Minister Clarifies Relationship Between 'Red and White' Village Cooperatives and Existing Village-Owned Enterprises
The Minister of Villages, Development of Disadvantaged Regions and Transmigration, Yandri Susanto, has assured that the existence of the Red and White Village Cooperatives will not undermine village-owned enterprises (BUMDes). On the contrary, he said, the Red and White Village Cooperatives will be encouraged to collaborate with BUMDes.
Village-owned enterprises have distinctive business units, for instance managing tourist villages and export villages. Meanwhile, the Red and White Village Cooperatives will focus on the distribution of subsidised products.
Regarding the form of cooperation, Yandri gave the example that the Red and White Cooperatives could collaborate with tourist villages managed by BUMDes to supply their needs. “There is no overlap with the Red and White Village Cooperatives, it is simply cooperation,” he said at Graha Mandiri, Jakarta, on Monday, 20 July 2026.
He also assured that the Red and White Cooperatives will not eliminate small grocery shops in their vicinity. “It will be regulated in such a way that everything stays alive and remains strong,” said Yandri.
Yandri said his ministry would draw up rules on the operational aspects of village cooperatives, targeted for completion in August. He said the regulation would relate to setting the selling prices of products at the cooperatives.
In line with Yandri, Coordinating Minister for Food Zulkifli Hasan stated that the main function of the Red and White Village Cooperatives is to act as a distributor of subsidised goods and farmers’ produce.
Zulhas, as he is known, said village cooperatives are government infrastructure for channelling government assistance and subsidised products. Given these characteristics, Zulhas said village cooperatives would gradually act as offtakers of agricultural products. For example, buying farmers’ unhusked rice at Rp 6,500 per kilogram.
The PAN politician said the government was still finalising regulations in the form of a presidential decree concerning the operationalisation of the Red and White Cooperatives. According to Zulhas, these rules would serve as the foundation for the cooperatives’ operations, including distributing government assistance, subsidised products and carrying out market operations. “This is gradual because it cannot all be done at once,” he said.
Zulhas said the government targets the construction of 35,872 village cooperative outlets to be completed by August this year. Meanwhile, construction will continue next year.
According to the Village Cooperative Management Information System website managed by the Ministry of Cooperatives, 16,944 cooperative outlets had been completed as of Tuesday, 20 July 2026.
Meanwhile, a total of 38,053 plots of land have been proposed as locations for building cooperatives. Of that total, 2,190 plots have yet to be verified, whilst the other 35,863 locations have been verified.
Of the total verified plots, as of Tuesday, 20 July 2026, 18,447 locations were under construction, whilst 472 sites had not yet entered the construction stage.