Latvian Agricultural Cooperatives Association and cooperatives in Latvia

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Latvian Agricultural Cooperatives Association
and cooperatives in Latvia

• Aelita Runce
• Latvian Agricultural
• Cooperatives Association

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Information about Latvian Agricultural
Cooperatives Association (LACA)

• LACA was established in 2002
• LACA is nongovernmental organization which
  associates agricultural cooperatives that are
  giving the services for their members (producers
  of agricultural products), but not produce the
  products for themselves
• at the moment LACA has 61 members
• finances of orgaization are composed of entrance
  fee from LACA members, membership fee, incomes
  from projects and national subsidies
• LACA is the member of COGECA
• the highest judge of LACA is General meeting, but
  executive of LACA is Direction

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LACA main activities (1)

• providing information to its members which are
  important for decision-making, as well as for
  daily work of cooperatives
• organizing training and education of association
  members
• consulting members in all questions relevat to
  cooperation and agricultural in general
• reprezentation of its members and their
  interesets to national government bodies
  (especially Ministry of Agriculture) and other
  institutions.

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LACA main activities (2)

• forming farmers and the rest public understanding
  about cooperation and cooperation privileges in
  agriculture
• cooperation with Ministry of Agriculture for
  planning support and legislation of cooperatives
  (rural development programme, national support
  for next year)
• performing statistical analyze of cooperatives
  development

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Cooperatives in Latvia

• Before 1990 members of agricultural
  cooperatives have common property farmland.
  They collectively manage it.
• After 1990 new cooperation trend
  agricultural service cooperatives (serious
  development of this cooperation form was starting
  after 2000).

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Information about cooperatives in Latvia (1)

• main principle - focus on collective interests
• objective of the common activity more economic,
  less social benifits
• cooperatives are ruled by specific laws they
  work in compliance with Law of Cooperation.
• the minimal number of founders of agricultural
  cooperative are three
• each cooperative member in general meeting has
  only one voice
• agricultural service cooperatives offer to its
  members a large number of services, ecpecially
  sales and purchasing, as well as supply farms
  with raw materials

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Information about cooperatives in Latvia (2)

• some of cooperatives are trying to set up
  processing. In Latvia are three agriculture
  services coperatives which are processing milk
• cooperatives mostly are managed by their members.
  There are positive examples in grain sector when
  cooperatives are managed by person from outside
• in other countries members are obliged to
  deliver their whole production to the
  cooperative. In Latvia it is not obligatoy
  (question of statutes)
• cooperation is more important for small farmers
• agriculture cooperatives ensure with working
  place for about 600 people in Latvia

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State support the development of cooperatives
because

• they provide tehnical support to farmers to help
  them progress and open up new economic outlets
  for their products
• they contribute to the maintenence of economic
  activities in rural area

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Support policy of agricultural service
coopertives

• national subsidies support for new cooperatives
  and recognized agricultural service
  cooperatives
• national subsidies support for repayment of short
  term and long term credit percents for recognized
  agricultural service cooperatives
• support for Producer groups from Rural
  development programme
• exemption of payment of enterprise income tax.
• European Union support from Rural development
  programme under activities Adding value to
  agricultural and forestry products and
  Modernisation of agricultural holdings

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Statistical data of Latvian cooperatives
development
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Latvian agricultural service cooperatives common
turnover (prognosis)
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Amount of members in Latvian agricultural service
cooperatives (prognosis)
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Cooperatives division by branches
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Main factors that are bother the development of
cooperation

• for large cooperatives there are problems to
  ensure operative decision-making procedure
  because of democracy principle of cooperative
• some cooperatives are established only for
  adopting national and European Union support
• there are problems with finding good managers
  because of law wages in agricultural sector, but
  in cooperatives it is very important
• small coperatives have problems to enchain bank
  credits

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Latvian cooperatives development vision in future

• grain and milk sector there are no requirement
  for new agricultural cooperatives, other sectors
  there are free places for new agricultural
  cooperatives
• cooperation (in field of experience, as well as
  in realization of products et cetera) between
  small and large cooperatives
• cooperation from primary production till
  realization of final product

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Actualities for agricultural cooperatives in
curent situation

• short-term / long term credit availability for
  agriculture service cooperatives (there are
  requirements for state guarantee)
• equal European Union support for all member
  states
• flexibility in adoption of Latvian rural
  development programme measures (there are
  necessity to change conditions of measures)
• support for export of agricultural production /
  food commodities (for example, support for
  product quality scheme in case of export of final
  product)
• agricultural cooperatives must buy/built milk
  processing eterprise

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Thank you for attention!