ILO: ooperatives and other social and solidarity economy organizations will be instrumental into the medium to long term recovery

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Greetings from the Cooperatives Unit of the International Labour Organization  in Geneva.

This a moment of great disruption. Full or partial lockdown measures have affected more than 5 billion people around the world. Recent ILO estimates indicate that more than 436 million enterprises are at risk. Millions of workers around the world are without a job and unable to sustain themselves and their families. To die from hunger or from the virus” is an all-too-real dilemma faced by 1.6 billion informal economy workers, half the world’s total workforce of 3.3 billion. Values of solidarity and cooperation are more needed today than ever.

Historically, such values experience a surge in popularity during such times of crises, including financial crises, natural disasters and conflicts. This was the around the financial crisis  in Argentina, the global financial crisis  and the debt crisis  in Greece. Similarly, cooperatives and wider SSE organizations have been key community actors in responding to public health epidemics such as AIDS (Swaziland, Vietnam) , the relief and reconstruction efforts after natural disasters (Japan, Australia) and in post conflict settings  (Sri Lanka, Rwanda).

In the face of the pandemic and its aftermath business activities for many cooperatives and wider SSE organizations have suffered across sectors. While some sectors, such as food retail, may have seen a surge in business most others have seen a total stoppage or dwindling of their activities. In order to serve their members and communities, many of the cooperatives in the rural and informal economies are having to adapt and innovate in responding to needs pandemic and its aftermath. Others struggle to figure out how to access government relief measures in countries where such measures exist.

Cooperatives and wider social and solidarity economy organizations are also mobilizing to provide relief for their workers, members, and communities in different aspects of the crises in the immediate to short term. Their support ranges from ensuring workplace safety and working conditions and stabilizing supply chains to shifting production toward much needed supplies, broadening access to relevant information on COVID-19 and advocating with governments to influence their policies to support their members and communities.

Credit unions and financial cooperatives are providing liquidity support to affected micro, small and medium-sized enterprises in countries such as Kenya, France, Ethiopia, Italy, Uganda and Canada. They are setting up solidarity funds and crowdfunding initiatives to support local businesses and vulnerable people.

Some cooperatives have transformed their products and services to meet urgent local needs for protective equipment, food supplies and care support. They shifted production toward much needed supplies like hand sanitizers and face masks and distributed them for high risk populations and frontline workers. Health cooperatives, including pharmacy cooperatives, are establishing support funds and distributing protective gear for their members, workers in essential enterprises and health care workers who are on the frontline of the public health care crisis.

Producer and consumer cooperatives are among key players keeping supply chains of essential foods and goods moving while also relocalizing production especially when produce coming from elsewhere is blocked. Agricultural cooperatives and consumer cooperatives have created direct supply chains in Japan. Coop Denmark’s Savannah project advances direct trade with Kenyan coffee producer cooperatives by shortening the value chain, enhancing product quality and building export capacities for producer cooperatives in the process.

Cooperatives and SSE organizations with strong presence in their communities are fulfilling a series of community support functions. Cooperatives in Italy are helping vulnerable people who cannot go shopping by themselves including in partnership with municipalities. Those in Japan and Korea are providing lunch boxes for disadvantaged elementary school children during school closures. In France they are producing service vouchers for disadvantaged populations, such as homeless people, for use in affiliated establishment offering hygiene and food services.

It is the nature of crises to expose new faults in a system or widen existing ones. Some thinkers predict a new global order. They point toward a rediscovery of the value of social state, especially as it pertains to health, education, social assistance. This is also a time when many people are realizing the need for transformative business practices that do not only care for the economic bottom line only, but also about social and environmental ones.

The value of cooperatives is recognized in the immediate crisis response. In some countries, like Italy and South Korea they are included in both consultation and implementation processes of government support measures. Their existing infrastructure and networks help in understanding emerging needs and implement support measures in an effective way.

What is important is that even after the crisis their role in the recovery and transformation of societies and economies beyond the immediate, but in the medium and long term is recognized. Toward that end it will be important for cooperative organizations to disseminate the knowledge on how cooperatives can help with enterprise transformation for instance in the case of bankruptcies, supporting worker-buy-outs of businesses through worker cooperatives can help preserve jobs.

Cooperative advocates can also share examples of how platform cooperatives work. Domestic workers and home-care workers in the US have been establishing their cooperatives using online applications. They are essential workers for ageing societies, but also face a deficit of affordable, accessible care services.

During these challenging times, at the ILO Cooperatives Unit we would like to reaffirm our solidarity with the cooperative and wider social and solidarity economy movements. We are convinced that cooperatives and other social and solidarity economy organizations will be instrumental beyond the emergency phase and well into the medium to long term recovery in the affected countries, as we have seen in many other crises contexts across history. We have all the confidence that th

“Next Generation” EU instrument of 750 billion EUR for the European Recovery Plan

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Ursula von der Leyen, president of the European Commission presented yesterday, in the European Parliament, the European Commission’s proposal for an ambitious Recovery Plan for Europe.

The Plan is based on two main pillars:

  • the “Next Generation EU” instrument of 750 billion euro
  • an increased EU budget of 1 100 billion EUR in-between 2021-2027.

The communication by the European Commission declares the social economy as one of the sectors touched most by the current crisis, together with the cultural and tourism sector.

At the same time, the social economy is considered an important instrument helping in particular the most vulnerable persons to find their way out of the crisis and into employment.

Also, the Commission underlines solidarity between people, generations, regions and countries as a main element and principle for recovery.

The Commission communication sets out proposals with a list of concrete measures to support recovery in Europe.

  • Recovery and Resilience Facility ( 560 billion euro) to be implemented in the framework of the European semester and based on national recovery plans – will provide support for investments and reforms in the different Member States based on grants and loans.
  • Through the new programme REACT-EU (‘Recovery assistance for cohesion and the territories of Europe’) (55 Bilion euro), for example, the Commission proposes to feed, until 2022, additional 55 billion EUR into ongoing cohesion policy programmes. Main criterium for the allocation of this funding is socio-economic impact of the crisis in the different territories, including elements such as youth unemployment. Also the relative prosperity of Member States will be taken into account.The revised proposal for Cohesion Policy provides for greater flexibility for transfers between funds in order to better support local and regional authorities.
  • According to the proposal of the European Commission, initiatives such as a new Solvency Support Instrument and a strengthened InvestEU initiative should help companies to overcome the crisis through a mobilization of additional private investments.
  • Green Transition should be fostered for example through the reinforcement of the Just Transition Fund and a strengthened European Agricultural Fund for Rural Development.
  • The Commission proposal also foresees a new Health Programme (EU4Health) reinforcing health security within the EU and preparing for possible future health crises.
  • Following the Commission proposal, also other programmes, such as Horizon Europe, the Humanitarian Aid Instrument or Digital Europe, should be strengthened.

The adjusted work programme 2020 of the European Commission foresees the continuation and expansion of different initiatives taken recently to support companies and employment. Examples are the SURE (Support Mitigating Unemployment Risks in Emergency) programme, reinforced measures against youth unemployment, the promotion of fair minimum wages or initiatives to strengthen equal opportunities (including pay transparency measures). Emphasis will also be put on the circular economysafe and sustainable food or biodiversity.

New resources, increased EU budget

To finance the measures proposed, the European Commission suggests

  • lifting the own resources ceiling to 2% of EU Gross National Income.
  • The increased EU budget will then enable the Commission to take up 750 billion EUR of credit on financial markets. These funds would then be paid back gradually, in-between 2028 and 2058 through the EU budget, including possibly new own resources (which could be based, for example, to a digital taxoperations of large companies or the Emissions Trading Scheme). The European Commission also plans to support Member States in fighting tax evasion.

Multi-Annual Financial Framework (EU Budget 2021-2027)

The Multi-Annual Financial Framework (EU Budget) 2021-2027, with 1,1 trillion euro, a specific Own Resources Decision and a Revised Multiannual Financial Framework 2014-2020 will now be negotiated with and in the European Parliament and the European Council. The objective is to have the revised MFF 2014-2020 adopted in early autumn 2020, the MFF 2021-2027 and the Own Resources Decision in December 2020.

This health and economic crisis we face is unprecedented in the history of the EU. The solution for the Commission to borrow money from the market is a remarkable one, a European solution for a European problem. The crisis is a game changer.

Energy efficiency and tourism: our model case WELCOMMON HOSTEL

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Energy efficiency of the building of WELCOMMON HOSTEL and use it as center to demonstrate applied technologies of energy efficiency and renewable energy sources.

Wind of Renewal is renting since August 2016 the building with about 3.200 square meter, which was until the end of the year 2013 a public clinic. We fully renovated the building already twice. Once at autumn 2016 to be for 1,5 years a model center for accommodation and integration of the most vulnerable refugees and then again to become an innovative, functional and esthetic Hostel with a social impact, the WELCOMMON HOSTEL.

The whole renovation was based on the idea and the awareness of re-use and up-cycling, not only to reduce renovation expenses but also for ecological  reasons.

Beside the fact that we did relevant changes for the lightning, changing the old lamps with new LED lights, there are double windows and some insulation, we regulated the boiler, the temperature of the waste gases and other mechanical systems, to reduce energy waste. However, the building is old and remains energetically wasteful and ineffective. The result is negative both as for the climate and for the expenses of the heating, cooling and electricity. The next step was the installation of 20 solar panels, in order to produce hot water for the clients of the hostel and reduce the use of oil for heating of water and the energy audit of the WElCOMMON HOSTEL, in order to evaluate the performance of energy efficiency measures (like changing to led lighting) and the solar systems installed recently.

There are measures of the temperatures on the solar panels and of the water in circulation and in boilers every one hour starting since some months ago as well financial data (payments of electricity and oil) for the last 3,5 years. All the data will be evaluated for a better understanding how we can implement solar systems on the roof of big buildings, like schools, hotels, companies and block of flats and how is their energy and financial performance in Athens.

For environmental and economic reasons we are immediately looking to modify the building to a zero emission building and to operate as a center of education and training in green trades and activities and also as a place to demonstrate energy efficient technology and present renewable energy sources in the city of Athens.

We are searching for company or cooperative or research center which is willing to provide to WELCOMMON HOSTEL the technology of energy reduction and renewable energy sources on buildings to transform it into a zero emission buildings. In return, we demonstrate the technology to our guests and cooperation partners from all over the world, who visit us to see our work. Thousands of people and organizations, schools, students, businesses will have the opportunity to be introduced to these technologies and practices in an open center for demonstration or from remote.