Researchers from the School of Economics Oemathonis Kupang—Yolanda O.M. Widyasari, Theresia Fouk Leu, and Thomas Ola Langoday—report that leading commodities in Belu Regency, East Nusa Tenggara, remain weakly competitive due to underdeveloped village trade institutions. Conducted in 2026 across 11 villages participating in the Desa Mandiri Anggur Merah Program since 2011, the study highlights a critical barrier to poverty reduction and economic growth in Indonesia’s border regions with Timor-Leste.
East Nusa Tenggara continues to face high poverty rates and limited market access. In Belu Regency, despite abundant local resources, weak trade systems prevent village products from reaching broader markets. As a result, most commodities circulate only in local markets with minimal added value.
The study applies a mixed-method approach, combining quantitative and qualitative analysis. Researchers identified leading commodities using Location Quotient (LQ) and Shift-Share methods, while also examining the structure of trade institutions within village business groups. Data were collected from group reports, field observations, and government sources.
Key findings include:
- Agriculture, particularly food crops and livestock, forms the economic base of Belu Regency.
- Five out of seven village business sectors show growth potential: livestock, food crop agriculture, savings and credit cooperatives, small-scale industry, and trade/services.
- Product competitiveness remains low due to small-scale production, inconsistent quality, and seasonal dependence.
- Trade systems are still traditional, relying heavily on local markets and intermediary traders.
- Limited processing industries constrain value addition and market expansion.
Thomas Ola Langoday from the School of Economics Oemathonis Kupang emphasizes that production strength alone is insufficient. Leading commodities must be supported by integrated trade systems to compete in wider markets.
The researchers recommend strengthening village trade institutions through the establishment of service cooperatives, producer cooperatives, and commodity-based processing industries. These models can improve bargaining power, enable fair pricing, and expand access to regional and international markets.
The study also highlights cross-border trade opportunities with Timor-Leste as a strategic pathway for economic growth in border areas. Integrating commodity development with institutional reform is identified as a key strategy to achieve village economic independence.
The proposed approach is expected to generate broader impacts, including job creation, increased household income, and stronger local economic structures.
Author Profiles
- Yolanda O.M. Widyasari - School of Economics Oemathonis Kupang
- Theresia Fouk Leu - School of Economics Oemathonis Kupang
- Thomas Ola Langoday- School of Economics Oemathonis Kupang
Source
Widyasari, Y.O.M., Leu, T.F., & Langoday, T.O. (2026). Model of Trade Institutional Arrangements for Leading Commodities in Desa Mandiri Anggur Merah Business Groups in Belu Regency, East Nusa Tenggara Province. International Journal of Business and Applied Economics (IJBAE), Vol. 5 No. 2, 571–588.
DOI: https://doi.org/10.55927/ijbae.v5i2.1
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