The Ukrainian cooperative movement addressed the economic plight of the Ukrainian people through the creation of financial, agricultural and trade cooperatives that enabled Ukrainians to pool their resources, obtain less expensive loans and insurance, and to pay less for products such as farm equipment. The cooperatives played a major role in the social and economic mobilization of the Ukrainian people, most of whom were peasants. First begun in the 1860s, after 1917 the development of cooperatives was stunted by Soviet policies, but continued in Polish-ruled Western Ukraine, where by 1939 cooperatives had 700,000 members, employing 15,000 Ukrainians. The cooperatives were shut down by the Soviet authorities when western Ukraine was annexed by the Soviet Union in 1939. However, they continued to exist and flourish among Ukrainian emigrants and their descendants in the Ukrainian diaspora in North and South America, Europe and Australia.
History
Under Russian rule
The beginnings of cooperative movement in Ukrainian lands ruled by the Russian Empire belong to the 1860s. The first consumer cooperative was formed in Kharkiv in 1866 at the initiative M. Ballin. In 1869-1871 credit unions were established in Hadiach and Sokyryntsi, both in Poltava Governorate, by Hryhoriy Galagan. However, until the 1890s the development of cooperative movement under Russian rule was slow due to lack of popular initiative, deficient law and hurdles presented by authorities. During that period many cooperatives were supported by zemstvo organs. The cooperative movement became more active after the adoption of a special law in 1897, which allowed the approval of cooperatives' statutes by local governors, not by the central government as it used to be before, as well as the 1895 law on small-scale credit. After 1905, Ukrainian governorates of Poltava, Kyiv and Podolia took leading positions in the whole Russian Empire in respect to the number of cooperative societies existing in their territories. First cooperative unions in Ukraine emerged in 1901 in Berdiansk, in 1908 in Kyiv and in 1910 (?) in Vinnytsia. However, in 1913 those unions were dissolved, and replaced with the "South Russian Consumer Society" in Kharkiv, which operated as a filial of the Moscow Union of Consumer Societies. In the same year the 2nd All-Russian Congress of Cooperatives took place in Kyiv, also involving representatives from Western Ukraine. Among prominent activists of the Ukrainian cooperative movement under Russian rule were V. Domanytsky, O. Yurkevych, Khrystofor Baranovsky, Borys Martos, P. Pozharsky, Y. Voloshynovsky, Mykola Stasiuk, M. Levytsky and others. In Volhynia and Podolia a big role in the cooperative movement during the time of the Russian Empire was played by the monarchist Union of the Russian People, whose ideologists saw cooperation as a way of establishing economic dominance of the Orthodox population over Jews and other foreigners. In 1912 out of 204 cooperatives active in Volhynia 24 were created by the Union of the Russian People. In 1911 a credit bank was established by the Black Hundred activists in Pochaiv. In Kholm Governorate the cooperative movement was organized by a local Orthodox brotherhood. By 1917, 7,000 cooperative societies were active in Ukrainian governorates of the Russian Empire, serving 9 million inhabitants.
Under Austrian rule
The Ukrainian cooperative movement in Galicia, a western Ukrainian region that was part of Austria-Hungary, originated in the 1870s. Initially, the Ukrainian Prosvita society which had been dedicated to educational and cultural efforts attempted to organize credit unions, stores and warehouses. Its ability to do so was limited, however, by lack of experience in economic matters. The need for an experienced organizer was fulfilled by Vasyl Nahirny, a Ukrainian Galician architect and public figure, one of the "parents" of the cooperative movement in Galicia, who had spent a decade in Switzerland studying that nation's well-developed cooperative systems. In 1883 he organized Narodna Torhivlia ("People's Trade"), whose goal was to buy and sell products in large quantities, eliminate middlemen, and pass the savings on to the Ukrainian villagers. Through this cooperative Nahirny hoped to familiarize Ukrainians with commerce. Many other cooperatives followed. In 1899, Silsky Hospodar, whose aim was to teach the peasants modern farming methods, was founded. By 1913 it had 32,000 members. Dnister, an insurance company, was established in Lviv and by 1907 had 213,000 policyholders. Most important, however, was the rise of Ukrainian credit unions. Although some existed as early as 1874, the Vira credit union was the first to be stable and well-regulated. Typically charging approximately 10% interest for loans, hundreds of credit unions sprung up throughout Austrian-ruled Ukraine. They helped put traditional moneylenders out of business. In 1904, a central association of Ukrainian cooperatives was formed, which had 550 institutional affiliates and 180,000 individual members.
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