In the past few years, Egypt has been shutting down a number of non-operating consumer cooperative stores. However, with the growing inflation, the Egyptian Parliament is discussing expansion in the operation of consumer cooperative stores and enhancing them in order to control merchants’ greed and face inflation. This comes as the government is supporting outlets that offer low prices, such as the government-sponsored supermarkets run by the Ministry of Agriculture, the Ministry of Interior, and the army. With governmental initiatives like Wattania and Aman, consumer cooperative stores will show whether they will economically make a difference.
Consumer Cooperatives: Between Dismissal and Comeback
Consumer cooperation is a branch of the cooperative sector that works to provide consumer goods and services to members at the highest quality level and at the lowest price under cooperative principles and within the framework of the state's general plan. "Ministry of Supply and Internal Trade spares no efforts to regulate prices in the Egyptian markets through the Consumer Cooperatives’ stores found across the country, which provide goods, particularly food, at highly competitive prices," according to the Consumer Protection Agency’s (CPA) website.
In recent years, the government has been closing a number of consumer cooperative stores. In September 2022, Ali Al-Moselhi, Minister of Supply and Internal Trade, issued Decree No. 30 of 2022 to liquidate 27 consumer cooperatives. Susan Hanna, Director of the Consumer Cooperative in Cairo, told Al Ahram Newspaper in 2021: “A coordination committee between us and the Consumer Cooperation Department at the Ministry of Supply convenes monthly to solve administrative problems related to the work of cooperatives, including budgets and meetings of boards of directors, in addition to helping troubled cooperatives and giving them the opportunity to reconcile their conditions before making a liquidation decision, or we merge them with another one."
In July, the Parliament's Economic Committee held several meetings to discuss the two briefing requests submitted by Representative Sarah Al-Nahhas regarding the reconsideration of categorical consumer cooperative stores and their general assemblies.
The committee further looked into a request for briefing submitted by Representative Nevin Al-Kateb regarding the expansion of the operation of outlets of consumer cooperative stores spread throughout Egypt to control merchants’ greed. It also examines the briefing request submitted by Representative Adel Amer regarding consumer cooperative stores and their role in mitigating and curbing prices.
Ahmed, a 33-year-old breadwinner, tells Arab Finance: "The expansion of consumer cooperatives is necessary because it will provide low-income citizens with products to help them overcome the prices."
Additionally, Ohood, a 50-year-old mother, tells Arab Finance that "consumer cooperatives are important, but only if they are managed fairly. At least the commodities in it are subsidized."
Consumer cooperatives have economic value as they play a role in supply and demand. Ahmed explains: “Among the most important roles performed by cooperative stores in the country is that they play a vital role in controlling prices and facing any kind of monopoly or misconduct while providing competitive prices that help stabilize the market price.”
Additionally, consumer cooperatives "aim to alleviate the burdens on citizens and fulfill consumers’ right to obtain quality and affordable goods," according to the CPA website.
In June, Ahmed Youssef Awadallah, General Director of Consumer Cooperatives Follow-up at the Ministry of Supply, confirmed that there are 4,000 branches nationwide and 2,700 cooperative stores. This was during the discussion of the plenary session of the Senate for the parliamentary study regarding activating the role of cooperatives in Egypt. Consumer cooperative stores could make a further economic contribution when they develop their operations. Ahmed says that “this development can be achieved by facilitating the delivery and availability of products and increasing the number of shops dealing with customers.”
Meanwhile, Egypt has already started the digital transformation of consumer cooperatives, as Hanna announced in 2021: "We started expanding sales through the associations' websites in response to the requirements of the times and to facilitate the citizens."
To further develop consumer cooperatives and promote them, Ohood explains that “they need to ensure having a good system and conscious employees.”
Moreover, consumer cooperatives can further be beneficial by "establishing new consumer cooperatives and introducing new non-traditional activities, such as packaging systems and selling fish and meat, as these activities provide great job opportunities that reduce unemployment," according to AlMarsad AlMasry.
Accordingly, consumer cooperative stores are important for citizens to face inflation and price fluctuations. By developing consumer cooperatives through digitalization and adopting new systems, their added value and economic contribution to the country would increase.
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