Original article

Institutionalization of the cooperative sector in Cuba: a necessary proposal

Iriadna Marín de León^{1  *} 
http://orcid.org/0000-0001-9043-4782

Odalys Labrador Machín² 
http://orcid.org/0000-0002-9376-5728

Yamira Mirabal González¹ 
http://orcid.org/0000-0003-2673-1381

Yenileidys Lorenzo Cabezas¹ 
http://orcid.org/0000-0003-3681-8026

Carlos Cesar Torres Paez¹ 
http://orcid.org/0000-0001-7956-5079

¹ Universidad de Pinar del Río "Hermanos Saíz Montes de Oca". Facultad de Ciencias Económicas. Centro de Estudios de Dirección, Desarrollo Local, Turismo y Cooperativismo. Pinar del Río, Cuba.

² Universidad de Pinar del Río "Hermanos Saíz Montes de Oca". Departamento de Capacitación y Superación a Cuadros y Reservas. Pinar del Río, Cuba.

Abstract

The current conditions of cooperativism in Cuba demand the need to offer solutions aimed at promoting the development of the sector, in coherence with the updating of the Cuban Economic and Social Model and in function of strengthening mainly the relations between the State and this sector of the economy due to its significance for the economic, productive and social development of the country. This article is based on creating an institutional structure that promotes, advises, supervises, controls and contributes to the achievement of a real management autonomy and, at the same time, establishes the public management processes through which the State guarantees the fulfillment of the economic and social commitments and the full recognition of the cooperative sector, without distinction between the agro livestock and non-agro livestock sectors. For the development of the research, the dialectical-materialist method was assumed as the general method, which made possible the integration of theoretical methods such as the historical-logical and the systemic-structural and empirical methods such as observation. Associated with these, the procedures of analysis and synthesis and the documentary analysis technique were applied. As results, the theoretical foundation of the problems linked to the State-cooperative relations and the institutionalization of the sector is offered for the realization of a proposal of attention to the sector. The institutional structure conceived is the National Institute of Cooperativism of Cuba and, from it, a series of strategic and management elements that make it distinctive are defined: logo, mission, vision, structure, objectives and functions.

Keywords: institutionalization; State-cooperative relations; cooperative sector

Introduction

Cooperativism in Cuba, from 1961 to 2013, developed exclusively in the agro livestock sector and assumed three fundamental forms: Credit and Service Cooperatives (CCS in Spanish), Agricultural Production Cooperatives (CPA in Spanish) and Basic Units of Cooperative Production (UBPC in Spanish). As a result of the improvement process of the Cuban Economic and Social Model of Socialist Development, the Non-Agro livestock Cooperatives (CNoA in Spanish) were created in 2013.

Based on the premises of the researches conducted, it has been found that in the operation of these cooperative enterprises there are two factors that affect their management: one of an internal nature, related to poor administration and governance, which has been addressed by different authors: Labrador, Rivera and Alfonso (²⁰¹⁸); Mirabal (²⁰¹⁶, ²⁰¹⁹); Labrador, Mirabal and Torres (²⁰²⁰) which have scientifically based solutions aimed at improving the management of the cooperative enterprise and another factor of an external nature, the State-cooperative relations, which has also been addressed by authors such as: Marín and Labrador (²⁰¹¹); Marín (²⁰¹³, ²⁰²⁰).

These relations have historically constituted a controversial and recurrent topic, since there are different points of view about the role played by the State regarding cooperativism, which demonstrates the need to seek a critical and realistic approach on this matter, which will provide the necessary response to contribute to the objectives and aspirations of cooperativism.

In practice, both public and private institutions seek to encourage the creation of associations that are the target of institutional support and thus facilitate greater, thus facilitating greater chances of success. Such organizations are considered lead institutions, which are those mandated by law to be responsible for the promotion, strengthening and regulation of organizations (^{IICA, 2017}).

Piñeiro (²⁰⁰⁹) defines the concept of institutionalism as all those norms, laws, institutions, operation of organizations or customs that guide the behavior of social groups or socioeconomic strata.

There are several proposals on the components that should be included in an institutionalization process; in this sense, a series of attributes that lay the foundations for the proper functioning of this process are recognized. According to Martínez (²⁰¹⁹), these attributes are: the existence of a long-term strategy, clear rules known to all actors, the presence of coordination spaces, the development of technical capacities, mechanisms for collecting and analyzing reliable information, as well as the incorporation of control and oversight mechanisms and the participation of social actors.

The institutional framework associated with the cooperative sector focuses on the development and promotion of cooperatives, with the purpose of representing such entities and contributing to the fulfillment of their socioeconomic objectives. The nature of this representation is based on training, technical assistance, marketing, and the provision of scientific and technical services, among others.

Cooperative institutes, as institutions of the State in function of the cooperative sector, are called upon to ensure compliance with cooperative laws of a very general and generic nature, regardless of the sector or service provided (^{Arzbach & Durán, 2020}).

The current conditions of the Cuban cooperative sector impose the need to create an institutional structure that promotes, advises, supervises, controls and contributes to the achievement of a real management autonomy and, at the same time, establishes the public management processes, through which the State guarantees the fulfillment of the economic and social commitments and the full recognition of the cooperative sector, without distinction between the agricultural and non-agricultural sectors, being this the objective of the present research.

The proposal for the creation of the National Institute of Cooperativism of Cuba is consistent with the conceptualization of the Cuban Economic and Social Model, the priorities defined in the National Plan for Economic and Social Development until 2030 and the Guidelines of the Party and the Revolution, approved at the VI, VII and VIII Congresses of the Communist Party of Cuba.

Materials and methods

In order to achieve the stated objective, a qualitative research was carried out, where the dialectical-materialist method is assumed as a general method, which allowed determining the components of the object of study and the main dialectical relationships among them, as well as their contradictions. In addition to the foundation and integration of the other methods (theoretical and empirical) that were used to deepen in the essence of the institutionalization of the cooperative sector in Cuba.

The theoretical methods used were:

Historical-logical method: with the objective of determining the behavior of State-cooperative relations in Cuba, as well as the historical development of these relations in recent times.

Systemic-structural method: to support the conception of the proposed institutional structure for the cooperative sector in Cuba, establishing the links between its components and the logical sequence of its process.

The procedures used were analysis and synthesis, and their use made it possible to determine the essential aspects of the process under study, breaking it down into its parts and qualities for the theoretical analysis, which were unified taking into account those common elements, which made it possible to understand its structure and thus be able to model it later.

The essential empirical methods employed were:

Observation method: it was developed through the application of the documentary analysis technique for the evaluation of the bibliographic material related to the different conceptions on the State-cooperative relations, both in the international context and in Cuba and its role in the development of the sector in the country.

Results and discussion

Background of the institute

The relations of the State with enterprises in general and with cooperatives in particular occupy an essential place, since they have a decisive influence on the socioeconomic activity of these entities and of society as a whole.

At the international level, there are examples of institutional structures, where a heterogeneous character can be appreciated, since each country assumes different forms in correspondence with its economic, political and social system and development.

The main institutions linked to the cooperative sector, in addition to being responsible for planning and directing the State's cooperative policy, carry out actions of promotion, supervision, accounting oversight, training, registration, cooperative censuses, legal advice, technical assistance, mediation and approval of the constitution, dissolution and liquidation of cooperatives (^{IICA, 2017}).

Furthermore, from an organizational point of view, Arzbach and Durán (²⁰²⁰) show that there are two types of cooperative institutes: those integrated as dependent on a ministry and those that are independent or autonomous.

Based on a comparative study, an analysis was made of the institutionalization scheme of the cooperative sector in Latin American countries (Table 1). A sample of seven countries was taken (Dominican Republic, Puerto Rico, Panama, Costa Rica, El Salvador, Argentina, Honduras), taking into account three fundamental criteria: the representativeness and scope of the sector in terms of the number of cooperatives and members, the relations between the sector and the State, and the experience in their operation.

Table 1 Institutions representing the State before the cooperative sector in Latin America by country 

Country	Acronym	Main institution of cooperativism
Argentina	INAES	National Institute of Associativism and Social Economy
Costa Rica	INFOCOOP	Institute for Cooperative Development
El Salvador	INSAFOCOOP	Salvadoran Institute for the Promotion of Cooperativism
Honduras	CONSUCOOP	National Cooperative Supervisory Council
Panama	IPACOOP	Panamanian Autonomous Cooperative Institute
Dominican Republic	IDECOOP	Cooperative Development and Credit Institute
Puerto Rico		Puerto Rico Cooperative League

Source: prepared by the authors

The documentary review of the selected institutes made it possible to identify a set of regularities (Table 2), based on: objectives, functions, economic sustainability and organizational structure, which constitutes a point of reference for the proposal in question.

Table 2 Regularities in the functioning of the institutionalization scheme of the cooperative sector in Latin America 

Criteria	Regularities
Objectives	To defend the interests of the cooperative sector. To formulate, direct, plan and execute the cooperative policy of the State. To oversee the legal regime that protects the operation of the cooperative sector. Coordinate and supervise the organization and operation of cooperatives, federations and confederations. Promote the development of the consolidation and integration of the cooperative movement. Promote cooperative education.
Functions	Promote and approve the constitution, organization, dissolution and liquidation of cooperatives. Maintain the National Registry of Cooperatives. Establish and manage cooperative training and education centers. Coordinate with government agencies and cooperatives on their respective cooperative development plans. To provide technical assistance to cooperatives in the economic, productive and social areas. Promote cooperative integration in the country. Exercise inspection and surveillance functions over the cooperative sector. Promote the creation and increase of sources of financing for cooperatives. To grant legal personality to cooperatives, through registration in the National Registry of Cooperatives.
Economic sustainability	Self-sustainable. State Budget. Financially self-sufficient.
Organizational structure	Chairman Board of Directors Administration and finance management. Technology, information and communication management. Technical Assistance Directorate. Audit Direction. Promotion and Development Directorate. Human resources management. Training management. Legal address. Regional management.

Source: Prepared by the authors based on reference websites of each Institute

The role of the cooperative movement in the current international situation recognizes the need for institutions in charge of coordinating public policies, strengthening supervision and control; it is urgent to advance towards an adequate institutional and legal framework, so that the role of the cooperative movement and its contribution to local development and that of society as a whole are recognized.

In the case of Cuba, even though the cooperative sector is not institutionalized, the existence of structures to serve it is recognized, which have been limited to serving the agricultural sector, objectively conditioned by the fact that cooperativism over the years has been limited to the creation of cooperatives in that sector.

The current circumstances demand the resizing of cooperativism, as one of the essential matrixes of the socialist economic and social model, with a new look towards the relations between the State and the cooperatives, therefore, an institutionality coherent with the changes needed to achieve the sustainable development of the Cuban society is imposed.

Rationale for the proposal

Currently, agro livestock cooperatives in Cuba are served through the system of the Ministry of Agriculture (Minag in Spanish), where there is a Directorate of Attention to Producing Units, a structure that is complemented by sub-delegations in the provinces and directorates in the municipalities. The work carried out by the Minag is supported by the National Association of Small Farmers (Anap in Spanish) and by the government in each territory. For such purposes, Decree-Law No. 365 (²⁰¹⁸), in Chapter IV: Relations with the Bodies and Organisms of the Central Administration of the State, its entities and the business system, establishes the links of cooperatives with the State.

This structure demonstrates the restricted autonomy of the cooperatives, where their attributions are limited to internal organization, to some external links and to the specialization imposed by the State, which, without the authorization of the State enterprise, cannot be varied, limiting the potentialities in the increase of surplus products for consumption and the agricultural diversification necessary to achieve cooperative sustainability.

Article 25.1 of Decree-Law No. 365 (²⁰¹⁸), provides that the relations of agro livestock cooperatives with the state enterprises to which they are linked are manifested through contracts, in order to develop their fundamental line of production, reconcile and agree on their development program, their annual production plan, volumes, assortments and destinations of productions for the state commission, or other different purposes that contribute to the plan of the economy.

One of the functions of the state-owned enterprises is to provide services to the cooperatives and their various departments, the most important of which are: machinery, hydraulic, fuel, automotive workshops, mechanization and supply services.

The allocation of resources flows mainly through the state-owned enterprise, limiting the contractual relations that the cooperative could establish with third parties.

In relation to the CNoA, in Decree-Law No. 366 (²⁰¹⁹), in Article 17.1 of Section Eight, it is expressed: the Head of the Organisms of the Central Administration of the State and the Provincial Administration Council that authorizes the constitution of a cooperative is directly responsible for the attention, control and evaluation of its operation.

The CNoA are attended to by the ministries or state enterprises from which they arise and are represented by the Central de Trabajadores de Cuba (CTC). In addition, they receive attention and control in the process of creation by the Temporary Provincial Groups for the attention and follow-up of the CNoA.

The current conditions of the Cuban cooperative sector impose the need to create an institutional structure that promotes, advises, supervises, controls and contributes to the achievement of a real management autonomy. Hence, the need to resize and standardize these relations, in terms of:

The State guarantees the presence of an institutional structure that:

• Establish an appropriate policy that harmoniously combines the interests of cooperatives with the interests of the national economy as a whole

• Supervise, support and advise the management of cooperatives, establishing relationships that allow for their multilateral development and growth

• Establish a real and objective legal framework that allows for the necessary state control and that, in turn, responds to their needs

The existence and development of a cooperative sector with autonomy, its own legal personality and legal support that allows it to operate under the principles of self-management, which requires, in all cases, a framework law that is drafted with the participation of representatives of the sector and that responds to its interests.

Premises

1. Political will of the State to institutionalize the cooperative sector. It is expressed in the political will of the State to recognize the validity and usefulness of the Institute of Cooperativism and its relevance in terms of promoting the development of the cooperative sector in Cuba

2. Establishment of the legal norm that supports the creation of the national organism. The National Institute of Cooperativism of Cuba will be designed in accordance with the provisions of the legal standard to be issued for such purposes, which will allow the implementation of the proposal from the Law

3. Human resources with training in the doctrine and philosophy of cooperativism, in the management structure. The training of human resources in the contents related to the theoretical, methodological and practical foundations of cooperativism will be indispensable in the management structure of the national organism due to the particularities in the management of cooperatives

The proposal is also aimed at promoting the development of second-degree cooperativism and thus cooperative integration for better marketing, organization of common production processes and services with a view to achieving greater efficiency and socioeconomic effectiveness.

Among its fundamental bases is the development of education, training and dissemination programs on cooperativism, promotion of innovative practices and research to achieve better economic, productive and social results.

Synergy in the elements that make up the proposal will be achieved through key functions, such as: planning, organization, integration, leadership and control.

Functions and structure of the organism

Name of the organism and subordination

The proposed name of the organism is: National Institute of Cooperativism of Cuba (INCC in Spanish).

When the National Institute of Cooperativism of Cuba (INCC) was created, a series of strategic and management elements were defined that make it distinctive: logo, mission, vision, structure, objectives and functions, which are described below:

Logo

The INCC will be the governing Institute of the cooperative sector in Cuba, with subordination to the Council of Ministers. The purpose of the INCC will be framed in the planning, organization, implementation and evaluation of the public policy towards the cooperative sector.

Mission

It is the governing institute of the cooperative sector in Cuba, which promotes, advises, supervises and controls cooperatives, with the purpose of orienting the economic and social benefits of the sector in terms of improving the quality of life of the population and the development of Cuban society.

Vision

To be the leading institution in Cuba for the development and promotion of cooperativism, providing services of excellence at the national and territorial level, with competent human resources identified with cooperative values and principles, applying innovative knowledge and methodologies and promoting alliances and integration networks, consolidating the cooperative sector as a key player in economic and social development.

Objectives

• Contribute to the strengthening of cooperatives as collectively-owned economic entities, with autonomy, self-management and a key player in economic and social development at the national and territorial levels

• To foster cooperative principles, values and identity in current and future generations, as a consubstantial element of the Cuban socialist system

• Encourage the increase and diversification of the production of goods and services with quality and competitiveness

• To promote the fulfillment of the cooperative social responsibility, for the benefit of the members, workers, family, locality and society in general

• Promote production and value chains and innovation networks among actors in the cooperative sector and between them and third parties

• Promote the creation of new cooperatives and the consolidation of existing ones

• Propose the set of public policies and legal norms that regulate the cooperative sector, taking into account the national and international context

Functions

• Propose to the appropriate authorities the public policies, legal norms and strategies for the operation and development of the cooperative sector in Cuba

• To ensure compliance with the values, principles and cooperative identity

• Coordinate with the different OACE (Organisms of State Central Administration) and national entities, so that the programs of the INCC and cooperativism, in general, are incorporated within the sectorial policies and the set of macro-programs, programs and projects of the National Economic and Social Development Plan

• Promote cooperative integration in the country, in order to achieve the strengthening and development of the cooperative sector

• Organize and provide specialized technical assistance to cooperatives in the improvement of the different subsystems of their management, as well as in the preparation of feasibility studies and the formulation, execution and evaluation of development projects, in order to enable them to fulfill their corporate purpose

• Lead the training and cooperative education process in conjunction with the Mined (Ministry of Education), Mes (Ministry of Higher Education), Citma (Ministry of Science, Technology and Environment), the MTSS (Ministry of Work and Social Security) and the training branch schools

• Establish and apply supervision and control systems that guarantee compliance with legal provisions and the adequate use of the financial and material resources of the cooperatives

• Mobilize funding sources and funds for the promotion and development of the cooperative sector

• To carry out studies and research on the subject of its competence

• To organize a statistical and information service on cooperatives

• Promote the incorporation of the cooperative sector as a key actor in the strategic management of territorial development

• Keeping the National Registry of Cooperatives

Structure

The INCC will be a national entity, which will have a central headquarters, composed of a President, a Vice-President and four directorates (Legal, Economic-Financial, Supervision and Control, and Education, Science, Technology and Innovation). It will also have representation in the territories with provincial and municipal cooperativism directorates (Fig. 1).

It is proposed that the provincial and municipal cooperativism directorates be subordinated to the provincial government and the Municipal Administration Council, respectively.

The Provincial Directorate of Cooperativism (DPC in Spanish) will assume and reorient the policies dictated by the INCC and will be in charge of the orientation and control of the Municipal Directorates of Cooperativism (DMC in Spanish). On the other hand, the DMC will be the local representation of attention to the cooperative sector.

Source: prepared by the authors

Fig. 1 Proposed structure of the INCC 

Relationship with organisms of state central administration and national entities

The INCC relates with the OACE and national entities, in order to promote collaboration and integration links, as do its provincial and municipal representations. The recognition by the different OACE of the particularities of the cooperative management model in their sectoral policies and development programs will be encouraged.

Financial sustainability

The INCC will be a budgeted unit. Once constituted, its plan and budget will be planned annually, applying the same procedure established for the rest of the country's organisms and institutions.

In addition, the INCC may mobilize other territorial, national and international financing for the development of its state functions, in accordance with current legislation.

The study made possible the theoretical foundation on the institutionalization of the cooperative sector at the international level, where the experience in the representation from the State, of a structure of attention to the cooperative sector is evidenced; such experiences constitute a reference for the proposal made.

The legislative basis of the cooperative sector in Cuba demands a necessary redefinition, in correspondence with the updating of the Economic and Social Model.

The proposal is based on the creation of the National Institute of Cooperativism of Cuba, with defined objectives and functions in order to contribute significantly to the achievement of the real autonomy of cooperatives, as well as the necessary support, advice and supervision in their management.

Referencias bibliográficas

Arzbach, M., & Durán, A. (2020). Regulación y supervisión de Cooperativas de Ahorro y Crédito en América Latina (24.^a ed.). Confederación Alemana de Cooperativas. https://www.dgrv.coop/es/publication/regulacion-y-supervision-de-cacs-en-america-latina-y-el-caribe/dgrv-regsupcacsal_sept2020_final/

Consejo de Estado de la República de Cuba. (2018). Decreto Ley No. 365 De las Cooperativas Agropecuarias. Gaceta Oficial de la República de Cuba, Edición Ordinaria No. 37. https://www.gacetaoficial.gob.cu/es/decreto-ley-365-de-2018-de-consejo-de-estado

Consejo de Estado de la República de Cuba. (2019). Decreto Ley No. 366 De las Cooperativas No Agropecuarias. Gaceta Oficial de la República de Cuba, Edición Ordinaria No. 63. https://www.gacetaoficial.gob.cu/es/decreto-ley-366-de-2019-de-consejo-de-estado

IICA. (2017). Institucionalidad de apoyo a la asociatividad en América Latina y el Caribe: Un análisis en países seleccionados. Instituto Interamericano de Cooperación para la Agricultura. https://repositorio.iica.int/handle/11324/6326

Labrador Machín, O., Mirabal González, Y., & Torres Paez, C. C. (2020). Potencialidades del cooperativismo agropecuario en función de la soberanía alimentaria y educación nutricional. Cooperativismo y Desarrollo, 8(3), 587-602. https://coodes.upr.edu.cu/index.php/coodes/article/view/401

Labrador Machín, O., Rivera Rodríguez, C. A., & Alfonso Alemán, J. L. (2018). La eficiencia y eficacia socioeconómica de las cooperativas: Enfoque desde la actualización del modelo económico cubano. Avances, 20(1), 11-26. http://www.ciget.pinar.cu/ojs/index.php/publicaciones/article/view/307

Marín de León, I. (2013). Propuesta de una estructura institucional para el sector cooperativo en Cuba. Cooperativismo y Desarrollo, 1(2), 155-163. https://coodes.upr.edu.cu/index.php/coodes/article/view/52

Marín de León, I. (2020). El sector cooperativo y su articulación con la gestión gubernamental. Cooperativismo y Desarrollo, 8(3), 362-366. https://coodes.upr.edu.cu/index.php/coodes/article/view/402

Marín de León, I., & Labrador Machín, O. (2011). Las relaciones Estado - cooperativas: Un reto en las condiciones actuales. Avances, 13(4). http://www.ciget.pinar.cu/Revista/No.2011-4/articulo/Estado_Cooperativas.pdf

Martínez, R. (Ed.). (2019). Institucionalidad social en América Latina y el Caribe (Libros de la CEPAL, N° 146 (LC/PUB.2017/14-P/Rev.1)). Comisión Económica para América Latina y el Caribe. https://www.cepal.org/es/publicaciones/42061-institucionalidad-social-america-latina-caribe

Mirabal González, Y. (2016). Instrumentos para la Gestión de la Responsabilidad Social Cooperativa. Cooperativismo y Desarrollo, 4(1), 12-21. https://coodes.upr.edu.cu/index.php/coodes/article/view/122

Mirabal González, Y. (2019). La responsabilidad social de las cooperativas en Cuba. Limitaciones y oportunidades. Deusto Estudios Cooperativos, (14), 121-141. https://doi.org/10.18543/dec-14-2019pp121-141

Piñeiro, M. (Ed.). (2009). La institucionalidad agropecuaria en América Latina: Estado actual y nuevos desafíos. Organización de las Naciones Unidas para la Agricultura y la Alimentación. http://www.fao.org/3/as449s/as449s.pdf

Received: July 21, 2021; Accepted: July 31, 2021