PREPARING THE ECONOMIC STRUCTURE OF MALUKU SOCIETY
FACING THE ERA OF GLOBALIZATION
(Study From a Business Law Perspective)[1]
Theresia NA Narwadan
Introduction
Globalization etymologically is the increasing interconnectedness and interdependence between nations and people throughout the world through trade, investment, travel, popular culture, and other forms of interaction so that the borders of a country become increasingly narrow or in other words, globalization is a process where individuals, groups, and countries interact, depend, are related, and influence each other, which crosses national borders. Maluku, a trading area that has been known since the Portuguese colonized the archipelago, is certainly not spared from this globalization.
Each region has a distinct pattern of economic growth. Therefore, in planning the economic structure of a region in the face of globalization, it is first necessary to understand the physical, social, and economic characteristics of the region itself, including its interactions with other regions.
Maluku Province is an archipelago consisting of 559 islands. According to Governor Decree Number 460.a of 2011 concerning the Determination of the Number, Name and Code Number of the Administrative Areas of Maluku Province in 2011, administratively Maluku Province is divided into 11 (eleven) Regencies/Cities, 90 (ninety) Districts and 1.022 (one thousand twenty-two) Villages/Sub-districts. The population of Maluku Province based on the results of the 2000 Census of the Central Bureau of Statistics of Maluku Province reached 1.200.067 people. This number increased from year to year, in 2008 to 1.440.014 people and in 2011 to 1.575.965 people. The population growth rate of Maluku increased in the period 2000 – 2010 compared to the period 1990 – 2000. This is because security conditions in this region have begun to become conducive, resulting in an increase in population inflow.
One measure often used to determine the economic condition of the population is the Labor Force Participation Rate (LFPR). This measure is usually used to determine the supply of labor. LFPR in Maluku Province in 2011, based on data from the Central Statistics Bureau of Maluku Province, was 69,47 percent. When viewed per Regency/City, it varies, 8 Regencies/Cities that have LFPR above the Provincial figure are West Southeast Maluku Regency 70,90 percent, Southwest Maluku 71,04 percent, Southeast Maluku Regency 69,98 and Buru Regency 70,85 percent, West Seram Regency 72,54 percent, East Seram Regency 72,37 percent. Meanwhile, LFPR in 3 other Regencies/Cities is below the LFPR of Maluku Province. Furthermore, the number of labor registrations in 2010 according to the level of education completed was high school graduates dominating with 63.756 people (69,35%), universities 12.852 people (13,98%), academies 10.776 people (11,72%) and the remaining 3.957 people high school graduates (0,71%) and elementary school 597 people (0,65%).
From an economic aspect, in 2009 fisheries production in Maluku Province was 50.896,8 tons and in 2010 it rose to 52.423,7 tons or an increase of 3 (three) percent, and the increase in fisheries production occurred in all types of fish.
The harvested area of paddy fields in Maluku Province in 2010 was 17.779 Ha or decreased by 4 (four) percent compared to the previous year, which was 18.545 Ha. Meanwhile, the harvested area of dryland rice in 2010 was 2.454 Ha or decreased by 9,35 percent compared to 2009, which was 2.707 Ha. The harvested area of sweet potatoes in 2010 was 2.428 Ha, decreased compared to 2009, which was 2.612 Ha. Fruit production in Maluku in 2010, some commodities, including those exceeding 1000 tons, are as follows: banana production of 8.095 tons, Durian 3483 tons, Duku 2.055 tons and other fruits below 1000 tons. Plantations in Maluku Province are generally People's Plantations. The production of smallholder plantations in 2010 was 74.306 tons of coconut, 8.106 tons of cloves, 2.347 tons of nutmeg, 4.757 tons of cocoa, 785 tons of coffee and 1.271 tons of cashew nuts.
Preparing Community Structures to Face the Era of Globalization
1. Understanding Regional Economy
The main issues in preparing the structure of society to face the era of globalization that need to be recognized include the following:
a. Population Development and Urbanization
Population growth is a major factor in economic growth, capable of rapidly transforming a region from an agricultural village to an agro-politan area and then into a large city. Population growth occurs through natural growth and urbanization. Natural population growth is a major factor influencing a region's economy, as it creates demand for various goods and services. A growing population requires food. New households also require new homes or renovations to existing ones, along with furniture, household appliances, and various other products. This fosters the growth of agricultural and industrial activities in Maluku.
Urbanization is carried out by young people who go to seek work in industries or companies far from where they come from. Migration to cities from villages or small towns has become a trend over time due to the influence of television, labor recruitment companies, and various other sources. This urbanization of young people is seen by those who carry out their economic needs, but it is an unfavorable event for the region, because it ultimately reduces the workforce managing the local area, so that the region's potential cannot be optimally utilized. The results of the population census conducted by the Central Bureau of Statistics of Maluku Province in 2012, for the area of Ambon City as the capital of Maluku Province, the highest density is 903 people per km2 and the lowest density is in West Southeast Maluku Regency, at 10 people per km2. To reduce this outmigration, local governments should begin training the workforce in the first years of working age by providing part-time jobs, then planning for their future as adults who will one day start a family. One way to encourage them to remain in villages or small towns is to provide suitable employment opportunities.
Educational institutions and the business world also need to recognize the need to build collaborative relationships. Education seeks ways to make communities useful to local businesses, and local businesses rely on education to improve the skills of the local workforce.
b. Fisheries sector and agricultural sector as supporting sources of regional income from the Fisheries sector.
Development activity is constantly occurring in every populated area, but some areas have stalled or even stopped altogether, leaving these areas as second-class economic zones. This results in investors and businesses leaving these areas, as they are deemed no longer suitable for business. Consequently, the region's economic growth rate slows.
Cooperation programs with investors can be an alternative to overcome capital limitations, reduce production risks, enable fishermen and farmers to use quality raw materials, so that the resulting products can be competitive, thereby increasing the income of fishermen and farmers in Maluku Province.
c. Tourism Sector
While Maluku is largely an archipelago, clean coastal areas can be a regional attraction, drawing tourists and residents to the area. As recreational destinations, coastal areas can be more commercially viable than other areas, depending on their characteristics. However, as a limited natural resource, it's crucial to consider that coastal areas must be an economic asset for the region. Developing these areas with various activities such as diving, surfing, camping, fishing and others, will help expand tourism and reduce the gap due to unemployment.
d. Environmental Quality
Perceptions of a region, including whether it has a good quality of life, are crucial for businesses to invest in. Local government investments that improve the quality of life for residents are crucial for maintaining competitiveness. If local governments want to attract capital and investment, they must be prepared to prioritize diversity, identity, and a welcoming atmosphere. The introduction of amenities to enhance the quality of life enjoyed by residents and attract foreign investors is essential.
Historic areas are important contributors to environmental quality. Preserving historic areas is linked to various aspects of the local economy, such as regional finance, housing, small-scale commerce, and tourism, creating significant employment opportunities. These activities contribute to the quality of life, enhance community image, and attract income-generating economic activities. Preserving historic areas protects cultural heritage and creates a pleasant place for people to live. Investors and developers generally assess the strength of an area through the quality and character of its landscape, one of which is the preservation of historic areas.
In addition to natural and cultural assets, public infrastructure is a crucial driver of business activity. The level of comfort of life in a region can be measured by the availability of public infrastructure. Public infrastructure is the main framework for economic development and is crucial for community activities. The most basic public infrastructure includes roads, ports, optimally functioning power plants, irrigation systems, clean water facilities that reach all residential areas, waste and waste collection and processing, educational facilities such as schools, playgrounds, green open spaces, places of worship, and many other facilities related to the community's daily activities.
2. Pro-Business Regional Development Management
Local governments and entrepreneurs are the two most influential groups in determining the pattern of regional economic growth. Local governments have advantages in some areas and, of course, limitations in others, as do entrepreneurs. Synergy between the two in planning how the regional economy will be directed requires a shared understanding. Local governments have the authority to create various regulations, provide various facilities and opportunities, and shape public perceptions. However, local governments are less aware of how economic activity actually occurs. Entrepreneurs have the ability to identify the needs of the masses and, through various initiatives, meet those needs. Meeting these needs keeps the wheels of the economy turning, generating salaries and wages for workers and taxes for the government. Through taxes, local governments have the opportunity to create conditions for further regional economic development.
Some efforts that the Maluku Government must make to prepare the economic structure of society to face the era of globalization are:
1. Preparing human resources who are competent, competitive and have good skills in facing global competition.
2. Implement standardization and certification for companies and government institutions for image, sincerity and product quality.
3. Eliminate the practices of corruption, collusion, nepotism and manipulation
4. Encourage local entrepreneurs, especially small and medium-sized entrepreneurs, to compete healthily.
5. Encourage the emergence of creative and innovative products from the Maluku community.
Ultimately, globalization isn't something to be avoided, but rather something to be embraced. Maluku Province, with all its natural resources and human resource potential, can certainly compete amidst the currents of globalization, as long as the government, entrepreneurs, and people of Maluku work together to create a better Maluku in the future.
Reading List:
www.kompasonline.com, accessed March 9, 2013;
www.liputan6.com, accessed March 9, 2013;
www.metrotv.com, accessed March 8, 2013;
www.tempoonline.com, accessed March 8, 2013;
www.tvone.com, accessed March 8, 2013.
[1] This article was published in a book COMPILATION OF THOUGHTS ON THE DYNAMICS OF LAW IN SOCIETY (Commemorating the 50th Anniversary of Universitas Pattimura in 2013), 2013
