President Granger addressed the Inaugural General Members Meeting of the IDPADA-G Credit Union on June 2nd, 2020. The Meeting, held online to adhere to social distancing guidelines, engaged over 450 credit union members and special guests. The excerpts below are taken from President Granger’s remarks. The full speech can be found at www.idpada-g.gy and on IDPADA-G’s Facebook pages.
“. . . The ‘International Decade’ acknowledges that Africans were the victims of the greatest crime against humanity and continue to suffer from dispossession, discrimination and intergenerational poverty. The ‘International Decade’ recognises that people of African descent have not yet fully overcome the legacy of colonial underdevelopment, which continues to contribute to their present condition.
The Programme of Activities, proposed by the United Nations, rests on 3 pillars – Recognition, Justice and Development. The ‘Programme’ recognizes that poverty is both a cause and consequence of discrimination. It urged that states should take appropriate steps to: “… strengthen national programmes for eradicating poverty and reducing social exclusion that take account of the specific needs and experiences of people of African descent…”
I proposed a five-point Plan of Action for the International Decade, in my address to the Cuffy 250 Forum in August 2016. I urged that the ‘Plan’ include efforts aimed at African economic empowerment.
The registration of a Co-operative Credit Union, by the International Decade of People of African Descent Assembly – Guyana, is a step in the direction of economic empowerment and eradicating poverty. It is in accordance with the objectives declared in the Programme of Activities of the ‘International Decade’ and the five-point ‘Plan’ which I had proposed in 2016.
Co-operative Credit Banks existed in British Guiana over a century ago. These institutions first emerged in response to African subsistence farmers’ need for loans.
The ‘old model’ Co-operative Credit Banks catered primarily for small loans for small-scale agricultural production and for meeting basic household and emergency needs. The ‘old model’ did serve the purpose for which it was intended. A ‘new model’ is needed to become an engine of economic development. . . .
. . . Co-operative Credit Unions were the successors of the Co-operative Credit Banks. The Co-operative Credit Unions have declined, with only 30 such institutions existing as at October 2019. Credit unions today account for slightly more than 24,000 members with estimated assets of US$28.9M.
The ‘new model’ of Co-operative Credit Unions must become an engine of enterprise development. Co-operative Credit Unions should graduate beyond catering only for the elementary stage of development – the provision of personal and subsistence loans. The ‘new model’, I suggest, should cater for four stages of economic enterprise development:
- traditional or subsistence;
- commercial or retail;
- industrial or manufacturing; and
- internationally-competitive stage
Co-operative Credit Unions should aim at financing not only small-scale agriculture, agro-processing and craft ventures but also commercial enterprises – the second stage of development. The third stage of development – the industrial stage, would involve the provision of capital for industrial development. The fourth stage would result in a co-operative credit union providing support for the production of internationally- competitive commodities.
The ambition of a new model is to provide financial services from the level of the small farmer and household, right up to the level of industry. Financing is needed at the levels of micro, small and medium-scale enterprises, particularly in the agriculture and agro-processing sector.
Government has launched a number of initiatives aimed at stimulating these sectors. The G$50M agro-processing plant at Parika, Essequibo Islands-West Demerara Region, was established in March 2020. The investment allows for the processing of 130 kg of produce per hour, benefits some 100 small farmers and provides employment for 20 persons.
The Regional Agricultural and Commercial Exhibitions (RACE) has become a catalyst for economic diversification led by micro, small- and medium scale enterprises. The Rural Entrepreneurial Agricultural Project (REAP) aims to revitalize rural village economies.
The ‘new model’ which I propose, envisages Co-operative Credit Unions as financial institutions with increasing assets, reserves, savings and shareholdings. The model is one which would see shareholding and savings widened and with a more diversified lending portfolio. All of this would necessitate legislative and regulatory changes.
The ‘new model’ is necessary for economic empowerment. Its development should be a priority for the remaining years of the International Decade of People of African Descent.
I urge the International Decade of People of African Descent Assembly – Guyana to consider carefully the adoption of a new model of Co-operative Credit Unions that will not be marginalized within the overall financial sector, but which has the potential to compete eventually with the formal financial sector and to stimulate enterprise development at the subsistence, commercial, industrial and internationally competitive stages.
I commend the International Decade of People of African Descent Assembly – Guyana on the establishment of the Co-operative Credit Union. The Credit Union is one of the many projects which will be undertaken by the Assembly but it has special significance for local economic empowerment.
I congratulate the Union on its Inaugural General Meeting. I wish it every success, beyond 2024 and for decades to come.