Encourages social cohesion

Most refugees and forcibly displaced people come from fragile and conflict-affected states, where social contracts have been undermined. Establishing structures that the local community trusts, as well as strengthening local governance, are both key to peace-building. Cooperatives and other SSE entities are well positioned to address the needs of both refugees/displaced people and host populations, because of their ability to combine practical assistance and support through collective action.

Economic empowerment

The SSE and cooperatives provide a platform for refugees and host communities to engage in income-generating activities. By forming cooperatives or associations, small-scale farmers and agricultural producers can pool resources, increase market access and facilitate sales for members. This collective action allows them to use their combined power to tackle issues such as access to land, negotiating prices with buyers and improved access to infrastructure.

Strengthens local governance

Cooperative structures strengthen local governance by promoting participatory decision-making and community ownership of development initiatives. The SSE and cooperatives establish trusted structures to localize service delivery. Cooperatives add value by localizing these services and adapting them to be relevant for the community they serve.

Improves access to wider services

Cooperatives act as entry points for delivering essential services like financial education, healthcare, and training in labour rights and child protection. They also facilitate access to finance. Forming a cooperative can serve as a guarantee mechanism for accessing financial services, such as opening commercial bank accounts for refugees who lack individual collateral or documentation.

Enhances resilience

Cooperatives enhance the resilience of communities by providing safety nets during crises and promoting sustainable development. Linking cooperatives to finance, such as through VSLAs providing revolving loans (Uganda) or facilitating access to commercial bank accounts (Ethiopia), helps pool and sustain financial resources, contributing to long-term resilience, independent of external support.