Cooperatives a hot item among political parties

With one year until the provincial election slated for June next year, political parties are paying increased attention to the bursting numbers of cooperatives popping up in recent months, concerning themselves with how to win favor from their members.

With the enactment of the fundamental law on cooperatives last December, which eased prerequisites for cooperatives significantly by eliminating the required amount of equity investment and the initial number of union members, nearly 1,000 such unions have been created this year alone.

Before the enactment, the law requires at least 300 million won ($269,400) in equity and 200 union members to launch a cooperative. As of last month, 1,089 would-be cooperatives requested the government grant be launched. Among those, 943 won the grant.

Among the newly launched unions include unions of merchants at traditional street markets and bakeries, all formed to counter the expanding conglomerates’ grip into market areas largely led by small to medium-sized enterprises.

The pace at which small cooperatives are expanding is not likely to be interrupted any time soon, with Seoul Mayor Park Won-soon on the forefront leading the movement.

Having named such unions as good-deed groups, the civic activist-turned-mayor recently unveiled a plan to increase the number of cooperatives to 8,000 by 2022 and earmarked 8.6 billion won in city budget to support the union creation and lecturing program this year.

Park is not the only member of the major opposition Democratic Party with an interest in cooperatives.

The DP’s presidential candidate Moon Jae-in pledged he would nurture the economy incorporated with social values centering on cooperatives during the presidential election campaigning last year.

The topic of a seminar discussion that Moon attended for the first time after the presidential defeat was on cooperatives.

Kim Han-gill, the newly elected DP leader, proclaimed in his speech during the race for the party leadership that he would strive to have the DP’s influence reaching local communities by supporting cooperatives.

Because of the nature of cooperatives that can be associated with social values, such as its focus on common values that band union members as a group seeking common interests, the DP is hoping to put the groups at its advantage in future elections.

“As cooperatives have values such as solidarity as an alternative to capitalism in self-reflection, they hold special meanings for liberal politics,” said Representative Kim Sung-ju of the DP.

Having sensed the rival party’s hope, some Saenuri members have voiced the party needs to come up with plans to appeal to cooperatives. Saenuri Representative Nam Kyung-pil held a seminar with the main subject on cooperatives, for which 61 incumbent and former lawmakers attended.

“Cooperatives have conservative social values that provide momentum [for the Saenuri] to take a lead [in appealing to potential voters],” said Saenuri lawmaker Lee Lee-jae.

But concern has arisen over how close the political circle and cooperatives should be. Under the law, it is illegal for cooperatives to carry out political activities or express their political leanings.

“It could be tempting for politicians to use cooperatives to their own advantage for the nature of such unions,” said Kim Ki-tae, director of the Korea Cooperative Federation Research Institute. “But economic functioning of cooperatives will inevitably be weakened once political meddling takes place.”

By Kang In-sik, Kim Gyeong-jin [jkkang2@joongang.co.kr]