Cooperative company in South Korea
National Agricultural Cooperative Federation (NACF/Nonghyup)
NACF Official Logo
. The 'V' shape signifies a 'bud' and 'rice', which means the eternal development of Korean agriculture while 'O' shape stands for 'smoothness', 'money' and 'cooperation'.
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NACF headquarters in Seoul
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Native name
| 農協中央會/農業協同組合
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Company type
| Cooperative federation
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Industry
| Banking, agricultural marketing & supply, livestock marketing & supply and extension services
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Founded
| August 15, 1961
; 62 years ago
(
1961-08-15
)
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Headquarters
| ,
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Area served
| South Korea
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Key people
| Lee Sung-hee
(Chairman)
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Revenue
| KRW 36.289 trillion (2011)
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| KRW 964 billion (2011)
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| KRW 703 billion (2011)
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Total assets
| KRW 305 trillion (2011)
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Subsidiaries
| Nonghyup Bank
NH Investment & Securities
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Hangul
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Hanja
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Revised Romanization
| Nonghyeopjunganghoe / Nongeophyeopdongjohap
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McCune?Reischauer
| Nonghy?pchunganghoe / Nong?p hy?pdongjohap
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Website
| www.nonghyup.com/eng
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The South Korean
National Agricultural Cooperative Federation
(initialized as
NH
(in Korean, derived from
N
ong
H
yup
) or
NACF
) was established in 1961 to enhance the social and economic status of its membership and to promote a balanced development of the national economy. Its role is divided into three areas:
marketing
and supply,
banking
and
insurance
, and
extension services
.
Terminology
[
edit
]
Although literally referring to local member cooperatives, the term
nonghyup
is used by
South Koreans
to describe both a local cooperative (Korean:農協) and the NACF (Korean: 農協中央會).
History
[
edit
]
- 2012 - NACF restructured into a federation with two holding companies, to increase effectiveness and competitiveness
- 2011 - Ranked ninth largest cooperative by the International Cooperative Alliance
[1]
- 2011 - Opened NH Residential Hall to accommodate 500 students from farming households
- 2011 - Launched 50th anniversary emblem and slogan
- 2008 - Ranked third largest cooperative by the International Cooperative Alliance
[2]
- 2008 - Opened International Banking(IB) center
- 2007 - CHOI Won-Byung inaugurated as
chairman
of the NACF
- 2006 - Hosted the 37th World Farmers’ Congress of the
International Federation of Agricultural Producers
(IFAP)
- 2006 - Launched NH Investment and Securities after the acquisition of Sejong Securities
- 2005 - Introduced the
CEO
system for each business division
- 2004 - Launched the "New Rural Community and New Agricultural Cooperative" campaign
- 2004 - Established Nonghyup Culture and Welfare Foundation
- 2002 - Co-founded NH-CA Asset Management, Ltd. with the
French
Credit Agricole
- 2001 - Hosted the
International Co-operative Alliance
(ICA)
General Assembly
- 2000 - Launched the integrated NACF,
consolidating
the federations of agricultural, livestock, and
ginseng
cooperatives
- 1998 - Acquired ISO 9002 certification for the NACF brand
Kimchi
, which was designated the official food for
1998 Olympics
- 1995 - Founded the Korea Agricultural Cooperative Marketing, Inc, a subsidiary for produce distribution and sales
- 1995 - Initiated the independent operation of the Marketing and Supply and the Banking and Insurance divisions
- 1989 - Introduced a
direct election
system for the president of member cooperatives and the chairperson of the NACF
- 1986 - Began supplying tax-free oil for
farm machinery
and equipment
- 1985 - Launched an IT center equipped with 360 online networks
- 1984 - Launched annuity and
fire insurance
businesses
- 1984 - Launched
credit card
services
- 1981 - Restructured the 3-tier organization to a 2-tier organization, consisting of individual cooperatives and the federation
- 1969 - Launched the mutual credit business
- 1961 - Established the NACF, consolidating agricultural cooperatives and the Agricultural Bank in accordance with Agricultural Cooperative Law
Member cooperatives
[
edit
]
Member cooperatives are democratically controlled,
autonomous
business groups, funded by member subscriptions rather than government financial investment. They, in turn, fund the NACF through institutional subscriptions. Cooperatives are governed by
directly elected
presidents, who, in turn, elect a chairman of the federation.
Member farmers and associate members
[
edit
]
Member cooperatives allow non-farmers, who have invested a certain amount of capital into the cooperative, to open tax-free bank accounts and access some services. However, whereas member farmers are defined as the genuine owners or
stakeholders
, associate members can only obtain limited access to or influence over the cooperative.
[
citation needed
]
As of December 2011, the number of the member farmers was 2,446,836 and the number of the associate members was 15,262,611. In 2010, these figures were 2,447,765 and 14,483,532, respectively, indicating a decline in member farmers of 929, and an increase in associate members of 779,079.
[
citation needed
]
Number of cooperatives
[
edit
]
At the end of year 2011, the NACF comprised 1,167 head branches, alongside 3,306 cooperatives.
Korean agriculture
[
edit
]
Recent international agreements have affected South Korean agriculture and by extension the effectiveness of the NACF. These include the
European Union?South Korea Free Trade Agreement
, implemented in July 2011, and the
Free trade agreement between the United States of America and the Republic of Korea
, which took effect on 15 March 2012. Proposed agreements include the
China?South Korea Free Trade Agreement
, the official
public hearing
of which was held at the
World Trade Center Seoul
on 24 February 2012.
Concerns over free trade agreements are reflected in the uncertain trends in Korean agricultural production. Total production by the agricultural sector in 2011 was KRW 44.62 trillion, up by 7.1% from 2010 (KRW 41.68 trillion) and including an 8.5% increase in the livestock and dairy sector. Conversely, the Korea Rural Economic Institute (KREI) expects the total production of agricultural industries to decrease by 1.1% in 2012.
[
citation needed
]
Operational restructuring
[
edit
]
On 2 March 2012, the NACF restructured its operations, establishing financial and marketing holding companies through the revised Agricultural Cooperative Law and a resolution of the
board of directors
on 2 February 2012. The new NACF performs as the center of the member cooperatives, governing the Extension and Support Unit, the Agricultural and Supply Business Unit, the Livestock Marketing and Supply Unit and the Cooperative Banking Unit.
Extension and support unit
[
edit
]
The NACF supports the operations and management activities of member cooperatives by providing education and training for their members and working to promote the rights of farmers. It also provides
investments
to develop and promote new agricultural technologies and products.
Marketing and supply units
[
edit
]
The NACF provides marketing support for the production,
distribution
, processing, and consumption of agricultural and livestock products, focusing particularly on increasing the income of farming households by expanding sales channels and reducing farming costs. This enables farmers to concentrate their efforts on farming.
Cooperative banking unit
[
edit
]
The banking unit serves as an intermediary and facilitator, providing loan and deposit services for member cooperatives and engaging in other incidental businesses. As of 2011, the total deposit is KRW 209 trillion and the total loan volume is KRW 146 trillion.
Subsidiaries and affiliated organizations
[
edit
]
NongHyup Financial Group
[
edit
]
Founded in 1961, NongHyup Financial Group was created from the merger of Agricultural Bank and Agricultural Federation. The objective of the financial holding company and its subsidiaries is to secure the funds and revenues necessary for the intrinsic activities of the NACF, and to provide differentiated banking services to its customers. The group provides financing, mortgages, personal lines of credit, corporate finance, real estate finance, and new technology finance services. It also offers life, property, and casualty insurance products.
Marketing holding company
[
edit
]
The objective of the marketing holding company and its subsidiaries is to vitalize the marketing and supply of agricultural and livestock products through advanced expertise and efficient product distribution.
- Korea Agricultural Cooperative Marketing Inc.
- Namhae Chemical Corporation
- Young Il Chemical Co., Ltd
- Nonghyup Hansamin, Ltd.
- Nonghyup Logistics Service, Inc.
- Korea Agricultural Cooperative Trading Co., Ltd.
- Agricultural Cooperative Pusan Kyongnam Marketing, Inc.
- Agricultural Cooperative Chungbuk Marketing Co., Ltd.
- Daejeon Agricultural Products Marketing Center Co., Ltd.
- Nonghyup-Agro, Inc.
- Samhyup Nongsan Co., Ltd.
- Nonghyup Feed, Inc.
- Nonghyup Moguchon, Inc.
Controversies
[
edit
]
In 2013, Rep. Bae Ki-woon (
Minjoo
) and monthly news magazine
Sisa IN
exposed NACF's unethical business practice of paying newspapers and other media outlets to run promo articles. Among the media outlets which received payment from NACF were newspapers
Dong-A Ilbo
(628.7 million won),
JoongAng Ilbo
(375 million won),
Chosun Ilbo
(56.6 million won),
Kyunghyang Shinmun
(33 million won) and
Hankyoreh
(12.5 million won), as well as news agency
Yonhap News
(132 million won) and news website
OhmyNews
(55 million won).
[3]
An NACF public relations employee, who requested anonymity, told
The Korea Observer
that it has paid media outlets in exchange for articles that promote the cooperative and its policies. The employee also said that NACF does not spend its money to bribe media organizations to stop publishing "negative" news against it.
See also
[
edit
]
References
[
edit
]
External links
[
edit
]
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Business Groups with a total asset over KRW 10 trillion, as designated by
KFTC
in 2023
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International
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National
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Other
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