During the recent launch of the United Nations International Year of Co-operatives 2012 (IYC 2012), the worldwide co-operative movement also launched a new development fund – the Global Development Co-operative (GDC) – to help provide much needed finance to cooperatives in developing countries.
The Global Development Co-operative (GDC) aims to raise USD 50m to provide access to low cost loans for capital and infrastructure projects. The fund will seek to identify and engage with investors with an interest in both international development and extending the reach and benefits of the cooperative model.
The ICA organised a special ceremony in New York to mark the launch of the IYC 2012 and the event was attended by many of the world’s largest 300 cooperatives. During the ceremony the GDC was launched publicly for the first time.
The GDC will help to provide essential funding for such businesses as traditional lenders are often not active in this market or they do not sufficiently understand the cooperative business model. This new GDC investment concept has been developed by The Co-operative Bank in the UK and the International Co-operative Alliance (ICA).
Paul Flowers, Chair of The Co-operative Bank and also Chair of the new Global Development Co-operative fund, said: “The launch of the GDC symbolises everything that is great about the movement as the International Year approaches. With the UK being the birthplace of co-operation I am extremely proud to be involved.”
Dame Pauline Green, President of the ICA, said: “This initiative …will ensure that a positive and long-lasting legacy will remain from the International Year, helping thousands of cooperators in the developing world.”
The planned work of the GDC is complementary to that already being undertaken by ICMIF’s Allnations programme which provides direct capital support to developing cooperative and mutual insurance organisations . Allnations was founded in 1966 and has successfully helped Unique Insurance Company of Ghana, Coopseguros Ecuador, SURCO of Uruguay and CIC of Kenya with capital injections. GMC in Cameron and Tajy in Paraguay are being considered for investments in the near future.
The Allnations team at ICMIF have been advising the GDC team on structure, investment policy and other areas as the GDC will be structured similar to Allnations. The aim of the GDC is to be a capital provider to development institutions in the cooperative world that already exist, such as Allnations, WOCCU and Okicredit. These organisations will draw down on the capital raised by GDC to ensure poverty alleviation goals set by the GDC are delivered by those who are expert in their fields. “It truly is the venture capital support vehicle for the wider cooperative sector and a great legacy for the year” said Shaun Tarbuck, President of Allnations.