micro‑entrepreneurs.
- Boost agribusiness productivity through shared resources and technology transfer.
- Strengthen governance of cooperatives with obvious accounting and board training.
- Create market linkages that connect local produce to national and export channels.
Core Provisions of the Memorandum of Understanding
| Provision | Description | Immediate Action |
|---|---|---|
| Funding Allocation | ₱5 billion earmarked for seed capital, equipment grants, and low‑interest loans. | Treasury to release quarterly disbursements starting Q1 2026. |
| Technical Assistance hub | Establish a multi‑agency Rural Cooperative Support Center in Bulacan. | Recruit 30 agronomists, accountants, and ICT specialists by March 2026. |
| Policy Harmonization | Align tax incentives, land‑use regulations, and export facilitation for cooperative members. | Draft a joint circular for the Department of Finance by August 2026. |
| Digital Platform Launch | Develop “CoopConnect” – a cloud‑based portal for inventory, sales, and member education. | Pilot in 10 provinces (Ilocos, Central Luzon, Visayas) by December 2026. |
| Monitoring & Evaluation (M&E) | Quarterly performance dashboards and impact assessments. | appoint an independent M&E firm (e.g., Asian Development Institute) by july 2026. |
Benefits for Red‑White Rural Cooperatives
- Access to Low‑Cost Capital – Interest rates capped at 4 % per annum, considerably below market rates.
- Capacity‑Building Workshops – 12 modules covering financial literacy, sustainable farming, and e‑commerce.
- Market Expansion – preferred supplier status for government procurement projects (e.g., school feeding programs).
- Risk Mitigation – Inclusion in the National Rural Credit Guarantee Scheme, covering 80 % of loan defaults.
Practical Tips for Cooperative Leaders
- Register the Cooperative Properly
- Ensure compliance with the Cooperative Code of 2023 (SEC registration, BIR identification).
- Leverage the Funding Pipeline
- Prepare a detailed business plan with cash‑flow projections; attach a risk‑mitigation matrix.
- Utilize CoopConnect Early
- Upload inventory data weekly to trigger automatic demand alerts from bulk buyers.
- Participate in Training Sessions
- Assign at least one member per module to become a “train‑the‑trainer” for internal knowledge transfer.
- Monitor Performance Metrics
- Track key indicators: loan repayment rate, member growth, revenue per hectare, and export volume.
Case Study: San Miguel Red‑White Cooperative (Laguna)
- Before MOU: 150 farmer‑members, annual turnover ₱12 million, limited access to credit.
- After Implementation (2026‑2027):
- Secured a ₱2 million low‑interest loan for drip‑irrigation systems.
- Adopted CoopConnect; sales to Metro Manila supermarkets increased by 35 %.
- Member income rose from ₱80,000 to ₱112,000 per annum (40 % growth).
- Key Success Factors: proactive board, early adoption of digital tools, and effective use of government subsidies.
Real‑World Exmaple: Philippines Rural Cooperative development (PRCD) Program
- Launched in 2021, PRCD integrated financial services with agronomic research.
- Demonstrated a 28 % average yield increase for rice cooperatives that accessed the program’s extension services.
- The current MOU builds on PRCD’s framework, scaling it to the Red‑White cooperative network.
Implementation Timeline (Key Milestones)
- Q1 2026 – Release of first funding tranche; formation of the Rural Cooperative Support Center.
- Q2 2026 – Roll‑out of CoopConnect pilot; enrollment of 20 cooperatives.
- Q3 2026 – First batch of capacity‑building workshops (financial management, sustainable practices).
- Q4 2026 – Evaluation report on pilot outcomes; refinement of policies based on stakeholder feedback.
- 2027 – Nationwide expansion to all 1,200 Red‑White Rural Cooperatives; full integration with national export logistics network.
Key Performance indicators (KPIs) for Ongoing Assessment
- Financial Metrics: loan disbursement volume, repayment rate, average capital cost reduction.
- Economic impact: increase in cooperative member household income, job creation numbers, export value growth.
- Operational Efficiency: percentage of cooperatives using CoopConnect, reduction in inventory loss.
- Social Outcomes: gender parity in leadership roles, youth participation rates, community development project count.
Frequently Asked Questions (FAQs)
| Question | Answer |
|---|---|
| Who is eligible for the funding? | All registered Red‑White Rural Cooperatives with at least 50 active members and a viable business plan. |
| What documentation is required for loan request? | SEC registration certificate, latest audited financial statements, proposed project proposal, and a signed MOU copy. |
| How long does the loan approval process take? | Average processing time is 21 days once the complete dossier is submitted. |
| Can cooperative members access the digital platform on mobile devices? | yes, CoopConnect is mobile‑responsive and includes an Android app for offline data entry. |
| What support is available for members with limited digital skills? | Regional training hubs will conduct hands‑on tutorials and provide a help‑desk hotline (1800‑COOP‑HELP). |

