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Rural-urban linkages and development : a case study of North Sulawesi, Indonesia Tuerah, Noldy 1998

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RURAL-URBAN LINKAGES AND DEVELOPMENT: A CASE STUDY OF NORTH SULAWESI, INDONESIA by NOLDY TUERAH B . S c , Sam Ratulangi University, Indonesia, 1985 M . A . , The Flinders University o f South Australia, 1990 A THESIS S U B M I T T E D IN P A R T I A L F U L F I L L M E N T OF T H E R E Q U I R E M E N T S F O R T H E D E G R E E OF D O C T O R OF PHILOSOPHY in T H E F A C U L T Y OF G R A D U A T E STUDIES (School o f Community and Regional Planning)  W e accept this thesis as conforming to the required standard  T H E UNIVERSITY OF BRITISH C O L U M B I A December 1997 © N o l d y Tuerah, 1997  In presenting  this  degree at the  thesis  in  partial fulfilment  of  University of  British Columbia,  I agree  freely available for reference copying  of  department  this or  publication of  and study.  thesis for scholarly by  this  his  or  her  requirements that the  I further, agree  purposes  representatives.  may be It  is  thesis for financial gain shall not be  permission.  Department of The University of British Columbia Vancouver, Canada  Date  DE-6 (2/88)  the  0  that  for  an  advanced  Library shall make it  permission for extensive  granted  by the  understood  that  allowed without  head  of  my  copying  or  my written  11 ABSTRACT There is a lack o f research on the relationships between rural areas and the urban hierarchy i n Indonesia. Because o f this, policies for urban and rural development are undertaken in isolation from one another, without incorporating the implications o f rural-urban linkages for rural development. This study contributes to our understanding o f rural-urban linkages in Indonesia by examining four villages in the Province o f North Sulawesi. Because o f the importance o f the Indonesian government's transmigration program for rural development in North Sulawesi, specific emphasis is placed on the comparison between the experiences o f transmigrant villages and indigenous non-migrant villages in their relationships to the urban hierarchy. The main case study covers four villages (two transmigrant, two indigenous) i n Dumoga Subdistrict o f North Sulawesi. The linkages between these villages and the various levels o f the urban hierarchy are articulated through the following key sets o f variables: economic ties, population movement,  services delivery, physical infrastructure,  technology and political  administration. The variables associated with administration interact strongly with the other sets of variables, as government policies (an aspect o f administration) have impacts on all other forms of rural-urban interaction. In the  comparison between  indigenous (Mongondownese) villages and those o f  transmigrants (Javanese and Balinese), it was found that the transmigrants were better off i n terms o f almost every social and economic indicator. Although the success o f the transmigrants may be attributed i n large part to the application o f their skills at wet rice farming in the new environment o f North Sulawesi, they have also been strongly supported in their endeavors by central government programs which provide them with land, tools, irrigation infrastructure and other benefits.  |S..,  Ul This study also examined in detail the mechanics o f policy setting as it pertains to rural villages. It was found that although a system has been put i n place by the Indonesian government to promote lower level inputs into the planning process, the continuing strong centralization o f the administrative system results in a filtering process as policy suggestions work their way up from lower levels (village, subdistrict, district) to higher levels (provincial, national). Despite efforts at administrative decentralization, policy setting and implementation for rural and urban development remain highly centralized. The concept o f the urban hierarchy which was utilized in this study is that which is defined by the Indonesia administrative system, consisting o f the provincial capital (medium size city), the district capital (small town) and the subdistrict capital (rural center). It was found that without its administrative functions, the lowest level on this hierarchy (the rural center) would have very few functional linkages to the rural areas, as most o f the other sets o f linkages bypass the rural centers. The rural-urban linkages o f transmigrant villages differed greatly from those o f indigenous villages with transmigrants having stronger connections to higher points on the urban hierarchy. Considering the income differences between migrants and non-migrants, the  long-  term implication o f this final point is that we can expect a gradual reduction in the functions o f lower level centers i f rural development is successful and incomes increase.  iv  Table of Contents Abstract  ii  Table o f Contents  iv  List o f Tables  vii  List o f Figures  xi  Acknowledgements  xii  Chapter One  Chapter T w o  Introduction Background o f the Study Problem Statement Objectives o f the Study Literature Review and Development o f A Conceptual Framework Functions and Roles o f Small Towns The Negative and Positive Effects o f Linkages Roles and Functions o f Small Towns: Evidence from Developing Countries Growth Centers and Rural Development Agropolitan District Rural Central Planning The Impact o f the Green Revolution and the Process o f Rural Change Transmigration Program or N e w Land Settlement Conceptual Framework The Research Process and Description o f Study Areas Introduction The Method o f Choosing Study Areas Household Sampling Data Collection and the Questionnaire Definition o f Maj or Terms Data Processing and Analysis Description o f Study Areas The Country North Sulawesi Province Bolaang Mongondow District The Villages The Rural center The Small T o w n The M e d i u m City  1 1 6 7 7 7 17 21 26 28 30 32 37 40 47 47 48 51 53 55 58 59 59 64 68 73 80 82 85  Chapter Three  Chapter Four  Chapter Five  Chapter Six  Policies for Rural and Urban Development Introduction What is a Village? Agricultural Development Policies Transmigration Programs and Regional Development City Size and Function W h y do M e d i u m Cities and Small Towns Need to Develop? Rural-Urban Areas Development and Policies The Challenges and Constraints o f Rural-Urban Development Conclusion Characteristics of Nonmigrants and Migrants i n the Case Study Areas Introduction Demographic Differentials Occupational Differentials Economic Differentials Ownership Differentials Production The Effects o f Rural Development Motivation o f Migrants and the Comparative Advantages The Contribution o f Migrants to the Region Some Special Issues o f Changes and Problems Conclusion Rural-Urban Linkages Introduction Economic Linkages Migration Linkages Service Delivery Linkages Physical Linkages Technological Linkages Conclusion The Financial Linkages Between Central, Local, and Village Governments Introduction Decentralization i n Indonesia Government Structure o f Indonesia Financial Links Between Center and Region Sources o f Local Government Revenue and Problems Local Government Expenditures Village Finance  87 87 89 93 100 108 110 115 117 118  121 121 123 126 134 146 151 153 156 158 159 161 165 165 166 182 183 191 198 204  207 207 209 210 213 216 223 226  Chapter Seven  Chapter Eight  Local Economic Development Conclusion  228 232  The Planning Process Introduction The Concept o f Development Planning i n Indonesia The Process o f Compiling Regional Development Plans H o w do the Bottom-up and Top D o w n Planning Process Work? The Role o f Development Agencies The Role o f Local Planning and Development Board (Bappedd) Coordination Local Autonomy Community Participation The Roles o f Local Leader Human Resources Conclusion  236 236 237  Conclusions, Implications, and Further Research Introduction Major Findings General Conclusion Policy Implication and Recommendation Further Research  280 280 281 296 301 312  243 256 256 257 260 263 266 273 275 277  Abbreviations and Glossary  314  Bibliography  320  Vl  List of Tables Table 2.1  Characteristics o f the Villages  50  Table 2.2  Total Respondents Interviewed  52  Table 2.3  North Sulawesi: Population B y Sex, 1920-1990  64  North Sulawesi: The Structure o f Employment by Industry, 1990 and 1994 (percentage)  67  Bolaang Mongondow District: Population and Density  68  Bolaang Mongondow : The Structure o f Employment by Industry, 1994 (percentage)  69  Bolaang Mongondow: Sectoral Distribution o f Gross Regional Product, 1990-1993  71  Bolaang Mongondow: Planted Area B y Rice and Crops, 1994  71  Demographic Characteristics o f Sampled Villages  76  Indicators o f Agricultural Development by Village, 1995  78  Table 2.4  Table 2.5  Table 2.6  Table 2.7  Table 2.8  Table 2.9  Table 2.10  Table 2.11  Primary Occupation o f Person Aged 15 and Over by Village, 1995  79  Table 2.12  Major Public Facilities o f Sampled Villages  80  Table 2.13  Manado: Sectoral Distribution o f Employment, 1990 and 1994  86  Rice: Program, Area Harvasted and Total Production per annum, 1960-1988 (1 unit = '000,000 ha/'000,000 ton)  97  Table 3.1  Table 3.2  Sponsored and Spontaneous Transmigrants from Java and B a l i Settled in North Sulawesi  104  Table 3.3  Type o f City and Population Size  109  Table 3.4  Strategic Cities i n Long-Term Development II (1994/95-2018/19)  112  Table 4.1  A g e and Sex o f Household Head of Nonmigrants and Migrants  124  Table 4.2  Education and Sex o f Nonmigrants and Migrants  125  Table 4.3  M a i n Occupation o f Household Head and Housewife o f Nonmigrants and Migrants (percentage)  127  Table 4.4  Part-time Occupation o f Household Head and Housewife for Nonmigrants and Migrants (percentage)  129  Table 4.5  Family Labor Utilization and Hired Labor for Nonmigrants and Migrants  134  Table 4.6  Sources o f Household Income by Sector and Location (According to Percentage o f Households)  137  Sources o f Household Income by Major Commodities (According to Percentage o f Households)  138  Source o f Household Income by Nonagriculture Activities (According to Percentage o f Households)  139  The Proportion o f Household Expenditure and Average Costs for Daily Needs for Nonmigrants and Migrants  140  The proportion o f Household Expenditure and Average Annual Costs for Education, Health, Clothing, Utensils and furniture, and Others, for Nonmigrants and Migrants  142  Nonmigrant and Migrant Access to Informal Credit Institutions (percentage)  144  Purchasing o f Land (Paddy Fields, Crop Fields, and Empty Land) by Nonmigrants and Migrants (According to Percentage o f Households)  145  Table 4.7  Table 4.8  Table 4.9  Table 4.10  Table 4.11  Table 4.12  Vll  Table 4.13  Table 4.14  Table 4.15  Table 4.16  Table 4.17  Table 5.1  Table 5.2  Table 5.3  Table 5.4  Table 5.5  Table 5.6 Table 5.7  Table 5.8  Table 5.9  IX  Land Ownership o f Nonmigrant and Migrant Households  148  Origin o f Land Owned by Nonmigrants and Migrants (percentage)  149  Production Tools o f Nonmigrant and Migrant Households (percentage)  150  Household Goods Ownership of Nonmigrants and Migrants (percentage)  151  Production o f Paddy, Corn, Soybean, and Peanut of Nonmigrants and Migrants (ton)  153  Nonmigrants and Migrants: Market Location and Households'Needs  170  Total Savings, Total Transfer Outside the Region and Average Amount o f Transfer by Nonmigrants and Migrants, i n Dumoga Subdistrict (Rupiah)  174  Amount o f Capital Transferred by Nonmigrants and Migrants to Support Their Parents, Siblings, Relatives and Children (Rupiah per year)  174  Amount o f Capital Transferred and Transportation Costs o f Nonmigrants and Migrants for Visiting Families and Relatives Outside Village (Rupiah per year)  176  Proportions o f Nonmigrants and Migrants Selling Their Paddy or Rice by Location o f Sale  177  Purchasers o f Rice Sold by Farmers  178  The Changing Price o f Rice and Fertilizer at Four Case Study Villages in North Sulawesi i n 1985, 1990, and 1995 (Rupiah)  181  Distance to Schools for Nonmigrants and Migrants (percentage)  185  Health Facilities: Destinations for Nonmigrants and Migrants (percentage)  187  Table 5.10  Table 5.11  Table 6.1  Table 6.2  Table 6.3  Table 6.4  Table 6.5  Table 7.1  Table 8.1  Table 8.2  Modes o f Transportation Used by Respondents to Access Village, Rural center, Small Town, and M e d i u m City Markets (percentage)  193  Nonmigrants and Migrants Access to General, Agriculture and Health Information (percentage)  200  Bolaang Mongondow and North Sulawesi: The General Composition o f Revenues, 1985/861995/96.  218  Bolaang Mongondow and North Sulawesi: The Composition o f Local Revenues, 1993/94  220  Bolaang Mongondow and North Sulawesi: The General Composition o f Expenditures, 1985/861995/96  224  Bolaang Mongondow and North Sulawesi: The Composition o f Expenditures, 1993/1994  225  The Composition o f Nonmigrants and Migrants Village Revenues 1995/96 (thousand)  227  Government o f Indonesia's Mandated Bottom-up Planning Cycle  253  Summary o f Non-migrants and Migrants Characteristics  283  M a i n Linkages and Types o f Policies Based on Government Levels  287  List of Figures Figure 1.1  Rural-Urban Relations and Rural Development Conceptual Framework  46  Figure 2.1  M a p of Indonesia  63  Figure 2.2  M a p o f North Sulawesi  65  Figure 2.3  M a p o f Bolaang Mongondow District  70  Figure 2.4  M a p of Dumoga Subdistrict  74  Figure 3.1  Structure of Village Government  92  Figure 4.1  Allocation of Household Workers i n Four North Sulawesi Case Study Villages, Based on Sector and Type of Workers  133  Rural Household Income Sources in Case Study Areas of Four Villages North Sulawesi, Indonesia  135  Figure 4.2  Figure 5.1  Paddy and Rice Marketing Channels i n North Sulawesi  180  Figure 6.1  The Structure of Indonesian Government  212  Figure 6.2  Intergovernmental and Private Sector Funds F l o w in Indonesia  215  The Stages of Planning Process  252  Figure 7.1  xii  ACKNOWLEDGEMENTS I am greatly indebted to my supervisor, Michael Leaf, Ph. D . , for his insightful feedback and unending academic and moral support. I am also very grateful to You-tien Hsing, Ph. D . , and Professor T. G . M c G e e , members o f my doctoral committee who offered constructive criticism and valuable comments. I am also obliged to a number o f agencies and people i n North Sulawesi and Central Sulawesi for letting me conduct the research. They include the Bappeda o f North Sulawesi Province, Bappeda o f Bolaang Mongondow District, Bappeda o f Manado Municipality, Bappeda of Donggala District, Statistics Office o f North Sulawesi, Subdistrict Government o f Dumoga, Subdistrict Government o f Kotamobagu, Subdistrict Government o f Parigi, and the village government o f Doloduo, Dondomon, Mopugad Selatan, Mopuya Selatan, Tindaki, Purwosari, and Tolai. I also thank the resource persons working with these offices who shared their data and time with me. M y grateful thanks are also due to M e g Rakow assisted me with copyediting and Catherine Griffiths was a valuable helper i n the computer lab. I am particularly indebted to my fieldwork colleagues: Teddy Minggu, Oktavianus Kalangit, M e i d i Satiman, Indah Sulangi, Susanti, Christien Karambut, Rinna Pangemanan, and Paulus A . Lowing. To them, and to the many people i n the survey villages who gave o f their time and patience, and to the administrators in all the desas, kecamatan, and kabupaten in which I worked, I am deeply grateful for their excellent support. Terima kasih banyak. I would like to thank to the Ministry o f Education and Culture i n Jakarta who sponsored my study. Finally, special thanks to Andrew and Wulan, for their unending love and patience and good humor.  1  CHAPTER ONE INTRODUCTION Background of the Study The growth o f primate cities in Southeast A s i a is a well-documented phenomenon (McGee, 1969, 1994; Ginsburg, Koppel, M c G e e , 1991; Laquian, 1993; Leaf, 1994, 1996). Although Southeast A s i a is one of the least urbanized regions o f the world, population figures o f its major cities have soared. Indonesia is no exception to the phenomenon. Its capital city, Jakarta, has a population which doubles every 15 years and had reached 8 million in 1990 ( C B S , 1992). It is part o f the larger extended metropolitan region o f Jabotabek, which i n 1990 had 16 million inhabitants. Such metropolitan growth is linked with migration from the countryside as well as sustained by natural increase. The process accelerates as employment opportunities i n the countryside dwindle. N e w agricultural techniques are introduced, often at the cost of marginal employment. For instance, in Indonesia the spreading changes in rice harvesting methods may mean that village women using ani-ani knives and harvesting stalk by stalk are replaced by hired laborers  using  sickles (Collier,  1979).  Even  large-scale,  capital  intensive  agricultural  undertakings are experiencing harsh competition because deteriorating terms of trade are challenging their position. Nonagricultural activities are also under pressure, both in the countryside and in the regional centers, as competition from big city-based enterprises has increased, both i n secondary and trade activities. In some sectors the take-over o f small-scale activities has already been completed. Migrants are lured to big cities by the wide range o f jobs offered. Most migrants to Jakarta find employment  i n the informal sector (Sethuraman, 1976). The size o f the informal  2  sector in a metropolis like Jakarta has been positively correlated with the number and size o f large-scale industries and government departments, the so-called formal sector (Hugo et al., 1987). This correlation partly depends on the migrants' expectations o f eventually finding a job in the formal sector. Researchers claim that hopes, rather than actual job opportunities in the formal sector, attract migrants to Jakarta (Sundrum, 1976; Wirosuhardjo, 1983). Most migrants would never qualify for a formal job. Another type o f migrant comes to live in big urban centers for the facilities offered in these places, most important o f all being schools and other centers for education. Underlying these demographic trends and economic processes is the concentration o f development  investment  in just  a  few  metropolitan centers.  This  tendency—whether  spontaneous or induced—has been justified by spatial conceptualizations o f economic growth theories, such as Perroux's "growth pole" and Hirschmann's "trickle down" notions. Adherents of such concepts have argued that development efforts should be concentrated so as to achieve savings on infrastructure and transport costs for enterprises. The so-called urbanization and conurbation economies are intended to tempt other industries to settle in the growth pole, making use o f the forward and backward linkages thus more easily created. Such planning theories have heavily influenced development policy, as implemented by Third W o r l d governments and international aid agencies. A s an example o f such concentrated investment, during the 1970s Jakarta absorbed 60 percent o f all foreign investment i n Indonesia and 26 percent o f all private Indonesian investment, while government expenditures were twice as high in Jakarta when compared to the highest provincial figures ( H i l l , 1989; Prabatmodjo and Kusbiantoro, 1993). Although expanding quickly, Jakarta contained only 4.4 percent (CBS,1992) o f Indonesia's population.  3  Once a certain level o f development has been reached and an innovative center has been established, the theorists argued, growth should spread and intraregional economic inequalities as well as differences between city and countryside should diminish. Import substitution industries were considered the type o f economic activity most likely to trigger growth and the succeeding spread, thus earnings from primary exports were channeled into this sector. Import substitution, however, proved inadequate as a solid base for the national economy. It was quite limited in its prospects, due to a lack o f investment capacity and marketing opportunities. The capital funding sector suffered from low product prices, while the demand for manufactured products remained low and concentrated in the big urban centers. In Indonesia, after the first and easiest stage o f import  substitution  for  consumer  goods,  there was  confusion  over  how  to  continue  industrialization policy. Several options were proposed, such as starting capital goods industries, upgrading exports o f agricultural products, or exporting consumer goods ( H i l l , 1989). However, by the 1970s it had become clear that the growth pole approach did not work as planned. Although the concept o f concentrating investment still had many supporters, new ideas emerged. Critics o f growth pole policy warned that besides its basic weakness o f concentrating on economic growth instead o f welfare and employment, growth pole policy had other serious drawbacks. It led the population o f the metropolis to expand by multimillions o f migrants. Even worse, its implied preference (urban bias) contributed to a neglect o f living conditions in the countryside, and o f social services in general. The goal o f spreading development was not fulfilled. A s a response to such shortcomings, a new development paradigm was sought. Interest in theories o f regional planning increased, and greater importance was given to the role o f small towns and medium cities in economic development. Previously, small towns had only been 1  ' A small town in the Indonesian context is generally the capital city of the district (kabupaten), and a medium city is the capital city of province. The operational definitions of medium city and small town for this study is discussed in Chapter Two.  4  conceptualized as centers for public administration and locations for social facilities. Most Indonesians live in rural areas and derive a living from various forms of agriculture. The dispersed settlement pattern is punctuated by distinctive nodes which are sometimes large enough to be called towns. These places are described as service centers, and act as the sites o f commercial, medical, educational, administrative and associated activities. The growth o f the largest Indonesian cities has been relatively well-documented (see M c G e e 1994; Leaf, 1994; Rutz, 1987; Nas, 1986). They are the foci o f the nation's political and economic organizations, whilst within them new social relations are being established. Despite the rapid growth o f these cities, it can be argued that they affect directly only a small proportion of Indonesia's population. The rate o f urbanization at the provincial level is relatively low, ranging from 31percent to the very low levels of 8 to 12 percent ( C B S , 1992). Far less is known about the social, economic and geographical relations o f the many small towns and rural centers  2  with which the majority o f the population have more direct contact. Emphasis should be put on the regional context o f these small towns and rural centers, as they constitute the structure on which development plans must be built and implemented. Future development may depend on a viable system o f settlements that intervenes between the primate city and the rural village (Hackenberg, 1980). The distribution o f population in Indonesia is uneven. Two-thirds o f Indonesians live on the "inner islands" o f Java, Madura, B a l i and West Nusa Tenggara, which together represent just 8 percent o f Indonesia's land area. In 1986, population densities in Inner Indonesia averaged 685 people per square kilometer. Java's population density in 1986 was 774 people per square  2  Rural center is the capital city of the subdistrict  in Chapter Two.  {kecamatan). The operational  definition of rural center is discussed  5  kilometer. Many o f Java's districts represent the highest rural population densities i n the world, reaching as high as 2,000 people per square kilometer. In Indonesia's "outer islands", population densities average thirty-three people per square kilometer, although they range from seventy-two people per square kilometer on Sumatra and fifty-one people per square kilometer on Sulawesi, to fifteen people per square kilometer on Kalimantan, and just three people per square kilometer on Irian Jaya (World Bank, 1988). The fear o f overpopulation on the inner islands, especially i n Java and B a l i , has been an important reason for the Transmigration Program. The two principal objectives o f the Transmigration Program are population redistribution, or "reducing the population density in certain regions in order to facilitate ... development and rehabilitation efforts in said regions," and regional development, or "fulfilling the manpower requirements o f ... areas in which the population is relatively scarce, so that the available natural resources, especially agricultural land, can be utilized efficiently and effectively' (Government o f Indonesia [GOI], 1984). In order to reach the goal o f contributing to regional development in the settlement areas, the transmigrants have to be integrated into their new economic and social environments. Evidence from various settlement areas indicates that the process o f this integration is not without problems (Heeren, 1967; Hardjono, 1977; Koentjaraningrat, 1982; Swasono and Singarimbun, 1985). However, in some areas there are indications that certain transmigration settlements are relatively more successful in terms o f economic and rural development, when compared with their counterpart indigenous rural settlements. Large-scale transmigration has had a significant impact on town and urban development in the outer islands. Small towns and rural centers i n transmigration regions have experienced a boom in activity as a result o f transmigration-related construction and the search for off-farm work by local people and by transmigrants. Many of these small towns and rural centers are  6  growing at rates that promise to double their populations in ten years ( C B S , 1985). For small towns and rural centers that have no formal urban status and depend mainly on central budgets, rapid increases i n road traffic and accelerated growth may be difficult to manage under current planning arrangements. Cities may also find it difficult to keep pace with the accelerated growth, and the capacity to deliver urban services is particularly l o w i n large coastal cities and small frontier towns in the outer islands. Therefore, the growing demands for services in these areas must be taken into account in future development planning. Select key questions which are significant in determining the suitability o f various alternative planning strategies are listed in the problem statement section below.  Problem Statement There is a lack o f research on the relationships between rural areas and the urban hierarchy in Indonesia. Because o f this, policies for urban and rural development are undertaken in isolation from one another, without understanding the implications o f rural-urban linkages for rural development. 1. H o w do rural centers and small towns contribute to successful economic development i n rural settlement areas? A r e there significant differences and structures involved which may relate to different impacts upon rural development? H o w do rural-urban linkages contribute to rural development? 2. D o rural transmigration settlement areas differ from indigenous rural settlements in terms o f their linkages with rural centers and small towns? H o w can the development of local people be improved by learning from the migrants' experiences o f successful economic development?  7  3. What possible solutions are currently envisioned by the government policy-makers who are responsible for addressing the problems o f the region's rural centers, small towns and rural settlements?  Objectives of the Study The study has three main objectives. First, the study is to explore how rural-urban linkages  stimulate  rural  development,  how  rural  development  policies stimulate  rural  communities, and what the impacts of those policies are on rural populations. The chosen approach is an in-depth analysis which targets the specific cases o f villages (local rural settlements) and rural transmigration settlement areas in North Sulawesi, Indonesia. The second objective o f the study is to attempt to understand the impacts o f linkages on rural development, by analyzing the dynamic o f various stages o f government intervention and the planning process. A particular emphasis is placed on transmigration because o f its impacts i n the North Sulawesi policy context. The final objective o f the study is to obtain data and actual information on policy implementation within rural-urban linkages, so as to shed more light on the types of intervention that are most useful for rural-urban development goals. Producing new knowledge about ruralurban linkages and development in North Sulawesi, Indonesia, is the major goal o f the dissertation.  Literature Review and Development of A Conceptual Framework Functions and Roles of Small Towns The idea o f strengthening the fabric o f small towns and intermediate cities was floated as early as August 1963 at the second Rehovolth Congress held in Israel, where participants outlined and discussed the ^Agrindus' concept for "national decentralization by regional  8  concentration" (Weitz, 1965: p.92). The purpose o f Agrindus was to secure cooperation between the largest possible number of neighboring villages for the maintenance o f agricultural services; the processing, storage, grading, packing, transport, marketing and financing o f farm produce; and the establishment o f factories and workshops to meet agricultural and other requirements. The cooperative was to be extended to include cultural and sporting facilities, educational and health institutions, etc. (Weitz, 1965; 94). Thus agriculture was to be combined with industry, without undermining the village, an age-old asset. Instead, villages were to be improved, even reformed, and brought into line with changing conditions. A consensus expressed the view that a region deemed suitable as a basis for the described agricultural planning and rural development was one which contained villages linked to a single urban center (Weitz, 1965: 105). Johnson (1970) supported the same view when he observed that "a modern type o f agriculture not only presupposes the existence o f markets where produce can be sold as well as o f markets where inputs can be purchased, but it is necessary that both types o f markets should be spatially dispersed i n such a way that they w i l l be within satisfactory distance and travel time o f farmers, for the single reason that farmers' relative mobility is always limited by their very nature of space bound occupation" (Johnson, 1970: 181). Furthermore, he hoped that "ideally, the investment and production decisions o f urban entrepreneurs should trigger a chain reaction o f differentially smaller investment and production decisions in town hinterlands, which would manifest themselves not merely i n random, unplanned, ribbon-pattern developments extending outward from urban centers along already crowded transport routes, but in more purposefully deployed investment clusters properly located at promising growth points in the widening angles of economic landscapes between main lines o f travel and transport" (Johnson, 1970: 184). Johnson advocated the strengthening o f the market centers only from the viewpoint o f modernization o f a developing economy. Equitable growth is another dimension of the problem  9  that warrants a strategy o f development oriented to small towns and market centers. If one goal of equitable growth strategy is to provide basic public and social services to large numbers o f people in order to increase their productivity, employment potential and incomes, then much o f the city-size research indicates that small towns and intermediate cities offer sufficient economies of scale for investment in a wide range o f public utilities, infrastructure, social services, commercial activities and small and medium-sized agro-processing and manufacturing enterprises (Clark, 1968). The spread effect o f development has failed to occur i n many developing countries because o f inadequately articulated and integrated settlement  systems  through which innovations and the benefits o f urban economic growth could be diffused (Berry, 1967). In 1980 the U N Center for Human Settlements recommended the "development o f a system o f intermediate settlements with sufficient dynamism to counteract the attraction o f the great metropolises and concentrating on towns of appropriate size as social, economic and cultural centers for their rural hinterlands" ( U N C H S , 1980: 9). Rondinelli and Ruddle (1978) synthesized the previous strategies o f economic growth with equity as Urban Functions in Rural Development ( U F R D ) . A i m e d at predominantly rural areas with fairly high population densities and a predominance o f small-scale peasant proprietors, U F R D ideas are particularly relevant to poor countries with scarce government funds and manpower resources. The U F R D approach emphasizes a gradual nucleation o f dispersed rural populations into hamlets and villages, and encourages urbanization by strengthening strategically located key market towns. In particular, it promotes a concentration o f public services in rural growth centers, which not only serve their nucleated village or town populations, but also provide a wide range o f services to the surrounding dispersed rural populations (Bromley, 1984: 379).  10  According to Rondinelli (1984: 37) "small town development policies must be focused on strengthening their capacity to stimulate agricultural production and marketing o f agricultural goods, to support small scale agro-processing industries, and to diversify the economic base on market centers. Investment i n farm-to-market roads is required to link town-based enterprises with rural supply areas and to make services, facilities and inputs for agricultural production and marketing easily accessible to rural populations scattered widely over the landscape. Attention must be given to providing water, basic housing, health and social services in towns to increase the productivity o f the labor force, and also to providing off-farm job opportunities and urban amenities that w i l l encourage people to stay i n rural areas". Recent literature on spatial planning has emphasized the role o f small towns in the process o f regional and national development. Towns are supposed to act as intermediaries between the countryside and the big cities where economic and bureaucratic decision-making are concentrated. The increased attention given to the function o f small towns i n development is linked to many phenomena: the excessive growth o f metropolises, the failure o f development policies centered on big cities, the neglect o f rural resources. Small towns have become a very fashionable subject. Planning concepts are not always realistic, however, and empirical evidence on the present functioning o f small towns lags behind regional planning theories.  Small towns as propulsive and absorptive growth centers When faced with the excesses o f metropolitan growth, many researchers have adopted growth pole theory to support the option o f secondary growth centers, due to the concern that congestion in the metropolis is reducing the economies of agglomeration. The concept of the growth pole is not abolished, it is only moved to other places, so as to avoid further pressure on overcrowded cities such as Jakarta, Bandung, Semarang, Surabaya, Medan, Palembang, and  11  Ujung Pandang. L o and Salih (1978) introduced the concept o f urban efficiency with regard to agglomeration economies which they claimed failed to work beyond a certain city size even when the city continued to grow. They advocated policies to both redirect metropolitan growth to middle-size cities and to stimulate lower-level towns to grow into the optimum efficiency-size class. B y having propulsive growth centers in other parts o f the country, it was hoped that regional inequalities might also diminish. The sorts o f activities associated with the propulsive growth center concept are largescale industries with high labor productivity and high potential to link with other activities. Such industries need a well-developed physical and institutional infrastructure. Their existence might mean the presence o f a trained labor force and high quality commercial services, whether in-firm or not. Such industries would attract other companies to the growth pole, subsidiary as well as independent enterprises (Rondinelli and Ruddle, 1978). To facilitate spread to the hinterland, the complex should develop functional relations with agriculture and rural home-based industries (Hansen, 1978). Regional physical and human resources would have to provide the basis o f the main industry. Agro-based industries are often thought o f as propulsive i n small town centers o f growth, but mineral resources, hydro-power plants and existing artisanal skills might be points o f departure as well (Rondinelli, 1983). A number o f countries in Latin America, Africa and A s i a have purposefully attempted to implement growth center strategies in regional development. Their objective is to stimulate production activities, often in the framework o f import-substituting industrialization, which would trigger economic growth and restructure the regional economy. The emphasis is mostly on large-scale capital investments and their concentration in urban areas with a view to assumed economies o f scale and location. Centers especially suited for such investments are those which function as inter-regional foci o f production and trade, generally cities with 100,000 inhabitants  12  or more. It is assumed that the spread effects o f polarized growth in these medium-sized centers w i l l have a stimulating effect on the smaller ones within the region. Economic linkages with the regional center w i l l gradually transform the smaller ones into lower order growth foci and make them "instruments o f modernization" for their immediate surroundings (Misra and Sundaram, 1978). The development o f medium-sized centers w i l l also counter primate city dominance and bring about an "optimal urban hierarchy". Such a hierarchy is thought to facilitate the diffusion of innovations to the lower order centers, thus enabling these to perform in an adequate way their intended roles in the development and modernization o f their rural hinterland (Johnson, 1970; Berry, 1972; M i s r a and Sundaram, 1978; Rondinelli and Ruddle, 1978; Rondinelli and Evans, 1983). However, in developing countries the expected spread effects often appear to be o f little consequence for the smaller centers, especially due to the strong economic linkages with extraregional and overseas clients and suppliers. In this respect, Mabogunje (1978) has identified the limited results o f growth center strategies based on import-substituting industrialization and the prerequisites which condition their possible success i n Third World countries. If the regional policies pursued also aim at the development o f smaller centers for the benefit o f the rural areas, it seems more appropriate to invest directly in such centers. The question is whether to invest i n all o f these or only in centers o f a specific order or i n those enjoying a particularly favorable location. In regions where motorized traffic is already rather well-developed, it seems less desirable to promote the emergence o f a dense network o f service centers. In lesser-developed regions, however, the stimulation o f "hintertowns" or a type o f "intermediate settlement" is advocated as a supposedly necessary link between the rural areas and the higher order urban centers (Manshard, 1977 in Hinderink and Titus, 1988). In several developing countries attempts have been made to stimulate, in a planned way, the development and distribution of such rural  13  centers. The centers' role and importance is no longer seen as derived from the spread effects o f polarized growth i n the medium-sized regional cities. O n the contrary, these rural centers are considered "engines o f growth" i n their own right and for the benefit o f their rural hinterland. Their development as market and service centers helps to increase the productive capacity of the rural producers and promotes the commercialization and specialization o f agriculture i n the framework o f national economic growth (Mosher, 1969; E S C A P , 1979). The planning and proper functioning o f these rural centers is thought to contribute to an "effective" integration o f the rural population in the national economic and political order. Moreover, it is assumed that the development o f rural centers increases local employment and, in this way, helps to stem the rural exodus to the metropolitan areas (Johnson, 1970; Southall, 1979). Elaborating on the growth center concept, some scholars emphasize the aspect o f the redirection and reduction o f migration streams. They argue that small towns might compete with a larger city as  a place o f domicile for potential migrants, provided labor opportunities are  sufficient (Rondinelli and Ruddle, 1978) and presuming that the search for work is the dominant motive for such a migration. Compared to a metropolis, small towns have some attractive amenities to offer, namely a more informal and personal atmosphere which might help i n the search for a job, a lower cost o f living, and a healthier living environment. Generally speaking, small towns are less troubled by problems such as cramped living space, crime and overburdened infrastructure. If small towns are to become a redirection location for the migration currently flooding the largest metropolises and attract rural migrants as well as urbanites, labor-absorptive activities should be encouraged within the small town production structure. This might entail large-scale labor-intensive enterprises, but more often small-scale industry is proposed (Lo and Salih, 1978). What is labeled "the informal sector" comes to the fore: low-capital enterprises which are based  14  on local resources and are manageable without high-tech skills. They should, however, offer a enough remuneration in order to justify quitting a rural job but not trying for Jakarta, Surabaya or some other metropolis. This proposed type o f labor absorption fits current realities, as Sethuraman (1976) described in Jakarta, where most migrants tend to find work i n small-scale trade, transport services or industry. Such labor-intensive, small-scale activities in small towns w i l l differ in character from those i n the metropolis. In places like Jakarta, abundant purchasing power exists, supported by the salaries o f factory workers and government officials. Besides small-scale industry, products may be ordered by metropolitan large-scale enterprises in such a way that a large and diverse body o f informal trade, services and industries is sustained. However, in small towns, although local pockets o f wealth exist, there is no such complex in which to participate. Thus, informal sector activities, next to petty trade and services, should be directed at upgrading regional primary produce or substituting large-scale manufactured goods. A s discrimination against informal activities and competition from large scale industry are nation-wide phenomena, a policy that intends to give breath to informal job opportunities i n small towns should be nation-wide as well. O n a local level the development o f skills and the use of locally produced goods should be stimulated. Finally, it should be noted that such an employment program in small towns w i l l not always result in the growth o f their population figures. Today's network o f roads is o f adequate standard to make commuting to and from the villages possible.  Small towns as service centers and accelerated rural development The needs o f both town and village populations are addressed i n the service center concept. Although previously not explicitly concerned with small towns, the notion o f spread of  15  services has a long history. Hospitals and schools and extension offices have been regarded as pawns in the development game since prewar colonial times. Facilities are unevenly spread in developing countries, and are usually concentrated in the larger cities. For reason o f social justice, public facilities such as education and healthcare ought to be accessible to all citizens, including those living in the countryside. Small towns are considered to be efficient locations for such services by planners who are inspired by central place theory and who interpret it normatively ( E S C A P , 1979, Rondinelli and Ruddle, 1978). A good transportation network is a prerequisite. Because it is possible to plan public facilities, equal access seems an attainable target. Steering the location and growth o f private enterprises that function as service facilities (i.e., stores, repairshops, printing shops or public transport companies), is less easy. The service center concept resembles the previous concept o f small towns as accelerators of rural development. It differs in dealing with the whole range o f enterprises serving consumers (whether other enterprises or private persons) living in the countryside or in the town. For the services offered, it is supposed there is no rural provision. The concept o f small towns and service centers as motors for rural development is focused on assisting productive activities only. Such a brief discussion o f concepts involving small towns does not mention the various combinations o f concepts often urged, and by which cross over between service center and rural motor, or absorptive growth pole and rural motor, are met. A s several authors (Titus et al. 1986; Rondinelli, 1983; L o and Salih, 1978) have pointed out, the functions outlined seem to correlate to town size. For instance, propulsive growth pole potential w i l l be more developed in larger towns because o f the larger pool of skilled labor and managerial abilities, and the larger opportunities for interindustrial linkages and subsidiary services to develop (Rondinelli, 1983). L o and Salih (1978) gave another example, pointing out that smaller towns are more apt to act as agropolises, while middle sized towns can become absorptive growth poles. In this respect,  16  Rondinelli emphasized that secondary centers had large pools o f indigenous skills and industry, already oriented towards labor-intensive activities. Instead o f being local points o f growth, one might conceive o f small towns as geared to speeding up rural development. This small town concept is frequently repeated in regional planning. It gained popularity with Friedmann and Douglass' (1976) 'agropolitan district' idea. A country should be split into units o f a 'single, integrated, self-governing district,' requiring that each district have sufficient autonomy and economic resources to plan for and carry out its own development. Decentralization o f decision-making and concomitant land reform were considered crucial steps. While not every spatial theorist and certainly not every planner is so demanding, strong integration between town and region is viewed by many as necessary and enhanced  by  good transportation and communication links (Stohr and Taylor, 1981). The urban enterprise associated with the concept of small towns as accelerators for rural development emphasizes rural, and especially agricultural production. First, it entails government extension services and private enterprises distributing inputs like high-yielding seeds, fertilizer, insecticides, and tools. Second, it includes enterprises involved, directly or indirectly, in the marketing or processing o f agricultural produce. Next, rural nonagricultural enterprises should also be equipped with tools and raw materials, and the marketing and processing o f home industry products undertaken i n the regional centers as well. Both large-scale and small-scale urban enterprises might be considered in these respects, with the most important criteria being not size, but their subsidiary and beneficial role. These supporting activities would not meet standards o f efficiency when dispersed over a region. Because o f the volume of input necessary to sustain an agro-processing plant, for instance, its best locus might be in a regional center. The same holds true, although to a lesser degree, for trade and service activities.  17  The Negative and Positive Effects of Linkages Some argue that small towns and cities are predominantly parasitic—they allow townbased elites and administrative agencies to exploit the rural population and to drain rural areas o f their resources, which are invested i n metropolitan centers (Lipton, 1977; Funnel, 1988; Potter and U n w i n , 1989). The implication is that small towns and cities should not be deliberately developed by the government. If they are encouraged to grow they w i l l likely exploit rather than develop the rural areas in which they are located. Moreover, linking them to the national space economy w i l l not facilitate the "trickling down" o f benefits but merely promote rural to urban migration and the penetration  o f rural areas by exploitative national governments  and  multinational corporations. Schatzburg (1979), for example, insists that "the structures and organizations o f these small towns usually benefit the already wealthy elements o f local society who  have the means and skill to co-opt most developmental resources and initiatives that  originate with the national governments." Thus, he maintains, small towns are "structured to enhance the well-being (social, economic and political) of those who are relatively advantaged" (Schatzberg, 1979, p. 174). Their development, he implies, would be detrimental to the rural poor because small towns and cities "are both centers o f extraction that siphon off financial and human resources from the countryside and blockage points that inhibit the downward flow of resources as w e l l ' (Schatzberg, 1979, p. 181). It is also claimed that rural people have limited access to farming innovations and that this lack o f access makes small towns and cities ineffective dissemination points for innovation. Moreover, although farm people participate actively in town-based market trade, the urban traders who dominate the markets seek to maximize their profits and are uninterested in diversifying the agricultural economies in which market goods are produced. It is argued that  18  capital and credit are usually controlled by townspeople who prefer to invest in the towns and to lend to other townspeople who have more collateral, rather than to rural people who are perceived to be high-risk borrowers (Preston, 1978). A study o f urban centers i n Peru has indicated that the penetration o f export industries and resource exploitation activities in the towns created greater dependencies on the national capital, and made life increasingly difficult for subsistence farmers i n the rural hinterlands (Roberts, 1976). Critics warn that strengthening the linkages between small towns and cities and the metropolitan centers has made many rural workers redundant, undermined the network o f local trading and petty production activities and weakened the economic structure o f small towns, making them ancillary and dependent on the metropolitan economy (Roberts, 1976; Schatzbergs, 1979). For these reasons, Friedmann proposes a strategy o f "agropolitan development" based on the creation o f rural districts o f about 50,000 inhabitants. The objective would be to create selfreliant rural economies, with minimal linkages to the metropolitan economy (Friedmann, 1980). Stohr and Todtling (1977) have suggested a variation o f the strategy based on "selective spatial closure" as a way o f protecting small towns and rural populations from backwash effect. A counter-argument is that small towns and cities per se are not necessarily parasitic; indeed, many perform the beneficial functions essential to rural development, as described earlier. N o r is the interaction with larger, more modern and economically diversified urban centers necessarily exploitative. M u c h depends on how the economies o f small towns and cities are developed, and the ways in which the linkages between them and larger and smaller communities are organized. Once urbanization begins it is impossible to expect spatial closure. Leeds (1980) argues that no nucleated settlement can be closed, that its very existence even at a low level of  19  agglomeration is based on specialization, which in turn requires exchange. The author insists that "no town is an island onto i t s e l f . The agglomeration o f population in towns and cities is based on exchange and interaction: "for any locality, external connections are entailed. Theoretically, never should one expect to find autonomy, closure or boundedness. O n theoretical grounds, one should always expect flows o f goods, services, personnel, property, knowledge, information or possibly other values going in and out o f any locality. The heart o f this in and out is exchange— and the heart o f human exchange is human strategizing ..."(Leeds, 1980, pp. 25-26). A good deal o f empirical evidence suggests that small towns and cities can perform beneficial functions for rural populations. Not all o f the interactions between urban and rural people are to the detriment of the latter, and although linkages with larger communities can bring profound changes to smaller towns and cities, in many cases they create new opportunities for the poor. In his study o f highland towns in Bolivia, Preston found that the negative impact o f ruralurban linkages on some of the rural poor was usually minor, but that they also offered new economic and social opportunities to many others. He stated that the most important influence on agricultural innovation in highland B o l i v i a had been personal contacts among farmers and that those contact points were most often the tool shops in market towns. Farmers are "much more likely to be impressed by seeing large healthy new varieties o f potatoes in the market rather than being told about them or even to some extent than actually seeing them growing" (Preston, 1978, p. 69). The degree to which market towns made new products available was crucial in disseminating agricultural innovations to their hinterlands. Moreover, he found little systematic or serious exploitation o f rural people by market operators or merchants, nor did individuals or institutions i n the towns seem to pose obstacles to capital accumulation by farmers. Preston concluded that "there is little feeling o f injustice at the distribution o f income" and that most  20  rural families could get access to some capital. Likewise, the negative effects o f administration in the towns were, with the exception o f a few individual cases, not a serious problem for farmers and municipal officials had indeed a good deal o f popular support (Preston, 1978, p. 176-177). Other studies o f market towns indicate that rural people can compete fairly with townspeople and that linkages between the towns and rural areas are the primary channels through which rural people derive income. Studies o f marketplace interaction in the small Guatemalan city o f Antigua, for instance, document the ability o f rural people "to establish themselves as permanent market participants in competition with urban vendors, to obtain permanent rights i n market space, to cope with hostile administrative structures and to form trading partnerships with urban customers." (Swetnam, 1978, p. 137). The very existence o f the urban market i n Antigua depends on linkages between the city and its rural hinterland, linkages that, in this case, seem to benefit rural residents as much as, i f not more than townspeople. A study o f Dagupan City a medium-sized town in the Philippines showed that it has had strong trade relationships with the primate city, Manila, as well as with other towns and cities in its region. The study concluded that those trade and commercial linkages have not been detrimental to Dagupan's economic development, nor to those people living in the town's surrounding area. Sales penetration and contractual ownership penetration by large Manila-based firms changed but did not destroy local trade relationships. Instead, they stimulated local innovations in distribution and opened new employment opportunities. Dannhaeuser argues that trade with M a n i l a was one of the major factors that kept capital within the Dagupan region instead o f being transferred elsewhere. The expansion o f active marketing by Manila-based firms in Dagupan seems to have mobilized local capital and labor resources that had previously been idle. The expanded economic ties did not impose political dependency on the metropolis. Local  21  officials have levied high license fees for companies and taxes on salesmen doing business in the city, often to the dismay o f the large companies (Dannhaeuser, 1981, p. 165). Richardson comes closer to the truth i n pointing out that "neither the 'diffusion pole' nor the 'parasitic' views o f the role o f small cities are correct as a general rule. M u c h depends on how the functions o f these cities have evolved with respect to their hinterlands, on the institutional and cultural features  o f the country in question and on how policies for  strengthening the small cities are formulated and implemented" (Richardson, 1982, p. 14). A l l o f this suggests that spread effects and beneficial interaction do not happen automatically as small towns and cities grow and diversify or as they are more strongly linked to other elements o f the settlement system. Their economies and linkages must be structured to create benefits for their rural hinterlands and for the national economy. From their studies o f growth poles in developing countries Misra and Sundaram conclude that "unless the new growth centers are planned as regional centers capable o f serving the region they are located in, they cannot become instruments o f modernization" (Misra and Sundaram, 1978, p. 170). Smaller towns must not only serve their rural areas but also be linked to larger centers that can support the wider array o f services, facilities, infrastructure and inputs that are needed to promote agricultural development in rural areas.  Roles and Functions of Small Towns: Evidence from Developing Countries Although the literature on small towns and cities in developing countries has grown so large in recent years that it is impossible to survey all o f it here, samples can be cited to indicate the range and types o f functions that these settlements perform. Examples o f studies which indicate that small towns and cities in Latin America can perform important economic and social functions come from Mexico, Bolivia, Honduras and Guatemala (Beals, 1975; Evans, 1982;  22  Hardoy and Satterthwaite, 1986). Small cities i n Mexico—such as Oaxaca, which has some 100,000 residents—are important market centers for their regions (Beals, 1975). The market in Oaxaca, for example, provides outlets for agricultural goods, livestock, nonagricultural products such as fibers and firewood, and a wide variety o f artisanal products—pottery, baskets, mats and household and agricultural implements. A n impressive array o f people find employment directly or indirectly through market activities—carpenters, stonecutters, healers and curers, butchers, blacksmiths, small-parts sellers and marriage arrangers, mechanics and vendors. The market offers opportunities for farmers to sell their own goods and for a large number o f intermediaries to engage i n trade. Oaxaca supports traders who buy and resell goods within the market, traders who travel to small rural markets to collect goods for resale in the urban market, and traders who buy goods i n the market and resell them door-to-door in town. The market offers opportunities for rural people to shop i n stores located on the market's periphery and to visit doctors, dentists, clinics, lawyers and lenders. Wholesalers collect small quantities o f local products i n the Oaxaca markets and sell them in bulk to retailers in larger cities; they also buy manufactured goods in the city to sell in small lots back i n Oaxaca. The city's market and other commercial activities provide employment for field buyers, agents, truckers and small-load haulers (Beals, 1975). Even very small towns i n Mexico—those with 2,000 to 5,000 residents—support minimum basic services that are not available in rural villages: primary schools, medical doctors' offices, health clinics, pharmacies, gasoline stations, secondary schools, cinemas, restaurants, small banks, hotels and, in some places, dentists, lawyers, veterinarians and technical schools (Doherty and B a l l , 1971). Field studies o f small towns in Honduras and B o l i v i a indicate that even in the poorest countries o f Latin America, towns with average populations o f 10,000 to 12,000 can provide basic health, agricultural supply, educational and commercial services. They are most important  23  as transportation and distribution centers and as markets for agricultural products grown in surrounding rural areas (Evans, 1982). The degree to which markets in small towns can facilitate and promote interaction between urban and rural residents is seen i n anthropological studies o f towns such as Antigua in Guatemala, where the bulk of trade is controlled by rural middlemen and  where  rural vendors  travel  long distances  to participate  i n the  periodic  market  (Swetnam,1978). Similar roles are played by small towns and cities in many African countries (Hirst, 1973; Funnel, 1976; Richardson, 1978; Wunsch, 1979; Haggblade et al., 1989; Baker, 1990; Pedersen, 1990). Small towns in Ghana—like Techiman, with less than 20,000 in population—are periodic market centers for their rural areas. Wunsch notes in his study o f Techiman that trucks come on market day from as far a way as Kumasi, Tamale, and Accra, as well as from rural areas in Upper Volta, M a l i and the Ivory Coast. The town supports retail stores, schools, hospitals and a wide range o f skilled and semi-skilled craftsmen, including physicians, nurses, tailors, carpenters, masons, mechanics, ministers and civil servants. Larger towns such as Obuasi with a little more than 30,000 residents, have a wider range o f agro-processing, marketing, service, commercial and informal sector activities. Moreover, Obuasi encompasses a population that is socially, religiously and ethnically heterogeneous. In the 1970s, it had more than 90 voluntary associations including religious, ethnic, occupational, trade, recreational, lodge, and secret societies (Wunsch, 1979). Studies in West Bengal, India, have revealed that rural towns with even as few as 5,000 residents can act as "minimal urban centers" for their rural regions (Corwin, 1977; Wanmali, 1985). These West Bengal towns are reported to: - serve as economic, political and cultural centers for the population o f the villages i n the surrounding rural micro region;  24  - provide the market where products not locally produced and specialized goods and services are available, and where local products may be sold; - provide the wide range o f occupational specialists not usually found i n rural villages, but necessary for the continuing existence of a primarily agricultural rural population; - serve as centers in which administrative and educational specialists representing the wider society and its urban centers meet and interact with the local rural population; - be characterized by extreme diversity in occupation and heterogeneity in population, regardless of their relative size as urban centers (as rural towns, such settlements exist to serve a nonresident population dispersed in agricultural villages); and - characteristically draw a large segment o f the elite population from far outside the immediate locality, recruiting on the basis o f education and experience in specialized administrative, professional and educational positions (Corwin, 1977, p. 39). In his studies o f small central places i n India, Johnson found that they are particularly conducive to commercial and industrial activities that cater to local, short-term market demands and that have a small potential number o f customers who are within easy reach by foot, bicycle or other forms o f transportation (Johnson, 1974). Thus, small towns in India frequently contain a wide array o f small retail stores, personal and commercial services, and small cottage processing, fabricating or simple manufacturing operations. Those activities that cater to a small portion o f a larger region can also be located successfully in small towns and cities i f adequate transportation and additional services are present. The most frequently found economic activities in Indian towns are weight-losing and bulk-reducing processing activities, such as sugar mills, saw mills, livestock slaughtering houses, canneries and o i l crushing mills. These localized activities in turn create demand for transportation and supply services, brokerage, storage, credit and insurance services.  25  Studies o f rural industries in South Korea and Taiwan indicate that, in addition to supporting resource-processing activities, small towns and small cities are also good locations for small market-oriented activities such as animal feed shops, ice manufacturing plants, and production o f clay building materials, earthenware, hand tools, and small concrete products. Medium-sized towns support a wider variety o f services, including: commercial printing; motor vehicle repair; and small machine, galvanizing and metal processing shops. Simple assembly, mixing or finishing activities and separable manufacturing operations can also be efficiently located in small towns and cities, i f they have good transportation links with larger urban centers (Ho, 1980). In Southern Thailand towns from 14,000 to 57,000 in population provide health clinics, small hospitals, postal and district government services, elementary and secondary schools, small libraries, banks, bus services, telephone exchanges, and some types o f vocational and higher education. Although few systematic studies have been done o f the "influence" areas o f small towns and cities i n developing countries, estimates made in South Thailand indicate that the larger and more diversified centers—with median populations o f about 33,000—have influence areas averaging 10,000 sq. km, and serve hinterland populations averaging 630,000. Such centers are linked to as many as 22 smaller and less diversified towns within their influence areas (Rondinelli, 1984). Studies o f people who migrated from rural villages to small towns and cities in northeastern Thailand found their level of satisfaction high. Most migrants were able to increase their incomes and find better educational and health facilities than i n their villages o f origin. Although housing conditions i n the towns seemed to be o f lower quality, the studies revealed that migrants on the whole were "rather pleased with their new life in town", and that among those  26  who migrated voluntarily to small towns and cities "there is widespread satisfaction with the quality o f life found at the destination" (Fuller, 1981, p. 92 and p. 101).  Growth Centers and Rural Development In most developing countries, and especially in those o f A s i a and Africa, growth centers are located in rural regions (Appalrayu and Safier, 1976; Mabogunje, 1978; Southhall, 1979; Hinderink and Titus, 1988). The traditional view interprets their role as "parasitic", draining the rural hinterland o f resources such as skilled labor and savings. However, from  another  perspective their location i n rural areas could be viewed as a potential advantage, provided that policymakers can design growth center policies that capitalize on their important locational advantages. One such policy approach so is to promote a more appropriate industrial structure i n the growth center. The standard industrial strategy is to develop large scale manufacturing industries which produce import substitutes with the aid o f capital-intensive techniques. Experience has shown that this type o f strategy is doomed to fail, at least as an instrument o f spatial development. It creates an enclave pattern o f development and suffers from limited market opportunities, too few jobs, and negligible diffusion of benefits to l o w income groups. A preferable, and more feasible, approach is to promote relatively labor-intensive agricultural processing industries which produce food (and intermediate materials) either for exports or the home market. The simple equation o f agro-based industries with small firms located in rural areas is frequently erroneous, since many agricultural industries such as sugar and fruit canning are made up o f relatively large-scale firms that need to locate in or near urban centers for labor supply and marketing reasons. I f the economic structures o f the pole and its hinterland are interdependent, this should facilitate the development of the intraregional road system (important  27  for agricultural marketing and commuting) and o f hinterland-based supplying firms, both o f which increase the probability o f substantial "spread" effects. The location o f a vigorous growth center in a rural region has other advantages. The emergence o f a stable hierarchy o f service centers may be critical to the efficient delivery o f basic services, such as health, education, and social welfare, to the rural population. The provision o f these services and accessibility to them may be a key factor in whether the rural population stays in rural areas or migrates to the large cities. The growth center w i l l very probably be the apex o f this service center hierarchy. Promoting the growth center may bring into the region supply facilities for higher order services that are otherwise obtainable only outside (e.g., in the primate city). More importantly, the strength o f the upper levels of the regional urban hierarchy may influence the  stability o f the settlement pattern in lower level centers, owing to such  considerations as reinforcement o f the transportation and communication network and firmer administrative control o f service functions. The provision of more and better services is critical to raising rural living standards. In many developing countries, the rate o f aggregate population growth remains so high that the potential land resources/labor ratio is not only very low, but falling quickly (Geertz, 1963; Lipton, 1977, 1982; Gilbert and Gugler, 1992). Thus it w i l l become increasingly difficult for the rural population to eke out a living from the land, and conditions o f rural labor surplus are unavoidable. The implication is that off-farm employment opportunities w i l l have to be created, and it is an open question as to whether this should be attempted in villages or in accessible larger towns. The village approach is difficult to implement effectively and is, at best, only a partial solution. More urbanization is inevitable, whether planned or unplanned. Moreover, urbanization is the most clearly demonstrated instrument for reducing fertility rates. Successful rural development strategies may be little more than population boosters, with the additional  28  mouths more than nibbling away the gains from rural investment and improvement. If a planned urbanization strategy is chosen, a growth center component is desirable. A regional growth center's key advantage is that it offers an alternative destination to the primate city for ruralurban migrants. Since this alternative is located within the "home" region, the growth center may help to retain population in the region and enhance the possibility o f easy return migration to the rural areas i f rural and village job prospects improve. If the migrant moves to the primate city, on the other hand, s/he is much more likely to be lost to her/his home region forever. These arguments suggest that the seeming contradiction between an emphasis on rural development and the existence o f growth center strategies is more an illusion than reality. Only in very rare circumstances can the needs o f the national population be satisfied v i a sole reliance on rural development. Furthermore, to use a growth center as an instrument o f rural development implies promoting it in a different way than in the past. The historical precedents o f heavily capital-intensive  expansion,  disfunctional  enclaves  creating  intraregional  core-periphery  relationships, hinterland underdevelopment, and regressive income impacts are too obvious to allow expectations that growth centers w i l l stimulate the development o f rural regions as a matter of course. Growth centers must be designed expressly for this purpose and implemented with great care.  Agropolitan District In contrast to the growth center approach, there have been other suggestions on how rural areas might be developed. One o f the more interesting ideas is that o f the "agropolitan district" (Friedmann and Douglass, 1976; Friedmann and Weaver, 1979; Friedmann, 1980). Friedmann argues that growth centers imply an urban-industrial strategy. Instead, he suggests, elements o f urbanism should be introduced into rural areas via the "cities-in-the-fields" approach, involving  29  the creation o f a spatial unit namely the "agropolitan district" which is larger than the village. The agropolitan district supplies services, provides off-farm jobs, and is self-governing. Normally, it would have an average population density in excess o f 200 persons per square kilometer, contain a core town of 10,000-25,000 with a commuting radius o f 5-10 kilometers (walking or cycling distance), and have a total population o f 50,000-150,000. Most o f the labor force would be agricultural, but there would be some small-scale light industry, agro-processing and agro-supplying industries, and a variety o f service activities. The functions o f the district would be financed by retaining local savings, the substitution o f volunteer work for taxes, the transfer o f capital from the primate city to rural areas, and changing the internal terms o f trade i n favor o f agriculture. The major difference between the agropolitan and the growth center approaches is that the former aims to resist urbanization, whereas the latter is ideally embodied within a national urban development strategy. The objections to the agropolitan district revolve around the issue o f its feasibility. It would require far-reaching institutional and political reform. Since the key principle is self-governance backed up with sufficient financial resources, implementation would require communal ownership o f landed wealth, land reform to rationalize holdings, and a reversal of the flow o f savings from rural to urban areas. There is also the striking contradiction between the emphasis on participation and self-government at the local level and the authoritarian regimes that are so endemic i n the developing world. It is difficult to foresee rich elites voluntarily giving up political power and wealth to permit the realization o f some abstract spatial idea. Moreover, whereas a growth center strategy is very selective spatially, with the chances o f success declining as the number o f designations increase, the agropolitan district approach seems to call for an even scatter o f a larger number o f districts. In most cases the required network o f a system o f dispersed towns in the 10,000-25,000 range does not exist, and it is unclear how they would be  30  created—whether by selecting certain villages for expansion or by establishing new rural towns. These implementation issues have not been addressed by  proponents o f the agropolitan  approach.  Rural Central Planning The growing interest in rural central planning results from a renewed interest in rural development as part o f a 'basic needs' strategy, with emphasis on the goal o f greater equality i n benefit distribution o f the national development efforts. 'Basic needs' comprise not only social services such as education and health care, but also income (i.e., productive work) for the rural poor within and outside o f agriculture, and better economic services (i.e., credit, agricultural input distribution and marketing). This renewed emphasis on rural development comes from many administrators, economists, sociologists and others realizing that the old axiom i n economic theory about automatic 'spread effects'  in development is no longer tenable in  developing countries, i n the light o f much concrete evidence during the past two decades ( U N , 1979). While per capita income i n developing countries has grown, the number o f poor has also grown and their income has decreased. Polarization and growing income gaps between rural and urban people have resulted. According to the U N , development strategies in developing countries have centered on rapid industrialization and urban development (United Nations, 1979). There is no dearth o f policy statements extolling the merits o f rural development, yet i n practice it remained a low priority, as the budgets o f many countries show. The allocations for agricultural research and extension, for instance, are invariably low. The same holds true for social and other economic services for rural areas, e.g., infrastructural development.  31  The neglect o f rural development has become apparent. Mass migration to "primate' cities has produced desolate slums. For every newly created urban job, several rural unemployed migrants come to the city, necessitating further expenditures on housing, infrastructure, and services. Nonagricultural production has increased, but per capita food production has stagnated despite the "Green Revolution.' Governments have had to spend scarce foreign currency to import foodstuffs (which could have been produced locally) rather than to purchase much needed machinery, spare parts and industrial raw materials (United Nations, 1979). Rapid population growth i n cities is certainly both a consequence  and a major  contributing factor to the stagnation o f rural growth. The benefits o f increased productivity have been virtually overtaken by the growing number o f mouths to be fed. Nevertheless, to blame population growth alone for the present unsatisfactory state o f affairs is too easy and offers only a partial explanation. After all, per capita income has expanded. The problem is much more one o f unbalanced (sectoral) growth and a skewed distribution o f the growth's benefits. The literature discussed above indicates that linkages o f rural areas to urban areas can be identified v i a some main variables. One variable is population mobility from rural to urban areas. These people are mostly landless laborers i n rural areas and they move to urban areas looking for jobs. Because their skills are mostly related to agricultural activities, it is difficult for them to find jobs in urban areas. The jobs available in urban areas are primarily related to manufacturing and services activities. Therefore, the majority o f migrants become involved i n informal sector activities i n urban areas. The literature also indicates that migrants quite often send money to their families left behind in rural areas. The remittances sent from urban areas are often invested in opening small shops, improving their housing or buying land i n rural areas (Hugo, 1981; Firman, 1994). Thus, capital flows from urban to rural areas v i a remittances (or money which  32  they bring back when they visit their families in the villages) have significant impacts on economic activities in rural areas and rural development in general. Other linkages between rural and urban areas are with regard to production. The majority of agricultural commodities produced in rural areas are sent to markets i n urban centers where most o f the consumers are located. Many rural people visit markets located in rural or urban areas to buy manufacturing goods (which are produced in urban areas) such as clothing, soap, and cigarettes. Thus, it is clearly indicated that rural-urban linkages occur not only v i a the flow o f migrants and agricultural products from rural areas to urban areas, but also through the flow o f remittances and manufactured products from urban areas to rural areas.  The Impact of the Green Revolution and the Process of Rural Change After the first decade o f the Green Revolution and its new rice technology based on H i g h Yielding Varieties ( H Y V ) ,  many scholars concluded that the fruits o f this agricultural  intensification would be enjoyed mainly by large landowners (Sayogyo and Collier, 1973; White, 1976;  Sayogyo and Wirandi, 1985). Consequently, it was argued that development would take  place largely at the expense o f the landless (Antlov, 1986). There were many studies showing effects on the overall agricultural employment situation and especially on aspects such as the harvest ( Stoler, 1977; Collier, 1981; Husken, 1984). Until the introduction o f the H Y V s , the harvest had been open, meaning that everybody who wished to could participate and in return get a share o f the harvest. In particular, it was an important source o f income for many landless women. This was replaced by a more efficient closed harvest system in which only a limited number o f precontracted male workers were allowed to participate. The harvest is only one o f several aspects in which the poor, and especially the landless, were found to experience a deteriorating situation as a consequence o f the Green Revolution.  33  W i t h rapidly increasing yields and the subsequent commercialization o f agriculture, the rich could invest much o f their surplus in extensions to their large land-holdings. Land become concentrated in fewer and fewer hands, a process which would further widen the gap between rich and poor. Other arguments mainly focus on the Green Revolution's insufficient contribution to broader aspects o f rural development. First, the concentration of efforts on rice production has had a negative impact on the area,under secondary crops, especially those grown in irrigated fields, commodities such as maize, soybeans, groundnuts and cassava. Second, it has been argued that the various programs did not improve the position o f the very small and landless farmers (Tjondronegoro, 1991). Credit was not provided to them for lack o f collateral, and the commercialization o f production relations often decrease an agricultural laborer's opportunities to earn a cash income. Third, the policy discriminated against farmers who didn't grow rice, mainly those situated i n the upland areas and drier parts o f the country. Thus the programs did not only fail to alleviate the positions o f certain social groups, but also left out certain areas. In retrospect, however, the Green Revolution provided most rural groups with new opportunities, with derived benefits varying considerably. Based on my interviews with rural people i n Dumoga Subdistrict, it seems fair to conclude that although most groups are better off now than some twenty years ago, the gap between rich and poor has further increased. There is a small group o f commercially minded farmers who have benefitted the most, many o f whom had large resources at their disposal. Those who have profitted have invested their surplus by buying more land. Through the expansion o f state expenditures, the economic standing o f civil servants has also grown rapidly. In the four villages under study, the main advantages o f this development have been reaped by subdistrict officials, civil servants who are working in education, health, and  34  agricultural services located in the subdistrict, and some village officials, who are now among the village wealthy. Another small group o f villagers has been able to take great advantage o f the increasing government expenditures in rural areas. These are the entrepreneurs in the construction sector who have been able to secure contracts for various local government-sponsored building projects, such as for construction o f roads and bridges. Such entrepreneurs have made huge profits, part o f which they have invested i n land, but they have also been used to finance other nonagricultural investments. Through their activities, these entrepreneurs have been able to provide a large group of villagers with nonagricultural occupations. Although these entrepreneurs are a very limited group, they have been an important and dynamic force in the diversification o f the village economy. After more than three decades o f development, rural areas have experienced numerous changes. The changes have occurred both i n agricultural and nonagricultural production, employment structure, income opportunities and social structure. Various rural development policies that have been taken by both central and local governments have played a significant role in influencing the process o f change throughout the country. Such policies are directly aimed at the agricultural sector, and strive to improve physical infrastructure, increase rural income by enlarging rural employment opportunities, and also intervene i n social service provision to upgrade the living conditions in rural areas. There are numerous studies which analyze the impact o f agricultural production programs on rural employment and income distribution (Collier, 1978, 1981; White, 1976; Jones 1984; Kasryno, 1986; Manning, 1988). The studies indicate that the agricultural development and its related policies have been accompanied by complex changes in the rural employment and income conditions. Furthermore, the findings indicate that there were great differences in impact—  35  between regions, within region, and between households. It is important to note that the early studies (during 1970s) were often rather negative on employment and income effects of technological innovations. O n the other hand, the later studies (done in the 1980s) have shown that in general the Green Revolution has had a positive impact on rural employment and income. A study done by Kasryno, (1986) analyzing 1980 census data, indicated a shift in youth employment  (those i n the  10-29 age  group) out o f agriculture, implying the  start o f  intergeneration mobility o f labor on Java away from farming. There were other interesting developments and trends in rural employment and agricultural incomes. Based on microstudies, Kasryno found that i n the period 1977-1983 the relative share o f income from all farming-related activities remained largely unchanged, while the component o f farm labor income declined from 42 percent to 28 percent o f total income. This process was accompanied by an increase in income generated by off-farm employment, which rose from 12 percent to 23 percent o f the total income. A study done by Manning (1987) confirm this increasing importance o f the nonfarm sector for the income o f rural households. Kasryno's data show a total rural income increase over six years, rising by approximately 11 percent per annum. This indicates improvements in productivity o f both off-farm employment and on-farm employment. In analyzing various data sources, Manning (1988) found that the rapid growth i n rice output has been accompanied by some increased employment i n agriculture. He argued that this was especially related to the relative absence of mechanization in Indonesia. Similar findings by Jones (1984) suggested that increased public spending in rural areas has been more important for the employment situation in rural areas than agricultural growth. The spin-offs from activities related to public spending appeared to have greater impacts on the service and construction sectors rather than to manufacturing. In addition, although many o f these new, nonagricultural  36  jobs have been created i n the urban areas, generally rural households also benefitted through circular migration. Aside from the above views, there is a notable change on the labor supply side. Increased education and job opportunities in the nonagricultural sector have changed rural people's perceptions about agriculture and rural areas. A greater flow o f information about modern life through television and the mass media stimulates the desired for better jobs, life styles, expectations and living conditions. In the last two decades a large portion o f young laborers have shifted from the agricultural sector to nonagricultural sectors (Gunawan, 1993). However, this phenomenon  is not an indicator that nonagricultural sectors  have  generated  sufficient  employment opportunities, because most migrants from rural areas enter the urban informal sector. They are economically unstable, insecure, and among the lowest income earners in the city. Therefore, they are expected to return to the village at retirement age (Hugo, 1981; Gunawan and Zulham, 1992). Rapid movements o f rural and agricultural labor to urban areas are partly due to strong pull effects o f the urban sector. Some studies indicate that high urbanization has been strongly motivated by substantial differences between agricultural and nonagricultural wage rates, and the perception that nonagricultural jobs are more interesting and satisfying for young, more educated rural people (Castello et. al. 1987; Saefullah, 1994). The rural to urban flow is not necessarily due to an unavailability o f agricultural jobs in rural areas. The movement o f young and educated villagers to urban areas is not simply because o f economic reasons; there are social and psychological aspects which induce migration.  37  Transmigration Program or New Land Settlement New land settlement can be categorized into three types (Nelson, 1973: p.73). First, there is directed settlement, characterized by a high degree o f government control over settlers with respect to: size and location o f farms and land clearing; resale o f land; crop choices; management practices; credit availability; eligibility for land; cooperative organization; and the settlers' contributions o f time to communal activities. The second type is spontaneous settlement, made by individuals or small groups without government assistance, sometimes in the wake o f forest exploitation, sometimes i n advance o f government investments in the area, and sometimes simply by clearing a small part o f government-owned forest. The third type, semi-directed settlement, involves specific government investments and programs o f assistance to spontaneous colonists in the region that is in the consolidation stage o f development. Based on the above classification, it can also be said that directed settlement is an instrument o f three kinds o f policies. First, i n Nelson's view, directed settlement is an instrument of natural resources development policies, and specifically o f land development policy. In this view it is taken in connection with the determination o f the internal rate o f return of the investments made i n directed settlement projects, especially in countries that need loans from agencies such as the W o r l d Bank or bilateral donors. Second, directed settlement can also be seen as an instrument o f policies that aim to relieve tensions in densely populated existing settlement areas. In some countries, the agency in charge o f land reform is also responsible for the execution of settlement projects, (i.e., i N C O R A in Colombia, I E R A C in Ecuador, O N R A in Peru, and the Ministry o f Transmigration in Indonesia). Third, settlement objectives may be related to geopolitical concerns. A number o f projects have been executed in frontier areas in order to safeguard territorial integrity, for example, the Caqueta development in Colombia and the  38  movement o f large numbers o f Javanese and Balinese migrants to West Kalimantan and Irian Jaya (West N e w Guinea) in Indonesia. Such resettlement also plays a role in nation-building. Spontaneous settlement is enhanced by directed settlement. Settlers w i l l locate in the vicinity o f such projects as well as near other types o f natural resource development which imply the construction o f penetration roads. Spontaneous migrants w i l l occupy land on either side o f such roads, and w i l l also proceed along rivers, expecting the facilities under construction there to give them more opportunities. They leave their villages for reasons such as poverty, land shortage,  crops failures and other natural disasters  such as droughts  and  earthquakes.  Consequently, spontaneous settlers are normally found around new settlements that receive support from the state and near infrastructure also provided by the state. Thus, government exerts an important influence on the geographical choices taken by the "spontaneous" settlers. In Malaysia great numbers o f settlers have been moved from the northern and western states o f peninsular Malaysia into its two eastern states. Under the guidance of regional development authorities created by federal legislation, rubber and o i l plantations were established with the necessary processing plants. The factories have their own acreage o f plantation trees plus some land for workers' subsistence crops. Technical assistance and marketing are provided by the estate's personnel and prices are set by the central authorities. Settlers receive their land with a dwelling and have to pay back a large part o f the cost o f their resettlement through annual payments. The Indonesian situation is rather different in that the official transmigration programs suffer from serious logistical problems, such as inputs which often do not arrive in time for the first season's crop; a main crop that has been selected but is not always adequate to the survival needs o f the settlers; and sites which are often ecologically unsuitable and poorly connected to markets (making it difficult for settlers to obtain cash income). In most cases the land used for  39  resettlement is perceived by local people as their own, so tensions emerge between indigenous or local people and the new arrivals (Colchester, 1986). In addition to the official transmigration program in Indonesia, there are also a great number o f spontaneous settlers, who might be termed pioneers. They operate as individuals or small groups and their general performance appears to be much more successful than that o f officially resettled people (Hardjono, 1977). The Indonesian transmigration program is under considerable international pressure to be reviewed or even abandoned, partly because o f the program's political, human rights and ecological aspects, and partly due to its high cost per settler. The loans which the government has undertaken to finance transmigration efforts weigh heavily on the national budget, especially since o i l revenues have fallen. A study by Nelson (1973) o f 24 projects in Latin America concluded that directed settlement is not an adequate instrument o f land development policy. The internal rates of return required for bankable projects relied upon too many unrealistic assumptions regarding the quality of the government services provided and the nature o f the settlers. N o r could directed settlement serve as a means to solve problems such as population pressure in existing/established rural settlements, since the amount o f resources required would be far greater than the means which governments have available. In the face o f these conclusions, sponsors have started to withdraw from policies o f directed settlement, while the numbers o f spontaneous settlers keep increasing. Instead, governments have started to provide services and infrastructure to spontaneous settlers in centers of certain size and not too far removed from main roads already in existence. This trend is also apparent in the older transmigration areas in Indonesia.  40  Conceptual Framework Small towns (district capitals in the Indonesia context) and rural centers (subdistrict capitals) perform a variety of roles i n national development. They are tools for achieving a balanced distribution o f the urban population. They promote and support rural development, and provide functional linkages between rural and urban areas. In some countries they play major roles i n the decentralization o f economic and social activities. The definition o f small towns varies from country to country, but their size is usually somewhere  between that o f a regional  city and a rural center. The majority are directly the result o f agricultural and rural development. Some serve special purposes such as mining and tourism. Small towns in many countries have experienced a decline in their roles as the service centers for their hinterlands. Improvements in all aspects o f transportation and communications and the introduction o f modern strategies o f organization and development in both the private and public sectors have considerably increased the role o f the big cities and metropolitan centers, resulting in out migration from rural areas. In addition to the well-known " p u l l " factors attracting rural out migrants to the large cities, there are also "push" factors such as inadequate marketing systems, uneconomic prices for agricultural products, manpower redundancy caused by mechanization and the Green Revolution, and (sometimes) inequities i n landlord and tenant relationships in the use and development o f agricultural land. The negative effects o f this out migration to the large cities are evident in the formation o f squatter settlements and overcrowded, expensive housing. Studies o f the role and function o f rural centers and small towns, and o f the linkages o f small towns and rural centers in rural development attracted the interest o f many scholars and researchers during the two decades prior to the mid 1980s. Since the late 1980s little attention has been given to the study of rural-urban linkages and development. Instead, the study o f big cities has dominated recent academic discourse. However, the phenomenon o f globalization is  41  affecting not only big cities or urban areas, but also more remote areas, such as rural areas and rural centers. It is expected that today's wave o f globalization and internationalization, with its consequences in the areas o f technology and communication, may also influence the linkages between rural and urban areas. Concerns about the high growth rates o f metropolitan cities and the accompanying deterioration o f the quality o f life have been expressed  i n many scholarly and popular  publications. Since Indonesia is predominantly agricultural and more than 70 percent of the population lives i n rural areas, small towns play crucial roles i n providing the economic, physical, social and cultural bridges between the regional cities and rural areas. In the development o f rural areas, small towns and rural centers need to be strengthened to act  as  sites for exchanging  nonagricultural employment  agricultural and  opportunities  industrial products  and  for providing  for the surplus or under-employed  agricultural  laborers. Deliberate planning o f small towns and rural centers is necessary within a wellarticulated system o f service centers to form a framework for successful implementation o f rural development strategies. The planning and development o f small towns, rural centers and programs for rural development should be integrated, preferably within a framework o f regional planning and development in which the responsibilities o f the various agencies o f the national, provincial and local governments are well-defined. The regional level is probably the ideal level at which the proper integration o f physical, economic and social planning can take place. The key to the role o f small towns and rural centers in developing countries lies in the state o f rural development. The success o f integrated rural development depends on a proper institutional framework which could ensure public participation in planning, decision-making, implementation and evaluation. This implies the inclusion o f a bottom-up approach i n planning and a policy which promotes self-reliance i n rural areas.  42  The studies reviewed above address the relationships between rural and urban areas through economic, social, and physical factors and through the analysis o f the linkages between the rural and urban as two separate entities. In many cases, the studies emphasize the role of the small town in rural development by focusing on its relationship to the rest o f the urban hierarchy. However, there is a dearth o f studies which deal with the government policies which affect these relationships. There is also a lack o f studies which examine how such factors affect rural development. It is necessary to view the rural-urban relationship from the rural perspective, and then to comprehend its linkages throughout the urban hierarchy. Given the lack o f studies o f the linkages between transmigration villages and urban areas, it would also be useful to ascertain how such linkages compare to those o f nontransmigration villages. What is needed for understanding ruralurban linkages is a complete picture, which allows us to examine variables i n such categories as economy, migration, services, infrastructure, technology, and political administration. Finally, data for all such variables in the broader picture o f rural-urban linkages must be interpreted through regional development and planning perspectives. Having surveyed the theoretical literature and empirical studies which discuss the most important linkages between urban and rural areas, and based on my observations in the study areas, it is possible to develop a conceptual framework o f rural-urban relations and rural development. The conceptual framework simplifies the very complex real situation o f ruralurban relations and can be used as a guideline for field work i n order to achieve the goals of the study as proposed earlier. The conceptual framework in Figure 1.1  depicts two kinds o f rural settlements:  transmigration villages and non transmigration villages. The urban areas i n the diagram are classified according to their administrative functions, with the capital city o f a subdistrict as a  43  rural center, the capital city of a district as a small town, and the capital city o f a province as a medium city. Figure 1.1 shows how transmigration villages and non transmigration villages have different patterns linking them to the urban hierarchy. Transmigration villages have strong linkages to medium cities and other big cities and regions (as indicated with thick lines). These linkages are associated with market places, schools, hospitals, and visit to the migrant's place o f origin. Linkages between transmigration villages and small towns are relatively weak (as indicated with thin lines). These linkages are mostly related to market places, schools, and health clinics. Linkages between these villages and rural centers are very weak (as shown with a dotted line). These linkages are limited only to people visiting rural centers for administrative matters dealing with subdistrict government. O n the other hand, non transmigration villages have strong linkages to rural centers (as indicated with thick line). These linkages are associated with market places, and administrative matters dealing with local institutions. Their linkages to small towns are relatively weak (as indicated with thin lines). These linkages are related to market places, schools and health clinics. Their linkages to medium cities are very weak (as indicated with a dotted arrow line). These linkages are because o f those few rich nonmigrant farmers who visit medium cities for education, health, and shopping. N o n transmigration villages have no linkages to other big cities and regions. The Figure 1.1 also indicates that non transmigration villages and transmigrant villages have linkages v i a local people visiting markets located i n transmigrant villages or migrants who visit markets located in nonmigrant villages. This framework shows how the rural-urban linkages can be explored through the following main sets o f variables. 1. (E) the economic variables are the most common variables used to analyze the condition o f communities or households i n a certain area. In this study, a number o f economic variables w i l l be examined. For example, "production" is related to villages' production o f rice, crops, and  44 l i v e s t o c k . " M a r k e t i n g " is related to where and to w h o m rural p e o p l e send their products; and h o w and w h a t k i n d o f goods and u r b a n products are m a r k e t e d to r u r a l areas. " C o n s u m p t i o n " relates to rural p e o p l e ' s expenditures o n b o t h goods p r o d u c e d i n rural areas a n d i n urban areas. " I n c o m e " requires analysis o f the sources o f rural p e o p l e ' s i n c o m e . " C a p i t a l f l o w s " are related to the m o n e y sent or f l o w i n g to u r b a n areas or other regions, and the c a p i t a l i n f l o w r e c e i v e d i n rural areas f r o m afar, s u c h as remittances. 2. ( M ) the variables o f m i g r a t i o n i n c l u d e "rural-urban m i g r a t i o n " , s u c h as w h e n rural people m o v e to t o w n s or cities to f i n d temporary j o b s i n off-farm e m p l o y m e n t . A n o t h e r variable o f " s o c i a l i n t e r a c t i o n " is related to the frequency w i t h w h i c h rural p e o p l e v i s i t their f a m i l i e s or attend s o c i a l or r e l i g i o u s ceremonies i n t o w n s . 3. (SD) the s e r v i c e d e l i v e r y variables c o v e r the l i n k a g e s o f rural c o m m u n i t i e s to f i n a n c i a l a n d credit facilities, education, and health services d e l i v e r e d b y both p u b l i c and private sector. 4. (PI) the p h y s i c a l infrastructure variables i n v o l v e the transportation n e t w o r k s w h i c h serve as channels b e t w e e n r u r a l and u r b a n areas. A n e x a m p l e are transportation f a c i l i t i e s a v a i l a b l e for use b y people i n r u r a l c o m m u n i t i e s to connect w i t h other areas. E l e c t r i c i t y n e t w o r k s a v a i l a b l e i n rural areas, a n d i r r i g a t i o n networks located i n rural areas as the m a i n infrastructure for w a t e r i n g rice fields are other variables. 5. (T) the t e c h n o l o g y variables c o v e r the l i n k a g e s o f rural c o m m u n i t i e s to c o m m u n i c a t i o n and i n f o r m a t i o n related to general i n f o r m a t i o n , agriculture and health. T h e rural-urban l i n k a g e s i n c l u d e d i n these sets o f variables are e x a m i n e d i n the context o f the case study v i l l a g e s i n Chapter F i v e . 6. (PA) the p o l i t i c a l a d m i n i s t r a t i o n variables i n this study i n c l u d e central and  provincial  g o v e r n m e n t s ' budgetary f l o w s to l o c a l government and rural d e v e l o p m e n t , and the structural relationships o f government hierarchy f r o m central to v i l l a g e government. T h e p o l i t i c a l variable  45  is also related to organizational interdependencies,  such as village government, village  institutions (village council, farmer groups, and non government organizations). The informal political decision chains relate to the role o f informal leaders in acting as channels between the rural community and local governments. However, many o f these variables are also directly affected by government policies. Thus, such policies and their means o f implementation should also be analyzed. Following an overview of the case study area in Chapter Two, these policies are examined in detail in Chapter Three. Chapter Four and Five present the case study findings with regard to the comparison between migrants and nonmigrants and rural-urban linkages. Chapter Six and Seven give an in-depth analysis o f how these rural areas are effected by the administrative system and the planning process. Chapter Eight summarizes the main findings and discusses implications for policy.  46  .2 £  c >^ U  3  .5  O *»  C O  o  s  = 0  <D 0 0  .2 Q ?  c  11  12  M  M P  b  a>  • 1—1  CO  O  S t;  FT  u  S £ s  o  e  0  s  o  "*  O 1— a>  o  a «  73 s a W  a  ^  '5. £> -fa  «  U W Q  5  S g o  u ^ 3  o o  S-i  O  Sr  o o o o o o IT) IT,  o '-3 < i-i  u  U  *2  M  > Q  C  ii >  •3 2  s  bO  a  " 3 n, o  3  1 0  rj_,  M  „  s  o  •a 2 •- § T3  ,  a  'DO P-i  S-  .2  C5  P1 1s-3  o  o 3  o  M 0  . u U  o  bo  | I  g J  '-s .a >^  rt  •3 ^ s,  a o a  S  II  <U  W  3  d  3  xTO o 13 c °^  o 2  M  OJD  "  ^ o  S -2  CQ +-» K O  9) U  O  3  a o  s OS -o «  • 1  U  u  „  S  o  13  am  -2  £ - ^ ~  D 2 H ^5 II  W Q h  (U  ^  47  CHAPTER TWO  THE RESEARCH PROCESS AND DESCRIPTION OF STUDY AREAS  Introduction The purpose o f this chapter is to explain in detail the research method applied in this study. This chapter also provides information about the setting and conditions which have affected the population o f both local people and transmigrants. The characteristics o f the four study villages are also defined. The study is based on a combination o f explanatory research and descriptive research. The former is research related to generating explanations which focus on the analysis o f relations among the variables being investigated. The latter describes i n detail specific social phenomena in the communities under study, i n an attempt to explain the relationships among some social phenomena. The first section o f this chapter describes the method of choosing study areas, household sampling, data collection, and method o f analysis. The second section provides about the setting and conditions which have affected  information  population, both local people and  transmigrants, and defined the characteristics of the four study villages. The chapter's third section discusses the national and regional contexts, and is followed by a discussion o f Bolaang Mongondow District, Dumoga Subdistrict, and the four study villages. Finally, it is also necessary to elaborate on the setting and conditions of the capital city o f Dumoga Subdistrict, the rural center called Imandi; the capital city o f Bolaang Mongondow District, the small town called Kotamobagu; and the capital city o f North Sulawesi Province, the medium city called Manado.  48  The Method of Choosing Study Areas North Sulawesi is one of the many provinces outside the islands of Java and B a l i that has become a destination area for transmigrants sponsored by the central government. In 1963 part of Dumoga subdistrict's area was designated by provincial and local governments as a location for the first group o f transmigrants from B a l i to locate in North Sulawesi. In the early 1970s groups o f transmigrants from both Java and B a l i followed. W i t h a settlement history o f more than 20 years, it is possible to study and analyze the differences between transmigrant villages and nontransmigrant villages' linkages to rural centers and small towns. Another reason for choosing North Sulawesi is that most studies o f urban-rural linkages in Indonesia have focused on Java. There has been only very limited attention given to the nature o f rural-urban linkages in the regions outside Java. A n important consideration in this study was how to decide on the criteria used for choosing study areas or selection of villages. Selection o f particular study sites was conditioned in part by the experiences and background o f the researcher and the locations o f the places to be studied. A t the beginning o f the project, an observation o f each village was carried out. Officials at the District Bureau o f Statistics and the District Development and Planning Bureau were contacted in order to obtain data, reports, maps, and to elicit help in gaining the confidence o f local leaders and residents i n the selected survey areas. Field observation and analysis o f secondary data allowed the researcher to determine the village's characteristics and also to determine which villages were dominated by local people and which by transmigrants. A number o f researchers have stressed that different types o f agriculture involve different forms o f production with concomitant variations i n patterns o f social relations (Paige, 1975; Friedman, 1980). The forms o f agricultural production in North Sulawesi can be classified into three types: plantation agriculture, dry season crops (palawija), and the predominant wet rice  49 (sawah) c u l t i v a t i o n . These categories are based not o n l y o n the type o f crops g r o w n , but also o n the s o c i a l relations o f p r o d u c t i o n associated w i t h each f o r m o f p r o d u c t i o n . T h e first o f these forms is the m o s t c o m m e r c i a l i z e d , w h i l e the s e c o n d type is the least c o m m e r c i a l i z e d . I n D u m o g a subdistrict, there is o n l y a v e r y s m a l l p r o p o r t i o n o f the p o p u l a t i o n active i n p l a n t a t i o n agriculture. A large p r o p o r t i o n o f v i l l a g e s , h o w e v e r , depend o n the seasonal r i c e c r o p . Therefore the s a m p l e p o p u l a t i o n w i l l i n c l u d e o n l y those v i l l a g e s i n w h i c h the p r e d o m i n a n t types o f agriculture are w e t rice c u l t i v a t i o n and dry season crops. T h e f o l l o w i n g criteria were d e v e l o p e d i n order to chose four v i l l a g e s i n N o r t h S u l a w e s i as the m a i n case study, and three v i l l a g e s i n C e n t r a l S u l a w e s i as a c o m p l e m e n t a r y case study. 1.  T h e v i l l a g e ' s m a i n products are r i c e and crops (such as c o r n , soybean, peanut, cassava, and other vegetables).  2.  E a c h v i l l a g e under study must be o f the same a p p r o x i m a t e distance to its c o r r e s p o n d i n g rural center, s m a l l t o w n and m e d i u m c i t y as the other study v i l l a g e s are to theirs.  3.  A c c e s s i b i l i t y a n d r o a d c o n d i t i o n s to the v i l l a g e s must be r e l a t i v e l y easy and g o o d .  4.  B e c a u s e one o f the study's a i m is to investigate differences i n the l i n k a g e s a n d i m p a c t s o f rural d e v e l o p m e n t o n transmigrants v s . l o c a l people, t w o t r a n s m i g r a t i o n v i l l a g e s and t w o non-transmigration  (local  people)  villages i n N o r t h  S u l a w e s i were  chosen,  and  two  t r a n s m i g r a t i o n v i l l a g e s and one non-transmigration v i l l a g e i n C e n t r a l S u l a w e s i . T h e s e l e c t i o n c r i t e r i a above for the case study areas are detailed i n T a b l e 2 . 1 . B a s e d o n the criteria above and a m o n t h o f o b s e r v a t i o n i n the f i e l d , four v i l l a g e s were c h o s e n as a m a i n case study i n N o r t h S u l a w e s i : t w o n o n - t r a n s m i g r a t i o n v i l l a g e s ( a l l l o c a l people), D o l o d u o and D o n d o m o n ; and t w o transmigration v i l l a g e s ( a l l migrants), M o p u g a d Selatan ( w i t h a l l transmigrants o r i g i n a l l y f r o m B a l i ) and M o p u y a Selatan (transmigrants m o s t l y o r i g i n a t i n g f r o m E a s t Java). F o r the three v i l l a g e s i n C e n t r a l S u l a w e s i , T i n d a k i w a s c h o s e n as the  50  non-transmigration village, and Purwosari (mostly transmigrants from East Java), and Tolai (dominated by transmigrants from Bali) as the transmigration villages.  Table 2.1 Characteristics o f the Villages Distance to Province and Village North Sulawesi: Doloduo Dondomon Mopugad Selatan Mopuya ' Selatan  Main Production Rice Crops  Status  RC (km)  ST (km)  MC (km)  16 14  53 51  237 235  X X  X X  21  58  242  X  X  X  good  19  56  240  X  X  X  good  Central Sulawesi: 23 Tindaki 28 Purworejo 32 Tolai Center, Note : R C = Rura:  Transmi -gration  Road Condition  Nontransmigration  X X  X X 103 103 X X X 108 108 X X 112 112 X ST = Small Town, M C = M e d i u m City  X  good good  good good good  Doloduo Village and Dondomon Village are known as two o f the oldest villages located i n Dumoga Subdistrict. Both villages are dominated by local people called the Mongondownese. A s agricultural villages, the main production is rice and some crops. Because o f their fertile land, farmers can produce rice two times per year, or sometimes three times i n a two-year span. The people o f Mopugad Selatan Village are mostly Balinese and, M o p u y a Selatan Village is dominated by Javanese. Both villages are known as transmigration villages, among several located i n the Dumoga Subdistrict or Dumoga Valley. These two transmigration villages produce mainly rice, some crops and vegetables. They can harvest rice two times per year or three times in a two-year period.  51  Ethnicity is another criterion for choosing the villages sampled i n the main case study, because o f the assumption that ethnicities have a strong impact on people's links to rural centers, small  towns,  and  Mongondownese  medium  cities.  This  study  selected  three  ethnic  groups,  namely,  (the indigenous people), Balinese, and Javanese. Both the Balinese and  Javanese i n this case study moved to the Dumoga Valley between 1974 to 1976. Most o f the rice fields located in these four villages are directly connected to irrigation systems. A l l villages are connected to an asphalt road in good condition and serviced by mini buses which run to rural centers and small towns. The mini buses are operated as private enterprises. One big bus, organized by the provincial transport department, runs once a day from Doloduo to the medium city (Manado) the capital city o f the province. The distances from the four villages to the rural centers, small towns, and medium cities are relatively similar, as Table 2.1 indicates.  Household Sampling In Indonesia, a village register o f households is kept by village officials. The register provides basic demographic information about all residents. This information is used as the basis for village statistical reports and as a record of population to be enumerated in the decennial census. Therefore, the registers are most accurate at the time o f the census which is when they undergo extensive updating. In the four sample villages in North Sulawesi and the three villages in Central Sulawesi, the registers were organized in the same way. Household members were listed together, with the first entry being the household head. Almost all information was available on the age, sex, and religion o f each o f the household members. Other information, such as details o f main occupation, schooling, literacy, and ownership of specific types o f consumer goods was also sometimes available.  52  When a register was deemed suitable for use as a sampling frame, the register was updated using information available from the heads o f each neighborhood (dusuri). From the updated register, a sample o f 239 households and 60 respondents was drawn including village officials, informal leaders, elders, planners, politicians and entrepreneurs in the four villages, rural center, small town, and medium city o f North Sulawesi; and 49 households and 35 respondents  including village officials,  informal leaders, elders, planners, politicians and  entrepreneurs in the three villages, rural center and medium city o f Central Sulawesi. Details on the respondents interviewed during the field work are shown in Table 2.2. The sampling method used was systematic sampling with a random start. After the initial sample selection, a further systematic sample o f 3 households from the original survey o f each village was undertaken. These 3 households were to serve as replacements if, for any reason, it was not possible to contact sampled households. Table 2.2 Total Respondents Interviewed Province and Village North Sulawesi: Doloduo Dondomon Mopugad Selatan Mopuya Selatan Rural Center Small Town Medium City Total Central Sulawesi: Tindaki Purwosari Tolai Rural Center Small Town Medium City Total Total respondents  Household  Village Official  Informal Leader and Elder  Planner  76 52 56 55  2 2 2 2 2  4 3 3 3 6 3 2 24  -  -  -  -  -  -  -  239  10  16 16 17  2 2 2  -  -  49 288  6 16  -  3 3 3 2 2 2 15 39  Politician  -  -  2 3 3 8  1 2 3 6  -  -  1 2 2 5 13  1 1 2 8  Entrepreneur 1 1 1 1 2 4 2 12  1 1 1 2 2  7 19  53  Data Collection and the Questionnaire The first period of field work took place in North Sulawesi and Central Sulawesi for five months between October 1995 and February 1996. The second period o f field work took place in North Sulawesi for two months during December 1996 and January 1997. The primary data were gathered through the use o f questionnaire surveys. The core instrument for these surveys was developed i n September 1995 after preliminary field interviews and discussions with researchers working at the Institute o f Management and Development Studies, Economics Faculty, Sam Ratulangi University, Manado. Each household questionnaire consisted o f five sections. The first section asked for information from the head of household related to age, education, place o f birth, marital status, number o f children, number of family living i n the same household, and the nature o f the relation between each family member and the head o f household. The second section was directed towards gaining household information. Information was gathered from the head and spouse on their employment histories, ownership, housing as well as socioeconomic and demographic characteristics. The third section o f the questionnaire asked about their main production, cost o f production, marketing, consumption patterns and capital flows. The fourth section sought information about the family linkages to other villages, rural centers, small towns, and medium cities, or their commuting patterns (e.g., journey-to-work, education and health facilities, bank, cooperatives, and market). The final section o f the questionnaire asked the head or spouse questions  about  their perceptions  regarding rural development  (including transmigration  programs), terms o f trade, job opportunities, their participation in planning processes and development, government policies on rural development, and the environment.  54  The questionnaire for village officials, informal leaders, elders, planners, and politicians consisted o f 16 open-ended questions designed to elicit opinion and identify issues regarding the following: implementation o f rural development programs, participation of community in planning processes and development, the role o f rural centers and small towns in rural development, the role o f local government on rural development, and central government policies to strengthen local governments and community participation in development. O n average, about two hours was needed to interview the household and less than two hours to administer the questionnaire for village officials, informal leaders, elders, planners, and politicians. Interviewers were carefully selected and received training from the Department o f Economics and Development Studies, Economics Faculty, Sam Ratulangi University. Eight interviewers (5 females and 3 males) were recruited. The interviewers were primarily from rural backgrounds. One could speak Javanese, another could speak Balinese, and some others Mongondownese. A l l were students who had prior experience in conducting social science survey research, and all underwent an intensive training concerned with the survey instrument and the purpose of the study. Household interviews were held either by visiting in the house early in the morning while the respondents ate breakfast or i n the evening after dinner, or i n the rice field during lunch break. Every evening after the day's work o f collecting information from households was completed, all interviewers met with the author to discuss any problems arising from the respondents and to seek solutions together. In North Sulawesi, questionnaires were administered between October 7, 1995 and November 25, 1995. In Central Sulawesi, questionnaires were administered from December 1 to December 20, 1995. A l l interviews were conducted in Indonesian language {Bahasa  Indonesia).  55  The cooperation from respondents was excellent. For instance, i n North Sulawesi there were only 6 refusals from potential respondents, and in Central Sulawesi only 2. In brief, the field work was divided into the following four stages. 1. The first step was a reconnaissance phase to observe and select the villages to be chosen as case studies. The first phase also included a pilot study in a village not included in the sample, in order to pretest the questionnaire. 2. The second step included initial interviews with households in the four villages, and in-depth interviews with village officials, informal leaders, and elders. A t this stage, secondary data were also gathered from the village office. 3. The third step consisted o f interviews held in the rural center, the small town, and the medium city with planners, informal leaders and politicians. 4. A t the fourth and final step, interviews were held i n villages and the rural center and small town to confirm some secondary data and to explore more information with villages officials. Similar stages were applied for interviewing and gathering secondary data in villages, rural centers, and small towns in Central Sulawesi.  Definition of Major Terms Household For the purposes o f the study, a household is defined as a group o f persons who eat and cook together. The inclusion o f the eating and cooking components o f the definition was based on previous research and is considered to define an economic unit i n Indonesian society. A household consists o f all persons who are considered by the household head to be members o f the household and/or those persons who in the previous five years had their normal place of residence i n the household. This time period is considered suitable for theoretical purposes in  56  that economic links, both i n terms o f contributions to production and subtractions due to household consumption, would be expected to be most important during this period.  Household socio-economic status The household socio-economic status is classified based on land ownership, including land they themselves own or rented land. There are four levels: 1. Households without any land. 2. Households with a small piece o f land or less than 0.5 ha. 3. Households with a piece of land between 0.5 ha to 1 ha. 4. Households which have more than 1 ha o f land.  Income of household Household income is the total real income in currencies, or goods and services that could be transferred  into currency by a member o f the household (Rupiah/day; Rupiah/month;  Rupiah/season; Rupiah/year). The household real income includes remittances sent by members of the household working or living outside the village.  Migrant People who were born in a province other than North Sulawesi and later on moved to Dumoga Subdistrict, North Sulawesi. In this case study, all o f the migrants were born on Java and B a l i and moved to Dumoga Subdistrict as transmigrants government.  sponsored by the  central  57  Nonmigrant People who were born in Dumoga Subdistrict or elsewhere in North Sulawesi, and who at the time o f survey live i n Dumoga Subdistrict. In this study, the nonmigrants are identified as local or indigenous people.  Rural center The rural center is a capital city o f the subdistrict (kecamatan),  and the location o f the  subdistrict government and some district services or local agencies (dinas) involved in such areas as agriculture, education, and health. A rural center also has a bank and market which is open twice a week.  Small town The small town is a capital city o f the district (kabupaten), where most o f the local agencies (dinas) are located. Most public services are available in this town, including education facilities up to and including secondary school, hospital and health center, banks, cinema, restaurants, cafes, and shops. The markets i n small towns are open every day.  Medium city The medium city is the capital city o f the province, known as a Kotamadya.  Kotamadya  form the lowest level o f fully autonomous urban government. Governments o f kotamadya  are  able to regulate their own activities and maintain their own sources o f revenue. Thus, the kotamadya governments are able, like those at the district level, to maintain a broad range o f internal planning and service functions within their government apparatus. Almost all public  58  services are available in the city, such as education facilities up to and including universities, hospitals and health centers, recreational facilities, and traditional and modern daily markets.  Data Processing and Analysis A l l questionnaires were coded at the respective field sites by trained coders. Open-ended or unstructured questions were coded on the basis o f what the respondent emphasized i n his or her answer. After the coding, data were keypunched in Manado and transferred onto magnetic tape for analysis using the S P S S X package. The data analysis required two levels o f analysis: descriptive statistic analysis and qualitative analysis. Descriptive statistic analysis is used for analyzing variables indicated through absolute numbers or percentages. This kind o f frequency table is useful for classifying data into cross tabulation. Cross tabulation is a simple method applied to investigate and analyze the relationship between two or more variables. Thus, cross tabulation can be used for hypothesis testing. Qualitative analysis is especially useful for variables related to sociocultural phenomena which are impossible to quantify, such as decisions within the family to move, or the level o f participation o f community association [mapalus]).  in rural development  (e.g., mutual  assistance,  sociocultural  A s mentioned earlier, some difficulties may be encountered in the  process o f sampling, and need to be taken into account in interpretation o f findings. The main variables for hypothesis testing were analyzed by fitting those variables into cross tabulation. The 239 households i n four villages i n North Sulawesi constitute the main case study. The results o f the interviews (both with questionnaire and without questionnaire) with 49 households i n three villages in Central Sulawesi are used to support the findings gathered at the four villages in North Sulawesi. For purposes o f analysis villages are classified into two groups, transmigration villages and non transmigration villages.  59  Description of Study Areas The Country Indonesia is a vast archipelago state that consists o f over 13,000 islands, with some three thousand inhabited and more than ten thousand uninhabited islands. It is the largest country in Southeast A s i a , with a land area o f over two million square kilometers, situated along the equator over an expanse o f more than five thousand kilometers. It has a varied physical environment. In the early part o f the seventeenth century the Dutch obtained footholds on Java and Maluku, and operated until the close o f the eighteenth century in the form o f a private trading company. The Dutch colonial period lasted until 1949, except for two brief periods, in the early 1800s when the British were in control, and in the 1940s during the Japanese occupation (Ricklefs, 1981). The islands o f Java and B a l i , generally referred to as the central or inner islands, are wellendowed with physical factors which are favorable for agriculture. They have mostly welldrained and fertile volcanic soils, enjoy rather favorable precipitation levels and intensive cultivation can be carried out in many areas. Rice and other food crops dominate the agriculture production pattern. The outer islands generally have a less favorable combination o f physical factors. Drainage problems occur on a large scale in some parts o f South and East Sumatera, South and Central Kalimantan, Southeast and Central Sulawesi, and in the southern part o f Irian Jaya. Agriculture development i n these swampy zones is very limited. Soil fertility in a number o f areas in the outer islands has been seriously effected by leaching processes, with considerable areas o f Kalimantan and Sumatera suffering from such problems o f soil impoverishment. Most of the country's perennial tree crop estates and plantations which produce for the world market are located on the outer islands.  60  The differences between Java and the other islands, however, go beyond current patterns of inequity. In terms o f historical, ecological, and population developments, Java and the outer islands are seen as two quite distinct situations (Geertz, 1963; Ricklefs, 1981). The political and economic concentration o f power on Java, particularly in Jakarta, is to large extent based on the extraction o f resources from the outer islands. The labor structure and population processes evident at the micro level in Java are affected by both the social and political structure o f Java and the relationships between Java and the outer islands. One important aspect is also related to the culture. In Java and B a l i , rice is the main staple o f the diet. In the outer islands, other traditional staples (such as corn, cassava, sweet potato, and sago) are the basis o f the traditional diet. The diversity o f Indonesia's  development  has its consequences  for  transportation,  communications, and location o f modern industries. Inter island shipping remains the dominant form o f transportation and many parts are relatively isolated. In these areas, air transport is of key importance. O n Java and parts o f Sumatera, the road and railway systems are rather well developed and communication is comparatively good. Modern industrial development is largely concentrated on Java and some parts o f Sumatera. Most o f the big chemical industries (largely state-run) and other basic industries are found at coastal locations on both islands. Most privately owned and labor intensive small and medium-sized manufacturing industrial activities, which produce mainly consumer goods for the domestic market are found at locations near their customers (i.e., Java). A s the fourth most populous country i n the world, Indonesia reached a population o f 200 million inhabitants in February 1997 . The population growth rate is slightly lower than 2 percent 1  It was predicted by the Central Bureau of Statistics and State Ministry of Population and Family Planning that Indonesia would reach 200 million in population on February 4 1997. Published by Kompas February 5 , 1997. 1  th  th  61 per a n n u m . T h e r e l a t i v e l y l o w p o p u l a t i o n g r o w t h rate is l a r g e l y attributable to a m a s s i v e f a m i l y p l a n n i n g p r o g r a m . T h e n a t i o n - w i d e efforts i n this f i e l d were l a u n c h e d i n 1970. T h e p o p u l a t i o n g r o w t h rate i m p l i e s a d e m o g r a p h i c  structure  that is characterized b y a r e l a t i v e l y y o u n g  p o p u l a t i o n . T h e d i s t r i b u t i o n o f p o p u l a t i o n is e x t r e m e l y u n b a l a n c e d . T h e islands o f J a v a , M a d u r a , and B a l i , w h i c h account for o n l y 7 percent o f the total area,  have close to two-thirds o f the  n a t i o n a l p o p u l a t i o n . T h i s results i n the p o p u l a t i o n density o f J a v a , at a l m o s t 2 0 0 0 persons per square k i l o m e t e r , b e i n g one o f the highest i n the w o r l d . T h e 1990 census (the most recent census f r o m w h i c h results are a v a i l a b l e ) i n d i c a t e d that a r o u n d 31 percent o f the p o p u l a t i o n l i v e d i n urban areas. O u t o f the five largest cities, four are situated o n J a v a Island. R u r a l - u r b a n m i g r a t i o n is a substantial contributor to the urban p o p u l a t i o n g r o w t h . In the p e r i o d 1980-1990, o n average the p o p u l a t i o n s i n u r b a n and r u r a l areas h a d g r o w n b y 5.4 percent and 0.76 percent per year respectively. The  l i m i t s o f e x p a n s i o n o f c u l t i v a b l e l a n d o n J a v a have been reached, yet agricultural  l a n d remains a v a i l a b l e i n the outer islands o f Indonesia. A major p o l i c y o f the Indonesian g o v e r n m e n t and the c o l o n i a l D u t c h a d m i n i s t r a t i o n p r i o r to independence w a s the sponsorship o f p o p u l a t i o n m o v e m e n t f r o m J a v a to these islands. S u c h m o v e m e n t , b o t h t h r o u g h the governmentsponsored t r a n s m i g r a t i o n scheme and t h r o u g h spontaneous m o v e m e n t , has o c c u r r e d , but the costs i n v o l v e d i n these l o n g distance m o v e s and the u n s u i t a b i l i t y o f m u c h o f the l a n d for wet rice agriculture have l i m i t e d the numbers o f migrants ( H a r d j o n o , 1977; W o r l d B a n k , 1988). The  e c o n o m i c structure and c o n d i t i o n s have changed c o n s i d e r a b l y i n the past t w o  decades. F r o m the 1970s to 1980s, the a g r i c u l t u r a l sector ( i n c l u d i n g f a r m f o o d crops and f a r m non  f o o d crops, estate crops, l i v e s t o c k , fishery, and forestry) p r i m e d the engine o f e c o n o m i c  d e v e l o p m e n t as the m a i n contributor to the total gross d o m e s t i c product. I n the 1990s agriculture was replaced b y m a n u f a c t u r i n g as the l e a d i n g sector. It is estimated that the trade sector w i l l  62  become the next main engine o f economic growth in Indonesia. The slow down in world trade i n the m i d 1980s, the relatively poor export price performance o f a number o f non-oil commodities, and the fall o f oil prices in 1986, all led to a deterioration o f external economic conditions in the mid 1980s. The growth rate o f gross domestic product slowed down from an average annual rate of about 8 percent during the 1970s to 7 percent during the period o f 1985 to 1995.  63  C3  C3  O C  O o  © OH  2:  S-i  W)  t Si 05  .1 x <>-  <*2C_I2£>-IDU» «  <  »^ BM  <  So  _  64  North Sulawesi Province North Sulawesi occupies the eastern section o f the long northern peninsula o f Sulawesi (refer to Figure 2.2). The main section o f land is about 600 kilometers long and not more than about 80 kilometers wide. It consists o f four districts (Sangihe Talaud, Minahasa, Bolaang Mongondow, and Gorontalo), and three municipalities (Manado, Bitung, and Gorontalo). Each district has its own unique background and culture. Minahasan and Sangerese people are mostly Christians, Bolaang Mongondowese and Gorontalese are mostly Moslems.  Table 2.3 North Sulawesi: Population B y Sex, 1920-1990 Male Year 295,039 1920 374,000 1930 664,726 1961 861,293 1971 1,069,763 1980 1,255,330 1990 Source: Bappeda, 1994.  Female 292,400 374,000 667,772 856,378 1,045,621 1,221,859  Total 587,439 748,000 1,332,534 1,717,671 2,115,384 2,477,189  The population o f North Sulawesi has grown from more than half a million i n 1920 to over 2 million in 1980 and 2.477 million in 1990. The growth rate o f population during the period 1971-1980 and 1980-1990 was 2.21 percent and 1.60 percent per annum respectively. North Sulawesi's population has grown more slowly than that o f the country as a whole. The changes i n the rate o f population growth are not only influenced by natural increase but they are also affected by migration. In the period 1980-1990, the average population growth in urban and rural areas was 4.76 percent and 0.84 percent respectively. Even though the coastal regions o f the peninsula's northern part have long been densely populated, the interior o f this region is still a pioneer frontier. In the last two decades population growth in some interior rural areas, however,  66  has increased because o f the transmigrants from Java and B a l i as well as spontaneous local migrants. The economy i n North Sulawesi depends mainly on the agricultural sector. The proportional contribution o f the agricultural sector to the total gross regional product ( G R P ) was about 26.92 percent in 1994. A m o n g those five sub-sectors (farm food crops and farm non-food crops, estate crops, livestock, fishery, and forestry) classified under the agricultural sector, the sub-sectors o f farm food crops/farm non-food crops and estate crops shared a relatively big contribution to the total regional gross domestic product, with the proportions o f 10.6 percent and 9.1 percent respectively i n 1994. Looking at the absolute numbers, however, the data indicated that growth rates o f the fishery and forestry sub-sectors in 1993-1994 were about 16.3 percent and 13.3 percent respectively. These figures were relatively high compared to the agricultural sector's overall growth rate (only 7 percent). The second largest contribution to the total gross regional product ( G R P ) was provided by the services sector with around 38.02 percent in 1994. Between the two sub-sectors, government services and private services, which are classified, under the services sector, the shares o f government services and private services in the total regional gross domestic product were about 14.9 percent and 3.2 percent respectively i n 1994. A t the same time, the contribution o f the manufacturing industrial sector to the total G R P was 35.07 percent. Most o f the manufacturing activities in North Sulawesi are classified into small-scale industries, producing mainly food and beverages, cigarettes, textiles, furniture and handicrafts, and agro-processed products. Some basic industries, such as coconut o i l plants and most o f the fish canneries are located i n the municipality o f Bitung, where the main port is located. Other big industries and many small-scale industries are scattered along the corridor between Manado, capital city of the province, and Bitung. It is understandable that most o f the industries in North Sulawesi are  67  concentrated  i n these areas because they can be supported  by the relatively complete  infrastructure required by industries, such as a main harbor, airport, highway, transportation networks, and communication. Since 1995 this area, the corridor o f Manado-Bitung, has been designated by the central government for promotion as one o f the growth centers in Indonesia's northeastern region. Table 2.4 North Sulawesi: The Structure o f Employment by Industry, 1990 and 1994 (percentage) 1990 Industry  M  F  1994 M+F  M  F  M+F  Agriculture  63.67  38.95  56.49  64.20  41.77  57.74  Manufacturing  12.59  14.53  13.17  10.90  10.98  10.95  Service  23.74  46.44  30.34  24.90  47.25  31.31  100.00  100.00  100.00  100.00  100.00  100.00  Total  Note: M = Male, F = Female Source: Bappeda, 1994; Statistics Office, 1995 A comparison o f employment in the various sectors is shown in Table 2.4. The data clearly indicate that more than 50 percent o f employment was found i n the agricultural sector. The proportion o f employment absorbed in manufacturing activities was relatively small and decreased slightly from 13.17 percent in 1990 to 10.95 percent in 1994. A t the same time the proportion o f employment i n the agriculture and service sectors slightly increased. Males took most o f the agricultural employment (64.20^percent), and females dominated employment in the service sector (47.25 percent). The higher proportion o f females in the service sector may be due to the fact that many o f them are employed i n the trade, hotel and restaurant, banking, and government sectors.  68  Bolaang Mongondow District The Bolaang Mongondow District (kabupaten) is one o f four districts in the province o f North Sulawesi. The district, an area o f 8358 square kilometers (30.4 percent o f the total area o f North Sulawesi), is located between Minahasa District and Gorontalo District (Figure 2.3). The district has good access to major road and transportation networks. The Trans-Sulawesi highway crosses the northern coast o f the district and another highway crosses the district's southern coast. Between these two highways, another highway crosses through the hills and valleys o f the middle o f the district to the national park on the district's western side, bordering Gorontalo District. W i t h an average population density o f 47.04 persons per square kilometer in 1994, Bolaang Mongondow District is the least densely populated district in the province o f North Sulawesi. In 1994 the population numbered around 393,211 persons, consisting o f 200,870 males and 192,341 females. In other words, the district had a sex ratio o f 104.43, the highest among the districts and municipalities i n North Sulawesi. There were about 85,428 households, with an average o f 4.60 persons per household. The district is administratively divided into 15 subdistricts (kecamatan) and 243 villages (desa). Table 2.5 Bolaang Mongondow District: Population and Density Year  Population  Persons/km2  150,127 1961 208,609 1970 299,696 1980 372,725 1990 393,211 1994 Source: Bappeda, 1992; Bappeda, 1994.  17.96 24.95 35.85 44.59 47.04  The structure o f employment classified by sector is shown in Table 2.6. The data indicate that the majority o f employed males and females i n Bolaang Mongondow were working in  69  agriculture. The service sector absorbed the second largest proportion o f employment. The proportion o f females involved i n the service sector was more than two times that o f their counterpart males. The proportion o f people engaged i n manufacturing activities was relatively small. A s at the provincial level, males dominated i n agricultural activities and females were concentrated in the service sector.  Table 2.6 Bolaang Mongondow: The Structure o f Employment by Industry, 1994 (percentage) Industry M Agriculture 73.75 Manufacturing 8.42 Services 17.83 Total 100.00 Note: M = Male, F= Female Source: Statistics Office, 1995  F 42.70 8.08 49.22 100.00  M+F 67.29 8.34 24.37 100.00  In the distribution o f Bolaang Mongondow's gross regional product ( G R P ) among the agricultural (A), manufacturing ( M ) , and services (S) sectors between 1990 and 1993, the largest share was contributed by agriculture. Agriculture's contribution slightly increased from 49 percent in 1990 to 50.95 percent in 1993. The district has almost 170,000 hectares o f agricultural land, with around 42,791 ha farmed in wet rice with irrigation networks and about 7,000 ha without irrigation systems (rain-fed fields or sawah tadah hujari). W i t h almost 50,000 ha o f rice fields in 1992, the district has the largest area o f rice fields o f any district in North Sulawesi. Most o f the wet rice fields are situated in Dumoga Subdistrict, where the four case study villages are located. Dumoga Subdistrict is called the "rice barn" o f North Sulawesi.  71  Table 2.7 Bolaang Mongondow: Sectoral Distribution o f Gross Regional Product, 1990-1993 Sectoral Distribution (%) Total S M A 100 38.41 12.20 49.39 1990 100 12.22 36.86 50.92 1991 36.21 100 12.32 51.47 1992 36.44 100 50.95 12.61 1993 Note: A = Agriculture, M = M i n i n g and quarrying, manufacturing, utilities, and construction. S = Services. Source: Bappeda, 1994 Year  The biggest part of agricultural land in Bolaang Mongondow consists o f plantations o f coconut, clove, nutmeg, cocoa, and vanilla. Some o f these commodities are exported both to other provinces in Indonesia and to other countries. These plantation areas are distributed in small plot areas o f small-holder production, and organized by local people. However, because the price o f these crops is relatively unstable, being subject to fluctuations on the world markets, and the terms o f trade are relatively poor, farmers have not given serious attention to or organized the plantations efficiently. Table 2.8 Bolaang Mongondow: Planted Area by Rice and Crops, 1994 Plantation Rice: Wet rice fields Rain-fed fields Coconut Clove Coffee Nutmeg Cocoa Vanilla Pepper Others (corn, cassava, sweet nuts, vegetables, fruits, etc.) Total Source: Bappeda, 1994  Area (ha) 49,791 42,791 7,000 46,715 7,526 3,422 96 989 232 74  (%) 29.44 25.30 4.14 27.62 4.45 2.02 0.06 0.58 0.13 0.05  60,245 169,090  35.62  potato, 100.00  72  Table 2.8 indicates that around 35.62 percent o f agricultural land in Bolaang Mongondow District is planted in corn, cassava, sweet potato, nuts, vegetables and fruits, all crops which were traditionally staples o f the Mongondownese diet. However, when the wet rice fields were developed and supported by dams and irrigation networks built i n the early 1980s, rice became the main production crop i n the region. A t the same time, the main staples o f the diet of most population in Bolaang Mongondow gradually changed from corn, cassava, and sweet potato to rice. Some people i n the region still rely on both corn and rice as their main staples. The manufacturing sector's contribution to the total gross regional product from 1990 to 1993 was less than 13 percent. A l l manufacturing activities included in this sector were smallscale industries: food industries, ceramics industries, brick industries, furniture industries, utilities for agricultural production, and handicrafts. Most o f these "industries" were family-run or home industries. There are many small industries and craft production related to agriculture and simple agro-processing, dispersed throughout the countryside. Palm sugar processing is the most common, especially in Passi Subdistrict. Another kind o f agro-industry, rattan manufacturing, is concentrated in Kotamobagu Subdistrict, and bamboo-craft i n Lolayan Subdistrict. This primary and secondary production is partly reflected in the trade flows at traditional markets i n the subdistrict centers or rural centers. In most rural centers there is a market which i n some places is open five days and others only two or three days per week. In addition, there are markets i n some o f the larger villages. Commodity flows and trader movements at the market link subdistricts to one another and moreover link the countryside to the outside world. The share o f the service sector in total gross regional product has decreased, mainly in the government subsector, from 38.4 percent to 36.4 percent. The drop is probably because local government has limited recruiting new public servants and has reduced expenditures for public  73  services. Some subsectors such as trade, transportation, and government contribute a relatively large share to this sector. The banking subsector and other services contribute relatively little to the services sector total.  The Villages The four villages selected for study are located i n Dumoga Subdistrict o f Bolaang Mongondow District. Figure 2.4 displays the location o f the four villages. T w o villages, Doloduo and Dondomon (both non-transmigration villages) are located 16 kilometers and 14 kilometers respectively on the west of the subdistrict capital or rural center. The other two villages, Mopugad Selatan and Mopuya Selatan (both transmigration villages), lie to the northwest, 25 kilometers and 20 kilometers respectively, from the subdistrict capital. O f the  four villages, Doloduo and Mopuya Selatan  have the  easiest access to  Kotamobagu, the district capital. Both villages have direct public transit services to Imandi (a subdistrict capital), Kotamobagu (a district capital), and Manado (the provincial capital). B y minibus (Kijang) from these two village to Imandi, Kotamobagu, and Manado, it costs Rp 500, Rp 1500, and R p 6500 respectively. The five-kilometer trip between Mopugad Selatan and 2  Mopuya Selatan can be undertaken by oplet, a small minibus, at a cost o f Rp300. From Dondomon to Imandi or Doloduo by public minibus is costs Rp500. The various demographic characteristics o f the four villages are shown i n Table 2.9. O f the four villages, Doloduo has the largest population and the largest village area. Settled by local people in the late 1800s, Doloduo is also the oldest village o f the four villages, and one o f the oldest villages i n Dumoga Subdistrict. Before it was settled, Doloduo was a place for hunting and  At the time of the study in 1995 the rate of exchange between the United States dollar and Indonesia rupiah was approximately $1 = Rp2270. To place this amount within a local context, the wage for an agricultural laborer was Rp5000 per day. 2  75  farming by traditional methods, such as slash and burn, by local people. It was chosen for farming because o f the fertile land and its close access to one o f the biggest rivers in the area, the Ongkag Dumoga River. The river provided water for irrigating farm land by a traditional network system. In the early 1900s, local people started to settle permanently in the area, with a nucleus o f around 20 households in the small hamlet. In 1910, some families migrated to Doloduo from Dumoga Village which is approximately 25 kilometers from Doloduo. W i t h the new migrants, the number o f families in the village then counted around 80 families. According to one o f the elders living i n Doloduo, at that time Doloduo was directly under the traditional kingdom o f Bolaang Mongondow. In the 1930s the Dutch came and took over the village, and people of ages twenty years and over and those married less than twenty years had to pay taxes to the Dutch colonial government. Since the 1950s, Doloduo's population has grown relatively quickly because more people migrated to the area from other subdistricts and also from Minahasa. The most common motivation for this was that people could buy the land very cheaply (1 ha o f land sold for only Rp50). In the early 1950s some local people moved to Dondomon, which is located only 5 k m to the east o f Doloduo. Because o f the flow o f migrants from other villages surrounding Dumoga Subdistrict, the village population grew quite high. The biggest movement o f migrants to the village came i n the m i d 1970s, and was comprised o f both Mongondownese (70 families) and Minahasans (180 families). Even though these two villages had been growing since the early 1950s, road access to the areas remained very poor. In 1972 the main road was built o f asphalt. Before the road was developed, traveling from Doloduo to Kotamobagu (around 60 km) took more than one day by  76  foot or two days by gerobak, a cow-drawn cart. Thus people had to spend days to transport their crops to the market i n Kotamobagu and to buy their daily needs to take home. Mopuya Selatan and Mopugad Selatan are two transmigration villages which were established in 1972 and 1975 respectively. The majority o f migrants who settled in Mopuya Selatan originally came from East Java Province and those in Mopugad Selatan came from B a l i Province. Originally, M o p u y a Selatan and M o p u y a Utara were part o f a single village called Mopuya Village. Because o f the village's rapid growth (a consequence o f both natural increase and in-migration, with limited availability o f land surrounding the village), village officials, elders, and informal leaders decided at a village meeting in 1985 that the village o f M o p u y a would be divided into two independent villages called M o p u y a Utara and M o p u y a Selatan. This agreement was also approved by the Dumoga Subdistrict and local government officials. The same conditions and outcome were experienced by Mopugad Village, which divided into two independent villages, Mopugad Selatan and Mopugad Utara, in 1987.  Table 2.9 Demographic Characteristics o f Sampled Villages Characteristics Doloduo Population 4,571 1993 Number o f 967 Households The Average o f Population per 4.7 Household Area o f Village 1,540 (Ha) Source: Village Offices  V i i lage Dondomon Mopugad Selatan  Mopuya Selatan  1,892  1,695  2,262  351  336  415  5.3 719  5.0  5.4  344  594  77  A l l four study villages receive irrigation. Doloduo gets water from the Kasinggolan D a m which was completed in 1981, and Dondomon, Mopugad Selatan, and Mopuya Selatan from Torout D a m which was completed in 1986. Before the introduction o f irrigation, it was only possible to cultivate one crop o f rice per year, but now it is possible to grow two or three crops o f rice a year. Agriculture in all of the villages is highly integrated into input and output markets. The use o f pesticides, fertilizers, and modern strains o f rice is almost universal. These inputs are mostly bought by farmers from the owners o f the rice m i l l , rather than obtained through the government Inmas program to which, according to local statistics, all farmers in the four villages belong. The Bimas (mass guidance) program, the organization which preceded Inmas, was largely accepted in the area during the late 1970s. The reason most farmers buy their inputs from the owners o f the rice m i l l is that they can get credit and pay later i n the harvest season at prices a little bit higher than the common price. Because o f the geographical location o f the villages and the year-round access to irrigation, the majority o f land not used for buildings is capable o f being used for growing wet rice. Table 2.10 shows a number o f aspects o f agricultural development. The first two measures were obtained from local statistics while the remaining measures were estimates obtained in interviews with village officials. These data indicate that the villages o f Mopugad Selatan and Mopuya Selatan are the most developed agriculturally. They possess more modern agricultural equipment, prepare more o f their land with tractors, and also use outside laborers. However, the variation between villages is not great. This is in large part due to the large-scale changes in agriculture, such as the introduction o f mechanization and the spread of Bimas subsequent Inmas programs, which took place i n the early 1980s.  and the  78  Table 2.10 Indicators o f Agricultural Development by Village, 1995 V i i lage Indicator o f Mopugad Dondomon Doloduo Agricultural Selatan Development 4 1. a. Number o f Tractors 4 2 4 b. Number o f Rice M i l l s 3 7 c. Number o f Corn M i l l s 2. Percentage o f Farmers 100 100 100 involved i n Inmas (1) 3. Preparation o f Land (%) 20 a. Tractor 40 30 40 b. C o w 40 70 60 c. Human Labor 4. Percentage o f Agricultural Labor from 10 15 20 outside o f Village (2) 5. Number o f Farmer 6 4 4 Groups Note: (1) Inmas is an agricultural program o f mass intensification. (2) Refers only to the planting seasons. Source: Village offices and field surveys  Mopuya Selatan 7 5  100 30 30 40  15 5  The most common method o f harvesting is termed bawon. T w o forms o f this method occur. In the first form, harvest is open to all members o f the village, with each harvester receiving approximately one-tenth o f the amount they harvest. The second form o f bawon involves only invited family members who receive a larger share o f the harvest than non related villagers. Another form o f harvesting that was reported i n all four villages was harvesting for wages. According to statistics obtained from the village offices (see Table 2.11), all villages have a high percentage o f inhabitants engaged i n agriculture. The data indicate that Doloduo and Dondomon have relatively high proportions  of employers and government  workers. In  Dondomon, there is an especially high proportion who are working as carpenters, with most o f their customers coming from outside the village and many o f their products found i n small towns. Mopugad Selatan and Mopuya Selatan have a relatively high proportion both o f farmers  79  who own land and farm laborers. In Mopuya Selatan a relatively large number o f persons specialize i n building trades. There are also traders o f items such as house utensils, food and vegetables who travel by bike or motorbike to the other villages surrounding  Dumoga  Subdistrict. M o p u y a Selatan also has many people engaged in transportation, such as minibus drivers, conductors on public transit, and motor cab drivers.  Table 2.11 Primary Occupation o f Persons Aged 15 and Over by Village, 1995  Occupation Farmer (Own Land) Farm Laborer Employer Trader Carpenter Transport Worker Government Worker Construction Laborer Others Total Number Source: Village Offices  Doloduo 43 10 28 4 3 2 8 1 1 100 871  Village (percentage) Dondomon Mopugad Selatan 42 59 15 20 2 20 3 4 10 6  9 1  100 351  5 2 2 100 368  Mopuya Selatan 40 31 4 8 3 4 6 2 2 100 627  The main public facilities available in the four villages are indicated in Table 2.12. In general the data indicate that only Mopuya Selatan has relatively complete public facilities. B y contrast, Dondomon's public facilities are quite limited. A l l villages have a primary school. Only two villages have a junior high school, thus the children from Dondomon and Mopuya Selatan have to walk or travel to other villages which have junior high schools. The public senior high school is only available in Imandi which is a rural center. The public markets located in the three villages are not open simultaneously. There is a schedule which rotates the opening o f each market on a different day for a whole week.  80  Table 2.12 Major Public Facilities o f Sampled Villages  Facilities Market Bank Cooperative School: Primary School Junior H i g h School Senior H i g h School Health Services: Community Health Center Small Health Clinic Center Post Office Source: Village Offices  Doloduo 1  Village Dondomon Mopugad Selatan 1 -  Mopuya Selatan 1 2 1  -  -  -  -  1  6 1  3  1 1  2  -  -  -  -  -  -  -  1  1  -  1  -  -  1  -  -  The Rural Center The rural center is the Dumoga Subdistrict capital, which is called Imandi. It is situated in the middle o f the Dumoga Valley, and the distance between Imandi and Kotamobagu, the Bolaang Mongondow District capital, is around 40 kilometers. The rural center consists o f three villages (Imandi, Modomang, and Dumoga) and has a total population o f 8,393 inhabitants in 1994. The average population density is about 1.6 persons per ha. The population growth rate in the period 1984-1994 was around 2.9 percent per year (Statistics Office o f Bolaang Mongondow, 1995). The relatively high population growth rate was caused by both in-migration and natural increase. A s a rural center located in the middle o f wet rice fields, the main activity of population is i n the agricultural sector which accounts for 80.8 percent o f the total employment. Most people working i n agriculture produce rice and food crops such as fruits, vegetables, and beans. Some o f them also have ponds for fish and livestock. Breeding chickens and ducks are other small scale  81  activities. The population involved in industrial activities amounts to only 1.2 percent. A l l industries located in this area are classified as small industry, producing mostly food, handicrafts, and furniture. The population engaged in trade accounts for 5.4 percent o f the total employment. Most o f these activities such as those o f shop keepers, retailers, traders, and middlemen,  are  concentrated i n the center o f Imandi where the public market is located. Around 8 percent of the population work as public servants, police, and army. A small proportion o f people, slightly more than 1 percent, were involved i n transportation and others activities. Because nonagricultural village jobs are limited, during the slack season, many farmers look for work outside the village. Most o f them move to small towns and/or medium city to find work as construction workers, laborers i n public markets, and laborers i n small-scale industries such as concrete, brick, or rattan industries. Some farmers go to work as gold prospectors in the western reaches o f the region, next to the National Park o f Dumoga Bone. Such prospecting has been banned by local government because most o f the activity is carried on inside the national park. The rural center has a good road network connecting it to villages around Dumoga Subdistrict and to other rural centers, districts, and the medium city. The main public transportation to villages surrounding the rural center is provided by oplet, a small minibus, bendi, a horse-drawn cart, and ojek or motor-cab. The route from Imandi to Kotamobagu is served by kijang, a minibus, and costs about R p l 5 0 0 (in 1995 the rate o f exchange between the United States dollar to Indonesia rupiah was approximately $1 = Rp2270). The route from Imandi to Manado (the provincial capital)  route is served by buses run by department o f  transportation and private companies. Tickets costs about Rp6000 for a four hour trip. Because it is a center o f the subdistrict region, all subdistrict government offices and services such as police, post office, schools (from primary school to senior high school),  82  community health center, and some local government institutions such as agriculture, education, and health, are located in Imandi. There are two public markets, one located in Imandi and the other in Dumoga Village. The markets are open two times a week each on a different day. To support local economic activities, there are two banks (one private and the other government-run) open six days per week. There are shops specializing in groceries, building materials, agricultural inputs and equipment, textiles, furniture and household supplies. There are many warung, or small shops, located in the environs of the public markets and also restaurants, cafes, barbers and hair-salons. The main urban facilities available in the rural center are very limited. There is no sewage or drainage system. Because there is no water supply available, almost all households have their own well for drinking water. Most houses have electricity. For those who have television, regional and national television programs have become the main-stay o f family entertainment. Some wealthier families enjoy other television programs by means o f satellite dishes.  The Small Town The small town is Bolaang Mongondow District's capital and called Kotamobagu. It consists o f 17 kelurahan or villages and all together constitutes a subdistrict headed by a Camat (head o f subdistrict). In 1988 the population in Kotamobagu totalled 40,070 inhabitants and had increased to 50,683 population by 1992. During the period o f 1988-1992 the average annual population growth rate was 3.32 percent. It was predicted by local government that in 1997 the population would total around 63,143 and by 2002 it would reach 76,889 inhabitants (Statistics Office o f Bolaang Mongondow, 1995). The distribution o f population in Kotamobagu is relatively unbalanced. According to 1991 subdistrict government data, most o f the population was concentrated i n the city center,  83  such as in the Kotamobagu and Gogagoman kelurahan,  where the population densities were  around 82 and 79 inhabitants per ha respectively. Population density outside the city center ranged from 46 persons per ha to only 7 persons per ha. Formal documents published by the subdistrict government do not contain information about employment based on main industry. Based on my interviews with government officials who are working i n subdistrict and district offices, as well as interviews with informal leaders, entrepreneurs, and politicians, and confirmed by my direct observations in town (during two weeks in October 1995 and a week in December 1996), it can be assumed that the majority o f population work i n the agricultural sector. Because all local government offices and services are located i n town, there is some employment in the government sector. The trade and industrial sectors absorb a relatively small proportion o f employment. According to my observations, the town starts its activities early in the morning, especially in the two public markets (pasar), called pasar Inpres and pasar Sebelas  Maret,  located in the center o f town. Around 5 a.m. the small trucks with many kinds o f vegetables came from outside town and start to unload the vegetables to the main wholesalers in these two public markets. From these main distributors, the vegetables are distributed to traders who conduct their businesses i n these two markets, and to the bike or motorbike vendors who market their vegetables by traveling from one village to another. After six a.m. the town becomes busy with children who are going to schools which start at seven a.m. and last until one p.m. A t the same time public servants and employees are going to their offices, and the markets are becoming more crowded with customers. The warung, small shops which sell food, coffee, and tea, and are located surrounding the markets, are filled with customers having breakfast before they go to work. The big shops start to open around 8 a.m. and some o f these shops are open until 9 p.m. Activities in the center o f town start to slow down after  84  3 p.m. In the evening only a few shops, restaurants, and cafes are open, and after 9 p.m. the city center grows quite after a busy day. Some private and government banks with nice looking buildings are located i n the very busy areas to support the main economic activities in town. There are many kinds o f small shops in the center o f town specializing i n selling textiles, house supplies, accessories, jewelry, furniture, and groceries. Nearby are shops which specialize in distributing motorbikes, bikes, spare parts for cars and motors, electronics, building materials, and agricultural supplies. In the last few years two department stores and car centers have opened. According to one entrepreneur, in the last decade many more new hair salons, video rental shops, cassette and compact disk shops, electronics and satellite disk businesses, and car accessories shops have opened in town. This boom indicates that modernization and globalization are reaching even small towns located in isolated areas such as North Sulawesi. The main transportation i n town is the oplet, a small minibus, and the bendi, a horse drawn cart, which are used mostly for short distances around the center o f town. To connect the town with other rural centers and towns, there are many minibuses. From Kotamobagu to Manado, the provincial capital, there are buses called Damri,  run by the Department  of  Transportation and by private companies with fares of around Rp4000. Some private transport companies offer special services to pick up passengers at their homes outside the city region and then deliver them to specific places i n Manado, a special service which costs around Rp7000. Most public facilities such as hospital, schools, post office, and police station are available in town. The town is also complete with water supply, electricity, and communication. Most government offices are relatively new buildings. Although the buildings are big, the services they offer to communities are very slow.  85  The Medium City The medium city is the capital city o f North Sulawesi Province, called Manado. The city has been settled by local people since the sixteenth century, and was previously called "Wenang". In 1623, the name o f Wenang was changed to Manado (a word taken from the Minahasan language, " M a n a dou", meaning "too far"). In 1919, based on the approval o f the colonial Dutch government, it became a provincial capital. The municipality o f Manado consists o f 5 subdistricts and 68 kelurahan,  neighborhoods  which are administratively similar to villages and constitute the lowest level o f government in the city. In 1994 the city's total population was 347,235 persons, and during the period o f 1990 to 1994 the population growth rate per annum was 2.49 percent. According to an analysis o f the Central Bureau o f Statistics and Population and Family Planning Bureau, during that period the natural growth rate o f population was only 1.27 percent per year. Therefore, the remaining 1.22 percent was provided by the flow o f in-migration from other districts in North Sulawesi and from other provinces outside North Sulawesi. The total area o f the city is around 15,726 ha and the population density is around 22.39 persons per ha. Based on the 1990 census data and the 1994 national economic census, the employment structure in Manado is shown in Table 2.13. The data indicate that the service sector absorbs the biggest part o f employment in Manado and the proportion o f employment in that sector increased from 72.2 percent in 1990 to 77.3 percent in 1994. In the same period the proportion o f employment involved in the manufacturing sector slightly decreased, and in the agricultural sector sharply decreased. The increased proportion o f employment i n services sector is strongly related to an increase in the activities o f the tourism industry. During the last few years, several big hotels were built in Manado, and an increasing number o f tourists (both international and local) are traveling to North Sulawesi to enjoy the diving, scenery, and culture o f North Sulawesi.  86  Table 2.13 Manado: Sectoral Distribution o f Employment, 1990 and 1994 Year  Sectoral Distribution (%) A M S Total 1990 10.19 17.65 72.16 100 16.54 1994 6.14 77.33 100 Note: A = Agriculture, M = M i n i n g and quarrying, manufacturing, utilities, and construction. S = Services. Source: Bappeda, 1995; Statistics Office, 1994.  The economic growth rate o f Manado during the period o f 1989-1995 averaged 10 percent per year. The industrial sector and services sector (especially banking subsector) indicated rapid relative increases. However, at the same time some sectors  (trade and  transportation sectors) showed decreases. The overall composition o f the regional economy indicated that the main engine o f Manado's economy strongly depended on certain sectors, such as trade (23 percent), transportation (18 percent), government (17 percent), and banking (which increased its proportion to 10 percent o f the total gross regional product). The main public transport in the city is the oplet, a small minibus. A l l oplet are run by private companies. The cost for one trip, for either a short or long distance, is only Rp300. Certain routes are served by buses called Damri,  which are run by the Department o f  Transportation, and charge a fare similar to the oplet (Rp300). Around certain public markets such as Bersehati Market and Pinasungkulan  Market, the two biggest markets o f the six located  in Manado, there are many bendi which haul short distances with the cost around Rp300 per person. In the evening, there are many motor-cycle taxis or ojek especially i n the center o f town, which offer services for short and long distance hauls, with the price depending on the distance. These motor-cycle taxis mostly begin to operate after the oplet and bus are no longer running. This kind o f transportation is classified under the informal sector because it is not considered by city government as public transport.  87  CHAPTER THREE POLICIES FOR RURAL AND URBAN DEVELOPMENT Introduction Since the implementation o f Indonesia's first five-year development plan in 1969, rural development has been a priority, especially for the agricultural sector. Efforts to increase rural living conditions have been undertaken through such giant programs such as intensification o f rice production and transmigration. Large amounts o f the money required for this have been borrowed from the W o r l d Bank and other lenders. Both programs have been put into action by provincial and local governments, following strict guidelines produced by the central government through the Ministry o f Agriculture and the Ministry o f Transmigration. Generous portions o f the project budgets have been invested in basic infrastructure such as dams, irrigation systems, and road networks. The programs have had a significant impact in creating new job opportunities for both on-farm and off-farm employment, and increasing incomes o f rural communities. O n the other hand, these programs have widened the gap between the rich and the poor, creating conflict between migrants and local people. Certain species o f tree and animal life have been destroyed. A s indicated by this field study, the most important problem is the lack o f program planning and coordination among departments and across economic sectors. In Indonesia, rural development policy emphasizes the goal o f rice self-sufficiency. There are two approaches to increasing rice production. The first approach, intensification o f rice production, is implemented by increasing the use of agricultural inputs such as new seeds, fertilizers, pesticides, and mechanizing production tools such as hand tractors. The second approach is extensification o f wet rice production, which is accomplished by enlarging the area  88  under wet rice cultivation. The means o f implementing this approach has been through the transmigration program. Clearing o f land is accomplished by destroying the forest and then converting the fertile land into wet fields for rice. In the case study areas o f North Sulawesi, transmigrants are resettled i n fertile land which can easily be turned into wet rice  fields.  Therefore, the transmigration program strongly supports the rural development policy o f rice self-sufficiency. Urban development tends to focus mainly on physical and services development rather than on urban management that could improve local government institutions and upgrade human resource capacities as the main resources for implementing local autonomy. Rural and urban development policies have been implemented separately as two different areas o f concern rather than put into a unified rural-urban development framework. This chapter presents a review o f those components o f rural development policies such as rice production intensification programs (or Green Revolution), transmigration programs, and urban development policy. A l l o f these have had an impact upon the study area. The first section explores the meaning o f village and the structure o f village government. The second section analyzes how the national project o f rice production intensification programs and related policies (such as market intervention policies) have been implemented i n rural areas in Indonesia. The third  section investigates  the  outcomes  o f transmigration  programs  vis-a-vis regional  development and planning. The fourth section addresses the issue o f why medium sized cities and small towns need to develop. The final section investigates the policies which have been implemented with regard to rural-urban development.  89  W h a t Is a V i l l a g e ? Village Classification Villages in Indonesia are characterized by a variety o f socioeconomic conditions and levels o f development. A village's level o f development can be measured by criteria such as income, community participation in local development, and levels o f health care and education. Based on the primary livelihoods o f village people, villages can also be classified by primary economic function (Maskun, 1993): fishing village (perikanari), wet rice village  (persawahari),  dry land village (peladangan), husbandry village (peternakan), plantation village  (perkebunari),  and small industry village (perindustriari).  Based on location, villages may be classified as a  peripheral village, enclave or isolated village, island village, and village with close or easy access to a city. A l l o f these have an effect on village characteristics and development. In formulating the development strategies and policies related to the needs o f rural areas, villages or rural areas are divided into three groups. First, there are villages which have rapid growth, usually those villages located relatively close to and/or with easy access to urban areas. Generally, the main economic activities o f such communities are diversified and do not depend solely on the agricultural sector. The community also shows indications o f cultural change, a transition from traditional values or adat, and a start towards a market economy. Most o f the rapid growth villages are classified by the Indonesian government as swasembada villages. Second, there are villages which have high potential to develop. In general, the main activity o f these communities is work i n the primary sectors especially agricultural and mining sectors. In these villages, diversification o f activities are relatively limited and the community is quite homogeneous i n culture and custom (adat). In general, economic activities are still on a subsistence level but some people are already oriented to the market economy. The villages are located relatively far away from cities and with difficult access to towns. These villages is mostly  90  classified as swakarya  villages, which is considered a lower level o f development than  swasembada. Third, there are villages seen as having problems and limitations such as scarcity of natural and/or human resources and poor access to other centers and settlements. Such conditions are the main causes o f villagers' poverty which makes them leave and go to other villages, with hopes o f benefiting from the results o f development nationally and locally. These are poor villages which require a special approach i n order to increase the development i n their region. These villages are classified as swadaya villages.  Village Government Structure Indonesia's Basic L a w N o . 5 o f 1979 defines a village as a region settled by a number o f people in a community, legally organized directly under a subdistrict head (Camat) and with authority implementing its own household. A village differs from a city because it has a relatively l o w population density and its main activities are concentrated on the agricultural sector. In general, village communities are homogenous in terms o f culture, ethnicity, religion, and main occupation. Furthermore, a group o f villages which have functional linkages both socially and economically w i l l create a region or rural area. These rural areas mostly consist o f relatively similar types o f villages, although they may be administered through a rural center. The structure o f the village government in the province o f North Sulawesi and consequently i n the four villages o f the research is shown in Figure 3.1. The village head and secretary are ex-officio chairman and secretary o f the village council (Village Consultative Council or Lembaga Musyawarah Desa [ L M D ] ) . Members o f the village council are formal and informal leaders in the village, including the village head, leaders o f village organizations, and elders. The village has the right to arrange its own affairs, although the yearly budget has to be  91  approved by the subdistrict officials. Village governance is implemented by the village executive together with the village council, being a legislative body on the village level. The village head is assisted by five village officials and heads o f the neighborhood organizations or hamlets. These neighborhood organizations are organized on a territorial basis and consist o f a number o f families ranging between fifteen and fifty households. The village head is not a government official and does not receive a monthly salary. A n y remuneration for village heads and officials has to come from the village's own resources. The village head is assisted by a second village council not belonging to the village government. The function o f this second village council, the Village Council for Development Planning and Guidance or Lembaga Ketahanan Masyarakat Desa ( L K M D ) , is to participate i n 1  planning, programming, coordinating, and executing programs for village development. In the villages o f the field study, membership o f these two village councils generally overlapped to a high degree. Meetings between the village government and representatives o f the population were attended by members o f both councils. The village head has two basic roles: as the head o f the village community, and as the one responsible for carrying out instructions from higher levels of the government. The second role has gained in importance since the beginning o f the first fiveyear development plan in 1969. Rural development programs o f a number o f ministries are carried out with the assistance o f the village head and village government. One such example is agricultural development programs. The field extension worker operates at the village level and therefore has to cooperate with the village government.  ' The L K M D was established by the Ministry of Home Affairs in 1980. At the village level, the L K M D , through its various sections, is responsible for coordination of all activities (as indicated in Figure 3.1.) in the field.  92  Figure 3.1 Structure o f Village Government  Head of Village  Village Consultative Council (LMD)  Village Officials  Village Council for Development Planning and Guidance ( L K M D )  1. 2. 3. 4. 5.  1. 2. 3. 4.  Social General Sectoral Development Security Religion  Heads of Neighborhood or Hamlet  Security Education and Culture Information Infrastructure and Environment 5. Economy 6. Religion 7. Family Welfare 8. Health and Family Planning 9. Youth, Sports and Arts 10. Social Welfare  Working Groups  In reality, this structure means that there are no village activities which are not controlled and influenced by the L K M D , village head, or neighborhood heads respectively. Through the hierarchical structure o f the organization, the government institutions above village level up to the Ministry o f Home Affairs are always kept informed about village activities. The village head has to report to the head o f subdistrict, who himself has to inform the head o f the district and the local regional planning board, who inform the government's sectoral institution and the Ministry of Home Affairs. Apart from the L K M D , the head o f the village is assisted by five village officials {pamong desa) who are responsible for field activities corresponding to those o f the  93  L K M D . A s an advisory board, the Village Consultative Council ( L M D ) , has been set up to approve annual development plans and budgets.  Agricultural Development Policies Overcoming Rice Deficiency Rice is the main staple food for the majority o f Indonesia's 200 million people. During the first four decades following the proclamation o f independence in 1945, Indonesia had to import large quantities o f rice mainly from Burma, Thailand, Japan and the United States to maintain adequate food stocks to feed its people. For external security reasons and to maintain internal social stability, i n the early 1960s the government began to envisage an agricultural program to achieve self-sufficiency in rice production. The rice deficiency was a drain on scarce foreign exchange, and it was also perceived as a political weakness i n Indonesia's international relations. In the government's view, i f the domestic supply o f rice could not be supplemented by international markets—whether for political, economic or other reasons—the stability and wellbeing o f the country might be seriously threatened. Even i f supplies o f rice were available on international markets, fluctuations in international prices might have destabilizing effects within Indonesian society. Studies which were carried out on a limited scale during the early and m i d 1960s, led to a concerted effort in the first five-year development plan (1969-1973) to increase rice production on the island o f Java, which is the most densely populated part o f the country and the most ricedeficient. B y the end o f the first five-year plan, the government laid plans to spread the riceintensification program to the other islands during the next plan period, and the third plan placed more emphasis on other crops, such as potatoes, maize and soybeans, shifting the emphasis from rice-sufficiency to overall food self-sufficiency (Mears, 1981; Sajogyo and Wiradi, 1985).  94  Although the program was very successful during the 1970s i n increasing productivity per unit o f paddy land, the total consumption o f rice increased rapidly because o f population growth during this period. A t the beginning o f the 1980s, Indonesia was the world's biggest importer o f rice and despite great achievements o f the agricultural intensification program during the previous decade, the goal o f self-sufficiency i n rice seemed as remote as ever. Some economists (Mears, 1981: 50, 419, 422) were doubtful that self-sufficiency could be achieved permanently, in either rice or other food, because o f the high growth rate i n food production that would have to be sustained over a number o f years. The cost o f implementing this program was very high, but thanks to the government's determined efforts and willingness to absorb much o f the costs during the critical period o f the 1970s and early 1980s, the overall goal was eventually reached. B y 1984-1985 Indonesia was self-sufficient in food production.  Rice Production Policy A combination o f macro economic management and sectoral policies are key factors in achieving agricultural development objectives. A t the macroeconomic level, adoption o f a flexible exchange rate policy, fiscal and monetary policies which help control inflation, and liberalization of foreign trade are essential for increasing the competitiveness o f Indonesia's agriculture and spurring domestic economic growth. Since the 1960s the agricultural sector has been allocated a key position in the plans and funds were made available according to this investment priority status. Rural development continued to emphasize intensive rice production. The largest contribution to growth in the food crops and agricultural sectors has been from rice production. Since 1977 rice production has grown at the rate o f over 6 percent per year (Darmawan and Hermanto, 1993). This remarkable rate o f growth has been achieved mainly due to government policies to support rice production.  95  In the 1970s and 1980s the policies included investment in expansion and improvement o f irrigation, investment i n research capacity to develop rice varieties adapted to Indonesian conditions, rice intensification programs to encourage dissemination o f new technologies and inputs, rice price support and stabilization policies, and investment in rural infrastructure. The main rice production policies which have contributed to the rapid growth i n production are found i n several rice intensification programs. The first rice intensification program introduced i n the mid-1960s was called B I M A S , which is an abbreviation o f the Indonesian  name, Bimbingan Masai, meaning "guidance  to the masses".  Through the  implementation o f B I M A S programs, farmers were provided with basic service packages. These programs included extension, short-term credit and heavily subsidized inputs such as H i g h Yielding Variety ( H Y V ) seeds, fertilizers and pesticides. The Agriculture Ministry provided extension services through its officers located i n subdistrict levels. The local branches o f  the  Indonesia People's Bank ( B R I ) handled the credit supply to farmers, while the Home Affairs 3  Ministry was responsible for the implementation o f the programs. Due to problems caused by low repayment rates, lack o f qualified extension personnel and the untimely provision o f many inputs, a new improved B I M A S program was introduced in 1970. In this program, the village heads' use of coercion to elicit farmers' participation was abandoned.  In the new B I M A S , "village unit areas", which were clusters o f three or more  villages, became the basis o f delivery institutions such as the village cooperative, the village unit bank, the agricultural extension field staff and the private kiosks which stock various farm inputs.  The term "masses" refers to the millions of individual farmers in Indonesia and especially to those on the densely populated island of Java. "Guidance" in this context refers to the government's intention to provide, on a basis of voluntary acceptance by farmers, an integrated package suitable for individual family farms, which would enable the farmer to increase productivity per unit of cultivated land by adopting the new techniques. A state bank appointed by the central government to support agricultural development. 2  3  96  A Food Logistic Agency or Badan Urusan Logistik ( B U L O G ) guaranteed the purchase o f rice at a floor price. A raise in the rice yield was generally the result o f this revamped B I M A S . However, after a few years, mainly due to the massive pestilence o f the brown rice plant hopper and the accumulated debt problems o f participating farmers, growth in output slowed down considerably. The second program, introduced in 1973 and rather similar to B I M A S , was called I N M A S (an abbreviation o f Intensifikasi  Masai, or "mass intensification" program). In this  program, cash loans were no longer provided. The program was introduced mainly with the intention o f providing services to those farmers who could not be given new loans because o f their accumulated debts arising from their participation i n B I M A S , and to those farmers, such as tenants, who did not qualify for B I M A S (Hardjono, 1983). Because o f the unavailability of credit for the participants o f I N M A S , the incentive to j o i n the program was limited and by the early 1980s the total number o f participants in B I M A S and I N M A S had decreased from 3.6 million in 1974 to about 1 million. The third program called I N S U S (an abbreviation of Intensifikasi  Khusus, or "special  intensification" program) was introduced i n 1979. Its introduction was necessitated by the pest control requirements at the local level. Research had shown that the rice hopper flourished under those conditions usually present in village areas where the crops i n the various rice fields ripened successively. The hopper could attack and destroy field after field i n swarms, thereby, resisting its enemies. Rice cultivation in the village areas had to be coordinated so that all village areas could be planted at the same time, creating less favorable opportunities for the brown rice plant hopper (wereng) to wreak their destruction. Hence, it is clear that I N S U S differed from B I M A S and I N M A S in that it focused on group farming. A l l owners o f a sizeable piece o f well-irrigated land (25-50 hectares) that had been earmarked for intensification were obliged to participate. The  97  farmer groups received financial support and decided on the timing o f activities and on the application o f the various input packages which were made available. A n extension o f the program (called O P S U S or "special operation") was introduced in the early 1980s in an attempt to bring the services to areas not yet covered by the programs. The fourth program is called S U P R A I N S U S ("super special intensification") and was introduced i n 1987. The program has been created as a further extension o f I N S U S and O P S U S and is aimed at specific areas as designated by the Ministry o f Agriculture. The backbone o f S U P R A I N S U S activities consists o f the following. First, there is the distribution and application of packages which include H i g h Yielding Variety ( H Y V ) seeds, solid and liquid fertilizers, and chemicals for integrated pest and disease control. Second, there is the organization of irrigation water control and harvest and post-harvest treatment; and third, the extension o f soil cultivation, planting (among other aspects, to ensure that densities exceed 200,000 plants per hectares), plant nursing and annual rice variety rotation. The decision on the actual application o f special inputs packages is made at the level o f the sub-units, called farmer groups, comprised of some 600 to 1000 farmers, or at the level o f tertiary irrigation system units o f 90 to 150 hectares (Government of Indonesia [GOI], Department o f Agriculture, 1987).  Table 3.1 Rice: Program, Area Harvested and Total Production per annum, 1960-1988 (1 unit = '000,000 ha/'000,000 ton) Total Total Production Area Harvested 8.76 N o Program 7.28 1960 13.14 8.14 BIMAS 1970 20.16 9.00 INMAS 1980 9.76 25.93 INSUS 1984 28.40 SUPRAINSUS 10.14 1988 Source: Modified from Mears, 1984; E I U , 1989. Year  Program/ Technology  Y i e l d (in metric ton/ha) 1.20 1.62 2.24 2.66 2.86  98  Statistics regarding the special rice programs, rice areas harvested, rice production and the average yields per hectare are shown in Table 3.1. The data indicate that the total production o f rice has greatly increased as a result o f expansion o f rice field areas. Since the 1970s onward, rice productivity has been substantially increased. Thus, the combination o f expanded rice field areas, improvements i n the irrigation infrastructure, and the intensification i n rice cultivation through the application o f H i g h Yielding Varieties ( H Y V ) , fertilizers, biocides and more efficient water use, has led to attaining the national goal o f self-sufficiency i n rice. In the early 1990s Indonesia's central government (through B U L O G ) quietly imported rice from Vietnam. The main justification given by the central government was that the rice imports were needed to maintain the nation's rice stocks. However, it can also be argued that despite the programs and technology aimed at increasing rice production, and the rice field areas available, rice production could no longer be increased. In other words, the  optimum  combination o f high technology inputs applied to each hectare o f rice field had reached it utmost productive limits. Realizing these limitations, in 1995 the central government (through the Ministry o f Agriculture) decided to improve rice production for self-sufficiency through a program called "a million hectares for rice field" i n swamp areas i n Central and South Kalimantan. Although the project has been running for more than one year, the results for rice production have not yet been published.  Market Intervention Policy Besides the programs for rice intensification, irrigation development, and development and dissemination o f modern varieties of rice, the main intervention policies aimed at increasing rice production are marketing and rice price supports and fertilizer subsidies.  99  The government is very conscious o f the decisive role o f rice in the general economy. During the 1950s and 1960s when the national economy was i n serious disorder, rice shortages occurred frequently as did shortages o f other essential commodities. In such periods the price o f rice inevitably influenced the prices o f other foodstuffs and necessities o f life. Control o f rice prices therefore had the effect o f stabilizing a large part o f the economy. The main instruments o f the rice price control policy have been a ceiling price for consumers, floor price for farmers, and control o f the international trade i n rice. The central government has delegated the National Logistics Agency ( B U L O G ) the responsibility to control the supply o f goods (particularly rice and sugar) and set their prices throughout the year. B U L O G has utilized procurement o f rice to defend the floor price, and has been successful since the mid1970s in maintaining the reported floor price. It was not until 1985, following two large harvests in 1984 and 1985 and a large build-up in stocks, that the farm price dropped below the reported floor price. The ceiling price has been maintained mainly by supplying urban markets from domestic procurement, imports and stocks. The basic concept o f the price policy was developed by Saleh A f i f f and Leon A . Mears i n 1969 (in Amang, 1993). It consisted o f five elements: firstly, the floor price should be high enough to stimulate production. Secondly, the ceiling price level should be reasonable for consumers. Thirdly, the price margin should be maintained at a reasonable level to encourage traders. Fourthly, domestic prices should be protected from unstable world prices, but always adjusted to minimize subsidies. Finally, a minimum stock should be maintained in order to implement the policy. In order to implement the rice policy, B U L O G has also built rice storage facilities throughout the country. The relatively narrow band between B U L O G ' s floor and ceiling prices o f rice has discouraged the private sector from participation in holding stocks o f rice. This has  100  forced B U L O G to maintain large amounts o f stocks to keep the market price within the ceiling and floor prices. Budgetary costs o f purchasing and maintaining such large stocks have become very high. In addition, the government has employed the fertilizer subsidy as a key instrument to stimulate crop production, particularly rice. The government subsidy for fertilizers has allowed a steady decrease in real prices o f fertilizer from 1970 through 1984 (Darmawan and Hermanto, 1993). In order to set farm-level fertilizer prices, the government has become heavily involved in the production, trade, and distribution o f fertilizer. The rapid growth i n fertilizer use, induced in part by the subsidy and accelerated by the adoption o f modern varieties and massive investments in irrigation, has sharply increased the budgetary burden o f the subsidy. Expansion o f rice production was the overriding concern o f agricultural policies in the 1970s and the 1980s. However, a series o f changes in the Indonesian economy in the mid-1980s have required a substantial broadening o f the agricultural policy concern beyond rice production issues. It seems that in the future, rice w i l l contribute less to the growth o f the agricultural sector. This is due to the technical limits to land and yield increases, and also to the changing nature o f demand which requires less growth in rice production than was the case i n previous years.  Transmigration Program and Regional Development Aims of the Transmigration Program The present transmigration program is primarily based on the government sponsored resettlement o f transmigrants from Inner Indonesia (Java, Madura, B a l i , and Lombok islands) to agricultural settlement areas in the Outer Islands. These sponsored transmigrants are preferably selected from young, male-headed, and landless farmer households. O n arrival they are allocated  101  a two hectare farm lot (depending on the quality o f the land), as well as a preconstructed house with a garden. Most o f the farm area usually has to be cleared by the transmigrants themselves. In addition, the transmigrants are supplied with food, tools, and fertilizer during the first year in the settlement. Besides this flow o f government sponsored migrants, there is also a consistently increasing flow o f spontaneous migrants, who usually j o i n their relatives i n the established settlements before starting a living of their own. This secondary group o f transmigrants was estimated to be about one-third o f the total flow (around 3,774,166 people) o f sponsored migrants who had been resettled by 1989 (Government o f Indonesia, 1990). The government seeks to encourage an increase in this spontaneous flow because it is so much cheaper and adds to the effectiveness o f the transmigration program. The major aims o f the present transmigration policy are: first, to achieve a more favorable distribution o f the national population and the labor force; second, to develop new resources and productive areas i n the Outer Islands, mainly through agricultural resettlement; third, to increase living standards in both the areas o f origin and destination o f the transmigrants; and finally, to integrate the national territory and foster national unity by bringing together the various ethnic groups and cultures (Government o f Indonesia, 1994). Although these aims have been persistent over time (e.g., five-year development plans IVI), their stress and mixture sometimes have changed considerably. This is especially true for the demographic aim which is not mentioned explicitly, i.e. alleviating population growth and pressures in Java. This aim's rationale is based on the argument that Java and B a l i have 63 percent o f the national population on almost 8 percent o f its territory. Thus, the islanders' problems o f landlessness, rural poverty and environmental deterioration, which can be solved only by extensive population redistribution measures (Nitisastro, 1970; Arndt and Sundrum,  102  1977, Arndt, 1983). Whenever authorities become nervous about Java's continuing population growth and the problems o f curbing it through family planning, the demographic issue surfaces in such forms as the necessity o f distributing the population and supply o f labor for national development purposes. The persistence o f this argument is clearly reflected i n the very high target figures set for the transmigration program o f the Five-year Development Plan I V (envisaging the settlement o f 465,000 families) and in the Five-year Development Plan V (decreasing to around 175,000 families). Although the target figures are dropping, the program 4  is still the world's biggest resettlement effort in history. In fact, Java has experienced a net outmigration for more than two decades. More than three million o f its inhabitants have been moved out, who might otherwise have burdened Java's local economy and environment. M u c h o f this achievement has been realized at high and ever increasing economic, social and environment costs. Many o f these costs might have been avoided i f the government had taken a more realistic stand towards some o f the program's basic assumptions and expectations. Within the framework o f the present transmigration policy, various aims are mutually contradictory. The aim o f alleviating demographic pressures on Java together with the political aim o f national integration are in fact causing great troubles.  Transmigration in North Sulawesi North Sulawesi received one o f the first four projects established by the Indonesian transmigration authority after independence  in 1945. Paguyaman Subdistrict i n Gorontalo  District was established as a settlement for transmigrants from Java, especially Central and East Java; i n 1953. Since it progressed well, transmigrants were sent there throughout the 1950s, resulting in around 640 households or 2,616 inhabitants. In 1968, when this project was finally  4  This is due to constraints in the central government's budgetary allocation for transmigration programs.  103  transferred from central government to local government, (which became fully accountable for further developing the settlement areas), the project had over 4,000 migrants (Hardjono, 1977 and Provincial Department o f Transmigration, 1994). A further history o f the transmigration project on North Sulawesi follows. In 1962 a small group o f transmigrants (88 families and around 163 people), originally from Central and East Java, were settled in Paguyaman Subdistrict. During the 1970s three groups o f transmigrants (around 1,600 families or 6,883 settlers) from West Java, East Java, and B a l i were resettled i n a new project known as Bongo I, Bongo II, and Bongo III villages in Paguyaman Subdistrict. During the 1980s, groups o f migrants (consisting o f 2,700 families or about 11,472 settlers), mostly from West Java, East Java, B a l i and East N u s a Tenggara were sent to new project areas called Marisa I, Marisa II, and Marisa III i n Marisa Subdistrict o f Gorontalo District. Most o f the Bongo and Marisa villages were designed for commercial crops cultivation. New  settlements were also established in two villages, Werdhi Agung i n 1963 and  Kembang Mertha i n 1964, i n Dumoga Subdistrict of Bolaang Mongondow District. The transmigrants settled i n these areas were some o f the victims o f the M t . Agung volcanic eruption in B a l i . W i t h relatively limited assistance from the transmigration authority, the resettled Balinese have proved as industrious and resourceful as they have i n other transmigration projects such as in Parigi Subdistrict, Donggala District, Central Sulawesi. The locations for these two transmigrant villages i n Dumoga Subdistrict were well chosen, since local terrain made Balinese-style irrigation possible, soil was fertile and no disputes occurred with local people about land matters. The populations o f Werdhi Agung and Kembang Mertha rose from 1,459 and 988 migrants respectively, to a total o f 3,649 and 2,360 inhabitants respectively in 1993. The population increased a direct consequence o f births and the arrival (from Bali) o f independent migrants attracted to the new areas. A total area o f 1,270 hectares is  104  under cultivation for rice, corn, soybeans, and groundnuts, all o f which can be marketed easily to the rural center i n Imandi and the small town in Kotamobagu.  Table 3.2 Sponsored and Spontaneous Transmigrants From Java and B a l i Settled in North Sulawesi Year Families Sponsored: 1950s 640 682 1960s 1970s 2,560 2,700 1980s 1990s 250 Spontaneous: 1960s-1980s 1,479 8,311 Total Source: Provincial Department o f Transmigration, 1994  People 2,616 2,610 11,390 11,472 963 4,923 33,974  In 1971 a new project was established at Tumokang in the Dumoga Subdistrict with 60 families (287 settlers), from Central and East Java. In the period o f 1972-1975, 500 families (2,475 migrants) from Central and East Java and B a l i were settled i n Mopuya Village. Another group o f around 400 families o f fully sponsored migrants (1745 settlers) from West Java and B a l i were settled in Mopugad Village. The population o f the three villages o f Tumokang, Mopuya, and Mapugad, increased from 4507 settlers i n 1975 to a total o f 9,556 inhabitants i n 1993. These new settlement areas were designed on a three-part system i n which one-third o f the land is used for fully sponsored migrants, one-third for independent migrants, and the resettlement o f local people, and the remaining third for future expansion o f commercial crops cultivation. During 1983-1984 there were around 500 families or 2,608 local people, the Bolaang Mongondownese, resettled in Torosik Village and Onggunoi Village, both villages located i n Pinolosian Subdistrict o f Bolaang Mongondow District. During the 1990s the transmigration program in North Sulawesi focused mainly on local people, with around 1,450 families (or 6,735  105  settlers) relocated in the new settlements o f Pusian and Malango villages i n Bolaang Mongondow District and Wonggarasi and Marisa V villages i n Gorontalo District. These local migrants were from four ethnic groups from four districts i n North Sulawesi: Sangihe Talaud, Minahasa, Bolaang Mongondow, and Gorontalo. The majority o f these local migrants have been located in commercial crops cultivation areas which are not supported with irrigation facilities.  Effects of the Transmigration Program on Regional Development It is already apparent that the transmigration program has significantly influenced demographic aspects, use o f natural resources, and living standards in North Sulawesi, and more specifically in the two districts o f Bolaang Mongondow and Gorontalo. Transmigrants have increased the supply o f food, especially rice, soybeans, and corn. The transmigration program in North Sulawesi (especially i n the case study area which is the center o f rice production i n the region) has significantly contributed to the increase o f rice production in the province as a whole. Data from North Sulawesi in Figures, (published in 1995 by the provincial government o f North Sulawesi) show that in the early 1970s North Sulawesi produced around 177,895 tons o f rice per year, and 391,186 tons per year by 1994. Bolaang Mongondow and Gorontalo districts contributed  around  31.5 percent and 43.0  percent  respectively o f the total production. The production o f soybeans increased from 1,782 tons per annum in the early 1970s to 26,370 tons per annum i n 1994. Both Bolaang Mongondow and Gorontalo District shared about 67.0 percent and 31.7 percent respectively o f the total soybean production. Corn production increased from 68,942 tons per year i n the early 1970s to 135,693 tons per year i n 1994. Bolaang Mongondow and Gorontalo district supplied about 14.0 percent and 29.1 percent respectively o f total corn production. Since the late 1980s North Sulawesi has been exporting corn to other regions and countries as well.  106  The most significant impact o f transmigration was on the region's infrastructure. Access and main roads were constructed during site development, resulting in around 14 percent o f all roads maintained by district governments (especially, Bolaang Mongondow and Gorontalo district) in the 1980s. Many o f these transmigration roads are poorly maintained and place a heavy burden on district public works offices when transferred to the province. However, a reliable transportation network is essential for the region's transmigrants for marketing their agricultural commodities and finding off-farm jobs and maintaining household income. Transmigration sites are also provided with a host o f public facilities such as schools, health facilities, agricultural input suppliers, market-places, religious facilities, and extension centers which are put in place in each settlement cluster. These facilities are frequently superior to those i n surrounding areas and serve the local non-transmigrant population to the degree that service personnel are available and access is not constrained by distance and travel time. The transmigration program has had a substantial effect on the budgetary allocations made i n the province's favor. Both during 1979-1982 and the 1985/86 financial year, an above average proportion o f the development budget (in national terms) was financed out o f funds set aside for transmigration. In 1985/86, more than 20 percent o f all the money available to the province for development investment came from the transmigration budget. Due to lack o f data on the precise pattern o f expenditure, it is not possible to quantify the direct income and multiplier effects on economic development in the region. It is, however, quite reasonable to assume that marked growth and employment effects have occurred.  Problems of Transmigration Program Weighed against these positive impacts are negative ones (Arndt, 1983). In this sense the impact o f settlements on the often fragile ecosystems o f the Outer Islands is now a matter o f  107  strong national concern. Environmentalists have pointed to the extended impact o f the burning and clearing o f tropical forests, which results in the destruction o f certain tree species, as well as other forms o f plant and animal life (Secrett, 1986). The pursuit o f national unity by means o f integrating local people with transmigrants from Java and B a l i is frequently disturbed by forced attempts to bring them together into the same schemes. The rationale behind this is that the local population should also enjoy the advantages o f the transmigration program facilities i n order to prevent local feelings of jealousy. For this reason 25 percent o f the participants are local transmigrants or translok. In reality there are many barriers to this planned integration. The sheer volume o f transmigrants may already have caused social unrest among the local population, who fear that they may become a cultural minority i n their own homeland. One such disputed case has been the scheduled settlement on Irian Jaya o f some 690,000 transmigrants from Java during the period o f 1984-1989, a plan which increased the local population by 54 percent. This quantitative integration problem may be aggravated by large cultural and economic differences which make it impossible to blend the two groups i n one settlement project or production system. The two different communities have different types o f social organization and modes of production. There is a clear contrast between the communally organized indigenous people as to compared the individually operating and commercially oriented Javanese transmigrants. Conflicts frequently arise from different systems o f land tenure and property relations, aggravated by the lack o f suitable land for transmigration sites (Soetrisno, 1985; Mubyarto, 1985). Another  important  issue  concerns  the  management  and  planning  problems  in  transmigration schemes which ensue from plans hastily devised i n order to fulfill the target figures. This becomes evident from the first stages o f the land evaluation and feasibility studies.  108  The surveys are often carried out in a rather haphazard way and in a very short time (around two months), with insufficient field checks on soil quality (Evers and Gerke, 1992). The costly feasibility studies, usually carried out by foreign consultants, disclose that on average only 20-25 percent o f the original surveyed areas are fit for human settlement. However, the authorities frequently try to raise this percentage (against the consultants' advise) in order to place the targeted number o f transmigrants. A study done by the Land Resources Development Center ( U . K ) , for example, concluded that although only about 75,000 hectares in Central Kalimantan were suitable and available for transmigration sites, government targets projected the clearance of nearly seventeen times as much forest between 1979-1989 (Secrett, 1986). This planning system—devised to meet over-ambitious targets—is inviting haphazard solutions because it leaves no time nor flexibility for plans to mature.  City Size and Function According to a Government o f Indonesia Report (1994) a city is defined as a region for settlement with a relatively high population density and main economic activities based on a sector other than agriculture. The urban community is a heterogeneous society because it consists o f both indigenous people and migrants who have come from other cities, provinces, and regions. The inhabitants also differ i n terms o f main occupation, culture, ethnicity, and religion. In Indonesia, a city has its own government organization such as local government level I (equivalent to a provincial government in the case o f Jakarta), or local government level II (for a provincial capital, municipality, or administrative center). District capitals, subdistrict cities and/ or rural centers do not have their own city governments, but are governed directly from the district government and subdistrict government levels respectively.  109  Based on population size, cities are classified into five types, as indicated i n Table 3.3. These cities have different functions i n the provision o f services, for example the cities can be classified as having international, national, regional (servicing one province or more) or local (servicing several districts or a part o f one district) linkages.  Table 3.3 Type o f City and Population Size Population Scale Type o f city more than 5 million Megapolitan 1 million to 5 million Metropolitan 500,000 to 1 million B i g City 100,000 to 500,000 M e d i u m City 20,000 to 100,000 Small City Source: Government o f Indonesia, 1994. Cities or urban areas can form a system because o f physical, social, and economic linkages with one another. In formulating development plans and policies that focus on such linkages, cities or urban areas are divided into four groups based on their roles and services functions in supporting national economic growth (Government o f Indonesia, 1994). First, there are cities or urban areas which function on a national scale as the main gate for the flow o f domestic goods and services, and also serve as an international trade center. These areas are also the centers for services, production and distribution, and main transit hubs for transportation reaching other lesser centers i n the regions or provinces. Metropolitan and big cities are included in this group because they have a relatively complete main infrastructure. Second, there are cities or urban areas which function as centers o f regional activities. These cities cover and service some districts as centers o f services, production and distribution, and are transportation hub for access to and from regions or districts. These cities are usually big and medium cities. Third, there are cities or urban areas which function as a center o f local activities. These urban areas service regions located in the district and consist o f medium and small cities. Finally, there are  110  cities or urban areas which have special services functions i n support o f developing strategic sectors, developing new regions, or distributing economic activities. The special services cities also function as buffer-zone areas o f agglomeration growth centers which are already existing i n those areas.  Why do Medium Cities and Small Towns need to develop? Population Growth in Medium Cities and Small Towns The reasons and urgency behind efforts to develop medium cities and small towns can be identified by looking at population growth rates, especially during the decade o f 1980-1990, as indicated in Table 3.4. The list o f cities that were classified as a strategic cities in Long-Term Development Plan II (1994/95-2018/19), includes many medium cities and small towns which have population growth rates exceeding the national urban population growth rate (5.36 percent per year) ( C B S , 1990). The evidence also suggests that many medium cities and small towns outside Java are i n conditions that require development, even though around 69 percent o f Indonesia's total urban population is concentrated on Java and Madura islands. Medium cities and small towns located outside Java have been playing important roles in regional development activities. They are centers o f accumulation, storage, processing, and marketing o f agricultural products from rural areas surrounding cities. There are also centers for producing and distributing the manufactured  products which supply both urban and rural  communities. They are also services centers for administration, education, health, information, and culture serving not only urban communities but also the rural communities where the majority o f Indonesia's population live. In transmigration areas, small towns are crucial centers for marketing o f agricultural production, and supply and distribution o f manufactured  products  such as consumer goods and agricultural inputs. Consequently, medium cities and small towns  Ill  generate regional economic development by creating new job opportunities and improving local income. Most cities outside Java fall under the classification o f medium cities and small towns, based on populations. However, to honor the national development commitments and i n order to equally distribute development beyond Java, and especially in the eastern part o f Indonesia, the growth o f the medium cities and small towns in regions such as Ujung Pandang, Palu, Kendari, Manado, A m b o n , Biak, T i m i k a and Jayapura has become a central issue for development. When these cities function as accelerators and centers o f regional development, they have an important role as a center o f social, economic, and political activities in the eastern part o f Indonesia. In order to accelerate the pace o f regional development in the eastern part o f Indonesia so that it can catch up with the very rapid development i n the western part o f Indonesia, the development o f medium cities and small towns must not be subject only to the considerations or criteria o f population size and economic activities. In contrast, development o f the medium cities on Java needs to be put in a broader context. These cities have relatively larger populations, are located near to one another, and are supported by good roads and transportation networks. The development o f medium cities on Java can not focus on one individual city in isolation. Rather, the development must consider several cities and their interconnections. The physical linkages may be so strong that it is almost impossible to distinguish the boundaries between them ( N U D S , 1985; Firman 1991).  Table 3.4 Strategic Cities i n Long Term Development II (1994/95-2018/19)  Strategic Cities  Total Population End o f End o f Repelita V Repelita V I 1993/94 1998/99  Population Growth (%) 1980Repelita V I (1993/941990 1998/99)  A . Metropolitan 1. Jakarta 2. Surabaya 3. Bandung 4. Medan 5. Semarang 6. Yogyakarta 7. Palembang 8. Malang 9. Tegal 10. Ujung Pandang 11. Surakarta  15,524,000 3,967,000 3,791,000 2,557,000 1,401,000 1,310,000 1,287,000 1,254,000 1,191,000 1,164,000 1,091,000  20,000,000 4,967,000 4,657,000 3,141,000 1,608,000 1,461,000 1,529,000 1,563,000 1,520,000 1,423,000 1,302,000  5.80 4.80 4.60 4.80 2.80 7.80 3.90 5.00 6.80 4.10 3.90  5.20 4.60 4.20 4.20 2.80 2.20 3.50 4.50 5.00 4.10 3.60  B. Big Cities 1. Cirebon 2. Kediri 3. Banjarmasin 4. Pekalongan 5. Padang 6. Bandar Lampung  985,000 770,000 634,000 628,000 575,000 548,000  1,142,000 946,000 764,000 782,000 726,000 651,000  2.60 5.60 3.90 5.10 5.00 4.30  3.00 4.20 3.80 4.50 4.80 3.50  C. Medium Cities 1. Denpasar 2. Pontianak 3. Kudus 4. Pekanbaru 5. Tasikmalaya 6. Samarinda 7. Manado 8. Pasuruan/Probolinggo 9. Jambi 10. Madiun 11. Purwokerto 12. Balikpapan 13. Mataram 14. Serang 15. Jember 16. Garut 17. Pematang Siantar 18. Kisaran/ Tanjung Balai 19. Ambon 20. Cilacap 21. Bengkulu 22. Klaten 23. Karawang 24. Palu  497,000 485,000 461,000 429,000 425,000 418,000 407,000 399,000 385,000 385,000 375,000 357,000 350,000 326,000 309,000 293,000 285,000 265,000 252,000 227,000 218,000 211,000 210,000 204,000  714,000 593,000 617,000 574,000 505,000 567,000 495,000 481,000 516,000 437,000 478,000 435,000 415,000 432,000 349,000 340,000 330,000 354,000 327,000 259,000 335,000 245,000 282,000 286,000  8.50 4.10 7.90 6.40 4.10 6.30 3.60 4.00 6.90 2.70 6.00 4.00 3.60 6.80 2.70 3.20 3.40 8.50 6.20 2.90 16.30 4.90 7.10 8.70  7.50 4.10 6.00 6.00 3.50 6.30 4.00 3.80 6.00 2.60 5.00 4.00 3.50 5.80 2.50 ' 3.00 3.00 6.00 5.40 2.60 9.00 3.00 6.00 7.00  Table 3.4 Continued Total Population  Population Growth (%)  Strategic  End of  End of  1980-  Repelita V I  Cities  Repelita V  Repelita V I  1990  (1993/94-  1993/94 179,000 162,000 150,000 147,000 138,000 134,000 130,000 126,000 125,000 124,000 123,000 117,000 108,000 108,000 100,000  1998/99 240,000 202,000 190,000 259,000 160,000 180,000 190,000 140,000 132,000 149,000 164,000 153.000 127,000 138,000 128,000  7.10 4.90 4.80 16.40 3.80 9.80 9.10 0.90 -0.02 6.40 6.80 9.00 4.50 4.00 5.10  1998/99) 6.00 4.50 4.80 12.00 6.00 6.00 8.00 2.00 1.00 3.80 5.80 5.50 3.20 4.00 5.00  98,000 93,000 93,000 88,000 87,000 85,000 81,000 80,000 77,000 77,000 72,000 63,000 63,000 61,000 57,000 56,000 55,000 54,000 52,000 50,000 48,000 44,000 42,000 39,000 29,000 27,000 21,000 20,000  131,000 113,000 108,000 107,000 105,000 103,000 106,000 95,000 90,000 96,000 84,000 80,000 73,000 75,000 71,000 70,000 69,000 76,000 67,000 59,000 58,000 54,000 51,000 47,000 40,000 30,000 28,000 25,000  9.10 4.30 3.00 3.00 2.30 3.30 10,90 2.60 1.90 5.60 1.10 7.40 3.20 2.50 6.10 5.50 6.10 10.00 9.80 5.20 4.20 6.20 3.20 11.20 14.90 7.40 -  25. Banda Aceh 26. Kupang 27. Jayapura 28. Batam 29. Pangkal Pinang 30. Lhokseumawe 31. Kendari 32. Sukabumi 33. Magelang 34. Situbondo 35. Palangkaraya 36. Kotabumi 37. Purwakarta 38. Gorontalo 39. Tembilahan C. Small Towns 1. Sorong 2. Dumai 3. Pare-Pare 4. Singkawang 5. Tarakan 6. Singaraja 7. Ternate 8. Bukittinggi 9. Sibolga 10. Watanpone 11. Bojonegoro 12. Baturaja 13. Palopo 14. Raba-Bima 15. Ende 16. Sumbawa Besar 17. Lubuk Linggau 18. Sampit 19. Dili 20. Kotabaru 21. Rantau Prapat 22. Biak 23. Maumere 24. Manokwari 25. Ubud 26. Tual 27. Buntok 28. Muaratewe.  Note: Repelita is a five-year development plan Source: Government o f Indonesia, 1995. Five-year Development Plan V I , 1994/95-1998/99, B o o k II.  6.00 3.80 3.00 4.00 4.00 4.00 5.50 3.50 3.00 4.50 3.00 5.00 3.00 4.50 4.50 4.50 4.50 7.00 5.00 3.50 4.00 4.50 4.00 4.00 7.00 2.00 6.00 5.00  114  It has been predicted that the population o f the strategic cities listed in Table 3.4 w i l l hit around 63.3 million people by the end o f Five-year Development Plan V I (1998/99). This number is around 77 percent o f the projected total urban population (around 82.4 million people). B y the end o f Long Term Development Plan II, the population i n strategic cities w i l l reach 114.3 million people or around 79 percent o f the projected total urban population o f 143.8 million inhabitants (Government o f Indonesia, 1995). The data also indicate that o f the eleven cities classified as metropolitan cities, eight are located on Java, two (Medan and Palembang) are located on Sumatera, and one city (Ujung Pandang) is located on Sulawesi. O f the big cities, three (Cirebon, Kediri, and Pekalongan) are located on Java, two (Padang and Bandar Lampung) on Sumatera, and one city (Banjarmasin) is located on Kalimantan. Thus, the location o f both metropolitan and big cities is mostly concentrated on Java, while four o f the cities are found on Sumatera, and one city each on Kalimantan and Sulawesi. The patterns o f spatial distribution o f medium cities show a concentration on three islands; o f the 39 cities, there are 15 cities on Java, 10 cities on Sumatera, and 5 cities on Kalimantan. The remaining 9 cities are distributed thus: 4 cities on Sulawesi, and one city each on B a l i , West Nusa Tenggara, East Nusa Tenggara, Maluku, and Irian Jaya. The locations for small towns are mainly distributed outside Java. There is only one strategic city located on Java, 9 cities on Sumatera, 4 cities on Kalimantan, 3 cities on Sulawesi, 6 cities on B a l i , West Nusa Tengara, East Nusa Tenggara, and East Timor, and 5 cities on M a l u k u and Irian Jaya. In other words, it can be argued that the location o f urban development for metropolitan, big cities, and medium cities is concentrated in the western part o f Indonesia, and it is only at the level o f small towns that there is a balanced distribution between the western and eastern parts o f Indonesia. This is not surprising since the majority o f Indonesia's population is concentrated i n the western  115  part o f Indonesia, which is more developed i n terms o f basic infrastructure including road and transportation networks, airports, ports, and communications for supporting economic activities. It is also the location o f most big industries and manufacturing activities.  Rural-Urban Areas Development and Policies The  development o f urban and rural areas needs a comprehensive approach and  integrative implementation which can increase the role and direct initiative for participation with the motivation o f mutual assistance o f communities. A s stated i n ( G B H N ) 1993, development is to be implemented by communities and government. Thus, community is the main actor i n development, while government has responsibility for directing, assisting, guiding, and creating conditions to support implementing development. Furthermore, i n the development o f rural and urban areas priority is given to balancing the growth rate o f development between rural and urban areas. From Five-year Development Plan I (Repelita I) 1969/70-1973/74 up to Five-year Development Plan V (Repelita V) 1989/90-1993/94, the development and dynamism o f urban areas has increased and cities have become important as centers for economic activities and as proponents  for regional and national development. Urban areas are seen as centers o f  modernization and technological innovation, centers o f social and cultural activities, centers o f education and arts, and as gateways i n connecting with other countries. The role o f rural areas i n national development was also seen as substantial as development is still dominated by the agricultural sector in the guest for national rice self-sufficiency. In  establishing national  and regional development,  rural  and urban  areas are  complementing each other i n an interdependent, interconnected system. The contributions o f rural and urban areas to each other's development are varied and essential: providing main foods,  116  services and basic facilities; providing raw and semi-raw materials, and mastering human resources for industry and other economic activities. Interlinkages o f mutual benefit like this are keystones for development o f rural and urban areas. During the early Long-Term Development Plan I (1969-1994) the orientation o f ( development  mostly emphasized achievement of sectoral targets. Villages and cities were  getting relatively less attention although they required special attention. With the successes of sectoral development, Five-year Development Plan I V (1984-1989) was the start o f more serious attention being given to spatial dimensions in planning and implementing development especially in rural and urban areas. Conditions such as limited job opportunities, shortage o f available land, and the limitation o f basic infrastructures i n rural areas have pushed rural people to migrate to cities, resulting i n major impacts for both rural and urban areas. The basic infrastructure provided in urban areas is usually not adequate to meet the rapidly increasing needs o f huge numbers o f migrants flowing from rural areas. Limited job opportunities in urban areas are a main cause o f increasing unemployment and the growing activities o f the informal sector. The gaps i n lifestyles between urban and rural people, and among community groups i n urban areas, are reflected i n the differences i n wage rates, availability and accessibility to basic infrastructures.  These  problems all decrease economic productivity and perpetuate poverty in both rural and urban areas. A s a part o f regional development, developing rural and urban areas requires special and thorough attention from both central and local governments. The problems arising both in rural and urban areas are connected to each other, which makes attempts to solve such problems in isolation even more difficult. Rural and urban areas are a single unified entity, a region, that requires  integrated  and comprehensive development management.  The rural-urban areas  117  approach is a readjustment i n establishing sectoral development which gives special attention to the linkages between rural and urban areas. The social and economic linkages between rural and urban areas are the foundation for formulating future development policies for both rural and urban areas.  The Challenges and Constraints of Rural-Urban Development The development o f both rural and urban areas faces some serious challenges and constraints. First, the number o f poor people is still high in absolute terms (around 27.2 million Indonesians). This is the main problem to be tackled i n developing rural and urban areas. Poverty in rural and urban areas is strongly related to low levels o f education, skills, and health, disadvantages which limit the ability o f people to get a job and earn enough income to support themselves. Another factor is the absence o f or limitations on infrastructure and transportation networks connecting poor regions to more advanced areas, therefore, stifling opportunities for growth. Some regions lack the natural resources that could be used for development. Thus, they remain poor. Second, limitations on the quality o f human resources have direct effects; including l o w productivity and fewer opportunities for people to actively participate i n development, especially in rural areas. Thus, the main challenge is to prepare and upgrade the skills o f rural and urban communities in adopting new technology so that community members can directly participate in development. Third, increasing the rate o f development requires utilization o f additional natural resources, especially land and water. O n the other hand, natural resources need to be managed carefully i n order to ensure their sustainability. Constraints on urban land results in the urbanization o f fertile agricultural land along the city's edge. Over use o f water resources,  118  especially i n urban areas, has reached such extreme levels that the supply o f water and much o f the catchment areas have been degraded. Waste, water and land pollution are major negative byproducts o f development which threaten the sustainability o f development. In rural areas, the limited education o f both communities and the local government personnel who guide development activities have contributed to the destruction o f the forest and conservation areas. The destruction o f local environments has a direct effect  on local  communities. Environmental degradation by private sector concerns who seek profits from mining, manufacturing, and fishing is a crucial planning issue i n and o f itself. Finally, the various economic imbalances between regions and cities, between villages and cities, and within the community groups in the city, are all significant planning issues which would benefit from a rural-urban approach. It is also clear that the discrepancy in supplies o f natural resources and human resources in terms o f both quality and quantity, is causing inequality in productivity among regions and thereby promoting uneven urbanization.  Conclusion The impacts o f Indonesia's rural and urban development policies, especially the social and economic effects o f rice intensification and transmigration programs have been substantial i n North Sulawesi. Rice intensification through the B I M A S program is generally well accepted in village communities that have adequate water for rice fields, even i f they are entirely dependent on rainfall. A l l o f the communities included i n the present study enjoy a regular irrigation system, and therefore meet this prerequisite for participation in the B I M A S program. Yet the program has been successful not only in transmigration villages such as Mopugad Selatan and Mopuya Selatan, but also in nontransmigration villages such as Doloduo and Dondomon. However, the B I M A S program is only beneficial to the farmers who possess wet rice fields and a majority o f  119  these farmers are identified as transmigrants. Thus, the rice production policies, which were designed by the central government in Jakarta, have fewer benefits for the local people. Local people primarily own dry fields and plant traditional crops such as corn, cassava, sweet potato, and other vegetables. Transmigration programs have generated a substantial impetus for regional development. Resettlement makes an obvious contribution to reducing the shortage o f labor and utilizing natural resources. More than half o f the total production o f rice i n North Sulawesi comes from transmigration areas. The increased  government  expenditure  resulting from  the  budget  allocations for transmigration has become very important for development. A part of the road network, (especially i n the two districts o f Bolaang Mongondow and Gorontalo)  has been  financed out o f the transmigration budget. Many public and private investments in the region can only be justified economically by the outcome o f the changes brought by transmigration. Resettlement programs make a distinct contribution to rising income levels, both for local inhabitants and for migrants. Therefore purchasing power i n the region has increased. The effects upon economic development in the province and district have not yet been properly incorporated into overall regional policy. Thus optimum use cannot be made o f the driving force they provide. Despite transmigration's significant influence upon the region, there is a lack o f coordination sensitive to the development potential and bottlenecks in the region. Coordination needs to be sensitive as well to special ethnic factors which influence the intake region's social absorptive capacities. For the most part, intersectoral coordination is still centrally managed, although a change o f course was made in this respect by Government Regulation No.6 in 1988. Urban development during the Long Term Development Plan I from 1969/1970 to 1993/94 clearly showed an emphasis on development o f urban infrastructure and services in  120  metropolitan areas and other big cities. Relatively less attention has been given to improving urban management and municipal development, especially in medium cities and small towns. These urban centers are quite often visited by people from rural areas for services such as education and medical help. There are a number o f relevant issues i n this respect, including: improving local government capability to increase local revenues, controlling physical urban development, managing and supplying urban infrastructure, land management, creating an environment for improving direct participation o f private sector and communities in urban development, issuing regulations that support urban development, and increasing the skill o f the local government apparatus i n urban development. Increasing the level o f education o f communities and improving their socio-economic conditions w i l l result i n greater demand for quality service from local governments. A s they become more knowledgeable, urban communities w i l l be more critical and skeptical regarding the problems o f urban development. Therefore, there must be a transition from a style o f urban management that was relatively closed to the public, to a new type o f implementation which is more transparent to urban communities. In Indonesia, rural development policy (especially in the case study area o f North Sulawesi) is focused on the goal o f rice self-sufficiency. This policy is strongly supported by the transmigration program. However, the policy does not address the issue o f rural-urban linkages in a way which can reduce the gap between rural and urban areas. Thus, a comparison between migrants and nonmigrants is helpful for understanding the overall picture o f rural-urban interaction. In the context o f North Sulawesi, especially in the case study area, transmigration is important because o f its significant impacts on both migrants and nonmigrants populations. Because migrants and nonmigrants have different characteristics, they also link differently to the urban hierarchy. These differences are described in detail i n the following two chapters.  121  CHAPTER FOUR CHARACTERISTICS OF NONMIGRANTS AND MIGRANTS IN THE CASE STUDY AREAS Introduction Rural development policies have clearly benefitted transmigrants more than their local neighbors. The findings show that the migrants enjoy significantly higher incomes and own more wet rice land and production tools than their local counterparts. The success o f migrants is not only derived from their skills and motivation to improve their lives, but is also supported by the central government which provides land and infrastructures such as dams, irrigation networks, and rural roads. Rural development policies are always designed in urban areas, in Jakarta by the central government or in provincial and district capitals. They are then implemented in rural areas under the supervision o f officials from provincial and district governments. Policy aims are usually to improve rural economic conditions. Rural communities can benefit when these policies are applicable to rural community conditions. However, this is often not the case, because these policies usually ignore the cultural differences between communities i n rural areas. One clear example is the introduction o f the Green Revolution for improving rice production. The strategy for increasing rice production was first introduced through the B I M A S program. This program assumed that rural communities w i l l easily accept new technologies such as new seeds, fertilizers, pesticides, and new practices, such as the use o f hand tractors in wet rice fields. However, the introduction o f new technologies cannot be evenly accepted by rural communities because o f their different cultural backgrounds.  122  The local people, especially the Mongodownese in this study, have practiced dry field planting o f crops such as corn, sweet potato, cassava, and vegetables for countless generations. They have become quite advanced in managing dry fields with these traditional crops. However, the economic value o f these crops is l o w compared with rice. Since the local people are less familiar with working i n wet rice fields, they do not benefit as much from wet rice technology as the migrants. The transmigrants, both Javanese and Balinese, are highly skilled in managing wet rice fields. They have for many generations grow wet field rice as their dietary staple and have learned to optimize production on the small fields which they have in Java and Bali. The skills 1  and knowledge o f managing wet fields, which were transferred from their ancestors, have become the main capital for starting a new life i n the fertile land o f the Dumoga Valley, where two hectares o f land were provided for each family by the government. Differences i n cultural background between the local people and transmigrants have significant implications for the adoption o f new agricultural technologies and the improvement o f socio-economic conditions. The impacts and consequences o f rural development policies on rural communities, are the main concern o f this chapter. There is very little information about the differential characteristics o f migrants compared with the local population, i.e., those born in Bolaang Mongondow, and North Sulawesi. The following section w i l l investigate how migrant and nonmigrant populations differ in terms o f demographics, occupation, economic situation, and ownership. The second section analyzes the motivations and the comparative advantages o f migrants, and notes their main contributions to  Many migrants have wet rice fields which are smaller than a half hectare. Most of them have previously no land and have had worked as laborers in wet rice fields. 1  123  the region. The third section analyzes the main effects o f rural development on family and community and identifies the main problems. The final section is the chapter's conclusion.  Demographic Differentials Age and Sex Differentials The age distribution and sex o f household heads in nonmigrant and migrant households are indicated i n Table 4.1. In general, the data show that the nonmigrants are relatively younger than their counterpart migrants. The nonmigrants are concentrated i n the 20-39 year age group while migrants are more concentrated i n the 30-49 year age group and the group aged 60 years and older. The proportion o f migrants aged 60 or older is almost four times higher than the proportion o f nonmigrants in the same age group. The proportion o f nonmigrants in the 20-29 years age group is almost two times higher than the proportion o f migrants i n the same age group . 2  Regarding the sex o f nonmigrants and migrants, the data reveal that male nonmigrants are generally concentrated i n the 20-29 and 30-39 age groups. Male migrants are predominantly i n the middle and old age groups (namely, 30-39, 40-49, and 60 years and above). Both female nonmigrants and migrants are predominantly found i n the young and middle age groups (20-29 and 30-39 years). In the oldest age group (60 years and older) there are high proportions o f both male and female migrants, compared to their nonmigrant counterparts. This is probably due to the fact that many o f the oldest migrants are still active in production activities, such as acting as bread-winner to support household incomes.  In comparison, data taken from Central Sulawesi reveal that the ages of both nonmigrants and migrants there are equally concentrated in the 20-39 years age group. In Central Sulawesi, the proportion of nonmigrants in the 50 year and older group is relatively higher than the proportion of migrants in the same age group. 2  124  Table 4.1 Age and Sex o f Household Head o f Nonmigrants and Migrants Age Group  Nonmigrants (%) Male Female M+F 20-29 27.1 37.9 32.1 30-39 31.4 43.1 36.7 40-49 17.1 3.4 10.9 50-59 15.7 13.8 14.8 60+ 8.7 1.8 5.5 Total (%) 100 100 100 Total (N) 70 58 128 Note: M + F = Male and Female Source : Sample Survey Data  Migrants (%) Male 15.3 22.2 26.4 12.5 23.6 100 72  Female 20.5 35.9 15.4 12.8 15.4 100 39  M+F 17.1 27.0 22.5 12.6 20.8 100 111  Education Differentials In general, as the data indicate i n Table 4.2, the education levels o f migrants are relatively higher than their counterpart nonmigrants, both for males and females. Almost 70 percent o f nonmigrants (both males and females), had at most completed primary school. Only 10.2 percent of nonmigrants (both males and females) had finished secondary school. In contrast, most migrants had studied at the junior high school level. Some o f them had even completed senior high school and college. About 16.3 percent o f the migrants had taken vocational training. The higher educational status o f migrants may be explained by their selection prior to arrival i n North Sulawesi. This finding supports some prior studies which also indicated that migrants tend to have higher education levels than local nonmigrants (Titus, 1978; Hugo, 1981) The data show that male migrants generally have a higher level o f education than female migrants. For example, at the junior high school level the proportion o f males was double that for females. This may be partly due to the fact that males are given priority over females i n schooling opportunities, because males w i l l usually become the bread-winner i n the household. However, in terms o f those educated at the level o f senior high school and vocational training, the proportion o f females is relatively larger than males. For nonmigrants, it appears that the  125  proportion o f those who had completed primary school and secondary school was higher for females than for males. Thus, it can be said that for the nonmigrant population, both males and females have a relatively equal opportunity to study at least at primary school. Although the levels o f education are higher among migrants than among nonmigrants, i n general both groups have a low level o f education (around 68.7 percent o f nonmigrants and 28.8 percent o f migrants had primary levels o f education and below) . 3  Table 4.2 Education and Sex o f Nonmigrants and Migrants Education Not completed primary school Completed primary school Not completed junior high school Completed junior high school Not completed senior high school Completed senior high school College/University Others*  Nonmigrants (%) Male Female M + F  Male  27.1 38.6  20.7 51.7  24.2 44.5  1.4 20.8  41.0  0.9 27.9  8.6  3.4  6.3  41.7  20.5  34.2  15.7  10.3  13.3  11.1  5.1  9.0  1.4  1.7  1.6  1.4  -  0.9  8.6  12.1  10.2  12.8  -  -  8.3 1.4 13.9  9.9 0.9 16.3  -  -  100 100 Total (%) 58 70 Total (N) Note : * including vocational training M + F = Male and Female Source: Sample Survey Data  100 128  100 72  Migrants (%) Female M+F  -  20.6 100 39  100 111  Data from Central Sulawesi show that the majority of both nonmigrants and migrants are educated at the primary school level, and only 25 percent of nonmigrants have completed secondary school.  3  126  Marital Status and Number of Children Data on marital status reveal that the majority o f both nonmigrants and migrants are married, with the proportion married being 96.9 percent o f nonmigrants and 91.8 percent o f migrants. The proportion o f divorced and widowed is relatively higher among migrants than among nonmigrants . Both nonmigrants and migrants tend to have big families. The proportion 4  of nonmigrants and migrants who have 3 or 4 children is 34.4 percent and 32.4 percent respectively. The proportion o f both non-migrants and migrants having 5 children or more is around 21.9 percent and 22.5 percent respectively . 5  Occupational Differentials Main Occupations of Household Labor Force The main occupation o f household head for both nonmigrants and migrants is indicated i n Table 4.3. The data show that most (80.2 percent) migrant heads o f households are farmers (own land). The proportion o f nonmigrants classified as farmer is around 47.7 percent . The proportion 6  of migrants classified as laborer and farm laborer is only 4.5 percent, while the proportion for nonmigrants in these occupations is almost 40 percent. The relatively higher proportion o f nonmigrants who work as laborers and farm laborers is related to the fact that they do not own their own wet rice field or dry crop fields. The data also show that 12.4 percent o f nonmigrants and 15.3 percent o f migrants are classified as trader, carpenter, public servant and other (such as retired). People classified in these  The data from Central Sulawesi indicate that the majority of both nonmigrants and migrants there are married. These patterns resemble the data from Central Sulawesi, where 37.5 percent of nonmigrants and 48.5 percent of migrants have 3 or 4 children, and 25 percent of nonmigrants and 24.2 percent of migrants have 5 or more children. These findings are similar to the data from Central Sulawesi where the proportion of nonmigrants and migrants classified as farmers was around 68.8 percent and 72.7 percent respectively. Only 6.3 percent of nonmigrants and 9.1 percent of migrants were classified as laborer and farm laborer. 4  5  6  127  occupations may also be farmers who work part-time i n either paddy or crop fields. The proportion o f public servants is relatively small for both nonmigrants and migrants, but those public servants may be working at the subdistrict level in low positions, and some o f them are working as primary school teachers in the villages. Since their salaries are relatively small, the public servants also need to work extra jobs to get more money to support their families' needs.  Table 4.3 M a i n Occupation o f Household Head and Housewife o f Nonmigrants and Migrants (percentage) M a i n Occupation  Laborer Farm Laborer Farmer ( O w n Land) Trader Carpenter Public servant Other N o job  Household l|iead Non-migrants 10.2 29.7 47.7 2.1 2.9 2.9 4.5  Total (%) Total (N)  100 128  Housewife  Migrants Non-migrants Migrants 41.4 32.4 4.5 2.3 4.5 80.2 3.6 0.8 0.9 0.9 3.6 7.2 55.5 62.2 100 111  100 124  100 103  Source : Sample Survey Data  Females, and especially housewives living i n rural areas, tend to experience "double duty", as preparing meals and doing daily household tasks for the whole family, while also working outside the household, either i n their own fields or as a laborer i n other people's fields. A s Table 4.3 indicates, 41.4 percent o f nonmigrant housewives and 32.4 percent o f migrant housewives work outside their household, mainly as laborers and farm laborers . This is 7  explained by the fact that they work outside the household i n order to earn cash to support the household's basic daily needs.  These trends are similar to Central Sulawesi where the proportions of nonmigrant and migrant housewives whose main occupation is outside the household are around 31.3 percent and 51.5 percent respectively. 7  128  It is common i n rural areas for youth to work, either helping their parents in wet rice or crop fields or working outside their home to contribute to the family's coffers. The proportion o f nonmigrants and migrants who have working youth or teenagers in the family is 30.4 percent and 36.0 percent respectively, the majority o f whom are working as laborers and farm laborers with only a small proportion working outside agricultural activities as traders . 8  In many cases the youth are working part-time after school. Those who no longer go to school tend to work full-time, either helping their parents or working outside the family. It is common that these family workers work with their parents during the busy times i n preparing for planting and harvesting and after those seasons work as laborers i n others people's wet rice or crops fields. They use the salaries they earn from working for other people to buy their clothing, shoes, and cigarettes or to travel to small towns for sightseeing. It is shown above that i n order to sustain their lives, farmers i n rural areas optimize all the labor force available in the family as a strategy for meeting the whole family's basic needs. The family labor force strategy not only involves the parents and teenagers, but i n many cases the younger children also participate in the whole family process o f production, whether at home or in the fields. The village reality is that after school, the girls help their mothers to look after younger brothers or sisters, or help to prepare lunch or dinner for the whole family, or help with other chores such as cleaning the vegetables, washing household utensils, gathering, carrying and cutting fire woods, and carrying water. C o m m o n activities for the boys are taking lunch for their parents i n the fields, shepherding livestock such as cows, water buffaloes, or horses, or helping i n the fields.  The data from Central Sulawesi show that the proportions of working youth in nonmigrant and migrant families are around 18.8 percent and 48.5 percent respectively. 8  129  Part-time Occupations and Off-farm Jobs In order to make a living in rural areas, some farmers have to work outside their main occupation or work i n off-farm jobs as Table 4.4 reveals. The data show that for both nonmigrants and migrants the proportion o f household heads who have a part-time job is around 48.5 percent and 35.1 percent respectively. The nonmigrant household heads are more likely to have a part-time job than the migrant household heads. Most part-time jobs are related to agricultural activities, usually activities to prepare land for planting paddy, such as land clearing, plowing, smoothing the soil and managing the water supply from the irrigation system. A l l these activities are ongoing, under rain or the heat o f the sun. The agricultural worker or laborer does not have a choice despite poor weather. In many cases a day's work, which earns from R p 4,000 to R p 5,000 per day, starts at 6 a.m., with a break from 11 a.m. to 2 p.m., and ends at 5 or 6 p.m.  Table 4.4 Part-time Occupation o f Household Head and Housewife for Both Nonmigrants and Migrants (percentage) Part-time Occupation  Household head Nonmigrants  Agricultural Laborer Laborer Trader Carpenter Other N o part-time job  14.1 8.6 6.3 4.7 14.8 51.5 100  Total (%) Source : Sample Survey Data  Migrants 9.0 3.6 9.0 3.6 9.9 64.9 100  Housewife Nonmigrants  Migrants  26.6 8.6  24.3 10.8  -  -  64.8 100  64.9 100  Other activities are related to paddy harvesting. The sequence o f activities is cutting paddy, gathering, dropping off paddy, clearing and filling gunny or plastic sacks, and taking all paddy to a spot next to a road accessible to small trucks. Laborers are mostly paid i n paddy rather than money, usually 10 percent o f the total yield. However, this 10 percent is divided according to the number o f people involved in the paddy harvesting activities.  130  Some nonmigrant and migrant household heads work part time as traders, either in their own house or i n the village markets. Some run small businesses in their houses, for example, opening a small shop (waning) selling things such as groceries, cookies, candies, cigarettes, soap, and some items for daily needs. Some sell agricultural products, such as vegetables and fruits, at the village markets. Some o f those agricultural products are produced by themselves and some purchased from other peasants in the village. Some household heads work part-time as middle men who buy chickens, goats and pigs i n the village which they market either at the village market or at markets in other villages. Both migrants and nonmigrants also find part-time work as carpenters and construction workers, in either their own village or in other villages where they build or repair houses, or work on other construction. Quite often these people are involved in construction o f government projects i n the villages, such as school buildings, community health centers, and other local government buildings. In general, these types o f part-time jobs outside o f agriculture are undertaken when the heads o f households are not too busy working at their own fields. There is a slow period, usually after planting and weeding and before harvesting, an interval o f less than 2 months, when the farmers must regulate the water flowing to their paddy field to ensure an adequate amount. A few weeks before harvest, there is also work to scare off the birds which would otherwise eat the paddy early in the morning (5 a.m. to 7 a.m.) and in the afternoon (3 p.m. to 6 p.m.) The data also indicate that 35.2 percent o f nonmigrants housewives and 35.1 percent o f migrant housewives hold a part time j o b . In general, they work as agricultural laborers and 9  In Central Sulawesi, the proportion of nonmigrant housewives working part-time is around 25 percent, which is higher than the proportion of migrant housewives with part-time j obs (only 15.1 percent). 9  131  laborers. Female work i n the paddy field usually deals with planting, weeding, harvesting and dropping off paddy.  Migrant Workers It is a fact o f life for both nonmigrant and migrant household heads that when they work either in their main occupation or at part-time jobs, they often have to work outside their own village, in other nearby villages, rural centers or small towns. That proportion both for nonmigrants and migrants is 60.9 percent and 60.4 percent respectively. There are various reasons why migrant workers have to spend a few days i n their place o f work or leave their village for a few days. One reason is related to the job itself, for example, that the job could be done and finished i n a few days such as paddy harvesting and dropping off. A second reason is related to the location o f work, and how much time is spent traveling and whether public transit is available. If the travel time is long or i f transit is limited, workers may have to spend a few days away from their villages. Some workers commute, leaving their villages early i n the morning and returning i n the late afternoon. Around 29.7 percent o f nonmigrants and 37.8 percent o f migrants commute like this, due to the work places being accessible by public transit or bike and relatively close to their own villages. Improved job opportunities available in the region have created migration patterns for the village workers, namely rural to rural migration rather than rural to urban migration. It is understandable that these migration patterns occur as a consequence o f new job opportunities being created i n certain villages throughout the region.  132  Job Creation and Hired Workers Increasing the a g r i c u l t u r a l activities i n the r e g i o n results not o n l y i n n e w j o b s i n the agricultural sector, but also i n i m p r o v i n g activities i n n o n - a g r i c u l t u r a l sectors. A s a consequence these a c t i v i t i e s are creating n e w j o b s outside o f a g r i c u l t u r a l a c t i v i t i e s , as i n d i c a t e d i n F i g u r e 4.1. T h e c r e a t i o n o f n e w j o b s outside agriculture s u c h as r u r a l s m a l l industries, c a n offer alternative e m p l o y m e n t o p t i o n s for r u r a l people, e s p e c i a l l y d u r i n g the s l o w season w h e n farmers do not have m u c h f i e l d w o r k . T h e r u r a l s m a l l industries are m o s t l y f o o d p r o c e s s i n g activities s u c h as p r o d u c i n g cassava crackers, m a k i n g t r a d i t i o n a l cakes and fried peanuts for snacks, p r o d u c i n g tofu and s o y b e a n cake, and p r o d u c i n g t r a d i t i o n a l ice c r e a m . S e r v i c e a c t i v i t i e s also create some n e w j o b s i n r u r a l areas. A s m o r e p e o p l e i n the v i l l a g e s use b i c y c l e s as a m a i n m o d e o f transportation there are n e w j o b s for v i l l a g e p e o p l e w h o o p e n b i c y c l e repair shops. T h e r e are also w o r k s h o p s for r e p a i r i n g a g r i c u l t u r a l p r o d u c t i o n tools s u c h as p l o w s , s m a l l tractors, and w h e e l s . R u r a l females o p e n hair salons to serve b o t h m e n and w o m e n i n the v i l l a g e s . T h e m a j o r i t y o f respondents, b o t h n o n m i g r a n t s and migrants, stated that under current c o n d i t i o n s p l e n t y o f opportunities c o u l d s t i l l be f o u n d (both i n the v i l l a g e s and outside the v i l l a g e s ) to w o r k as a g r i c u l t u r a l laborers or laborers for any k i n d o f m a n u a l j o b . T h u s , the j o b opportunities a v a i l a b l e b o t h i n the v i l l a g e s and outside the v i l l a g e s have kept the r u r a l to u r b a n f l o w s o f m i g r a n t w o r k e r s r e l a t i v e l y s m a l l . A l t h o u g h they do not have p r o b l e m s f i n d i n g j o b s i n the v i l l a g e s , s o m e n o n m i g r a n t s and migrants are m o r e c o n c e r n e d that the l a n d that c o u l d potentially be p l a n t e d as p a d d y and c r o p fields is l i m i t e d . T h e y also m e n t i o n that the potential for their c h i l d r e n to f i n d j o b s i n the cities after f i n i s h i n g secondary s c h o o l or u n i v e r s i t y w i l l not be easy, e s p e c i a l l y for those w h o w a n t to b e c o m e p u b l i c servants. S o m e f a m i l i e s c o m p l a i n e d that they h a d already spent too m u c h m o n e y to s m o o t h the w a y for their c h i l d r e n to w o r k i n l o c a l  133  government institutions, including money for bribes to certain key bureaucrats, although in the end their children were not accepted. Thus, they said, it is easier to become farmers because they do not have to spent too much money and certain skills learned from school or university are not needed to be a peasant. A real farmer needs only to learn by working directly in the field.  Figure 4.1 Allocation o f Household Workers in Four North Sulawesi Case Study Villages, Based on Sector and Type o f Workers  Working in village Agricultural Sector  ~* Commuter workers Migrant workers  Household Workers Working in village Nonagricultural Sector  -+ Commuter workers "* Migrant workers  The data i n Table 4.5 also indicate that some nonmigrants and migrants have to hire laborers to work their properties. It is quite common that they hire from 1 to 4 workers for working either i n wet rice fields or crop fields. During the planting seasons and harvesting seasons, they usually hire from 10 to 20 workers. These employers are mostly landlords who dominate land ownership and a significant part o f economic life i n the villages, by means o f  134  offering credit with relatively high interest to the village peasants, and controlling the village paddy mills.  Table 4.5 Family Labor Utilization and Hired Labor for Nonmigrants and Migrants Nonmigrants (%) Migrants (%) Number o f Hired Workers  Type o f Worker  Household workers: Work in the village Commuter worker Migrant worker Hired workers: Agricultural worker Nonagricultural Worker  0  1  2  3  4  68.8 96.9 46.9  24.3 2.3 8.6  6.3 0.8 18.0  -  1.6  7.8  94.5  2.3  2.3  0.8  25.8  43.0  17.2  18.0 10.2  0  1  74.8 93.7 29.7  13.5 5.4 8.1  2  3  7.2 0.9 13.5  4  3.6 13.5  97.3  -  0.9  -  15.3  29.7  27.0  11.7  35.2 1.8 15.3  Source: Sample Survey Data  Economic Differentials Income Sources Although people living i n rural areas work predominantly i n agricultural activities, it can not be assumed that their main sources o f income come from the agricultural sector. In fact, the farmer households i n the case study villages depend also on income from nonagricultural sectors activities such as work i n the services and trade sectors, rural industries, rural mining, urban jobs (services and small industries), and transfers, as shown in Figure 4.2.  135  F i g u r e 4.2 R u r a l H o u s e h o l d I n c o m e Sources i n C a s e S t u d y A r e a s o f F o u r V i l l a g e s i n N o r t h Sulawesi, Indonesia Food crops "* Crops Special crops Agriculture Tree crops Agrobased Rural  -> Small industry  Income  — Urban-based  Employment in rural services and trade "Nonagriculture -* Employment in rural Mining  Urban Services  Transfers (e.g., rents, interests, and remittances)  T a b l e 4 . 6 s h o w s the n o n m i g r a n t s ' a n d m i g r a n t s ' i n c o m e sources a n d average h o u s e h o l d i n c o m e based o n sectors a n d places. I n general, the average i n c o m e o f m i g r a n t households is h i g h e r than n o n m i g r a n t households. T h e data indicate that the average i n c o m e d e r i v e d f r o m the agriculture sector i s r e l a t i v e l y h i g h , c o m p a r e d w i t h the average  i n c o m e g a i n e d f r o m the  n o n a g r i c u l t u r a l sector, for b o t h migrants a n d n o n m i g r a n t s . T h e average i n c o m e f r o m agriculture for migrants is R p 3 5 6 , 1 8 9 p e r m o n t h , m o r e than t w o times h i g h e r than the average a g r i c u l t u r a l  136  income for nonmigrants, which is only R p 151,740 per month . The relatively high average 10  income o f migrants is related to the concentration o f migrants in two income groups at the income level o f R p 200,000 or less, and at Rp 201,000 to Rp 499,000. The proportion o f migrants i n the first category (income level Rp 200,000 or less) is only 40.5 percent while for nonmigrants more than 67 percent fall into that range. For those at the income level o f R p 201,000 to R p 499,000, the proportion o f migrants is larger than the proportion o f nonmigrants, 39.6 percent and 17.2 percent respectively. The data also show that almost 12 percent o f nonmigrants do not gain any income from agricultural activities; the figure for migrants is less that 2 percent. In other words, much o f the income o f migrants in the North and Central Sulawesi study villages comes from agricultural activities, perhaps because the proportions o f wet rice field ownership for migrants is also relatively high. The issues o f land ownership w i l l be discussed in detail later in this chapter. Another explanation may be that i n terms o f household labor utilization, migrants optimize their household labor resources better to support the family income. The relatively l o w average income o f nonmigrants earned from the agricultural sector is due to the fact that they tend to engage in agricultural production o f crops that have relatively l o w terms o f trade such as cassava, sweet potato, and corn. A s discussed i n Chapter Three such commodities used to be the main staples o f the nonmigrants' diet and may still be for some nonmigrants. Another interesting issue indicated in Table 4.6 is the average income sources based on non-agricultural sectors, which are higher for nonmigrants than for migrants  11  (per month,  The income data from Central Sulawesi indicate that the average income from the agricultural sector is high compared with the average income from nonagricultural sectors, for both nonmigrants and migrants. The average agricultural income for migrants is almost three times higher than the average agricultural income of nonmigrants. These patterns support findings from Central Sulawesi, where the average income based on nonagricultural sector is Rp 189,813 per month for nonmigrants and Rp 111,254 per month for migrants. 10  11  137  around R p 117,395 for nonmigrants and Rp 87,365 for migrants). This is due to the fact that some nonmigrants are forced to find jobs outside o f agriculture because o f the shortage o f land in the villages. M a n y o f them work in village industries, services, construction, and rural mining. Therefore, around 43 percent o f the nonmigrants' income comes from nonagricultural activities.  Table 4.6 Sources o f Household Income by Sector and Location (According to Percentage o f Households) Amount of Income from Source (Rupiah/month) 0 < 200,000 201,000-499,000 500,000 - 999,000 1,000,000- 1,999,000 > 2,000,000 Average (Rupiah)  Nonmigrants (%) Sector Location A NA FV FOV 34.4 11.7 10.9 54.7 67.2 47.7 61.7 31.3 9.4 17.2 13.3 20.3 4.6 5.5 4.6 2.3 1.6 1.6 151,740  117,395  Migrants (%) Location NA FV FOV 55.0 8.2 71.2 33.3 37.8 9.9 6.3 36.9 13.5 4.5 11.7 4.5 0.9 2.7 0.9 2.7 -  Sector A 1.8 40.5 39.6 14.4 2.8 0.9  172,443 95,757 356,189 87,365 405,768  95,493  Note: A = Agriculture, N A = Nonagriculture, F V = From Village, F O V = From Outside Village Source: Sample Survey Data The comparison o f income sources based on location o f work i n Table 4.6 indicates that the average income for both nonmigrants and migrants is mainly gained from their own villages, rather than from outside the villages. The average income o f migrants earned from within the village is around Rp 405,768 per month, while for nonmigrants it is only Rp 172,443 per month. The average income gained from outside the village for both nonmigrants and migrants is relatively similar, Rp 95,757 per month and Rp 95,493 per month respectively . In general, even though the income sources o f both nonmigrants and migrants are derived from different sectors  The data from Central Sulawesi indicate a similar pattern where, for both migrants and nonmigrants, the average income gained from their villages is high compared with the average income earned outside their villages. In Central Sulawesi, the average income of migrants gained from within the villages is around Rp 867,166 per month, and for nonmigrants only Rp 499,491 per month. The average income from outside villages for both migrants and nonmigrants is Rp 100,235 per month and Rp 18,125 per month respectively. 12  138  and places, most o f their income is still gained mainly from the agricultural sector and from within their own villages. The farmers' incomes from agriculture are based on major commodities such as rice, cash crops, tree crops, and husbandry, as indicated in Table 4.7. Rice earnings contributed the biggest part o f income for both nonmigrants and migrants. The migrant's average income gained from rice is around R p 347,473 per month, which is three times higher than the nonmigrant's average 13  income (only R p 111,315 per month)  . For nonmigrants, cash crop sales contribute the second  largest portion o f total income, and noncrops and husbandry contribute relatively small amounts to the total income. Husbandry contributes the second largest portion o f migrants' average income and cash crops and non-crops provide relatively small portions o f the total income. Table 4.7 Source o f Household Income by Major Commodities (According to Percentage of Households) Amount of Income from Source (Rupiah/month) 0 < 200,000 201,000-499,000 500,000 - 999,000 1,000,000- 1,999,000 > 2,000,000 Average (Rupiah)  Non-migrants (%)  Migrants (%)  R 53.3 32.0 12.4 1.6 0.8 0.8  CC 59.4 36.7 2.3 1.6 -  TC 83.6 15.6 0.8 -  H 96.9 3.1 -  R 6.3 35.1 42.3 11.7 4.6 -  111,305  38,874  11,770  1,295  347,473  CC 88.3 10.8 0.9 -  TC 87.4 11.7 0.9 -  H 82.0 14.4 2.7 0.9  -  -  8,166  4,956  26,622  Note : R = Rice, C C = Cash Crop (e.g., beans, vegetables, and fruits), T C = Tree crop (e.g., coconuts, cloves, and cocoas), H = Husbandry (e.g., chickens, ducks, goats, and pigs) Source: Sample Survey Data  Central Sulawesi data indicate that rice was also the top earner of total income for both nonmigrants and migrants. The average income gained from rice for migrants is around Rp 584,047 per month and three times more than the portion which rice earnings contribute to average income of nonmigrants (Rp 169,575 per month). The second biggest contributors to total income are husbandry for nonmigrants and tree crops for migrants. 13  139  The farmers' income received from nonagricultural sectors is divided into four major classifications. First are industries based on rural small-scale industry and agroindustry. Second are services including trade, and mining. Third are urban jobs, and fourth, transfers including rents and remittances. Table 4.8 indicates that the services sector contributes the biggest part o f total nonagricultural income for both nonmigrants and migrants . Nonmigrants' average income 14  gained from services activities is about R p 129,059 per month, and for migrants around R p 92,898 per month. The contributions o f rural industry, urban jobs, and transfers for both nonmigrants and migrants has a relatively small influence on their total income.  Table 4.8 Source o f Household Income by Nonagricultural Activities (According to Percentage o f Households) Amount of Income from Source (Rupiah/month) 0 < 200,000 201,000-499,000 500,000 - 999,000 1,000,000- 1,999,000 > 2,000,000 Average (Rupiah)  I  Non-migrants (%) S UJ  Migrants (%) S UJ  T  I  61.3 27.9 5.4 3.6 1.8 -  99.1 0.9 -  99.1 0.9 -  -  -  92,898  838  135  95.3 4.7 -  39.8 39.8 12.5 6.3 1.6 -  98.4 1.6 -  95.3 4.7  -  91.0 8.1 -  3,720  129,059  762  1,666  7,772  -  T  Note : I = Industry (e.g., agroindustry, small-scale industry) S = Services (e.g., services, trade, and mining) U J = Urban Jobs T = Transfers (e.g., rents, remittances, and interest) Source: Sample Survey Data  Data from Central Sulawesi show that the services sector contributes the biggest part of total income for both nonmigrants and migrants. The average income gained from the services sector by nonmigrants is about Rp 162,500, and for migrants is about Rp 94,545 per month. Contributions of rural industry, urban jobs, and transfers are relatively small for both nonmigrants and migrants in Central Sulawesi. 14  140  Consumption and Expenditure Patterns The proportion o f household expenditures and average costs for daily needs for both nonmigrants and migrants are indicated i n Table 4.9. The average costs for daily needs o f nonmigrant households are h i g h  15  (Rp 4,729 per day) compared with that o f migrants (Rp 4,016  per day). The majority o f both nonmigrants and migrants spent between R p 2,500 and R p 5,000 per day for daily needs. Only a small proportion o f nonmigrants and migrants spent more than R p 5,000 per day for daily needs.  Table 4.9 The Proportion o f Household Expenditures and Average Costs for Daily Needs for Nonmigrants and Migrants Expenditure on Daily Needs (Rupiah/day) 0 < 2,500 2,501 - 5,000 5,001 - 7,500 7,501 - 10,000 10,001 - 14,999 > 15,000  Nonmigrants  Migrants  (%)  (%)  22.7 57.7 11.7 6.3  38.7 46.8 5.5 6.3  -  -  1.6  100.0 Total (%) Total (N) 128 Average (Rupiah) 4,729 Source : Sample Survey Data  2.7 100.0 111 4,016  Although the average cost o f daily needs for nonmigrants and migrants doesn't differ greatly, it is quite interesting to investigate why they differ. The majority o f migrant households report that they do not have to buy many groceries i n the public markets because they produce rice, vegetables, fruits and other essentials themselves. However, only a few nonmigrant households produce vegetables, beans, maize and sweet potatoes for their own consumption. The  The situation appears similar for Central Sulawesi, where the average costs used for daily needs by nonmigrants is around Rp 5,656 per day, higher than the average costs spent by migrants, which is only Rp 4,651 per day. 15  141  majority o f nonmigrant households buy most o f the groceries they need at public markets or small shops (warung). Therefore migrants spend more on non-essential items. The desire to maximize the productive output o f the available land surrounding the house is more common among migrants rather than nonmigrants, especially for migrants from B a l i . The land surrounding their houses is planted with products for the family's consumption, such as many kinds o f vegetables and fruits, and also coconuts, cloves, and coffee. Because they can produce food for themselves, the money not spent on groceries can be saved, either by themselves at home or by joining an arisan, the rotating savings scheme common i n the villages. The patterns o f spending on education, health, clothing, utensils and furniture, etc. for migrant and nonmigrant households are shown i n Table 4.10. The data clearly indicate that the average annual expenditures o f migrant households for education, health, clothing, and "other" is high  16  compared with the average annual expenditures o f nonmigrant households for similar  items. "Utensils and furniture" is the only category where the average expenditures o f nonmigrants exceed the average expenditures for migrants. Besides the expenditure classified as "other", the average expenditure for education is the highest for both migrants and nonmigrants. The second biggest expenditure is that for clothing. The expenditure for health was the lowest o f all kinds o f expenditures for both nonmigrants and migrants. The average expenditures for "other" is high compared with other categories o f expenditures for both nonmigrants and migrants. The "other" category covers taxes, arisan or savings, charities, and donations for village development and activities. The relatively high expenditure for "other" indicates that both nonmigrants and migrants directly participate in rural  These findings echo data from Central Sulawesi where the average expenditures of migrants for education, health, clothing, utensils and furniture, and others per year are higher than the average annual expenditures of nonmigrants for similar items. 16  142  development as they pay taxes and donate money for rural community development activities. Migrants' expenditures on "other" are higher than those o f nonmigrants because o f their religious activities, especially for Balinese who hold frequent individual and/or communal ceremonies. Each religious activity or event requires money for buying offerings. According to one informal leader i n the village, the cost o f things to prepare one simple offering is around R p 5,000.  Table 4.10 The Proportion o f Household Expenditure and Average Annual Costs for Education, Health, Clothing, Utensils and Furniture, and Other, for Non-migrants and Migrants Amount of Expenditure (Rupiah) E 44.5 0 7.8 < 100,000 101,000-250,000 18.0 251,000- 500,000 14.1 10.9 501,000- 1,000,000 4.7 > 1,000,000 100.0 Total (%) Total (N) 128 Average (Rupiah) 241,756  Nonmigrants (%) H 5.5 85.1 7.8 1.6  Migrants (%)  UF 12.5 67.2 10.2 8.6 1.6  -  C 1.6 47.7 32.8 16.3 1.6  -  -  -  100.0 128 46,873  100.0 128 163,555  100.0 128 90,829  E O 4.7 38.7 28.9 7.2 19.5 21.6 27.3 24.3 14.1 1.8 5.5 6.3 100.0 100.0 128 111 157,971 250,139  H 3.6 83.8 9.9 2.7 -  C 1.8 46.8 32.4 15.3 3.6  -  -  100.0 111 49,885  100.0 111 173,829  UF 9.9 77.5 9.9 2.7  O 1.8 5.4 27.0 35.1 18.9 11.7 100.0 100.0 111 111 60,013 282,420  Note: E = Education, H = Health, C = Clothing, U F = Utensils and Furniture, O = Other (e.g., Taxes, arisan, charities, funds for village development and activities, and other) Source: Sample Survey Data  Raising Cash and Access to Informal Credit Institutions Many families do not have enough money to cover the household needs discussed above. Therefore, it is not surprising that there are some respondents,  around 21.9 percent o f  nonmigrants and 18 percent o f migrants, who reported that they had to sell some o f their belongings such as land, houses, and production tools, i n order to raise cash that they needed. Both nonmigrants and migrants shared similar reasons for parting with their belongings. First, they need money to pay for their daily expenses. Some also mentioned that both their paddy and cash crops harvests had failed due to flooding. Second, they need money to support their  143  children who are studying in the cities, and for paying the costs o f hospital or health facilities and medicines. Third, they sold their land because its location was too far from home and/or they did not have enough household labor to work in the paddy fields. Some had to sell their land to the local government because an irrigation network project passed directly through  their land.  Fourth, they sold the land in order to buy another piece o f land located closer to their village. Others sold land to raise money to add to or build a house. Finally, some sold their land or house to raise capital for starting a business. The reasons given above show that some respondents sell their properties not only for consumption reasons but as a transfer o f investment. For example, some respondents have decided to sell their land to finance building or improving their houses, or to establish a small business in the village, such as trading cows and goats, or running a small shop. Nonmigrants and migrants differed i n their choices o f buyers for their properties. Nonmigrants sold their properties to the people in the same village and/or to people outside the village, mostly other migrants. Migrants sold to people in the same village, to people outside the village (either migrants or nonmigrants), and to people in towns or cities. Other sources o f cash to fulfill the households' basic needs are the informal institutions o f credit within or outside o f the village. A s Table 4.11 indicates, more than 50 percent of both 17  nonmigrants and migrants borrowed money from their relatives . More than 7.1 percent o f nonmigrants have links to money lenders i n their own or other villages, while only 2.7 percent o f migrants accessed these sources o f credit. Those with credit links to the village landlords constituted only 5.4 percent o f nonmigrants and 7.2 percent of migrants. Some nonmigrants  The data from North Sulawesi differ from that of Central Sulawesi, where nonmigrants access credit from village landlords and cooperatives while migrants' credit links tend mostly to be with their close relatives. 17  144  (19.8 percent) and migrants (19.8 percent) also accessed other credit sources such as cooperatives and village banks (more details on these arrangements are discussed i n Chapter Five).  Table 4.11 Nonmigrant and Migrant Access to Informal Credit Institutions (percentage) Source o f Credit Close Relatives Village landlord Village money lenders Other villages money lenders Money lenders at rural center and small town Others Never access credit Total (%) Total (N) Source : Sample Survey Data  Nonmigrants 57.1 5.4 6.3 0.8  12.4 18.0 100.0 128  Migrants 51.4 7.2 2.7 19.8 18.9 100.0 111  The main reasons for borrowing money from family members are that it is easier to deal with them, and most family borrowers do not have to pay interest because they are borrowing from their parents, siblings, or cousins. Supporting each other like this indicates the strong bonds which link village people. When people need help they support each other, even i f the amount o f money borrowed is relatively small. Some respondents mentioned that helping each other like this is the one way they can survive, especially during flood or drought seasons when they can not harvest their paddy and other crops. Geertz termed this kind o f relationship "shared poverty" (Geertz, 1963).  145  Investment and Remittances In general, the proportion o f both nonmigrants and migrants who can invest some o f their money in buying new land is relatively s m a l l , as the data in Table 4.12 indicate. The data reveal 18  that a smaller proportion o f nonmigrants than migrants have bought new lands. Both nonmigrants and migrants tend to buy wet rice fields rather than crop fields or fallow land. The proportion o f nonmigrants and migrants who have bought crops fields were only 3.3 percent and 5.4 percent respectively. The proportion o f nonmigrants and migrants who bought vacant land were just 1.6 percent and 3.6 percent respectively.  Table 4.12 Purchasing o f Land (Paddy Fields, Crop Fields, and Empty Land) by Nonmigrants and Migrants (According to Percentage of Households) Size o f Land Bought (ha) 0 <0.5 0.51 - 1 1.1-2 Total (%) Total (N)  Nonmigrants PF 94.5 4.7 0.8  (%) CF 96.8 1.6. 1.6  -  -  100.0 128  100.0 128  Migrants EL PF 98.4 82.0 18.0  (%) CF 94.6 5.4  EL 96.4 3.6  -  -  -  1.6 100.0 128  -  -  -  100.0 111  100.0 111  100.0 111  Note : P F = paddy field, C F = crops field, E L = empty land Source: Sample Survey Data  Non-migrants and migrants differ in who they purchase land from. The data show that most nonmigrants bought their land from people in the same village, and only a small proportion bought the land from people outside the village or people living in the rural center or small town.  These findings resemble those based on data from Central Sulawesi, where the proportion of nonmigrants who purchased paddy fields, crop fields, and/or empty fields is small compared with the proportion of migrant purchasers. The proportions of nonmigrants and migrants in Central Sulawesi who bought paddy fields is 6.3 percent and 42.4 percent respectively, while the proportions of nonmigrants and migrants who bought crops fields is 18.8 percent and 36.4 percent respectively. Only migrants (around 15.1 percent) purchased empty land. 18  146  Most migrants, however, bought their land from nonmigrants outside their villages, and only a small proportion bought from people in the same village or from people living in the rural center or small t o w n . 19  Some nonmigrants and migrants receive a regular remittance  at least once a year from  their children, families or relatives who are working, mostly as public servants or workers at private companies, and living outside the region or in the cities. The proportions o f nonmigrants and migrants receiving remittances are around 10.8 percent and 6.3 percent respectively. The money they received each year ranges from Rp 50,000 to Rp 500,000. Some respondents mentioned that they received remittances sometimes more than twice per year, while others reported that they did not get money but received presents such as clothing and other things. Most o f the money and presents came through the post office or visiting family members or friends in the village, and only a small proportion received the money v i a village banks.  Ownership Differentials Land Land ownership by nonmigrants and migrants is found i n Table 4.13. The data reveal that the average land ownership o f wet rice fields for migrants is around 2.33 ha per household, a size more than three times greater than the average land ownership o f wet rice fields for nonmigrants (who averaged only 0.68 ha per household) . Table 4.13 also indicates that the majority o f  Both these patterns are different compared with the land transfer patterns in Central Sulawesi where both nonmigrants and migrants mostly bought land from people living in the same village, and only a small proportion bought land from people outside the village or living in the rural center or small town. The data from Central Sulawesi show similar patterns. There the proportions of nonmigrants and migrants who received remittances are 19.8 percent and 12.2 percent respectively. The amount of money regularly received ranged from Rp 50,000 to Rp 250,000 annually. Some of them also received clothing and other things. The remittances and gifts were mostly sent through families and friends visiting the village, and some came via the post office. These findings differ from the Central Sulawesi data, where the average total area of wet rice fields owned by migrants is around 4.68 ha per household, some 10 times greater than the average total area of wet rice fields owned by nonmigrants (only 0.44 ha per household). 19  2 0  2 1  147  nonmigrants (57.0 percent) do not have wet rice fields. Only 10.8 percent o f migrants do not have wet rice fields. The proportion o f nonmigrants and migrants who have wet rice fields sized 0.50 hectares and less are 41.4 percent and 53.2 percent respectively. Only 1.6 percent o f nonmigrants possess wet rice fields o f 1 hectare or more, compared with 27.9 percent o f migrants. The relatively high average land ownership o f wet rice fields for migrants is clearly related to the two hectares o f land for each family provided by the central government. The relatively l o w average land ownership o f wet rice fields for nonmigrants is strongly related to their culture and skills. They are more familiar working in crop or dry fields than i n wet rice fields. Migrants, however, are accustomed to working in wet rice fields, equipped with skills and knowledge they have brought with them from Java and B a l i . Looking at the average land ownership o f crop fields, the data indicate nonmigrants have around 1.06 ha per household. This size is more than three times greater than the average land 22  ownership o f crop fields for migrants (that size is only 0.29 ha per household) . The proportion of nonmigrants and migrants who do not have crop fields is 42.2 percent and 79.3 percent. Although the average ownership o f crop fields is higher for nonmigrants, most o f them own crop land o f less than 0.50 hectares. Only 2.4 percent o f the nonmigrants have crop field o f more than 1 hectare.  These patterns are similar to Central Sulawesi, where the average land ownership of crop fields of nonmigrants and migrants is around 1.01 hectares and 0.80 hectares per household respectively. Most nonmigrants and migrants there occupied land holdings of less than 0.50 hectares. 2 2  148  Table 4.13 Land Ownership o f Nonmigrant and Migrant Households Size o f Land Holding (ha)  Nonmigrants (%) Migrants (%) PF CF HL PF CF HL 42.2 0 57.0 7.8 10.8 79.3 8.1 41.4 55.5 69.6 53.2 19.8 85.6 <0.50 0.51 - 1.00 18.0 8.1 3.6 1.00-1.99 0.8 1.6 3.1 6.3 0.9 2.7 2.00 + 0.8 0.8 1.6 21.6 Average (ha) 0.68 1.06 0.41 2.33 0.71 0.29 Total (%) 100.0 100.0 100.0 100.0 100.0 100.0 Total (N) 128 128 128 111 111 111 Note : P F = paddy field, C F = crops field, H L = home lot Source: Sample Survey Data The average sizes o f the home lots (pekarangan) owned by nonmigrants and migrants are 0.41 ha and 0.71 ha per household respectively . The proportions o f nonmigrants and migrants 23  who do not have a home lot are only 7.8 percent and 8.1 percent respectively. The proportions o f non-migrants and migrants who have a home lot o f less than 0.5 ha are 69.6 percent and 85.6 percent respectively. Only 4.7 percent o f non-migrants and 2.7 percent o f migrants have home lots o f more than 1 hectare. Table 4.14 shows the origins o f land owned by nonmigrants and migrants. The data indicate that most (47.8 percent) nonmigrants bought their land from other village people . The 24  proportion o f nonmigrants who inherited their land from their ancestors is around 22.6 percent. Most (56.4 percent) migrants got their land from government. The proportion o f migrants who bought their land from people in the same village or other villages amounts to around 32.8 percent. The proportion o f inherited land for migrants is relatively small, only 4.5 percent. These  The data from Central Sulawesi indicate that the average home lots for nonmigrants and migrants are around 0.66 ha and 1.07 ha per household respectively. Most home lots for both nonmigrants and migrants tend to be less than 0.50 hectares. In Central Sulawesi, the data are a little different. Most nonmigrants there inherited their land from their parents, while migrants bought from people in the village and/or received land from the government. 2 3  2 4  149  people are children o f migrants, who moved to Dumoga Subdistrict (as transmigrants from Java and Bali) when their parents had settled i n the region.  Table 4.14 Origin o f Land Owned by Nonmigrants and Migrants (percentage) Origin o f Land  Nonmigrants 22.6  Inherited Given by government Purchased 47.8 Others 29.6 Total (%) 100.0 Total (N) 117 Source: Sample Survey Data  Migrants 4.5 56.4 32.8 6.3 100.0 107  Production Tools One indicator that could be used to show the success o f farmers i n increasing agricultural production is the availability o f production tools in their households. If they do not have enough production tools to farm either the wet rice fields or crops fields (i.e., utensils for clearing, plowing, and harrowing the ground, all important steps o f work i n the fields before planting o f paddy or crops), they must borrow or rent the tools from other farmers, or hire other farmers or laborers to work their fields. A s a consequence, they must cover extra costs for renting those tools and laborers. Table 4.15 reveals that in general the migrants have more production tools than the nonmigrants . The limitation o f nonmigrants in owning production tools such as plows, harrows, 25  oxen, and hand tractors is probably related to the relatively l o w income they earn each month (as already discussed i n an earlier section). Saving enough money to buy these tools is not a simple  This finding is similar to the experience in Central Sulawesi.  150  effort for nonmigrants who give priority to fulfilling their basic daily needs. Thus, it is fair enough to say that, based on the production tools they