Prabowo Launches Village Cooperatives to Combat Usury and Streamline Supply Chains

President Prabowo Subianto has emphasized the establishment of "Red and White Village Cooperatives" as a crucial initiative to liberate farmers from the clutches of usurers and streamline the distribution chain of basic commodities. Prabowo stated that farmers often bear the burden of daily interest rates reaching one percent, making it exceedingly difficult for them to escape poverty. "With one percent interest a day, it is impossible for them to rise," he remarked. The government has already launched 1,000 village cooperatives, with a target to expand this network to 30,000 by the end of 2026. These cooperatives are envisioned to be more than just organizations; they will be equipped with essential infrastructure such as warehouses, cooling facilities, transport vehicles, generic medicine outlets, and workshops. This provision aims to prevent farmers from being compelled to sell their produce at low prices due to a lack of storage facilities. Furthermore, Prabowo highlighted the protracted chain of trade for basic commodities. He noted that farmers' produce often passes through multiple intermediaries, including collectors, distributors, sub-distributors, wholesalers, and retailers, before reaching consumers. A study cited by Prabowo indicates that these middlemen capture margins of approximately 30 to 40 percent, amounting to an estimated IDR 313 trillion (approximately USD 20 billion) annually. Through the village cooperatives, the government intends to reduce this distribution margin to between 5 to 10 percent, with the surplus expected to benefit both farmers and consumers. This supply chain improvement is projected to recirculate approximately IDR 250 trillion (around USD 16 billion) within the lower strata of the community. Additionally, the cooperatives will serve as a distribution network for subsidized goods from the central government to villages, thereby preventing hoarding and helping to control inflation, especially during religious holidays. Prabowo acknowledged the challenges in implementing the program, including issues with electricity, water, internet infrastructure, and the potential for corruption. He pledged to take decisive action against any managers who exploit the cooperatives for personal gain. Information Source: VOI English