Cooperatives founded by farmers will soon enjoy legal status as
Chinese legislators gathered Saturday to discuss a draft law to
better protect farmers' business interests.
"How to help rural household better combat natural and market
risks in business operation and connect small and sporadic
household businesses with domestic and international markets are
major issues in facilitating agricultural and rural economic
development," said Li Chunting, member of the National People's Congress (NPC) Standing
Committee.
The draft law on farmers' professional cooperatives was
presented to the legislators for the first deliberation, as
household business, major backbone of China's rural economy, has
become ever vulnerable when facing more and more competitive
market.
Currently, China has no law or administrative regulations
defining the legal status of rural cooperatives, which in turn
fails to obtain government registration to guarantee their daily
operation.
Zhou Yongfu, a florist in Songming County in southwest China's
Yunnan Province, thought of making a fortune out of selling lily
but only found the price dropped well below its cost as lilies
flooded the market in 2004.
"What if we flower farmers worked together to tap the market, to
study market information," he recalled.
According to statistics from the Ministry of Agriculture, China
has over 150,000 economic cooperatives in the countryside, whose 23
million members account for 9.8 percent of the total rural
households.
Without basic legal regulations, many cooperatives fail to have
a sound in-house operation mechanism and leave their farmer
members' economic rights and interests in risk.
The proposed draft law stipulates that farmers' cooperatives are
organizations for mutual assistance set up by farmers who produce
similar agricultural products or offer and use similar farming
services based on household contract system.
To protect farmers' business interests, the draft law requires
cooperatives to set up an account for every member and define their
individual financial rights as a basis for profit and liability
sharing.
(Xinhua News Agency June 25, 2006)