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     Gung Ho Newsletter No.91-92
Add Time :2010-07-19      Hits:6577



ICCIC Become a Member of ICA

March 2010, ICCIC become a member of International Co-operative Alliance (ICA). 

What is the ICA?

Founded in 1895, the International Co-operative Alliance is an independent, non-governmental organisation which unites, represents and serves co-operatives worldwide. It is the largest non-governmental organisations in the world.
ICA members are national and international co-operative organisations in all sectors of activity including agriculture, banking, fisheries, health, housing, industry, insurance, tourism and consumer co-operatives. Currently, ICA has 239 member organisations from 90 countries, representing more than 800 million individuals worldwide.

What does ICA do?

ICA's priorities and activities centre on promoting and defending the Co-operative Identity, ensuring that co-operative enterprise is a recognised form of enterprise that is able to compete in the marketplace.

  • ICA raises awareness about co-operatives. It helps individuals, government authorities and regional and international institutions understand the co-operative model of enterprise. ICA is the voice of the co-operative movement.
  • ICA ensures that the right policy environment exists to enable co-operatives to grow and prosper. It helps its members in their lobbying for new legislation and more appropriate administrative procedures that respect the co-operative model, its principles and values. It provides political support as well as technical expertise to enable co-operatives to compete on a level playing field.
  • ICA provides its members with key information, best practice and contacts. Through its publications it ensures the sharing of information. It organises meetings and workshops to address key issues affecting co-operatives and allows discussion among co-operators from around the world. ICA facilitates contacts between co-operatives for trading purposes and intelligence sharing in a wide range of areas.
  • ICA provides technical assistance to co-operatives through its development programme. ICA promotes capacity-building and financial support, it facilitates job creation and supports poverty reduction and microfinance programmes around the world.


Main Results of Cooperative Democratic Assessment Experiment in Beijing

By Du Yintang

     Beijing Rural Cooperative Economy Operation Administration Station cooperated with ICCIC to carry out farmers’ professional cooperative regularization construction democratic assessment experiment in Beijing suburbs and have achieve preliminary results. The scope of experiment and demonstration will be further expanded this year.

        Farmers’ professional cooperative regularization construction is an important task commonly encountered by the development of farmers’ professional cooperatives in China.

Since the Farmers' Professional Cooperatives Law of the People’s Republic of China was promulgated on July 1, 2007, the development of farmers’ professional cooperatives has entered a new stage of dramatically-increased number and under-developed quality. According to the statistics of the State Administration Bureau for Industry and Commerce, by the end of 2009 there were 246,400 farmers’ professional cooperatives in China with 21 million member households. The number of cooperatives and member households had increased by one fold over the previous year. Of the total, the number of farmers’ professional cooperatives in Beijing was 3406, covering 427,000 farming households, increasing by 42% and 11% respectively over the previous year. At present, the development of farmers’ professional cooperatives in Beijing suburbs has covered areas of plantation, cultivation, agricultural products sales and processing, countryside sightseeing and fruit-picking business. This has become an important form of driving the increase of farmers’ income.

     However, the dramatic increase in the number of cooperatives has exposed some problems in cooperative regularization construction in China. Judging from a national scope, these problems include: some cooperatives do not have definitive operation tenets, system operation is not regularized, internal governance is not democratic, business operation is not active, service function is week, income distribution is not rational and financial accounts are not transparent, etc. These have affected the internal cohesion and development sustainability of farmer’s professional cooperatives.

     According to the above issues, Beijing Rural Cooperative Economy Operation Administration Station cooperated with ICCIC to take the lead in carrying out farmer’s professional cooperatives regularization construction democratic assessment experiment and demonstration in 20 cooperatives in two district and county in Beijing suburbs. Specifically-speaking, they made use of the Cooperative Development Ladder Assessment Tool introduced from Canada by ICCIC, modified it and redesigned it, and organized cadres and members of relevant cooperatives to carry out democratic assessment on the internal management and regularization construction of cooperatives, identified room for development and took measures to improve.

     Cooperative Development Ladder Assessment Tool introduced from Canada by ICCIC was a tool that was developed and designed by the Canadian Cooperative Association and that involved mobilizing cooperative cadres and members to jointly participate in a questionnaire exercise to carry out democratic assessment on five aspects including cooperative system construction, internal governance, business operation, financial management and vision planning. The purpose of this tool was to identify and analyze problems existing in cooperatives through democratic participative internal assessment on cooperatives and to work together to draft improvement plans and realize the self-perfection of cooperatives.

    This tool was experimented and applied by ICCIC in three cooperatives in the provinces of Gansu, Sichuan and Shaanxi, and won the favorable comments by local cadres and cooperative members who thought that this tool was rationally-designed, had regularized methods and presented objective assessment results which made it a good benchmark to evaluate the development level of cooperatives.

     Nevertheless, the trial use of the original version of the Cooperative Development Ladder Assessment Tool has exposed some shortcomings, which mainly include: 1. The original assessment tool only uses internationally-practiced cooperative principles as benchmark. This is not consistent with the standards in the Farmers' Professional Cooperatives Law of the People’s Republic of China. 2. The contents designing of assessment indexes is based on the basic framework of the criteria of cooperatives at advanced development level in foreign countries. It is considerably distant from the fact that most cooperatives in China are still in the elementary development stage. Some assessment contents are not able to aim at the assessment purposes. 3. The contents of the original assessment tool are too detailed, the questions are too cumbersome and the questionnaire is too long, which makes the assessment process time-and-energy-consuming and difficult to popularize. 4. The survey objects in the original assessment tool are not clear. The two-level rating method is somewhat objective and arbitrary. The marking methods are not consistent with the practical customs in China.

     According to the above issues, in the cooperative assessment experiment carried out in Beijing suburbs in conjunction with ICCIC, Beijing Rural Cooperative Economy Operation Administration Station considerably modified and redesigned the original Cooperative Development Ladder Assessment Tool.

The modified Cooperative Development Ladder Assessment Tool has the following features: Firstly, The original one-set questionnaire has been divided into Questionnaire A and Questionnaire B according to different assessment purposes and survey objects. Questionnaire A was based on the needs of the government and external bodies for assessing cooperatives, and took key leaders, finance staff members and accountants of cooperatives as questionnaire survey objects. It mainly assessed the overall development status of cooperatives. Questionnaire B was based on the need of self-reflection and self-improvement within cooperatives. It took ordinary cooperative members as backbone participants of assessment, and mainly assessed the internal governance and the management regularization level in cooperatives. Secondly, on the foundation of using internationally-practiced cooperative principles as assessment benchmark, more standards in the Farmers' Professional Cooperatives Law of the People’s Republic of China have been used fundamental criteria. Thirdly, in the designing and selection of index contents, the actual status of cooperatives development in China are fully considered, and the contents not involved or rarely involved in farmers’ cooperatives in China have been removed. Fourthly, the length of the questionnaire was considerably reduced and the number of questions is cut to control the assessment time to be within 30-60 minutes. Fifthly, the arbitrariness of marking is reduced. According to the marking practice in China, a hundred-mark system is used, which makes the marking more intuitive and distinct.

     Compared with some other assessment plans used in China, this set of cooperatives democratic assessment tool has overcome the defects in other assessment plans such as narrowly emphasizing achievement indexes and economic indexes as well as the defects of neglecting the importance of regularization construction. It has changed the historical means of downward and inward assessment, and emphasizes mobilizing the subjective initiative of cooperative cadres and members. Through upward assessment, it realizes self-monitoring and self-perfection of cooperatives. It has overcome the complicated issues such as rough index design and over subjective and arbitrary marking methods in the assessment plans of some local governments in China, and the issues where assessment methods designed by academic institutions are too professional and the data analysis is too complicated. The modified questionnaire has considered the objectives of having comprehensive and systematic assessment indexes, and objective and easy assessment methods.

     The modified questionnaires were tested in two rounds of democratic assessment in 20 cooperatives in two district and county in Beijing suburbs. Four cooperatives scored over 90, accounting for 20% of the total number of cooperatives; three scored 80-90, accounting for 15%; nine scored 70-80, accounting for 45%; and 4 scored 60-70, accounting for 20%. Through the items for which scores were deducted, we could clearly see the room for improvement in regularization construction of each cooperative, and therefore carry out further training and draft rectification measures accordingly. Cadres, members and experts participating in the experiment thought that the above assessment results basically matched the actual development status of local cooperatives, which proved that the designing of the set of assessment tool was quite rational, reliable and extensively applicable.

     In August 2009, 11 Central Government ministries and commissions including the Ministry of Agriculture of the People’s Republic of China issued the Recommendations on Carrying out Demonstration Cooperatives Building among Farmers’ Professional Cooperatives, which recommended building of demonstration cooperatives among farmers’ professional cooperative all around the country. Among the three important contents in building demonstration cooperatives, the top priority was to strengthen regularization construction and to improve democratic management level of farmers’ professional cooperatives.

     According to the above guidance, Beijing Rural Cooperative Economy Operation Administration Station and ICCIC have reached the intent of second phase cooperation, and have decided to further expand the scope in 2010 to select 80-100 cooperatives in 4-6 districts and counties in Beijing suburbs to carry out experimental demonstration of cooperative regularization construction democratic assessment.




Agnes Smedley and the Chinese Revolution


Stephen MacKinnon

Agnes Smedley (1894-1950) was an American original – political activist, journalist, and feminist. Born dirt poor in rural northern Missouri, Smedley grew up scrambling for livelihood and an education in a series of mining towns across the West.  Her father was an itinerant miner and heavy drinker who often left the family in destitution, especially when Smedley was very young and her mother saddled with four small children.  The family’s longest stay was in Trinidad, Colorado, where her mother took in wash and boarders to survive.  Her older sister became a prostitute in Denver. It was while attending teachers colleges in Phoenix and San Diego from 1912-14 that Smedley became politicized, influenced first by Emma Goldman’s Free Speech movement and later in San Francisco joining Ghadar (Sikh) activists in the Indian Independence Movement.  By 1918 Smedley was in New York city working for Margaret Sanger on birth control issues and for U.S. based Indian nationalist leader in exile, Lala Rajpat Rai. Both activities led to her arrest and six months in the Tombs without trial. The experience radicalized her further and made life long friends of fellow prisoners like Roger Baldwin (later founder of the A.C.L.U.).  A four part series in the The Call (socialist) on the condition of women prisoners made her an overnight sensation in the left to liberal salons of New York at the time. Thereafter she reported regularly for The Call and began to circulate in print and politically in ever wider left wing circles. 

By 1922 Smedley was operating on the world stage. She had moved to Berlin and lived with V. Chattopadhaya, a much older man of considerable charisma as the leader of the radical Indian nationalist movement in Europe. At one point Smedley and Chatto traveled to Moscow where she reconnected with Emma Goldman (also with Nehru). Back in Berlin, she spearheaded the establishment of Birth Control Clinics in coordination with Margaret Sanger. She became a close friend and confidante of the legendary artist Kathe Kollwitz and actress Tilleux Dureau. At the same time her relationship with Chattopadhaya fell apart and she suffered a nervous breakdown.  Under pyschoanalysis, Smedley wrote her first book – a thinly disguised autobiographical novel, Daughter of Earth, published simultaneously in English and German to considerable critical acclaim.  The book came out just as Smedley left by train across Russia for China as a special correspondent for the Frankfurter Zeitung, Germany’s daily newspaper of record at the time. 

Smedley passed through Moscow in 1928 on her way to China and she may at this point have joined the Comintern (and met Soong Chingling), but more as a publicist than as a intelligence operative.  What ever the association it did not last long. Smedley was too much the feminist and individualist, or the undisciplined loose cannon as fellow communists put it, to follow comintern discipline and directives. In Shanghai , between 1929-31, she befriended Rewi Alley, worked closely with Soong Chingling, and the activist scholar Chen Hansheng, all of whom taught her much about the condition of the urban and rural poor and dispossessed, especially women, of Shanghai, Canton, Manchuria, and other places.  She wrote about such subjects in a variety of languages – (tracking them down was quite an adventure for her biographers). Until the rise of Hitler in 1933, Smedley published mainly in German for the Zeitung and also in English for the Nation, New Republic, and eventually the Manchester Guardian. Her first China book, Red Army Marches, was a collection of vignettes, again highlighting women and describing conditions in and around the first communist led effort at organizing peasants in rural Jiangxi between 1930-34. Jan MacKinnon and I put the best pieces into a book, Portraits of Chinese Women in Revolution, which we published in 1970s.  In Shanghai from 1930 to 1936, she cast a wide net of Chinese associations. Smedley had an affair with the leading poet Xu Zhimo and later with Richard Sorge, but more importantly she befriended leading dissident intellectuals like writers Lu Xun, Mao Dun, and Ding Ling -- often hiding fugitive underground operatives  from Chiang Kaishek’s secret police in her quarters in Shanghai. Smedley took the famous picture of Lu Xun in the wicker chair at his birthday party in 1932. Smedley and Lu Xun saw each other often and together published a book on K. Kollwitz’s woodcut art. She was involved in numerous international protests against political repression by the Guomindang.

Smedley’s nose for political turmoil and excitement urged her to leave Shanghai. By fall of 1936 she was reporting from Xi’an (and debriefing e. Snow).   This of course placed her in the middle of Xi’an Incident of December, 1936: dodging bullets and broadcasting on radio (vs. Nanjing), and then moving to the caves of Yan’an in 1937.  There she had a then famous interview with Mao and wrote about her impressions in China Fights Back (1938). Yan’an ended with a well known conflict (fist a cuffs) with He Zizhen, leading to explusion of both women and Smedley becomng a major presence at Wuhan (Taierzhuang, Xuzhou) during its defense in 1938.   By then Smedley had become a celebrity internationally (celebrated by the likes of Auden and Isherwood) and was reporting daily on Wuhan’s defense for the Guardian.

Indeed, the very height of Smedley’s career as a journalist in terms of international readership was during the Anti-Japanese war of 1937-45.  She excelled as a war correspondent. Smedley liked the military life, had used guns since a teenager in the n. American wildwest, and so proved fearless on a Chinese battlefield.  Between 1939-41 she was attached to (today we say embedded?) and reported on combat with the New Fourth Army. In her reports, sandwiched between descriptions of battles and military maneuvers, she focused on the human story, giving attention to the conditions of women and health care issues especially. Smedley portrayed Chinese women not just as victims but as leaders in journalism, the military, and politics. She got along surprisingly well, for example, with Mme. Chiang Kaishek (Song Meiling).  In her best and most widely distributed work, Battle Hymn of China  (Knopf, 1943), Smedley combined autobiographical reportage with a sweeping narrative that combined the details of battles with montages depicting the suffering of refugees and the wounded – punctuated by portraits of individuals as war heroes and heroines. After a spell in Hong Kong Smedley returned to the U.S. just before Pearl Harbor to finish Battle Hymn and to go on speaking tours aimed at organizing support for the China War. Politically she remained independent of any single movement or party. It was the cause of China that concerned her, which meant working  with Republican missionary born Henry Luce (Time-Life) and Vice President Henry Wallace, as well as organizing rallies with Paul Robeson and others on the Left.  In 1945 she welcomed the CCP delegation led by Dong Biwu to the United Nations.

After the war, her position as a spokesperson for China changed and became increasingly difficult. Smedley’s independence isolated her politically and personally. She was branded a dangerous radical by the pro-Chiang Kaishek China Lobby while at same time ostracized by her old friends in the American Communist Party and on the Left in and around New York City (for being insufficiently pro-Soviet). Smedley drifted up and down the East coast, staying in writers colonies (notably Yaddo) and with old friends from China (Edgar Snow). She stayed in touch with visiting progressive Chinese journalists like Yang Gang, writer Lao She, and reconnected again with Chen Hansheng. But by 1948 she was undergoing almost daily harassment and public vilification as a target of J. Edgar Hoover’s FBI anti-communist pogrom.  General MacArthur accused her of being a notorious spy – still at large. Needless to say, like Jack Belden, Snow, and others, she was having problems publishing articles on China in the popular press. Her last book, a biography of the legendary Chinese Communist general, Zhu De, The Great Road, based on extensive personal interviews, was published posthumously. 

Smedley died in England in the spring of 1950 while on her way back, she hoped, to China.

* Her ashes were buried in Beijing the next year at Babaoshan, after China’s entry into the Korean war, with much ceremony. Her works today are still in print around the world in many languages. But in her motherland, debate continues about the political loyalties (and patriotism) of one of the twentieth century’s greatest woman global activists—an ironic epitaph for a woman who was so influential in giving a uniquely lyrical voice to the oppressed, especially women, the world over.

* She died a sudden unexpected, natural death after an intestinal operation at Oxford but both J. Edgar Hoover and the Guomindang China Lobby in the U.S. as well as her friends, the new Chinese leadership in Beijing, accused the “enemy” of secretly causing her death.


Summary Report on the “Sino-New Zealand Aid to Pengzhou City Post-quake Recovery Phase II Project”


By Yuan Peng

Project Implementation Background

In May 2009, the New Zealand – China Friendship Society (NZCFS) and the International Committee for the Promotion of Chinese Industrial Cooperatives (Gungho-ICCIC, hereinafter referred to as ICCIC) jointly implemented the “Sino-New Zealand Aid to Sichuan Pengzhou City Post-quake Recovery Phase II Project”. The project aimed to help people in the disaster area seek new industrial support. This project is the continuity and deepening of the assistance to farmers in the disaster area to improve infrastructure construction after the successful implementation of the Phase I Project.

Before the earthquake, farmers in Danjingshan Town, which was selected for implementation of the Phase II Project, were mainly engaged in tourism. Their income ranked top in the whole city. The 5.12 Wenchuan Earthquake destroyed local scenic area environment and infrastructure. Scenic spots suffered from catastrophic damage. The source of income of the farmers was cut off. There was an urgent need to develop a new industry.

Judging from the natural environment, industrial foundation and the current production technologies of farming households, there is predominance for the disaster survivors in the project area to opt to develop tea industry. Firstly, there is natural conditions predominance. The local soil, water quality and air quality are of top ranking, especially medium or large scale industrial enterprises have never been developed there, so the ecological environment has been well protected. According to the initial testing by governmental environmental department, the natural conditions are very suitable for developing organic tea industry. Secondly, there is industrial and market predominance. Tea industry in Pengzhou area has a long history, which can date back into the Tang Dynasty. At that time, Pengkou tea produced in Pengzhou was listed as the best in the 8 cities in Jiannan Prefecture. As recorded in the Tea Sutra written by the Chinese tea sage Lu Yu: “Pengzhou ranks top in Jiannan”. The project location is where the best tea in Pengzhou is produced. At the early stage of the implementation of the Reform and Opening-up Policy, Pengzhou tea gardens have once developed into a scale up to 10 thousand mu. Then as the local tourism industry developed, tea industry gradually subsided. Before the earthquake, the tea plantation area in Pengkou in Danjingshan Town as the project area was only about 300 mu. After the earthquake, a local business material company owner invested 10 million RMB and built a tea processing factory and tea expo garden in Pengzhou, with an objective to re-energize the traditional industry and actively develop tea tourism. The company location is only 12 kilometers away from the project area. Tea leaves produced in the project area can be directly sold to this company, which has removed market development issues at the early stages. Thirdly, there is production technology conditions predominance. Most local households are familiar with tea planting and have some technical foundation. When the Company invested in a tea processing enterprise, it was in urgent need for developing industrial production base. Dedicated production technology personnel have been specially employed to provide long-term technical guidance for the disaster survivors.

Considering the feasibility and urgency of developing tea industry for the disaster survivors in the project area. The New ZealandChina project guided the farmers to develop tea cooperatives, used the cooperatives as platforms to aid impoverished disaster survivors, and in the meantime improve the overall self-aid ability of the community disaster survivors so that they could achieve the objectives of restoring production and rebuilding their homes in a short time.

II.    Project Implementation

i. Preparatory work before project implementation

1. Determined project implementation subject and coordination subject and signed a three-party cooperation agreement

In order to ensure the effective implementation of the project, after the commencement of project, ICCIC, Sichuan Pengzhou Municipal Rural Development Bureau (the Rural Development Bureau) and Pengzhou Danjingshan Tea Cooperative signed the Three-party Agreement on the Implementation of the “Sino-New Zealand Aid to Pengzhou City Post-quake Recovery Phase II Project”. The agreement firstly specified the main tasks of the project, then broke down the project into activities contents based on the project task objectives. The agreement has set detailed work calendar as well as requirements, participants and scale of each activity. It has also specified the respective responsibilities of the three cooperation parties including ICCIC, Pengzhou Rural Development Bureau and Pengzhou Danjingshan Tea Cooperative in the project implementation. The project team considered the administration and management features in China and invited Pengzhou Rural Development Bureau to join, with an aim to utilize the administrative resources predominance of local government to provide supervision and guidance to ensure that the project funds are paid to the impoverished households aided, and at the same time to provide good organization and coordination for the project activities implementation by ICCIC and reduced project implementation costs.

2.      Carried out full-scale baseline survey

At the initial stage of the project, ICCIC carried out baseline survey in Paifang Village in Tianpeng Town, Shuangsong Village in Danjingshan Town and Danjingshan Village in Pengzhou City in order to comprehend the basic information of the project implementation area, such as regional conditions, agricultural production conditions (land, labor force scale, livestock inventory) and pre-quake agricultural industry development status, etc. Based on this, the project team travelled on foot over the mountains for over 2 hours and carried out basic information survey in some impoverished farming households in Shuangsong Village and Danjingshan Village who lived in the mountains without highway access. They visited and surveyed 15 farming households each in the two villages, and carried out basic survey on the population, labor force, householder education level, cultivated land, income source, post-quake aid, etc., which laid a solid foundation for aiming impoverished households at aiding objects in the smooth implementation of the project.

ii. Project Implementation

1 Cooperative concept training for farming households in the project area

At the beginning of 2010, ICCIC made a long trip deeply into Danjingshan project area and carried out cooperative concept training for some cooperative members and villager representatives in Paifang Village in Tianpeng Town, Shuangsong Village and Danjingshan Village Danjingshan Town in the project area. According to the facts that the trainees were mainly middle age women with generally low education level, i.e., mostly at primary school level and some illiterate women, the training was carried out mainly in three aspects: 1. How should small farming households unite together? 2. What is a cooperative, and what are the basic principles of a cooperative? What are the differences between a cooperative and the People's commune system in the planned economy times? How is it different from the current company system? 3. What are the benefits for small farming households to develop cooperatives, especially what are the benefits for women in rural areas? How do women participate in the development of cooperatives?

In terms of training methods, participative methods was used to lead farming households to actively participate in the discussion through illustrations, case studies and comparison, and Q & A sessions, and thus to deepen their understanding in the nature of cooperatives and to raise women’s awareness in the importance of cooperative development. In the meantime the cooperative basic principles of democratic participation were practiced.

According to the project plan, the trainees were mainly the core members of the Paifang Vegetable Cooperative and Danjingshan Tea Cooperative. Because the time of training happened to be a winter break time, most of the resident farmer members participated in the training. Their participation enthusiasm was quite strong. The training coverage exceeded 3/4 of the members.

2. Strengthening of cooperative tutor teams’ skills

As the local development of cooperatives was in a starting stage, issues concerning cooperative development in the project area could not be resolved by one or two training sessions by ICCIC. How can sustainable development in cooperatives in the project area be achieved when the project is completed? Local governmental departments play an important guiding and supporting role in it. The reality was that responsible staff in the Rural Development Bureau did not have sufficient understanding in cooperatives. This not only affected their supervision and guidance to the project but also affected the subsequent development of the project. In order to strengthen the skills of cadre tutor teams, ICCIC timely adjusted project activities contents and added mentoring and training for the cooperative tutor teams at county and township levels within the Pengzhou Rural Development Bureau. According to the main knowledge gap of the tutor teams and the challenges that local cooperatives would face in their future development, the training mainly focused on two aspects. On one hand, the training mainly deepened the understanding in cooperative system. It helped tutors master ways to boost the healthy operation of cooperatives, ways to deepen understanding of cooperatives role in resolving the issues concerning " Farmers, Rural Areas, Agriculture Production" as well as to fully master relevant state policy on cooperative development. On the other hand, to fully master the basic knowledge, basic strategy and methods of marketing, and on such basis guide cooperatives to effectively use modern concept to carry out marketing work and improve the market competiveness of agricultural products. In order to strengthen training effects, ICCIC also invited representatives from Huang Village, Naixing and Paifang in the project area to participate in the training.

3.      Issuing impoverished disaster survivors with tea seeding

Issuing tea seeding to impoverished disaster survivors in the project area was the only direct donation in the project. To ensure that funds would arrive in the hands of impoverished households that are in real need, and to ensure the coverage of impoverished households, in the "Three Party Cooperation Agreement", ICCIC specially included relevant terms and conditions to request Danjingshan Tea Cooperative to screen and determine a list of impoverished households to be aided and had the list reviewed and approved by Pengzhou Municipal Rural Development Bureau; At the same time, it also stipulated that Pengzhou Municipal Rural Development Bureau should, by means of inquiry, help Danjingshan Tea Cooperative to draft tea seeding purchasing plan and budget plan, to monitor and guide the project implementation by the Cooperative, and meanwhile take responsibilities in auditing the tea seeding purchase invoices of Danjingshan Tea Cooperative. Tea seeding inquiry documents and purchase invoices should be both submitted to ICCIC for file. ICCIC allocated funds to Danjingshan Tea Cooperative for aiding impoverished households to purchase tea seeding by the means of phased reimbursement.

In actual operation, the methods adopted by Danjingshan Tea Cooperative were: Issued notice to impoverished households on application for free tea seeding à impoverished households made application to the cooperatives within the stipulated time à cooperative approved applications made by impoverished households àsubmitted applications to the Rural Development Bureau for approval. The standards of classifying impoverished households were subject to local standards. Judging from the implementation effects, all applied impoverished households received tea seeding, and the amount of tea seeding issued basically tally with the amount applied for by the applicants. In the end, a total of 28 impoverished households applied for tea seeding, and the amount of tea seeding applied for ranged from amount for a hundreds of square meters of land to thousands of square meters of land. The largest scale was 5.2 mu. All impoverished households successfully completed their planting. 

III. Project Effects

As for the project implementation effects, ICCIC adopted a combination of cooperative development ladder assessment tool (DLA) developed by the Canadian Cooperatives Association and improved by ICCIC according to Chinese characteristics as well as interviews.

  1. DLA Self-assessment results

1Composition of assessed samples

A total of 18 cooperative members participated in the DLA assessment, accounting for nearly 30% of the total number of cooperative members. Of these 18 members, a majority of 14 were female, accounting for 78% of the total assessed members. In the age structure, they were mainly middle-aged, including 13 members between the ages of 30 and 50, accounting for over 70% of the total assessed. In terms of education level, 14 were below primary school level, accounting for 78% (see table below). The assessed samples have basically represented the composition of cooperative members.

Ordinary Cooperative Member Sample Number



Education Level







Primary School

Above Junior Middle School










NB: Among the assessed members, the youngest one aged 33 and the eldest aged 62. Illiterates were all among the women.

     2Self-assessment results

  Firstly, cooperative members had sufficient awareness of freewill, self-support and self-governance in cooperatives, but they had incorrect understanding in the cooperative distribution system.

All 18 members indicated that the cooperatives were free to join or quit. They were all aware that their cooperative had established members' assemblies, boards of directors and boards of supervisors. All confirmed that their cooperatives had held members assemblies and the system of one vote for one member was practiced. Cooperatives were able to publicize key decisions, business progress and financial balance details to members on regular basis. If a cooperative needed to apply for a loan, decision should be made by the members' assembly or the conference of member representatives or the board of directors. 

In addition, 17 members understood that they had the right to consult all kinds of financial records of cooperatives and indicated that their cooperatives had never been audited. Moreover, 15 members, i.e., 83% of the samples, said that their member representatives were elected.

However, a great majority of members did not know the cooperatives' share composition and means of surplus distribution, or had incorrect understanding. All members thought that they contributed to the shares by the means of contracting. They were not clear about the share composition for members who contributed to the shares by cash. Only 2 members thought that the biggest shareholder held over 50% of the total shares; other 16 believed that the biggest shareholder only held 20% of the total shares. In fact the percentage exceeded 50%, which were recorded in the articles of association. As for the distribution system, only 2 members indicated that it would be returned according to transaction volume, while the rest 16 suggested dividend distribution based on over 40% of shares. This proportion was nearly 90%. Meanwhile, all members indicated that they had received profit return from cooperatives.

Secondly, most members understood the operation status of the cooperatives. The satisfaction rate on cooperative cadres reached 100%.

13 members knew that their cooperatives did not have registered trademarks, accounting for over 70% of the samples. 16 were aware that their cooperative products had not acquired quality certification, accounting for nearly 90% of the samples.

Moreover, all 18 members selected satisfactory for their cooperative cadres. None selected "Not satisfied" or "Rather not say".

Thirdly, the effects of cooperatives became evident. Benefits members could gain from the cooperatives were fully affirmed and are highly consistent.

All 18 members confirmed that the cooperatives had helped them purchase production materials, sell agricultural products, provided technical training service and provided free information and technical training. Through the cooperatives, members increased their income, reduced their expenditure, acquired knowledge and skills. The cooperatives expedited agricultural products sales and agricultural production material purchasing, increased market information and increased opportunities for exchange and participation. 

2. Assessment by interview

More than 10 people, including cooperative member representatives, company representatives, villager representatives and local cadres participated in the interview, of which a majority were cooperative members. During the interview, we understood that the preliminary effects of the project were quite obvious, but the existing issues were quite evident.

Firstly, villagers had sufficient understanding of the freewill, democracy and mutual-help concept of cooperatives. They had strong sense of participation in business related to their individual benefit. However, they were generally not clear about the system arrangement of cooperatives.

During the interview, the biggest feeling of ICCIC project team was that the villagers had strong democratic participation awareness. Some members reported that because the cooperative members lived in scattered locations and there were a high percentage of aged women, therefore members elected member representative to service all members. Anonymous mass nomination was used in the election, and those winning over half of the votes were elected. As a result, more than 60 households of cooperative members participated and 5 were elected, of which 3 were female and 2 were male. Except one who was a village cadre, others among these 5 were ordinary farming households. The main work of these member representatives was to help the cooperatives purchase tea leaves from members and sell it to companies in a consolidated form, to make contacts for purchase of agricultural materials, and chores such as distributing agricultural materials. When asked if these member representatives received compensation or allowance for their labour, all members and representatives present denied. They all thought that member representative should service the members. Being elected means they gained everyone's trust, and how could they expect to ask fellow villagers to pay? At the interview with companies, feedback showed that these representative could help cooperative members weigh the tea leaves and deliver the tea to companies at miles away outside the mountains and sold the tea on behalf of members. On the following day, representative would also deliver the sales revenue to cooperative members. Time was spent in these processes. For representatives who achieve certain sales amount, the companies would pay them allowances at RMB 35 Yuan/time(day) to cover their transport expenses, meal allowances and labour service fee. Such allowance standards were the lowest. Local odd job labor cost reached about RMB 70 per day. Therefore, as cooperative members said, the representatives really served their fellow members.

On the most concerned issue of tea sales, almost every resident member household had sent representatives to negotiation with tea companies, while the cooperatives actually only played a role as shippers, and they never charged members any fees. Helping members purchase agricultural materials was voluntary service. At present the cooperatives do not have their own revenue.

However, during the interview we discovered that cooperative members only cared about system arrangement concerning their own benefit. All major decision-making concerning member business, such as participation in agricultural materials purchase and product sales, etc., required democratic consultation. They were not aware of the articles of association made by the 6 founders. When being asked about the cooperative basic system, many nodded to confirm, but didn't know its basic contents.

     Secondly, cooperatives brought concrete benefit to their members and were very welcome by members, but there was not much difference whether one was a cooperative member of not.

Besides all benefit of cooperatives mentioned in the DLA assessment, the most recognized benefit reported by members was that the cooperatives could help them solve the sales channel issues. Because there were few households in the area who grow tea, vendors basically did not purchase tea from the project area. Farming households had to bake fresh tea into dried tea and seek sales market by themselves. Now with cooperatives, tea companies automatically visited the project area to purchase tea. Farming households could sell fresh tea directly. This only reduced the labor intensity but also lowered the risks which would exist when members needed to explore market themselves. In addition, as members can jointly negotiate prices with companies, members reported that the product sales prices finally offered by the tea companies were basically the same as those on the Chengdu market (but tea companies and village cadres thought that these prices were more than 20% higher than those on the Chengdu market). For example, the price of pre-Qingming fresh tea leaves reached RMB 50 Yuan/500g, 25% higher than that in 2009. From this pre-Qingming tea season alone, the per-mu average net income of cooperative members was over RMB 600.

In addition, when purchasing fertilizer, cooperative members could enjoy wholesale prices, and saved shipping charges and labor service fee, and gained economies of scale. Tea companies also subsidized cooperative members with RMB 50 – 100 Yuan as fertilizer subsidy for newly-planted tea gardens so as to encourage farming households to plant tea. In terms of technical guidance, Pengzhou Rural Development Bureau helped contact Sichuan Provincial Tea Institute to provide voluntary guidance. Since the start of the project, local agricultural technology authorities have organized 2 production management training sessions. The tea planting initiative of cooperative members significantly increased.

However, during the interview we discovered that if non-members participated in the business service of cooperatives they could enjoy the same service and treatment as members did. Companies did not differentiate cooperative members and non-members when they purchased their products. For this, the explanation by the company's marketing manager was that they encourage villagers to grow tea and encourage them to join cooperatives. The development objective of cooperatives was to attract all tea-planting villagers to join cooperatives. At present some villagers who plan to plant tea but have not yet actually planted have joined cooperatives. They said joining cooperatives would make it easier for them to plant tea and will bring them benefit. In addition, villagers joining the cooperatives at present do not need to pay a membership fee or cash contribution to the shares, but only need to contribute to the shares with their land. Because the cooperatives do not distribute dividend, in fact this point was still vague. 

Thirdly, women’s concept and status have improved at various degrees and their income level has increased, but many women still have obvious “follower” mentality and do not have distinct self-awareness.

In the interview, the consistent view was that after women joined cooperatives, they directly participated in tea planting, increased their income and status in the family, and their perception has now changed. No matter female members who participated in the DLA assessment or those only participated in the interview, they demonstrated strong enthusiasm. A female member said that her husband was working away from home and sent home RMB 1000 Yuan in average per month for family spending. After she started to plant tea, she was "making her own money and spending it". Her personal shopping no longer needed to rely on money from her husband, and this saved her the hassle. This year after selling the spring tea, she made about RMB 2000 Yuan. Besides clothes shopping, she also joined others to spend a holiday in the Countryside Leisure and spent more than RMB 500 Yuan. She had never before thought about making a holiday. Joining the cooperative broadened her vision and changed her perception. A disabled and impoverished female member said that after joining the cooperative her status in the family had improved. In the past she did not make any money and was completely dependent on her husband. Now that after she planted tea and generated income by selling tea, she could on one hand subsidize family spending and purchased new furniture, and on the other hand continue to invest in production, such as purchasing chemical fertilizer and pesticide.

 However, the interview also found that because the majority of female members were middle-aged and had low education levels. Their follower mentality was distinct. They more tended to follow leaders and support leaders' points of view instead of expressing their independent view.

Thirdly, impoverished households have significantly benefited while some households' needs were not satisfied.

Since the implementation of the project, there were a total of 28 impoverished households who developed their new tea gardens. Their plantation area ranged from below one mu to 4-5 mu. The choice of plantation area mainly depended on the household labor force scale and amount of funds they wanted to invest. Without support by the cooperatives, it would have been difficult for these impoverished households to start tea production. With the support and free tea seeding provided by cooperatives, their tea production successfully started, and their hope of life was then enlightened.

During the interview, an aged women started to quarrel with some cooperative members around her, the cause was that when the cooperative notified impoverished households about the application for free tea seeding she was not home and therefore missed the opportunity to receive free tea seeding. When she saw that the tea trees planted by other impoverished households were growing healthily, she was very upset and complained that the cooperative's work was not good enough and that she should have been informed. In response, Pengzhou Rural Development Bureau explained that when the number of tea seeding applications submitted by impoverished households reached the required number, cooperatives concluded that work. The fact that the demand by some late applications was not satisfied has reflected that there was room for improvement in the cooperatives' rules in issuance of tea seeding.

Fourthly, tea companies have benefited from the development of cooperatives. The development of cooperatives also heavily relied on the tea companies.

Local tea companies expressed that after the establishment of cooperatives, the most benefit for the companies was that their raw material was guaranteed. Without cooperatives, the companies would be negotiating with and buying from individual small farming households, which implied higher transaction costs. With the useful platform of cooperatives, a few members assemblies could help consolidate purchasing guidelines. This also meant that technical guidance by the tea companies were more easily delivered, which was beneficial for improving tea quality. In the last 1 year plus, the companies had allocated over RMB 400, 000 Yuan to support farmers to develop tea plantation bases through cooperatives. This allowed the farmers to benefit from tea planting and also ensured raw material supply to the companies. 

IV. Lessons Learned from the Project

Having summarized the project implementation effects, there were two lessons learned for future project implementation by ICCIC.

1.      Training should be more closely linked to the local situation. High importance should be attached to the establishment of articles of association.

DLA assessment indicated that cooperative members were not clear about the basis system arrangement of cooperatives and had incorrect understanding. Members were more concerned about daily operation activities which were more directly related to themselves, and did not attach enough importance to the system arrangement listed in the articles of association, because the cooperative business had not covered these, especially in terms of distribution system. Although during the training and in the articles of association established by cooperatives, it was stipulated that at least 60% of the surplus should be returned according to transaction volume, but members chose the answer of dividend distribution above 40%. This indicated that the training was not well enough, and that training on fundamental principles of cooperatives should be strengthened. On the other hand, it also reflected that cooperative members were not involved in the drafting of cooperative articles of association, and even the founders of cooperatives were not actually involved. They were basically copies of other cooperatives template articles of association. This was quite common among farmer specialty associations in China. Therefore, in the guidance to cooperative development in the future, high importance should be attached to the establishment and revision of articles of association so as to make them the law to regulate and guide the behavior of cooperative members instead of a pile of paper.

2.      Strengthen the development of cooperative leaders

Similar to the operations of most farmer cooperatives, Danjingshan Tea Cooperative demonstrated distinct “Sheep flock effects”. The ideology, concept and behavior of leaders had strong influence on other ordinary members. Therefore, strengthening the cooperation awareness and operational management skills of leaders will have strong leverage effects on improvement of sense of affinity in cooperatives.

3.      How to achieve sustainable development of projects

The achievements of the Sino-New Zealand project was obvious, but subsequent projects are needed to boost the continuous growth of cooperatives. In order to expand the project effects, we can consider to subsidize the ICCIC website construction, and through the ICCIC website, establish a service enquiry platform for farmer specialty cooperatives in China. With its volunteer members teams who are engaged in cooperative studies and practical work, ICCIC will directly provide information enquiry service for cooperatives and achieve leverage effects.

Copyright: International Committee for the Promotion of Chinese Industrial Cooperatives
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