Published: Thursday January 26, 2012 MYT 6:12:00 PM

Dishonesty main cause of failure of cooperatives, says Dr M

ALOR SETAR: Dishonesty involving the management or members of cooperatives is the main cause of the financial failure of cooperatives, said Tun Dr Mahathir Mohamad.

"I understand that there are more than 8,000 cooperatives in this country but only 20% are able to manage their business properly.

"If there are unsuccessful cooperatives and when investigated, their failure is found to be due to the stated problem (dishonesty). When you accept responsibilities, you must carry them out properly," he said at a talk held in conjunction with the International Year of Cooperatives 2012.

Dr Mahathir said there must be honesty and efficiency on the part of the management and members in managing money to ensure success.

He said managing a business based on the cooperative concept was not easy as it depended on people who were willing to work for a small payment, while the operating costs must be kept low in order to earn bigger profits.

Dr Mahathir said there were already many opportunities for Bumiputras to do business and if the opportunities were well-tapped, they would be able to control 60 per cent of the economy.

"We give the Malay Bumiputras the opportunity to do business in town areas through the franchise system since they don't know how to do it on their own while only a small capital is required and the promotions are already there.

"But they are not interested. Perhaps it's because it's a small business, hence a small profit to be gained. They want to go big, but if they don't want to start small, then we'll find mostly the Chinese doing business," he said.

On another note, Dr Mahathir said the government needed to find better markets than Europe due to the economic downturn there.

He was of the opinion that Europe would not recover in the next few years and was unable to compete with China, Japan and Korea.

"Europe is our trading partner, their trade with us is more than 20 per cent, but if they have no money to buy our goods, we cannot get the revenue.

"And if we are not careful, if we don't work hard but only asking for higher pay with no increased productivity, we will be like Europe," he said. BERNAMA

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