artikel _fadel & gorontalo_entrepreneurship gov't.pdf

8/10/2019 artikel _fadel & gorontalo_entrepreneurship gov't.pdf

1/5

I SPECI L FE TURE

ENTREPRENEURIAL GOVERNMENT

When Gorontalo was still part of North Sulawesi prov ince, the reqency administration

could only earn

Rp7 5

billion ( 815,0 00) in

2000

from local taxes. Five years after

Gorontalo became the 32nd prov ince of Indonesia under the leadership of former

businessman Fadel Muhammad, that fiqu re had multiplied by more than six times to

Rp46 billion in 2006 BY ISH K

R FICK

Bureaucrats, according

to University of Indone

sia e

conomi

st Rhenald

Kasali, are inclin ed to

spend as mu ch money as

possible in order

to ob t

ain a

bigger bud get the follow

ing year.

In contrast, entrepreneurs are concer

ned with how to manage their budgets

efficiently

to

obtain greater output or

revenue.

Fadel

Muhammad

f

orm

er businessman

and co-founder of the Bukaka

Gro

up who

was elected as the first governor of Goron

ralo in 2001, is among the few

bur

eau

GlobeAsia I MA

Y

2 7

crars in the country w ho act like an ent re

preneur.

In 2002, a few

month

s after he was

officially installed, the M inistry of Home

Affairs cha nneled central government

funds

worth

Rp35 billion as sran -up

capital

to

develop the new province.

\

X hile

other governors might have

used the funds

to

build new offices for

themselves or oth er provinci al institu

tion s, Fadel used the money

to

build an

airport, sea port and roads. W ithout these

cilities, the new province will never grow,

he said.

He had three obj ect ives. First was

to

resolve the severe lack

of

intrastruc

ture facilities in C oronralo, Second

was

to

help ensure that agriculture pro

duce could be qu ickly transported

to

the

market or sea pon so that it would

not

be left:

decaying in production centers. T hird, co

end

Co

ronralo's dep

end

ency on North

Sulawesi for air trans por r.

Anyone visiting Co ronralo no long

er has co

go through Manado (the No rth

Sulawesi capital), brags the governo r. who

adm its

to

being a workaholic with an

1' -

hour daily schedule.

It was only later rhat rno nev was

allocated to develop a local legisb ti\c

cou ncil building on a sloping hill, and a

governor's office atOp the h ill with a com-


2/5

-nand ing view of th e sea, lake, bay and

almost

every

part of

the 12,445 sq

krn

province. Now, Fade l has also built a

cubcrnarorial

reside

nce

in from of th e m ain

rootball field,

In

contrast

to his backgrou nd as an

enginee r and his years

of

experie

nce

deve

loping heavy industries at

Bukak

a, Fadel has

been focusing on th e agricultu re sec

tor

as

the basis for develop ing the local eco

nom

y.

H is am bitio n is to turn G o romalo i

nto

what he calls an agropolitan p rovince,

which essent ially me ans t

hat

the agricul

tu r

e and

fishery

sectors will bec

om

e the

prov

ince 's economic backb one, with co rn

p rod uctio n as an emry poin t.

Agrop olitan is th e most feasible

altern ative l l develo

pin

g G

oro

ntalo,

asserts Fadel, po

intin

g o ut the facts

that the province has a sizable

stoc

k

of

arab

le land , and tha t most

of

its peop le are

f

armer

s - con c

entr

aring m ain ly on c

orn

produ

ction

- wh ile h um an resources in other

econo m icsccto rsarevcry lim ite

dan

dski llsand

educat ion levels are low.

O E SY

T SK

Th e 54-year old Fadel realized f

rom

the

start th at it wo uld

not

be easy to car ry out

h is plan . Arn in

Moo

talu, an

econ

om ist and

local lawmaker, says th at the people ini t ially

d

oub

ted the governor 's c

oncep

ts, bu t as

they too k note of how seriou s he was abo ut

implementing his plan, suPPOrt started to

flow in .

Fade l won a landslide victory (With

81 % of votes) for a second term in th e 20 06

elect ion . Th is clearly shows th at the peop le

s

up

port hi m , says

Amin

. Fadel is, incid

en-

tally, h ono red in the Ind onesian Reco rd

M useum as the gov

ern

or with the b iggest

share of vo tes.

Ahm

ad Pakaya, regent of o ronralo

(bo th th e province and a regency

wi t

hin it

share th e

same nam

e) un til 20

06,

remai ns

one of Fadel's strongest critics.

But , says Stal in Sam ad , an em ployee at

th e loca l airport, the presence of such an

influent ial o ppo

nent

has onl y made Fadel's

star s

hine

even br igh ter because his policies

are clearly inte nded to improve the welfare

of the

peo

ple, p

ar t

icu larly fa

rmer

s and sma ll

bu sin essm en, .

Stalin says th e

diff

er

enc

es b

etw

een the

gove

rno

r and the f

orme

r regent are in

str uctive. Ahmad , a retired senior ar

my

officer, was f

ond

of developing presti

g ious projects such as the Plaza sho p

ping mall (which rem ains vaca nt) , an

Eiff lsryle

tower, and a zoo (which is st ill

flnd ing tro

ub

le in locatin g animals) that

together cost the local budget aro

und

Rp7

billion .

In

cont

rast, Fadel's policies have bee n

focused on developing h

um

an resource

capacity,

imp

rovin g the ed ucation se

ctor

and peop le's welfare, says local

econom

ist

Ma

nto

Rahmalo.

Fadel has freed po o r pe

ople

from

ed ucati on fees and

hospi t

al bills. T he

n umber of pub lic healrhcarc centers has

inc reased from 33 un its in 200 1 to 52 in

2006

, plus extra mo bile healthcare service

and do

ctor

s,

T he G

oro

ntalo

pro

vincial adm inistra

tion claims tha t the

numb

er of p

eop

le

living in poverty has

drastically decli

ned

fr

om

72 % in 20 01 to 26 % last

year.

THREE

PILL RS

C ha ir

ma

n of the Go ron

ralo cha pter of the In

d

one

sian C

hamber

of

Com merce and Ind ustry

(Kadin), Rusli Habibic,

fi

sherm

en's in

come

has

Fadel's policies have

mo

re t

han

tripled from an

been focused

on

average R

p282,

000 per

mo

nth to Rp 987,

000.

In

developing

human

just one in itiative in this

sect or, th e ad

min

istration

resource

has laun ched a p rogram

that provides cap ital an d

capacity,

improving

ot her facilities to help

fish

ermen

increase o ut -

the education sector

put.

Fadel has been even

and

people's welfare,

more agg ressive in t

he

Manto Rahmalo.

agric ulture sector, deplo

saysrhreepillarshavcbeen pu

tin

placebyFadel

th at will influ ence th e fu tu re develop m

ent

of

Go ro

nt a

lo.

T hese are the acceleration of h uman

res

our

ce devel

opment

via ed uca tion ,

turn

ing G orontalo i

nto

an ag

ropo

litan

pro

vince

based in itially on corn produ

ct i

on

, and de

veloping th e fishery sector in coastal areas,

wh ich also fun ctions as a s

howc

ase for the

touri

sm se

cto

r.

Fadel has

worke

d hard for all of these,

says

Rusli,

who is also

president

of constru c

tion firm PT Cahaya Mandiri Persada.

Fadel und erstand s that education plays

a key role in th e develo

pment

of his pro

vince. Hi s first

mo

ve was to revise the ed u

cation cu rriculum in the province. I asked

education experts to design a regio nal-based

c

urr

iculum . \'V'e are the first (province) to

do this,

H e explai ns that the national cur

ricu

lum

is intende d to serve the

hum

an

re

sour

ces needs of big cities, so it's not

sur prising th at scho o

ll e

avers have no

in t

er

est in the agr icu lture, fishery and animal

hu sb

and

ry sectors.

Even th ose w

ho

could

not

gr

adu

ate f

rom junior

high school are no longer

willing to corne down to the p

add

y

fi

lds,

I

didn

't

want

thi s to h

app

en in G

oront

alo, he

says. So I changed th e curriculum so that

th e crop land s an d th e sea co u ld be properly

devel

oped

for ou r welfare.

T he resul ts, aside from the greater

b

udget

for the ad m inistration,

includ

e

impr

essive ec

ono

mic growth

of

7.0

6

in

2006 , the highest in th e coun ny.

Fishery output ju

mped

to 43 ,000 tons

in 2005 fro m 19,000 to ns in 2001. The ad

m inistrat

ion

claims tha t

ying

new

tech nologies to

boost agricultural o utput an d

qual

ity. H e

mob ilizes regems, m ayors, d istri ct heads

and village heads to assist far

me

rs.

In the past, corn production had been

in the range

of

two to

th r

ee to ns per hec

tare . \X/ith the int rod uction of bet ter

q uality seeds im

porte

d f

rom

Makassar in

South Sulawesi, omput

dou

bled to between

four an d five to ns per hectare.

O utput was

then

pushed even higher,

to between five a nd six

ton

s per hectare, by

using seeds result ing from the blen d

ing

of

the M akassar an d local seeds.

Last year, the local adm inistration in

trod uced the use of a new nu trition agent

developed by an alumni of the Bogor

Agricu

ltur

e Inst i

tu t

e. Um ar H asan

Sapurra,

an d prod uct io n is claimed to have increased

to 10.9

ton

s per hectare, wi tho ut the use of

fert ilizer.

Go ronta lo's c

orn

p

rodu

ct ion has now

MA Y 2 7

I

GlobeAsia 89


3/5

I

SPECI L FE TURE

reached 560

,000

ton s, a

400%

jum p from

the level four years ago. "I'm still no t

sat isfied becau se th e pr

od u

ction level in

C h ina can reach 17 tons per hectare, wh ile

the qu ality

or

its soil is no

di f

ferent ro

G or

on ralos ," says th e gove

rno

r.

Despite higher production , pri ces have

not

been und er pressure,

but

instead have

m oved up ward as quali ty

impr

oves and

thro ugh the wor k of a logistics agellLY set up

by the administratio n that ope rates a prIce

buffer

system.

Th e average price of corn in the past

was abo ut Rp :100 per kg, but thi s has

now surged to betwee n Rp 1.4 00 -Rp 1,700

per kg. "If the price of co rn Ialls below

the targeted floor pr ice, the agen cy will

purchase the co rn from farmers. T his

preven ts traders and spec u lato rs [rom

mam pu laring prices," says Fadel.

Does thi s m eans he's against the

m arket mechan ism? "I'm respo nsible for

im proving th e weifI re of farm ers

1Il

C oron ralo, not letting them become the

easy prey of speculators and traders," he

respo nd s.

Un der the current co nditions, I do n't

believe in free m arket mechan isms.Th rough

the bu ffer system, the government can

intervene," he argues.

9

GlobeAsia I

M A Y 2 0 0 7

SCOUTING

FOR

M RKETS

Fadel has also been active

Ir1

loo king for

overseas markets. Last year, for instance,

the gov

ernor

signed Mol.ls with Japan

and Sout h Korea to ex

port

Go rontalo

products.

Jap an now absorbs

around

36

1

h

of

Coron

ralo's agriculrure exports, Sou th

Korea 3455

lo,

wh ile the rem

aind

er goes

to Ho ng Kong , India, th e Philippines,

Taiwan and Mal aysia.

C orn farmers claim th ey are now

enjoying be tter lives. "People in my village

have been bu ying

TV

s and mo torcycles

with cash. T hey have plen ty or m on ey

afte r their harvests," says

Muchr

ar Baabura,

head

of

Paris village in Goronralo regen cy.

A sim ilar acc

ounr

is given by corn

exporter Leonard Yokorn, whose WIfe is

the local Mi tsubishi car dealer. "Since the

beginning of thi s year, my wife has

man aged t sell abo ut 20 cars per mo nth .

Some of th em (bu yers) have even swapp ed

their co rn for cars. We accepted ir."

Fadel has also set up th e G or omalo

Interna

tion al Mai ze Informati

on

C ent er

GIM lC),

the world 's seco nd center for

information and techno logy on co rn after

on e in Brazil.

T he Rp 15 billion facility sits on a five

hectare b lock of l

and

in Bone Bolango

regency. Fadel hopes that peop le from

variou s parts

of

the country and the worl d

will on e day com e to Gorontalo to learn

everythi ng about co m.

After his success in increasing corn

prod

ucti

on

, Fadel now wa nts to tu rn

Go rontalo into the center for hybrid rice

pro du ction in the country, He wants

Go rontalo to contribute 200,000 ton s ro

the 2 m illion ron national rice reserves.

It's an am biuo us target.

Goro

ntalo now

prod uces 130,350 tons of rice per year, wh ile

consum ptio n In the province, with some

1 m illion peo ple .

IS

about 128 ,250 tons,

giving an excess of o nly about 2, 100 to ns.

"\XTe ll expa nd our pad d y fields (from

the existing 25 ,00 0-30 .000 hectares)," says

Fadel. "But rlus is

not

enough. What

is more

import

ant

IS to develop the hu

man resou rces capacity through training so

tha t we can adopt hybrid techno logy and

im prove infrastructure. particularly irriga

ti

on

systems."

T he administration ho pes that these

steps will help to boost production levels

from the current 4.74 tons per hectare ro

12 ton s per hectare or about SL ( rons per

hectare

of

high qu ality nee.

Another area for fu ture development is

biodiesel. T he adrm nistra non has laun ched

a campa ign for people to get involved in

planun

g

jarhropa.

a tropi cal p l

ant

that

can be used as raw material fo r bioluel

prod ucuon .

In February, the administration signed

an MoU with Singapore-based firm Clean

Fuel to develop a biofuel m anu facturing

plant n Bone Bolango regency with total

investment of arou

nd

Rp 1 7 trillion. Th e

plant will have a

produ

ct ion capacity of 300

mi llion liters per year.

Not everyone is happy with wha t is

happ

ening in C oronralo.

Corn

exporrer

Leonard Yckom, for instance, com plains

abo ut the lack of

infrastructure faciliries.

Th e Coronralo sea POrt is roo small. It

mu st be further expanded so th at exportS

can be accelerated," he says.

Poor roads and a sho rtage

of

po\\"er are

oth er pro blems. Brown

ou t

s are regular. an d

on ly a relatively small road lrnks jalaludin

Airpor t and the prov incial capital. :-' anv be

lieve that th eir enginee r gO\'ernor will also fix

those problems when the tim e comes. GA


4/5

T he straigh t talking former business-

man and min ister as usual gets t the po int

o n the

hur

d les he faces in devel

opin

g his

province. A former ind ustr ialist, he is now

widely acclaimed as a successful agriculturist

having d ram atically increased corn produc-

tion and improved th e fisheries sector ill his

province.

D espite his success, he ac

know

ledges

that the odds are still Stacked against provin-

ciall eaders in the latitude th ey have to run

a

dd

Muh ammad still cut

an imp ressive figure as he

sat dow n for a brea

kf

ast

interview wi th

ClobeAsia

T he gove

rno

r of

oro

n-

ralo Province is often in the

news and is now held up as

exam ple of how ent repre-

neur ial government can transfo rm a poor

backward region int o one of Indon esia's

fastest growing economic areas.

rr

their provinces. H e says rhar rhe Regional

Autonomy Law which unleashed econo mic

dynamism in Indonesia's far flung region s is

str uctura lly flawed and that unless changes

are made , the cent ral government will con-

tinue to pull the str ings.

All the authority to concep tualize the

law was in the cenr ral govern ment and in-

facr the govern ment in Jakarta was reluct

ant

to

push the law, he no tes. For instance the

impl

ementin

g regulations

t

support th e

M AY 2 7

I GlobcAsia 91

--

----


5/5

I

SPECI L FE TURE

produ ct growth last year was a stirling 7.3%

as compared to the nationa] GO P growth

of 5.6%

We need ro adopt entrepreneurial

thin king within government, he notes.

\Vhen I was starting out on my programs

I searched the internet for information

and infact contacted the Kennedy School

of Govern ment and communicated with

the dean to learn more. W hat I have done

is not new and the programs have been

introd uced in many o ther count ries.

\Vhat he has done is introd uce corpo

rate culture into local bureaucracy where

perform ance is rewarded. H is best perform

ing staff, for example, receive remuneration

in terms of b

onu

ses that is

3

% higher

than their salary.

I am not a common man , he not es.

If I do some something, I have to do with

excellent performance. JUSt doi ng things so,

so is not my style.

Fadel is now courting investm ents to

improve the region's woeful infrasrruc

rure by getting rid of regulations that were

deemed unfriendly to business. He wants

ro continue

to improve the agricultural and

fisheries sectors as these are the biggest job

creators and is also urging Jakarta to d evote

more resources ro these two sectors. H e add s

that Indonesia needs more ent repreneurs in

these secto rs as they are the backbo ne of the

We

are

in

a

critical

period

today

because we have

a

large

population

and some

critical

problems to

tackle

but

only

a limited

budget

to run

the

country

Indonesia

is still susceptible

to

Ba lkanization and the

only

way

to

prevent it is

to

have strong economic

growth in

the regions.

law have not been issued but we governors

are now pushing hard for them.

Another pro blem facing regional

governments is that the cent ral govern

ment has no t marched development in the

provinces with political power. In many

sectors, including agriculture and telecom

muni

cation s the central governmem still

calls the shots and Fadel notes that he needs

central governm ent approval to use pon fa

cilities in neighboring regions to export his

province's rising corn production.

Even fertilizer and seeds must come

from the central government and he says

that Jakarta tends to use a one system fits

all approach to man aging the provinces.

T hat is wro ng because each region has

9 GlobeAsia I MA Y 20

07

different needs and we have to implement

regulations accord ingly.

Th

e bureaucrats in

Jakarta are still stuck in the old mind set

Il

J

they need to change with the time.

Not

one

to

take no for an answer.

has pushed ahead implementing his

programs nonetheless. To overcome the

prob lems, I have to be pro-active and use

my connections in the cent ral government

to push through my prog rams.

T he results of

his efforts have been

impressive and ot her provincial governors

are taking notice. Over the past six years,

he has increased

Co

rontalo's budget from

Rp407 billion and a turnover of Rp

3

billion ro a budget of Rp407 billion and

a turnover of Rp3.2 trillion. Domestic

national econo mv,

It the gO\'ernmem does this, the

count rv v.ill Start ro grow in two years. I al

readv

have the program and if the current

gO\'ernment wants me to, I can design it for

the ent ire country,' he says. Despite grow

ing criticism of President Susilo Bamb ang

Yudhoyono, Fadel adds that he continues to

support the president because if the govern

ment fails, the country could fractur e.

'\{le are in a critical period today

because we have a large population and

some critical problems to tackle

but

only a

limited budget to run the count ry. ndone

sia is still susceptible ro Balkanization and

the only way to prevent it is to h ave strong

economic grov.'th in the regions. GA

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