Asian Alliance for Solidarity Economy

by: Miguel Yasuyuki Hirota (mig@olccjp.net)

1. 1. SE’s achievements in Asia

The arrival of the concept of SE to Asia was rather late in comparison with other continents and it was only October 2007 when the 1^st Asian Forum for SE took place at Manila, the Philippines.  Workshops on this new economy took place in October 2008 at Bangkok, Thailand and in March 2009 at Kuala Lumpur, Malaysia when the Asian Alliance for SE (AA4SE, http://www.aa4se.com/) was established, but the term SE is still very little known, even in comparison with Europe or Latin America.

But this does not mean that SE experiences are foreign to Asia: there are indeed a number of unarticulated grass-root practices in many countries, such as consumers’ coops and NPO Banks in Japan, social enterprises in Korea, microfinance initiatives (remember that this movement was born in Bangladesh!) all over the region, local currencies in Japan, Korea, Taiwan and Hong Kong, elderly-care groups in Japan and CSR-minded small businesses throughout Southeast Asia, just to name a few.

1. 2. Challenges for Asia:

Some challenges should be taken into account seriously if we are to promote SE and to articulate its players all over this continent.

Linguistic diversity: it should be remembered that Asia has a number of mutually-unintelligible languages, such as: Bengali (Bangladesh), Burmese (Myanmar), Cambodian (Cambodia), Hindi-Urdu (India and Pakistan), Japanese (Japan), Korean (North and South Korea), Lao (Laos), Mandarin (China and Taiwan), Malay-Indonesian (Brunei, Indonesia, Malaysia and Singapore), Mongolian (Mongolia), Sinhalese (Sri Lanka), Filipino (the Philippines), Tamil (India, Sri Lanka etc.), Thai (Thailand), Vietnamese (Vietnam).  While in some countries English is widely spoken, it should be taken into account that most SE players in Asia only speak their respective country’s official language (Thai if they live in Thailand, for instance), making it tough for SE players to be articulated and to communicate each other beyond the language (=national) border.

This linguistic diversity poses another challenge on promoting SE in each Asian country too: since most people, including professors and public servants, are often not good at English, it is required that at least some basic information on this topic should be given in each country’s official language so that opinion leaders throughout the continent could share our perspective on SE and let it known to people in their respective language.

Geographical and psychological distance from other continents: another important remark is that most countries where the SE movement has been consolidated are non-English-speaking countries (France, Italy, Spain, Latin America and Québec) with which Asians usually do not have strong relationship. The traditional lack of links between these continents makes it harder for Asians to grasp what is happening globally in terms of SE and to exchange experiences with them.

1. 3. Perspectives and proposals for the next decade

Although the consolidation of SE players in Asia is still in an early stage, the coming years will see important events, such as the 3^rd Asian Forum in Malaysia in 2011 and the 5^th RIPESS conference in 2013.  It is quite important to make the best use of all available resources in order to maximise our synergy and take more steps forward.  Some proposals will be given below to help promote the SE movement in Asia:

Creation of multilingual platforms: the lack of information on SE and of international communication among Asian SE players who do not speak English has been the biggest hurdle, so it is crucial to set up platforms to get it over.  I would like to suggest the creation of following tools so that more Asians should be familiar with SE and be articulated better.  Obviously a huge amount of money would be required for translation services, but this cost should be regarded as something indispensable and efforts should be done to win such a funding.

-       Creation of another portal website on SE in Asian languages (not only English but also Chinese, Japanese, Thai etc.): this is not to deny AA4SE’s efforts so far to share information, but it would be ideal if more information could be provided in more Asian languages so that SE players, researchers, policymakers etc. could learn what SE is, how SE is practiced in Asia and other continents etc.

-       Creation of multilingual communication method: the multilingual discussion groups managed by Alliance 21 WSSE (now ALOE) with translation service between English, French and Spanish / Portuguese has been a key factor on articulating SE players and to stimulate communications among them, but it is crucial to provide similar services among key Asian languages if we are to expect same results. More SE players are expected to be articulated only when they feel linguistically comfortable, so it is indispensable to set up a platform in which people could communicate in Chinese, Indonesia, Japanese, Thai and other Asian languages.

Exchange of young SE players / students: it is essential that more Asians should understand how SE has been growing in the world in order to transfer such experiences to their own countries.  So it would be helpful if some programmes could be set up to promote exchange of the youth.  The mutual exchange (not only Asian youth to other continents but youths from other continents to Asia) would strengthen mutual understanding in terms of SE practices, and such articulators will help both quantitative and qualitative development of solidarity economy in Asia.

Recent advances in internet-based financial services have so far made it possible for SMEs and other unbanked sectors of society to make payments via text messaging. But their credit access to banks remains elusive.

To find ways of enhancing SME access to the full benefits of internet banking, CSRSME Asia will team-up with BDO, the country’s largest bank, and the Shared Vision Cooperative of SMEs to create the Bayanihan Cash Card (BaCC), a debit card that will connect SMEs and their clients with BDO’s ATM, mobile phone, point of sale facilities and automatic financial statement generation.

The approach is innovative firstly because it targets socially responsible SMEs or social enterprises with the triple bottom line of economic sustainability, social development, and ecological conservation.

Secondly, it allows social enterprises to strengthen their supply chains with the development of a financial intermediation system that will mobilize savings and provide financing for production and marketing of local products.

Finally, the project hints at a framework for participatory local development that increases the benefits of all stakeholders including small producers, consumers, wholesalers, trading/auction centers, retail distribution centers, vendors, banks, social enterprises, NGOs, and local government units.

The Inherent Conflicts of the Profit-Maximizing Market Economy

By Benjamin R. Quiñones, Jr.

Founder and Chairman, CSRSME Asia

In a profit-maximizing market economy, stakeholders are in constant conflict with each other while trying to look for ways to advance their own “stake” in the market. The final arbiter of resource allocation or the “allocator of resources” in this kind of economy is market price.

This situation creates a breeding place for conflicts among stakeholders throughout the system. The wholesaler wants to buy at a low price from the producer and sell at a high price to the consumer. The consumer/worker wants to buy at a low price while contending for a high wage. The investor/ banker wants higher interest for his loans to distributors and producers alike, but the latter want lower interest rate. Each stakeholder tries to protect its own interest and thinks very little about social responsibility.

The market solution towards integration is the reign of monopoly or oligopoly. One of the major stakeholders, or a collusion of a few of them, integrates the whole economic system through a global supply chain under a regime of economic and financial liberalization.

The globalization process has hastened the integration of national economies into a global market system dominated by transnational corporations (TNCs). This has deepened the gap between the haves and the have-nots and further marginalized the vast majority of people who have no access to productive resources.

In the midst of adversity and alienation, the human spirit time and again rises up to regain man’s dignity and freedom. Every epoch in various areas throughout the world is witness to heroic attempts of people to mitigate the harsh impact of market economy through self-help efforts and egalitarian outreach programs. A few examples are cited below:

● Solidarity-based initiatives (e.g. cooperatives, associations, fair trade, social enterprises) are created by people to try to overcome adversities and live a life that would otherwise be devoid of hope. Oftentimes, these solidarity-based struggles are waged without fanfare and independent of similar initiatives in other parts of the world. They aspire for a responsible, plural, social and solidarity economy that deliberately chooses serving the needs of people and ecological sustainability as the goal of economic activity rather than sheer maximization of profits under the unfettered rule of the market. They place economic and technological development at the service of social and human development rather than the pursuit of narrow, individual self-interest.

● There are institutions in various countries (some are called microfinance institutions, others are savings and credit cooperatives, still others are social finance or solidarity finance institutions) that mobilize funds from sources who support a fairer, more people- and environmentally oriented world and make these funds available to projects that do not merely seek profits for self-gain but also pursue the greater good of the community and the environment.

Solidarity Economy : A Sustainable Alternative

Solidarity Economy is a socio-economic order and new way of life that deliberately chooses serving the needs of people and ecological sustainability as the goal of economic activity rather than maximization of profits under the unfettered rule of the market. It places economic and technological development at the service of social and human development rather than the pursuit of narrow, individual self-interest.

Solidarity Economy is an alternative economic model to neo-liberal capitalism. This alternative socio-economic order and new way of life inspires attitudes and behaviors with values such as sharing, co-responsibility, reciprocity, plurality, respect for diversity, freedom, equality, ethics, brotherhood, and sisterhood [1]/ ^.

The Chantier Economie Sociale of Quebec cites five key principles to distinguish solidarity economy initiatives. These are [2]/:

(1) the objective is to serve its members or the community, instead of simply striving for financial profit;

(2) the economic enterprise is autonomous of the State;

(3) in its statute and code of conduct, a democratic decision-making process is established that implies the necessary participation of users and workers;

(4) it gives priority to people and work over capital in the distribution of revenue and surplus; and

(5) its activities are based on principles of participation, empowerment, and individual and collective responsibility.

Solidarity Economy adopts conscious altruism and solidarity, not extreme individualism, as the core of the new socioeconomic culture. It tends to favor cooperation, not competition, as the main form of relationship among humans and between them and Nature [3]/.

Solidarity Economy does not constitute a SECTOR of the mainstream economy. It is rather a global APPROACH encompassing initiatives in most sectors of the economy. This alternative approach to socio-economic development operates side by side with the market economy and is capable of sustaining its initiatives and competing in the market logic of traditional markets for as long as its approaches continue to be innovative [4]/^.

TOKYO, Nov 23, 2009, 2009 (IPS/GIN via COMTEX) –

The outbreak of the global financial crisis that followed the collapse of the U.S.’s major financial institutions last year sent many economies into a downward spiral. Many were also forced to rethink their economic development models.

For Dr Jun Nishikawa, professor emeritus at Waseda University in Tokyo, there is no more viable option than a solidarity-based economy, or one that promotes human and social development. This, in his view, contrasts with a profit- and greed-driven economy to which grassroots development is often hostage.

Dr Nishikawa is Japan’s leading theorist of the social development and solidarity economy (SE), an alternative framework for the development of grassroots people, which he thinks is not possible in a globalised market economy. He says it is a concept that seeks to transform a capitalist economy that advocates of solidarity economy like him believe engenders oppressive social conditions.

The concept of SE evolved during the first World Social Forum of civil society organizations in 2001. The forum sought to counter the ill effects of economic globalization and denounced the anti-human aspects of a market- oriented economy, where everything is “merchandised and transaction- based” and the environment is rapidly deteriorating, he says.

His dream is to see a society marked by a sustainable environment that can realise genuine human growth through the combined efforts of civil society and the public sector. This aspiration of his reverberated anew in the Asian Forum for Solidarity Economy, held in Tokyo last week.

In Japan the prospects for propagating SE appear promising against a backdrop of social and gender gaps, job insecurity and poverty, which have assumed disturbing proportions. In fact, Dr Nishikawa proudly says, a number of activities promoting solidarity economy are taking place in his country. These include social enterprises, social financing schemes, fair trade and non-profit undertakings in the fields of welfare, medical and care work and agriculture-all of which are intended to promote grassroots development.

He ponders the prospects for the pursuit of solidarity economy in Japan and elsewhere in the world.

IPS: What does SE mean in this time of economic crisis?

JUN NISHIKAWA: The economic globalisation has in recent decades brought about increasing poverty, unemployment and social division on a global scale, and this was heavily criticised by civil society groups.

On the other hand, it has promoted money-oriented, or greed, economy among transnational corporations and financial institutions. Their collective failures led to a global financial crisis in 2007-08.

In this situation, the governments tend to promote various regional cooperation schemes such as free trade and economic partnership agreements. However, there are fears that such schemes will only lead to a failed regional globalisation.

IPS: What is the role of the SE forum in this regard?

JN: The forum advocates a more humanistic economy and society both at the regional and global levels. This is particularly vital in Asia, where rapid economic growth has created enormous poverty, social division and environmental deterioration. IPS: What did the Asian Forum in Tokyo achieve that in your view can help address these issues?

JN: On one hand, the Forum in Tokyo is a good departure point to develop further SE activities in Japan as well as in Asia. On the other, it is a good beginning to exchange experiences, mutual support and partnerships among SE advocates in the five continents of the world.

In fact, we were amazed to see so many delegates, not only from Asia but also from Europe, North America, Oceania and other parts of the world. It means that the role of the SE movement in Asia is considered important not only among Asian nations but also in other parts of the world.

IPS: How would you describe Japan in the post-World War II era and what does its current mean for promoting SE in the world’s second largest economy?

JN: The post-World War II economy in Japan is marked by “development- oriented dictatorship,” which was led by a coalition of politicians, business groups and bureaucrats. The non-profit sector that existed in the form of cooperatives, however, largely survived within the said development-oriented regime. The force of civil society organisations has long been weak.

But the situation started to rapidly change after the collapse of the bubble economy, which took place through the 1990s. As a result, the development- oriented dictatorship ceased to function properly. It was prompted by the rise of civil society and people’s movements in this decade, which are seeking more public sector accountability and democratisation.

After 1993, the domination of Liberal Democratic Party (LDP), which symbolised the development-oriented dictatorship, ended and the Japanese politics entered a new era of coalition government made up of a plurality of parties. This change was accelerated by a change in the international environment, where the East-West Cold war ended and where the world has become more multilateral.

After the Asian currency and financial crisis between 1997 and 1998, and during the incumbency of Prime Minister Junichiro Koizumi, who promoted globalisation and liberalisation in Japan, the ill effects of globalisation became visible in this country, where 90 percent of the population thought they belonged to the middle class.

These international and domestic changes have pushed democratisation in Japan-a boost to CSO activities.

All this bodes well for pushing a solidarity-based economy.

IPS: Prime Minister Yukio Hatoyama has vowed to support civil society, non-profit and citizens’ actions. How do you view his leadership and what does it imply for the pursuit of SE in Japan?

JN: The election of Prime Minister Hatoyama brought an end to the old-style development-oriented political regime. He equates politics with ‘yuai’ (fraternity). This means giving a voice to marginalised sectors, including minority groups, and pursuing an economic programme that is fundamentally based on human development.

The ‘yuai’ is in stark contrast to the rapid marketisation pursued by past governments that created a lot of unemployment and poverty. In today’s Japan, the Democratic Party is committed to addressing these issues more than pursuing a growth-based economy as advocated by LDP.

All this means that the new government is keen to address social issues and involve the CSOs in resolving them.

IPS: Are you optimistic about the potential of SE to gain more adherents in Japan and consequently take root in the country?

JN: In a situation where major enterprises are moving their factories abroad and the government is running a heavy deficit every year, and poverty and job loss are on the rise, the people have no other choice but to depend on grassroots-led development or entrepreneurship.

In Japan, public-private sector collaboration has traditionally involved government and big private enterprises. Today we need to promote collaboration between the government and civil society to resolve the failures that have accumulated through the years under the traditional setup.

IPS: What is the role of Japan in promoting SE across Asia and the rest of the globe?

JN: Many Asian countries have followed the Japanese way of growth based on export-oriented industrialisation. Japan should lead the way in reversing this cycle, among others through a change of lifestyle-one that emphasizes responsible citizenship, positive social ties and sustainable environment.

These are not alien to Japanese and Asian cultures on the whole. SE is showing both Japan and other Asian countries that an alternative way of living is not only possible but also inevitable.

IPS: How do you expect the Japanese people act to respond to the SE challenge?

JN: Many Japanese have become conscious of the necessity to reverse today’s trends. This is evident in their overwhelming support for a new government during the election, inspired by the chain of events leading to President Barack Obama’s victory. A positive social development combined with environment conservation efforts will strengthen the people’s resolve toward an alternative lifestyle that is consistent with the ethos of solidarity economy.

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