MEMORANDUM FROM THE SANTIAGO SEMINAR

Antonio Romero Reyes
30 April 2001

The seminar took place this year between the 18th and 20th of April, at the  « El Canelo de Nos » centre in the San Bernardo district of Santiago (Chile). The theme of the event was: Social Money and the New Forms of the Economy of Solidarity, and its goal was to synthesise the debate that had previously taken place on the electronic forum (between the 5th of February and the 5th of April), thus contributing to the “Proposal Document” which would be put together by December 2001. This seminar is a part of the Social Money Workshop within the Workgroup on a Socio- Economy of Solidarity under the auspices of the Alliance for a United and Responsible World.

Peruvian participation was headed by Antonio Romero, on behalf of GRESP (Grupo Red de Economia Solidaria del Peru) and Yuri Cahuata on behalf of CEAS (Centro Episcopal de Accion Social). 37 people took part, coming from 10 countries and 3 continents (America, Western Europe and South-East Asia), including special guests such as Antonio Elizalde and Luis Razeto, both from the Universidad Bolivariana in Chile, as well as participants from other workshops, and Sergio Lub who represents the network Friendly Favors (http://www.favors.org). The largest representation was from the host country (Chile) with 13 people, followed by the Argentinean delegation with 8, who together were also responsible for the organisation and running of the event.

EVOLUTION OF THE SEMINAR

Introduction of participants (18 April)

At 6 p.m. participants in the seminar began a round of introductions, presenting their projects and/or the assignments of their respective bodies. 

Work in open session (19 April)

This day’s programme was composed of presentations and debates in open session, which took place in the following order:

Introduction of participants 
•	Introduction of the Alliance and REDLASES
•	Presentation of a summary of the document debated on the Forum
•	Round table discussion with participants (in groups of 2)
•	Presentation about Social Money experiments.

The Social Money group is one of fifteen workshops that are part of an overall theme (the workgroup): Economy and Society. During the meeting at Findhorn (Scotland), arranged for June, the various syntheses, from each of the workshops, will be consolidated. Each group, after its own meeting like the one in Santiago, has to produce a summary text (for which the organisers are in charge), which is then submitted for discussion on each of electronic forums, so that it can be enhanced by contributions from the electronic forum, the meeting of the workshop and by specialists.

The main presentation looks further into the nature of The Global Trading Network (Red Global de Trueque, or RGT), which, at the present time – it has to be said – is the most representative social money experiment from this part of the American continent, after having started 6 years ago in a suburb of Buenos Aires and having progressed in organisation, size and membership throughout a number of Argentinean provinces. The spread and the marketing of the RGT to other countries have given rise to similar experiments, particularly in Brazil and Chile. As far as the Andean Region is concerned, the Argentinean experience has inspired the example of Rumihuaico and Toctiuco, in Quito - Ecuador, and the  "Centro de Servicios de San Marcos" in the department of Cajamarca, in Peru.

The ingredients that help explain a large part of the success of the RGT in Argentina are summed up in the  "Nine Laws of God" (Kevin Kelly) or laws of complexity:

1. Decentralised growth in small autonomous units (barter clubs or « nodos »)  
2. A grassroots power base.
3. Growth for the individual and the locality rather than the involvement of large groups.
4. Innovation whilst learning from mistakes (there is no ready made formula).
5. Taking care to create increasing benefits, in the sense of encouraging favourable circumstances.
6. Following multiple goals. 
7. Maximising that which is on the fringe (that which is new): 
8. Loving uncertainty in that it encourages change and evolution.
9. Accepting that change changes.

It is interesting to consider the development of the RGT. The experiment started among a small group of people in a village near Buenos Aires (Bernal), and then spread throughout the neighbourhood, then throughout the town, giving rise to barter clubs and then to « nodos ». The upshot was that the experiment was able to multiply, reproducing itself throughout the communities and provinces of the country. In this way the phenomenon suddenly appeared in the urban periphery taking over new areas (town, village, province). Today it is present in at least 15 provinces and 60 communities in the country, affecting not less than half a million people divided between 400 and 500   nodos.
Obviously communication and information facilities, as well as the urgency and necessity for people to find a solution to the crisis of unemployment in Argentina, have been important factors that, among others, have helped the relatively rapid growth of this experiment, as well as the imitation on the part of urban operators in different areas. To sum up this experiment in a few words, one could say that it embodies a model of change supported by three main axes: the exchange of products and services, permanent availability of, and sharing, of information and training. This model has allowed the inclusion of people who are not working or, even if they are working, do not have the necessities to survive, as well as people with various productive abilities, unused resources and manual or intellectual skills not usually associated with capitalism or the conventional world.
 
This model functioned in a very fluid fashion, starting from a collective base of material resources and human abilities that had been underused/rejected by the economic system, but which were capable of satisfying immediate needs. However, over time this stock of resources and abilities diminishes whilst the scale and variety of needs increases, posing problems of reproduction (and accumulation) for this alternative system. In other words, the continued existence of the system, in the medium and long term, depends on production (the raw material) that is not necessarily found within the network: for example, milk for cheese production, cloth for the production of clothes.

This position was already anticipated by the developers/founders, and its strategic importance was addressed in the Institutional Collaboration Accord (Convenio Marco de Colaboración Institucional) signed with the Minister of the Economy.

The links with the State have been one of the aspects discussed the most, especially with respect to the political and social costs and benefits. The leaders of the RGT have been divided on the political interpretation of the economic approach enshrined in the accord mentioned above; is it a question of the institutionalisation/cooptation of the experiment? A new form of social assistance? Or perhaps a citizen initiative

Other more technical aspects which have inspired questions and comments from participants: the relationship between emission and inflation (definition of the rules, risks), price and worth, links between the business sector and cooperatives, community purchasing, the decision making process.

After the discussion, the main part of which was the presentation on Social Money, principally the Argentinean Experience, and before going on to the experiences in other countries, Luis Razeto classified the factors that he considered to be important, highlighting in particular questions of methodology and procedure, and setting them out within the conceptual framework of the economy of solidarity.

In order to present the Social Money experiments we will begin by mentioning those that have either directly, or indirectly, been influenced in the region by the RGT model (name of the money in brackets):

•	Argentina: Nodo de Catamarca (Talento). Presented by: Juan José Sánchez
•	Brazil: Banco Palmas (Palmares). Presented by: Ruth Espínola and Sandra Magalhaes
•	Chile: Red de Trueque de Santiago (Talento). Presented by: Enrique Peña
•	Peru: Centro de Servicios de San Marcos, Cajamarca (Alternativa). Presented by: Antonio Romero

Experiments inspired by LETS and SEL systems:
•	United States: Tucson Traders (Token). Presented by: Thomas Greco
•	France: Local Exchange Systems. Presented by: Smaïn Laacher
•	Thaïland: Community Money System (Bia Kud Chum). Presented by: Wanlop Pichpongsa

Exchange experiments not using social money:
•	Equator: Maquita Cushunchic - "Comercializando como Hermanos". Presented by: Rubén Tapia and Padre Graziano Mason
•	Columbia: Confederación Latinoamericana de Cooperativas-COLACOT. Presented by: Francisco Verano

Other networks:
•	Red de Planificación Participativa y Gestión Asociada - PPGA. Presented by: Héctor Poggiese
•	Friendly Favors network (Thank you). Presented by: Sergio Lub

From this list we will pick out two experiments: those of Banco Palmas (Brazil) and the Community Money System (Thailand); the former operating in a marginal urban zone, in Fortaleza in the state of Ceara. The second situation is interesting because, in contrast, it has developed in five villages in rural areas in the northeast and south of Thailand. Here follows a brief description of the two initiatives.

« Banco Palmas »

In the Brazilian experiment, the market where the exchange of products for « palmares » takes place is called the « exchange club », the bank operating as a facilitator of exchange: in the opening phase the bank negotiates and arrives at an agreement with each person on the price, on this basis the people hand over products and in exchange receive a « credit » from the bank in « palmares » which they then use to acquire the products that they need. During the first phase (negotiation, hand over of products, and issuing of money), the bank acts as a purchaser and in the second phase, strictly speaking the market, the bank acts as seller. In this way the bank offers the products that it received at the price originally decided. At the end of the market, if everything has been sold, the money returns to the bank. The rule is that everyone must buy on the day of the market (it is forbidden to save “palmares”). This entails a system of control so that the “palmares” are not reused.

The result of this very particular market is a sort of Walrassian equilibrium where all the products sold to the bank are subsequently bought and consumed (supply is equal to demand), the price at which these transactions take place is therefore constant and the amount of money in circulation during each market, to enable these transactions (credits in the form of "palmares"), returns to the bank, resulting in zero inflation.

The main impact of this model has been on jobs, benefiting about 4000 inhabitants in the Conjunto Palmeira Community Association and similarly fostering local community spirit.

Apart from serving as areas of social experiment, enabling the bridging of community, institutions and local power, these exchange markets, “parallel” to those where the national currency circulates, should serve as training laboratories for students of economy, since it is here that they can check or discover the “real” situations and practices that allow models of neo-classical equilibrium to operate in accordance with all their postulations, hypotheses, presumptions and theories. In my humble opinion, these procedures would be an excellent way to challenge the dogmatism of economic teaching offered in universities, where students have to uncritically absorb a boring litany of mathematical models drawn up in the developed world. There are many that leave university believing that the real world must adapt itself to theories or models of textbook economics (in fact it is the other way round) and, when they are asked to explain real situations, they summon up – like magic words – the allegedly universal concepts and principles of market, concurrence and equilibrium.

Systems of Community Money.

The Thai Community Currency Systems Project (TCCS) is an initiative that started in March 2000 with the crucial help of Stephen DeMeulenaere (http://ccdev.lets.net and http://concentric.itgo.com), who has been one of the world’s most active proponents of social money for the last 11 years and who is currently working with rural communities in Indonesia and Central Java.

The TCCS –– as mentioned above –– covering five villages in rural areas, is a project developed by the Local Development Institute, a Thai NGO (non governmental organisation) supported by a Canadian volunteer from CUSO (http://www.cuso.org), whose funding comes from the Canadian International Development Agency (CIDA), private foundations and individual contributions.

Of the two areas where the project is taking place, the poorest is in the northeast. In Thailand, the Asian crisis of 1997 increased the level of poverty by 4 million people (according to the World Bank the level of poverty passed the 9 million mark in 1997 and 13 million in 2000). In this area, subsistence agriculture has been replaced by more intensive commercial monoculture (eucalyptus plantations, tapioca, market gardening), forcing the small-scale farmers (who had to sell their property to pay their debts) off their land and causing environmental problems (deforestation, reduced soil fertility,etc).

The southern region (the Malaysian Peninsular) has benefited more from public policy. In fact, it has been transformed into a large-scale export region, producing rubber, shrimp, prawn etc. But in common with its northern neighbour there are problems of environmental decline and poverty among small-scale farmers.

As a result, community money, in this part of the world, can be seen as developing in response to adverse circumstances linked to an increase in poverty, environmental deterioration and, consequently, a worsening standard of living for the small-scale farmers in these two opposite areas of Thailand.

Kud Chum, in the province of Yasothon, is a district in the northeast, where the TCCS project is taking place, and where rice cultivation is the main economic activity. TCCS is a hybrid system that has adapted the Local Trading System (LETS) to the local trade and work exchange practices. In this sense, the community money, called Bia Kud Chum, is a way of enabling the exchanges, and the issuing of credits, to be controlled by the community itself. The system requires no interest payments and consists of a simple system of accounting debits and credits. It allows values to be fixed at the moment of exchange in working hours, national currency or local money (community value), assuming an equal relationship between them. Some transactions (the special cases) can include payment in official currency in such a way that sellers are reimbursed for real costs included in the product (material or other, bought in the formal market).

The relationship of monetary equality between the community money (the Bia) and the official currency (the Bath) is 1:1, even though the former cannot be converted and its circulation is restricted to the local area. The credit limit is 500 bias per person.

In contrast to the Brazilian situation previously looked at, where the market is emptied on the day of the market, within the Kud Chum exchange (and barter) are differed in time: the purchaser receives products from the seller valued in local money, producing a movement in each persons accounts (credit for the seller and debit for the purchaser). The purchaser is obliged to reimburse it (after a certain amount of time) with products or services equal to the credit he received. The accounts are balanced once the purchaser repays his “debt”.

What makes this experiment interesting, is that the use of the TCCS, in this specific case in the Kud Chum, has allowed a mobilisation of resources and abilities that were unused by the villagers thus giving a new impetus to the local economy. It is without doubt that this exchange experiment will soon link up to other development initiatives on behalf of the Thai NGOs.

On the first page of Parallel, Local & Community Currencies in Asia, Africa & Latin America (http://ccdev.lets.net/asia/asia.html#thai) there are a number of interesting references, such as the comparison that has been made with the Mexican Tlaloc (article: Mexico & Thailand: Community Currency Systems); or the reaction of the Thai government that considers the system of community money as a “threat to national financial security”, discussed in the editorial of 7th May 2000 under the title: The sledgehammer and the Northeast village nut, Thailand's Independent Online News & Information Service (http://ccdev.lets.net/asia/thailand/nationedMay7.html).

Group Work (20 April)

This second day was dedicated to group work, after the presentation of the last experiments present (COLACOT, PPGA, and Friendly Favors). Participants split into four groups divided around two main topics: 1) internal development of alternative economic forms (understood to mean orientated towards an alternative economy) and 2) external development in terms of links and new strategic alliances. Groups were asked to make their contributions in terms of strategic analysis (Strengths-Opportunities – Weaknesses-Threats).

We will present hereafter, the main points of the conclusions, proposals and questions raised by the groups.

THEME I:  ALTERNATIVE FORMS OF ECONOMIC DEVELOPMENT

Group 1. - Proposal for a "multinational ":

•	Using the consumer’s power and the capitalist’s money
•	Creating a network full of internal flexibility
•	Defining strategic alliances with sectors of production

Group 2. - Conclusions and recommendations about the experiments:

•	Social Money as an instrument
•	Collective production
•	More humane relationships
•	The question of scale
•	Exchange between « nodos »
•	Conditions necessary for local money to be used at the regional level
•	Relationship with the State: Opportunity or Threat?
•	Differences between Latin America and elsewhere
•	In house training

THEME 2: NEW STRATEGIC ALLIANCES

Group 3. -  Recommendations

•	Moving from micro experiments to integrated macro experiments
•	Fields of possible alliances
•	The economy of solidarity itself
•	Other sectors of society and the State
•	International areas

•	Crossover of action
•	Networks of trust (confiabilidad)

Group 4. - Conclusions and recommendations

•	Importance of words (of debate) for strategic alliances: 

•	They give a sense of general interest and common good.
•	They are necessary for discovering the complexity of specific experiments (a collective knowledge)

•	Conditions for alliances:

•	Don’t forget human relations
•	Justice and equity
•	Specific knowledge should be shared

•	Export the « imagination » inherent in the experiments. Examples: France (Academy, SELs), Chile (Universidad Bolivariana).

•	Boundaries exist mainly in our minds.

To finish the group work, the organisers asked for a project to be proposed (at idea level) in and from each country, which would serve as a sort of commitment on behalf of the participants with the rest of the group in the Forum. The following was the Peruvian proposal, highlighting three strands of intervention: 

1)	To bring together the experiments in the Andean countries, particularly in Equator and Bolivia, and share experiences
2)	AsGRESP, work out exchange projects using social money, which could be intended for a poor rural area, a marginal urban zone in a town or an area combining both.
3)	Relationship with the State: using areas already open (Comité de Lucha Contra la Pobreza, Comisión de la Verdad) to introduce the idea and envisage potential opportunities or threats.

------------------- o0o -------------------

INTERNATIONAL SEMINAR

SOCIAL MONEY AND NEW FORMS OF THE ECONOMY OF SOLIDARITY
El Canelo de Nos, San Bernardo, Chile
18 to 20 April 2001

Wednesday 18 April	
During the day	Arrival of participants in Santiago 	
18:00-19:00	Registration
	Reception
Presentation of documents	

Thursday 19 April	
09:00-10:15	Presentation of participants
	Presentation of institutions / experiments represented	
10:15-10:45	Discussion of working document and brief presentation of the debate from the electronic forum	Presentation from Heloisa Primavera 
Presentation from Françoise Wautiez
Proposals for working methods	
10:45-11:00	Coffee		
11:00-13:30	Group work 	Organisation of working groups (5)
Contributions, questions and new proposals	
13:30-14.30	Meal
	
14:30-16:00	Open session	Presentation of critique and contributions; new proposals from the groups (1) 	
16:00	Coffee		
16:30-17:30		Presentation of critique and contributions; new proposals from the groups (2) 	

Friday 20 April	
09:00-10:45	Open session	Brainstorming proposals 	
10:45-11:00	Coffee	
11:00-12:30	Group work	Contributions towards a new collective text: which takes into account the different proposals and contexts	
12:30-13:30	Open session	First draft summary	
13:30-14. 30	Meal	
14:30-15:30	Open session or groups	Contributions towards a new collective text: which takes into account the different proposals and contexts	
15:30	Coffee		
16:00-17:00		New compromise until 15 May 2001 /until 20 November
2001	
OPEN MEETING
18:00-20:00	Presentation of the Chilean « Nodos » experiments that exist and projects underway. Presentation of the different experiments present at the Seminar. Reception.	

   INT ERNATIONAL  SEMINAR SOCIAL MONEY
El Canelo de Nos - San Bernardo (Chile) 18-20.04.2001	
NAME	COUNTRY	INSTITUTION	ADDRESS/TEL	E-MAIL	
Heloisa Primavera	Argentina	RedLASES - RGT
Nodo Obelisco	Posadas 1120     26C
(1011) Buenos Aires 
4815.6824	heloisaprimavera@infovia.com.ar  
www.redlases.org.ar
http://money.socioeco.org	
Carlos del Valle	Argentina	RedLASES - RGT
Nodo Obelisco	French 3034  PB 2
(1425)	Buenos Aires
4821.9939	cibercharli@house.com.ar	
Roberto Pintos 	Argentina	RedLASES - RGT
Nodo Obelisco	Posadas 1120     26C
(1011) Buenos Aires 
4815.6824	rdpintos@hotmail.com
	
Carlos  A.Monaco	Argentina	Trueque Zona Oeste
RGT	Almirante Brown 192
Paso del Rey, P Buenos Aires
0237.462.5703	truequezonaoeste@sinectis.com.ar
	
Hector Poggiese	Argentina	FLACSO – 
Redes PPGA	Ayacucho 551
(1046) Buenos Aires	poggiese@flacso.org.ar
hpoggiese@psi.uba.ar
	
Walter Morroni	Argentina	FLACSO – 
Redes PPGA	Av. Hipolito Yrigoyen 9524, (1832) Lomas de Zamora
Buenos Aires	wmorroni@psi.uba.ar
wmorroni@hotmail.com
	
Carlos Sanhueza	Argentina	COLACOT	PatriciasMendocinas 634 PB1 
(5500) Mendoza	sanhue@arnet.com.ar
csanhueza@arnet.com.ar
	
Juan Jose Sanchez	Argentina	Be Pe  -   RedLASES	Av. Güemes 1121
(4700) SFV Catamarca
fono: 54.3833.430915	bepecentral@infovia.com.ar sanchezpalladino@arnet.com.ar
	
Armando de Melo Lisboa	Brasil	Univ.Federal 
Sta. Catarina	Rua Marcos Cardoso Fo. 286 
Florianópolis (88037-040) SC	alisboa@mbox1.ufsc.br
	
Fabio Búrigo	Brasil	CEPAGRO	C. Postal 6073 (88036-971)
Florianópolis, SC f:33.43176
	burigo@mbox1.ufsc.br	
Ruth Espínola	Brasil	PACS -  Instituto de Políticas Alternativas para el Cono Sur	Rua Joaquim Silva 56- 8º
Lapa, Rio de Janeiro, RJ
(20.241 – 110)	pacsruth@alternex.com.br	
Sandra Magalhaes	Brasil	BANCO PALMAS		asmoconp@br.homeshopping.com.br	
Francoise Wautiez	Chile			amaru@liberty.net	
Paulina Pizarro	Chile			tahoma@netline.cl	
Bernardo Reyes	Chile	Instituto de Ecologia Politica	Seminario 776 Ñuñoa 
Santiago	breyes20cl@yahoo.com
iep@vtr.net
www.iepe.org	
Luis Razeto	Chile	Universidad Bolivariana	Huérfanos 2917 
Santiago	luisrazeto@hotmail.com
www.economiasolidaria.net 
	
Antonio Elizalde	Chile	Universidad Bolivariana	Huérfanos 2917
Santiago
681.5301	elizalde@ia.cl
elizalde@mcl.cl
	
Luis Hidalgo	Chile	PET	Solero del Río  492  Piso 5º
Santiago 	hidalgo@pet.tie.cl	
Jessica Aravena	Chile	EL CANELO DE NOS	Av. Portales 3020
San Bernardo	canelo@rdc.cl	
Francisco Florez	Chile	Mvto. Furiosos Ciclistas	Av. J. Pedro Alessandri 1655
Ñuñoa   Santiago	focoff@latinmail.com	
Enrique Peña	Chile	Agrup. Cult. Parque Forestal	J.M. de la Barra 449  of. 11
Santiago	grupoculfor@mixmail.com	
Thomas Hardy	Chile	Unibol		thommyh7@hotmail.com	
Heidi Marchetti	Chile			hmarchet@yahoo.com	
Horacio Azocar Bustamante	Chile	COLACOT-CONFECOOP	Universo 7389
Cerrillos - Santiago	horazo@yahoo.es
	
Christian Palma	Chile	Nodo Calahuala Valparaiso	Mackenna 157
Cerro Yungay, Valparaiso	itinerante@terra.cl
aguilaresonante@yahoo.es	
Luis Francisco Verano Paez	
Colombia	
COLACOT	Calle 36 No 22 / 16
Bogotá
Fono: 335.0304	colacot-col@hotmail.com
colacot-col@usa.net
colacot-col@mundomail.com	
Padre Graziano Mason	Ecuador	MCCH- Fundación Maquita Cushunchic	Casilla 17 – 19 – 0010
Quito	fund@mcch.ecuanex.net.ec	
Ruben Tapia Mantilla	
Ecuador	RELACC-Red Latin. AmComercializacion Comunitaria	Casilla 17-19-0010
Moro Moro y Rumichaca
Barrio Turubamba	relacc@uio.satnet.net	
Alfredo Velazco	Ecuador		Victor Manuel Rendón 621
Guayaquil	avelazco@impsat.net.ec	
Smaïn Laacher	Francia	SEL de Paris	8 bis rue Campagne 1ere, 75014 Paris	smain.laacher@wanadoo.fr	
Henk van Arkel	Holanda	Aktie Strohalm	Oudegracht 42
3511 AR Utrecht
3230. 231.4314	
henk@strohalm.nl	
Camilo Ramada	Holanda	Aktie Strohalm	Oudegracht 42
3511 AR Utrecht
3230. 231.4314	
c.ramada@strohalm.nl	
Sergio Lub	Estados Unidos	Friendly Favors	3800 Vista Oaks Dr.
Martinez, CA, 94553, USA
925.229.3600	sergio@favors.org
sergio@favores.org
	
Thomas Greco	Estados Unidos	CIRC
520.195.8930	P.O.Box 42663
Tucson. Arizona 85133	circ2@mindspring.com	
Antonio Romero	Perú	GRESP		antorom@ec-red.com	
Yuri Cahuata Pilares	Perú	CEAS	Av. Salaverry 1945
Lince, Lima  471.0790	ycahuata@ceas.org.pe	
Wanlop Pichpongsa	Tailandia	TCCS	693 Bumrungmuang Rd
Bangkok   66.2.621.7810	tccs@loxinfo.co.th
wanloppich@hotmail.com