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Regional Economic Growth the Role of BUMDes Institutions in Enrekang

Regency

Article · November 2020

DOI: 10.6084/m9.doi.one.IJCRT2011027

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Regional Economic Growth the Role of BUMDes

Institutions in Enrekang Regency
Abdul Karim*1, Chalid Imran Musa2, Romansyah Sahabuddin3, Muhammad Azis4
* Doctoral Student in Economic Program Universitas Negeri Makassar, Indonesia
1
Departement Accounting, STIE AMKOP Makassar, Indonesia.
2
Departement of graduate program Universitas Negeri Makassar, Indonesia.
3
Departement of graduate program Universitas Negeri Makassar, Indonesia.
4
Departement of graduate program Universitas Negeri Makassar, Indonesia.

Abstract: The target of the development program is in regional economic growth with the establishment of Badan Usaha Milik Desa
(BUMDes) as a strategic business unit in increasing Village Original Income. The strategic values of the program are 1) the creation of
productive collective assets that are jointly managed and utilized by the community, and 2) cumulatively the regional economy can
develop, where each region has a specific and unique economic base.

Keywords : Regional Economic Growth, BUMDes Institution, Enrekang Regency.

I. INTRODUCTION
The District Government of Enrekang is more focused on efforts to increase economic growth in all villages in Massenrempulu.
Enrekang Regency has 12 Districts with 112 Villages in it, each village has its own potential in various sectors, especially in the
agricultural sector because it contributes 49.82 percent to economic growth in Enrekang Regency. This is what makes the local
government focus its attention on efforts to increase rural economic growth. The existence of Badan Usaha Milik Desa (BUMDes) is
needed because several villages are developed and Village Original Income is quite good because of the role of BUMDes in managing
all the potential of the village. Not many villages in Indonesia are developed and the people are prosperous because the villages are
developed and the village's original income is high because of the BUMDes (Soleh, 2017).
Administratively, Enrekang Regency has a total area of 1,820.67 KM2. Enrekang Regency is bordered by Tana Toraja Regency
in the North, Luwu Regency in the East, Sidenreng Rappang Regency in the South, and Pinrang Regency in the West. The economy of
Enrekang Regency is still dominated by small industries, the industrial sector has increased in the last five years in line with the
economy that has grown gradually (BPS, 2020).
Enrekang Regency has great natural potential as an area that is economically strong if its management maximizes its full use of
its potential. Currently, there is Crisis Global, namely Covid-19. It was during this period that the government and society showed to
the public that Enrekang Regency could survive in the food security sector from the agricultural aspect. During the Covid-19 Pandemic
period that hit the world, especially in Indonesia, farmers in Enrekang Regency remained productive in activities in the garden. This
means that this is where the role of farmers in the Enrekang Regency to maintain stability and food availability, both in the local and
national sectors, is still being carried out (Musa, 2019).
In 2019, Enrekang Regency has a harvest area of 156,128 square meters of ginger, which is spread across 12 sub-districts, the
sub-district with the largest harvest area is the Masalle sub-district, which is 75,000 square meters and is followed by Baraka and
Maiwa Districts with an area of 40,000 and 26,500 meters respectively.

II. METHOD
This research is descriptive qualitative. which is done to determine the value of the independent variable, whether one or more
(independent) variables being asked are expressed in the form of words, sentences, and descriptions without making comparisons, or
connecting between one variable and another. This research was conducted in Enrekang Regency, South Sulawesi Province.
To obtain relevant data in accordance with the objectives of this study, the researchers took data from data sources, namely
primary data and secondary data. The resource persons that the researchers will make informants in this study are 16 BUMDes
administrators. Data collection techniques used in this study were observation, interview, documentation.

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III. RESULT AND DISCUSSION
3.1. Result
3.1.1. The existence of BUMDes institutions in the village
In achieving the desired objectives of the central and regional governments, several strategies and targets are required to be
implemented. In this effort, the direction and policies for the development strategy of villages and rural areas, namely all villages,
legitimize the existence of BUMDes institutions in every village.
Based on data from 16 respondents, all of them said that their village currently has a BUMDes institution. Meanwhile, the
existence of BUMDes institutions within the period can be seen in the answers in the following table:

Table 1. Existence of BUMDes institutions in the village (years)

Number Year Percentage (%) Number of respondents
1 0–1 18.75 3
2 2–3 25.00 4
3 3–4 25.00 4
4 4–5 21.25 5
Total 100.00 16
Source: processed data, 2020.

3.1.2. The role of the Village Government in encouraging the development of BUMDes
The existence of villages as a potential basis for the economic activity must become a new paradigm in Indonesia's economic
development program as a whole. Changes in internal and external conditions that occur require the right and right policies from
policymakers in an effort to develop the potential of rural areas. It is time to make the village the center of development and make this
area the main motor of the economy.
Adjusted to the data from all respondents as many as 16 people in this study, the majority said that the village government is
currently encouraging the formation and development of BUMDes institutions. As a means of economic growth in rural areas to
support an increase in Village Original Income in supporting regional development growth. This can be seen in the following table:

Table 2. The role of the Village Government in the formation and development of BUMDes institutions
Number Role Percentage (%) Number of respondents
1 Very encouragin 75.00 12
2 Less encouraging 6.25 1
3 Mediocre 18.75 3
4 Don't push 00.00 0
Total 100.00 16
Source: processed data, 2020

3.1.2. BUMDes institutions encourage economic growth and development of village potential
The development of village potential aims to encourage the realization of community independence through the Development of
Leading Potentials and Institutional Strengthening and Community Empowerment. Village development must consider and be based on
the potential of each village (physical potential and non-physical potential) by prioritizing the advantages of each village. Efforts to
develop village potential need to empower community participation so that they feel like they belong and are responsible.
In driving regional economic growth, the role of BUMDes institutions is sufficient to contribute to the rate of economic
improvement, as seen from the answers of respondents as follows:

Table 3. BUMDes institutions in contributing to regional economic growth

Number Role Percentage (%) Number of respondents
1 Contribute 87.50 14
3 Mediocre 12.50 2
4 Don't contribute 00.00 0
Total 100.00 16
Source: processed data, 2020.

3.2. Discussion
3.2.1. Basic village potential development
The effort to build a village is to carry out development by considering links and match. Because links and matches are the main
keys to achieving good development. This means that the linkage/synergy of development policies from the local government (top-
down planning) and the village government (bottom-up planning) is needed. In this case, the development policy in rural areas must
also not contradict the development strategy set by the local government.
The basis of the national development strategy is as follows: 1) building without increasing regional inequality, 2) utilizing
natural resources for the greatest possible prosperity of the community, 3) building starting from the village, 4) the economy must be
oriented and based on sectors and types of businesses that add value add as much as possible with quality human resources, innovation,
creativity and application of appropriate technology, and 5) regional-scale development is a quality sustainable development nationally.
In an effort to achieve the desired development synergy, there are several rules and conditions that must be met and fulfilled. In
accordance with the objectives of regional development, the provisions and regulations must be fulfilled regarding the norms,
dimensions of development, and socio-economic conditions that occur, as in the following table diagram:

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Table diagram 4. Norms and dimensions of rural-based regional development
Development norms
1 Build for people and society
2 Efforts to increase welfare, prosperity, productivity do not create inequality in the social environment of
rural communities
3 Development must not damage, reduce the carrying capacity of the environment, and balance the natural
ecosystem.
Development dimensions
Dimensions of human development Leading sector dimension Mapping & zoning dimensions
1. Education 1. Food sovereignty 1. Between income groups
2. Health 2. Energy Sovereignty 2. East Enrekang area
3. Housing 3. Maritime and marine 3. Enrekang West Area
4. Mental / Character 4. Tourism and Industry
Necessary conditions
Law and enforcement Security and order Politics & Democracy Governance &
certainty management
Source: processed, 2020.

Based on the development that has been determined by the central government, what needs to be done in order to achieve
development synergy is the development of the regions/villages from below (Button up Planning) or what is known as building from
the periphery. The main objective of this development is to strengthen regions or villages to accelerate growth and equity.

3.2.2. Involving all resources in regional economic growth

Since the Global Covid-19 Pandemic hit the whole world, almost all economic activities have experienced paralyzed activity.
The impact is a decrease in Regional Original Income, as a result, economic activity does not circulate as usual. This becomes the basis
for local governments to conduct analysis and involve competent institutional structures in assessing the various potentials of each
village.
Local governments and village communities need to carry out activities that can increase food security and economic growth in
rural communities during the Covid-19 Pandemic. Regional economic growth can move through the utilization and maximization of the
village's superior potential. This can lead to the movement of the village economy in increasing village economic income.
Enrekang Regency is an area with a lot of potentials that can be converted into economic value. Where the location in Enrekang
Regency is only limited to rice fields, but because of its uniqueness, the rice fields can become a tourist attraction that can support
rural-based economic growth. The contribution to the utilization of these locations can contribute to the graph of the increase in local
revenue. The development of villages and rural areas is an important factor for regional development, poverty alleviation, and reduction
of disparities between regions. Village development in Indonesia is rapidly increasing with an average growth of 2.29 percent or 1,409
villages per year.
Strengthening the technology of local communities must be improved, so as to increase the productivity and quality of regiona l
economic development. Utilizing and transforming local potential into local advantages. To achieve this goal, support is needed
through 1) Program for enhancing rural economic institutions, 2) Program for developing and utilizing appropriate technology, and 3)
Program for enhancing village government institutions with various activities. These three programs can be implemented if the role of
Badan Usaha Milik Desa (BUMDes) has the right space in every village in Enrekang Regency.

IV. CONCLUSION
The existence and activities of community institutions in the Enrekang Regency cover almost all areas of community life, such
as socio-culture, economy, politics. The community institutions that have developed in Enrekang Regency today are the result of
articulation between values and norms that originate from modernity with values and norms that come from traditionalism. The rules of
the game that become the reference for society is behaving, interacting with each other, and realizing common goals, are born from
these mutual articulations.
In the economic field, existing institutions are growing rapidly, but their identities are similar to one another. Modern economic
institutions place profit as the main orientation. Banks and cooperatives, including their variants Bank Perkreditan Rakyat and Bank
Syariah, have shifted traditional institutions such as the Patteseng bond which is unique in offering choices and channeling voice
among rural communities. The presence of modern market institutions tends to marginalize the existence of traditional markets. The
presence of modern markets, which are supposed to increase diversity, is actually weakening the existing traditional market entities.
The presence of large companies as economic institutions that are more concentrated in the automotive and construction sectors, less
encouraging manufacturing and agro-industrial production, is also a phenomenon behind the low diversity in economic institutions in
increasing the rate of regional economic growth.

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