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BUMDes face uphill challenges in growing business
Researchers say that BUMDes should focus on meeting the needs of local residents and businesses for further growth.
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Village leaders and observers Warungbanten village head Jaro Ruhandi (right), Indonesian Farmers Seed Bank and Technology Association chairman Dwi Andreas Santosa (second right) and Institute for Research and Empowerment researcher Sunarji Zamroni (third right) participate in a discussion on Village-Owned Business (BUMDes) on Jan. 17, 2020 at the Village and City Festival in Ragunan, South Jakarta. (JP/mfp)
T
he government has set up many village-owned businesses (BUMDes) in the country in an effort to drive the rural economy, but some have been facing difficulty in growing their businesses amid their struggle for greater community participation due to differing visions and a lack of competency.
Romdon Hadanursyamsih, a manager of the Karya Mandiri BUMDes of Hegarmanah village in Garut, West Java, said that the company had grown relatively well because it generally served to meet the daily needs of villagers. However, its growth had stagnated because of difficulties in recruiting local residents to run the company.
“It is difficult to recruit all villagers, as we often find that they have a different vision from the current management on how to run the business,” Romdon told The Jakarta Post on Jan. 17 in Ragunan, Jakarta, at a discussion on operating BUMDes.
Researcher Bhima Yudhistira Adhinegara of the Institute for Development of Economics and Finance (Indef) said that involving more villagers in operating BUMDes might prove inefficient, as most villagers lacked the necessary knowledge to run a business.
In contrast, researcher Sunarji Zamroni of the non-governmental Institute for Research and Empowerment (IRE) in Yogyakarta believes that BUMDes should involve and employ as many villagers as possible to improve the community as a whole.
“BUMDes can be an instrument for [improving] welfare, and for that, they need collective action from the villagers. If the businesses are only controlled by a [handful] of people, they would be a huge missed opportunity,” he said.
To help foster community support for BUMDes, Bhima suggested that the businesses should focus on the needs of the local community: “If the villagers are mostly farmers, for example, the BUMDes should focus on the agrarian sector so they can improve the villagers’ income,” he told the Post by text message.
