The Role Of Plantation Sector In The Regional Development Of Musi Rawas Regency (An Approach Social Accounting Matrix Model).

Abstract

This study is conducted to examine and determine the role and contribution of plantation sector in Musi Rawas development to analyze the level of leakage in the regional economy and the role of marketing institutions in plantation sector. In its analysis this study use Social Accounting Matrix (SAM) model. SAM analysis resulted that the average of household income in plantation sector estimated 6,72 million rupiahs per year, and plantation sector contribute greatly to regional economy in Musi Rawas regency when compare with other agricultural sector. Beside that, plantation sector has big of multiplier effect to employment, household income, GDP and economic output. The plantation sector has a Value Added Multiplier (VAM) of 1,25, and based on the estimated impact of simulated output increase on the plantation sector it was seen that the average output of the plantation sector was 1,78, which means that when injected at 1 billion rupiahs, it would create an output of 1,78 billion rupiahs, with the highest output for the commodity of community rubber. In addition, the average inequality value in the household income in the plantation sector was 3.96, which calculated from income revenue by non farm group as recipients of the highest revenue compare with earnings of agricultural laborers as low income earners, with the palm oil commodity having the smallest value of household income inequality. From the Regional GDP of 7,68 trillion rupiahs there was a regional leakage of 357,36 billion rupiahs, or approximately 4.65% of the Regional GDP derived from the labor force factor of 4,14 billion rupiahs and capital factor of 353,22 billion rupiahs. This is because of the presence of capital in Musi Rawas from outside of the region. As a result, the remuneration obtained by the production factor also flows back out of the region. To overcome the regional leakage will require a policy reform such as local regulations regarding the opening of the processing plant for value added crops, which flows out can be enjoyed by the people, beside that Corporate Social Responsibility (CSR) is used to education and training to increase the farmer skill and improving the quality of human resources. The institutional role of farmers is still very weak; it is mainly due to a) lack of guidance, b) ineffective application of government regulations that favor farmers, c) lack of social capital or farmer’s poor institutional aspects particularly in the form of networking, regulations and transparency. On the other hand there is a low access of farmers to markets because the market information has not been exploited optimally, the role of middlemen is still high in the marketing of rubber, and there is no auction market and poor infrastructure to support marketing support. Therefore need to increase the farmer ability such as work ethics, kowledge and skill to process rubber and palm oil