WILLEMSTAD — During the International Congress of Social Economy held on January 23–25, 2025, Chesron Isidora, former Director of the Development Bank and currently a financial consultant and business development expert, delivered a compelling presentation on the role of cooperatives in strengthening small and medium-sized enterprises (SMEs). His session, titled "Cooperatives: Creating a Competitive Edge for Small Businesses," explored the transformative potential of cooperative models in addressing the chronic challenges faced by SMEs.
Chesron Isidora
Understanding SMEs’ Challenges
Isidora began by identifying five prevalent issues that hinder SME growth:
Lack of Capital and Cash Flow – Many SMEs underestimate financing needs and struggle with cash flow management.
Weak Marketing and Branding – Inconsistent messaging and low online visibility limit growth.
Excessive Dependence on Key Individuals – Over-reliance on founders creates operational bottlenecks.
Limited Human Capital – Recruitment, training, and retention remain major hurdles.
Weak Networks and Alliances – Limited collaboration with industry peers results in missed opportunities.
He emphasized that adopting cooperative principles can mitigate or resolve these challenges by fostering collaboration, pooling resources, and leveraging collective expertise.
Cooperatives as a Solution
Isidora described cooperatives as member-run organizations that combine financial strength, knowledge exchange, and risk diversification. Unlike traditional businesses, cooperatives democratize ownership and decision-making, ensuring that benefits are shared equitably among members. He highlighted the potential for cooperatives to transform SMEs into resilient, innovative, and scalable entities.
Globally, cooperatives play a significant role in economic development:
12% of the world’s population is involved in cooperatives.
Cooperatives employ 10% of the global workforce.
The 300 largest cooperatives generate $2.4 trillion in revenue, equivalent to Italy’s GDP.
However, in Curaçao, cooperatives have largely focused on credit unions, which offer loans but do not capitalize on the broader economic potential of production and joint investment models. Isidora urged stakeholders to explore diverse cooperative models that empower SMEs and drive sustainable development.
Benefits of the Cooperative Model
Isidora outlined key advantages of cooperatives for SMEs:
Access to Capital – Pooling financial resources allows SMEs to secure funding with better terms.
Knowledge Exchange and Skills Development – Members benefit from shared expertise and training programs.
Risk Diversification – Collective ownership and revenue sharing reduce individual financial exposure.
Cost Reduction – Bulk purchasing and shared facilities lower operational expenses.
Real-world examples included:
Mondragón (Spain): A federation of worker cooperatives with its own bank, fostering financial stability and growth.
Amul (India): A dairy cooperative that united small producers into a national brand through collective knowledge and quality control.
Recommendations for Building a Cooperative Ecosystem
To unlock the full potential of cooperatives, Isidora proposed a multi-pronged approach:
Government Support: Implement preferential tax policies, cooperative development funds, and public procurement programs prioritizing co-ops.
Regulatory Frameworks: Simplify registration and compliance processes, especially for micro and small cooperatives.
Education and Awareness: Integrate cooperative principles into school curricula and launch public campaigns to showcase success stories.
Technology Adoption: Develop digital platforms for cooperative management, e-commerce, and financial transparency.
Relevance for Curaçao
In smaller territories like Curaçao, where SMEs contribute approximately 50% of GDP and employ 50% to 70% of the workforce, Isidora stressed the need for practical solutions to sustain and grow these enterprises. He highlighted the unique suitability of micro or small cooperatives, which operate with minimal bureaucracy and focus on business activities, enabling swift decision-making and agility.
Call to Action
Isidora concluded with a powerful message: “Cooperatives are more than just an economic model; they are a social strategy for creating resilience, equity, and opportunity.” He called on governments, regulatory bodies, and financial institutions to champion cooperative-friendly policies and support structures. Establishing cooperative development funds and advisory centers could catalyze the creation of new cooperatives and foster sustainable economic growth.
By embracing cooperative strategies, Curaçao and other regions can transform SMEs into pillars of economic resilience and community well-being, ensuring long-term prosperity for all.