The New Cooperative Law

Pirhot Nababan

OVERVIEW

Since the colonial times, cooperatives have played a significant role in Indonesian economy. So much so that they have been declared as the backbone of the national economy under the elucidation of Article 33 of the 1945 Constitution, which states that the national economy is to be organized according to cooperative and family principles.

This importance is also illustrated by the significant growth of cooperatives and their members in Indonesia. According to the Ministry of Cooperative and Small-Medium Businesses, in 2012, the number of cooperatives reached 192,443 units, where 7,831 are savings and loan cooperatives. Members of registered cooperatives are comprised of 33,687,417 Indonesian citizens. In terms of capital, cooperatives have raised USD 9.14 billion and generated USD 642.64 million in profit.[1]