Islamic Law Shapes Ethical Retail Practices in Nabire’s Local Economy

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A 2026 study by Rawi Allan Iriandi from IAIN Parepare and Muhammad Akramul Sya’ban Ikbal from STAI Asy-Syafi’iyah Nabire finds that retail and grocery businesses in Nabire Regency largely operate based on Islamic business ethics, even without formally adopting a “sharia” label. The findings are significant as they show how ethical values strengthen business resilience in regions with complex logistical challenges.

Retail and grocery businesses are a key driver of the local economy in Central Papua, especially in Nabire. However, long supply chains, dependence on sea transportation, and fluctuating logistics costs create challenges in inventory, pricing, and financial management. These conditions often open the risk for unethical practices such as hoarding or price manipulation, making ethical governance increasingly important.

The researchers used a qualitative case study approach, collecting data through participatory observation, in-depth interviews with local and migrant traders, and documentation analysis. The study focused on real business practices in traditional markets such as Oyehe Market and Karang Tumaritis, capturing how Islamic legal principles are applied in everyday transactions.

The findings reveal that most entrepreneurial practices align with Islamic business values:

  • Inventory management prioritizes product availability rather than profit-driven hoarding
  • Pricing reflects fairness, adjusted to real logistics costs and local customs
  • Customer relationships are built through trust-based, interest-free credit systems (qardh hasan)
  • Honesty in measurement and product quality is consistently maintained

Traders rely heavily on social trust rather than formal contracts. Practices such as “kasbon” (informal credit) function both as social support for customers and as a long-term strategy to build loyalty. These approaches reflect key Islamic principles, including honesty (shiddiq), trustworthiness (amanah), and justice (‘adl).

However, the study also identifies several structural challenges:

  • Weak financial record-keeping, with limited separation between personal and business assets
  • Supply chain uncertainty due to weather and transportation constraints, creating minor elements of uncertainty (gharar)
  • Dependence on intermediary distributors, which affects pricing and stock stability

Despite these limitations, the research highlights that most uncertainties are driven by external infrastructure conditions rather than intentional misconduct. In many cases, stockpiling is carried out to ensure food availability rather than to manipulate the market.

Rawi Allan Iriandi from IAIN Parepare explains that Islamic business ethics in Nabire function as a practical system rooted in local wisdom and community values. He emphasizes that traders balance economic goals with moral responsibility, creating a business ecosystem that is both resilient and socially inclusive.

The study has broad implications for economic development. Ethical business practices help maintain price stability, strengthen social cohesion, and build trust-based market systems. For policymakers, improving logistics infrastructure and financial literacy—especially in sharia-based accounting—can further enhance business sustainability.

In the long term, the integration of local wisdom and Islamic legal principles offers a scalable model for inclusive economic growth in remote regions. It demonstrates that ethical governance can emerge organically and effectively support both profitability and social welfare.

Author Profile

  • Rawi Allan Iriandi- IAIN Parepare
  • Muhammad Akramul Sya’ban Ikbal -  STAI Asy-Syafi’iyah Nabire

Source

Iriandi, R. A., & Ikbal, M. A. S. (2026). Islamic Law Review of Local Entrepreneurship Management Practices in Nabire Regency: A Case Study of Retail and Grocery Businesses. Contemporary Journal of Applied Sciences (CJAS), Vol. 4 No. 3, 299–310.

DOI: https://doi.org/10.55927/cjas.v4i3.151

URL: https://ntlformosapublisher.org/index.php/cjas  


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