Hanoi supports development of collective economy

Data from the Hanoi Cooperative Alliance (HCA) showed that by the end of 2019, the city had 1,545 cooperatives, 80 more compared to 2018 (exceeding the plan by 67 percent), including 1,015 cooperatives in the agriculture sector, 228 in industry and handicraft; 230 in trade and services; 37 in transport; eight in construction; and 27 in other areas (health care, schools, and environment). Of those, 1,068 cooperatives were operating effectively.

According to the Hanoi People’s Committee, the local cooperatives have gradually contributed to the capital’s socioeconomic development, especially in the new-style rural area construction process. Efficient models of many cooperatives have yielded high economic values. The annual average production value has increased by more than VND220 million per hectare, which raised income for cooperative members and workers, contributing to sustainable poverty reduction, political stability and social security in the city.

Despite the above results, difficulties challenge the development of the collective economy model and cooperatives due to their small scale and limited competitive capacity. Many cooperatives, especially agricultural ones, were not able to work out effective production and business plans. Most cooperatives have difficulties accessing the state’s preferential capital and credit. Many cooperatives have not figured out their business orientations and are operating ineffectively.

In 2020, the HCA aims to develop diverse types of the collective economy model, mainly cooperatives designed for reasonable and sustainable growth, striving to help the collective economy out of its stagnation and show its important role in ensuring social security.

Meanwhile, the Hanoi People’s Committee intends to help its cooperatives contribute more to the capital’s agricultural restructuring and the city’s economic growth in general. Accordingly, by 2025, the city strives to establish from 250-300 new cooperatives to raise the total number to 2,052 with 595,000 members and 51,300 workers. By then, the average revenue of cooperatives is expected to increase to VND1.2 billion; and the monthly average income of workers will reach VND5-7 million.

To fulfill the targets, the Hanoi People’s Committee has proposed to state management authorities that they issue support policies to promote the development of the collective economy and cooperatives, focusing on training human resources; trade promotion, application of science and technology; establishing and re-organizing cooperatives’ activities. The city will also hold annual trade promotion programs to support its cooperatives and cooperative unions in the 2021-2025 period.