Red and White Cooperatives to boost rural economic independence

Jakarta (ANTARA) - Deputy Minister of Cooperatives Ferry Juliantono emphasized that the Red and White Village Cooperative program offers a solution to improve the village economy without burdening the state budget.

In a statement here on Wednesday, Juliantono underlined that the program is designed to create a new, mutually beneficial economic ecosystem in villages as well as eliminate the predatory practices of loan sharks and online lenders that harm village communities.

Through Presidential Instruction Number 9 of 2025, the government targets the establishment of 80 thousand village cooperatives by July 2025, with operations of those cooperatives targeted to start in September 2025.

The operational budget, estimated at Rp5 billion (around US$296,163) per cooperative, will come from a mix of the state budget, regional budgets, village funds, and banks.

"This is not a burden but an investment for asset redistribution and economic equality," he remarked.

The village cooperatives will carry out six main activities: office management; savings and loans; convenience stores; distribution of fertilizers, seeds, and pesticides; village pharmacies; and village clinics.

To strengthen the village economy, they can also develop businesses based on local potential, such as livestock, agriculture, or fishery businesses.

He affirmed that these cooperatives will play a strategic role, including becoming food suppliers for the Free Nutritious Meals program and creating new markets for village products.

The cooperatives will also serve as official distributors of fertilizers, seeds, and others, ensuring affordable prices for farmers and providing benefits to the community.

The program also aims to address inequality in access to finance in villages. The savings and loans units will replace the role of loan sharks and online lenders that often trap village communities.

To prevent collusion, corruption, nepotism, or potential abuse, the government has formed a task force led by Coordinating Minister for Food Zulkifli Hasan, involving the Ministry of Home Affairs, the Ministry of Villages and Development of Disadvantaged Regions, and local cooperative offices.

"This is an opportunity for the community while the state resources are used to create new centers of economic growth in villages," Juliantono remarked.