Rosario, Argentina: An Economy Based on Solidarity (5/10/05)

Faced with nationwide unemployment rates of 14%, and poverty levels of 33% what´s a municipality to do? The city of Rosario, Argentina’s third largest city with a population of 1.3 million, has developed some innovative responses to address the effects of Argentina’s economic crisis. Instead of resorting to privatization, the municipality is trying to redevelop the economy based upon local means while encouraging a cooperative as opposed to a capitalistic business model.

In 2001, the municipality opened the office of the Solidarity Economy. The basic goal of the department is to create and promote a city economy based on principles of solidarity and social equity. As Luis Martinez, the sub secretary for Solidarity Economy explains, this involves five main activities:

– Educating and working with unemployed people to help them develop and maintain democratically run cooperative enterprises. (e.g. educational workshops and training in cooperative management)

-Developing new forms of production and financing for these solidarity enterprises. (e.g. a communal warehouse for supplies, exclusive discounted loans)

-Working with the media and communication networks to develop a new consumer mentality based on solidarity principles. (e.g. community bulletins, public advertising)

-Developing municipal legislation that makes it easier for solidarity enterprises to operate successfully. (e.g. making registration easier, tax exemptions)

-Establishing and legitimizing the new solidarity economy. (e.g. developing and evaluating indicators to measure progress)

The Program for Food Production and the Office of Cooperative and Mutual Action are two programs run by the Office of the Solidarity Economy that incorporate the above activities.

Cristian, a resident of a shantytown in Rosario, is a participant in the Program for Food Production. After he shares with me some of the challenges of meeting consumer demand with his resources and his plans to expand and improve his enterprise, I tell him that he sounds like businessman and he smiles self-consciously hiding a touch of pride. Having completed two years of secondary education, it seemed unlikely that he would one day have his own business. In 2002, however, by attending a series of classes organized by the Program for Food Production, he learned how to make a variety of jams and jellies and preserve them in sanitized jars.

The Program for Food Production provides training in producing and selling foods such as: preserves, dried pasta, breads, desserts, flavored liqueurs and chocolates. The Program promotes cooperative action and discourages competition among the resulting enterprises. For example, the municipality sets equal prices for like products and encourages businesses to buy supplies in bulk together.

The municipality facilitates the development of these small businesses by providing small subsidies at the early stages of the business and adapting its local ordinances. Because the national food inspection program is inaccessible to these small, often family-based, businesses, the municipality created its own food certification program and sends its own inspectors to monitor the kitchens of participants in the Program.

To assist in providing a market for the goods, the municipality organizes seven weekly fairs held in public squares in prime city locations. The municipality provides specially designed checked tablecloths, matching aprons, headscarves and bright yellow tarps, and even transports the products to the fairs. At these fairs, participants in the Program for Food Production sell their goods alongside produce grown in Rosario’s urban agriculture program.

Cristian sells his products at two of the weekly fairs, though the majority of his business comes from selling his products to friends and people in his community. Now Cristian is even starting to exchange his products for fruits that he can transform into preserves. When I asked him what he has learned from his experience with the Program for Food Production he replied, "It’s helped me be more solidario."

Creating a culture of solidarity is also one of the goals of the Office of Cooperatives and Mutual Action. The work of the Office encompasses two projects: facilitating development of new cooperatives and acting as a liaison between cooperatives and the municipality.

Unemployed workers regularly come into the six-person basement Office of Cooperatives and Mutual Action following rumors of job opportunities. While the office does not provide jobs, it does provide trainings and services. Once a group of six people has been assembled who are interested in forming a cooperative (though not all parties may even be sure what that means) the office arranges a series of workshops.

Workshops guide participants in identifying their skills, evaluating the market, and deciding what services their enterprise will offer. Training courses are also needed, because "the notion of capitalism is ingrained," explained Juan Martin Atencio, a legal intern in the Office. Participants learn that a cooperative is a business that is jointly owned and democratically controlled, based on the values of mutual aid, responsibility, democracy, equality, equity and solidarity. The municipality provides a handbook, containing this definition as well as a chart identifying the differences between a capitalist business model and a cooperative one. The trainings also cover the history of cooperatives and the laws governing cooperatives in Argentina. The training can take up to two months depending upon the level of education of the participants.

Once the training process has been completed, the office helps the participants complete the paperwork required by national and provincial governments to register cooperatives (a service private lawyers often charge 500 pesos for). Though the fledging businesses must pay filing fees and taxes, the municipality does provide subsidies to them to purchase recordkeeping books.

In addition to providing trainings, the Office of Cooperatives and Mutual Action serves as a liaison between cooperatives and municipal offices. According to a local ordinance, municipal offices must opt to contract with a cooperative if one exists that supplies the need. When a government office needs to hire a painter, electrician, plumber, landscaper, or cleaning service, for example, they write a letter of request to the Office, who puts them in touch with a cooperative that can provide the service. This is the only program of its kind in Argentina.

The Office also ensures that members of the cooperative will do the work and that the cooperatives´ papers are in order. In 2004, the municipality made 412 contracts with approximately 45 different cooperatively run businesses. The total value of the contracts was 2,060,00 pesos. As the number of coops is growing at a faster rate than the number of government contracts available, the city is beginning to promote cooperatives to the private sector, meeting with trade associations such as the hospitality industry encouraging them to contract with cooperatives.

Through the Program for Food Production and the Office of Cooperatives and Mutual Action, the Office of the Solidarity Economy of the municipality of Rosario is trying to integrate the most vulnerable members of Rosario´s population into an economic system based on fairness and equity. Though there are limits to the municipality’s power — for instance, products made as part of the solidarity economy still sell for more than their mass-produced counterparts sold at supermarket chains — the programs of the solidarity economy are promoting dignified work for the under and un-employed, based on an alternative to the capitalist model.

Renate Lunn is currently traveling in Latin America. Read her travel blog at