Inclusive Investment in Agriculture: Cooperatives and the role of foreign investment

The document argues that agricultural cooperatives promote inclusive investment by allowing farmers to maintain control over resources while achieving economies of scale. It highlights that well-organized cooperatives reduce risk for foreign investors and facilitate more efficient contracting. The brief emphasizes that government support should be limited to creating an enabling legal environment and providing technical resources, rather than interfering in internal management, as bottom-up initiatives are generally more successful.

• Agricultural cooperatives provide significant economic contributions globally, such as producing 37 percent of agricultural GDP in Brazil and collecting 16.5 million litres of milk daily from 12 million farmers in India.
• Cooperatives offer smallholders multiple advantages, including the ability to collectively negotiate better prices and contract terms, improved access to financing and markets, and the creation of productive employment.
• The presence of cooperatives in a value chain reduces the perceived risk for foreign investors by providing reliable partners and ensuring the availability of inputs and buyers.
• Foreign investors often prefer contracting with cooperatives rather than individual farmers because it simplifies logistical arrangements and the contract process.
• Government intervention in cooperatives is most effective when limited to providing a sound legal environment and technical support; cooperatives created through government programs are often less successful than bottom-up initiatives.
• Effective legal frameworks for cooperatives vary by region, ranging from general social economy laws in Spain and Finland to specific cooperative codes in India, Canada, and the Philippines.

APA

Ruete, M. (2014). Inclusive Investment in Agriculture: Cooperatives and the role of foreign investment. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/inclusive-investment-in-agriculture-en.pdf

Chicago

Ruete, Marina. Inclusive Investment in Agriculture: Cooperatives and the role of foreign investment. International Institute for Sustainable Development, 2014. https://www.iisd.org/system/files/publications/inclusive-investment-in-agriculture-en.pdf.

Wikipedia

{{cite report |last1=Ruete |first1=Marina |title=Inclusive Investment in Agriculture: Cooperatives and the role of foreign investment |publisher=International Institute for Sustainable Development |date=June 2014 |url=https://www.iisd.org/system/files/publications/inclusive-investment-in-agriculture-en.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{ruete2014inclusive, author = {Ruete, Marina}, title = {{Inclusive Investment in Agriculture: Cooperatives and the role of foreign investment}}, institution = {International Institute for Sustainable Development}, year = {2014}, month = jun, url = {https://www.iisd.org/system/files/publications/inclusive-investment-in-agriculture-en.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }