Nusantara Economy

The Nusantara Economy and Sustainable Ecosystems:
A Case Study of Cinnamon in Tanjung Alam Village

The study on the Nusantara Economy was conducted by WALHI (Indonesian Forum for the Environment) from 2019 to 2021. This concept emphasizes a local economy based on sustainability values, encompassing environmental, economic, and social aspects. The Nusantara Economy is grounded in the principles of a people-centered economy, closely intertwined with the landscape and natural resource management traditions, while integrating ecological, social, and economic values aligned with Indonesia’s independence ideals.

WALHI has revitalized the term “Nusantara,” originally derived from Sanskrit, with the aim of connecting sustainable local practices and knowledge. There are four key indicators in the Nusantara Economy: historical integration with ecology, economic diversity without environmental degradation, and approaches that support restoration.

WALHI also underscores the importance of Community-Managed Areas (Wilayah Kelola Rakyat – WKR), which are based on four pillars: governance, management, production, and consumption. WKR covers more than 200,000 households and 1,5 million hectares of land.

Additionally, WALHI advocates for the formation of the Nusantara Economic Ecosystem to consolidate community commodities, aiming not only to provide economic benefits but also to support food needs at the local, intercity, and global levels. The primary distinction between the Nusantara Economy and the Nusantara Economic Ecosystem lies in their stages and objectives. The Nusantara Economy represents the stage where WALHI formulates concepts, definitions, models, and governance of local economic practices in the archipelago, which, while having ecological footprints, have been affected by geopolitical changes. Following Indonesia’s independence, the economy was not adequately managed, resulting in the neglect of many local potentials. This concept focuses on understanding and analyzing community economic practices tied to natural conditions and their history.

Thus, the Nusantara Economic Ecosystem is the subsequent step built to consolidate community commodities with the goal of not only providing economic benefits but also supporting local, national, and global food security. WALHI is developing an integrated economic ecosystem to unify the production and distribution chains of community commodities. This effort also counters cartels that often smuggle natural products abroad, causing the local economy to be overlooked by the state. Through this approach, WALHI seeks to strengthen the local economy while preserving environmental sustainability through emissions reduction and carbon absorption.

The Nusantara Economic Ecosystem supports community-based production and consumption systems, aiming to restore community rights and ecosystems while creating fair trade and economic sustainability.

From this understanding, WALHI has developed spices as one of the key bases in the Nusantara Economy concept to build a sustainable economy and strengthen the economic sovereignty of local communities. Spices like cinnamon, nutmeg, cloves, and coffee not only have high economic value but also deep connections to the ecological landscape and cultural traditions of Indonesian communities.

Specifically, WALHI notes that at least three provinces have cinnamon as a strategic commodity: West Sumatra, Jambi, and South Kalimantan. Among these, Tanjung Alam Village in Jambi Province serves as an example of a community-managed area that continues to rely on cinnamon as a flagship commodity.

Cinnamon Commodity in Tanjung Alam Village

Tanjung Alam Village in Jambi Province is one of the locations that produces cinnamon. However, the price of cinnamon tends to fluctuate as it can only be harvested once per growing cycle and requires large tracts of land to consistently produce high-quality yields. The Lembah Masurai District is the only area capable of producing over 1,000 tons of cinnamon annually, while other districts like Jangkat and East Jangkat yield only around 300-400 tons. To open the cinnamon auction market, it is recommended that the government focus its efforts on Lembah Masurai due to its higher production potential and continuity. Cinnamon (Cinnamomum) is a premier spice commodity derived from the inner bark of the tree. This plant grows optimally at temperatures of 25-27°C with rainfall between 2,000-2,500 mm and humidity of 70-90%. Such geographic conditions are only found in the Kerinci and Merangin regions of Jambi Province, making them the center of cinnamon production. As a seasonal plant, cinnamon can only be harvested once per planting cycle, and after harvest, the tree must be replanted. Nonetheless, cinnamon production in Jambi continues through rotation harvests across large tracts of land.

Cinnamon Marketing System

Cinnamon from Tanjung Alam Village is marketed through several channels, including on-site sales where farmers sell cinnamon trees to buyers who bear the harvesting costs. Farmers also sell dried cinnamon, with prices varying based on quality, ranging from IDR 18,000 to IDR 40,000 per kilogram. There are at least two main categories of cinnamon: KA (with a thickness of 1-2 mm and an oil content of 1-2%) priced at IDR 40,000/kg and KF (with a maximum moisture content of 10%) priced at IDR 46,000/kg. Prices often fluctuate according to market demand and harvest conditions, yet farmers frequently face unprofitable selling prices.

Economic Life in Tanjung Alam Village

Most residents of Tanjung Alam Village work as farmers, cultivating primary commodities such as rice, coffee, and cinnamon. The agricultural system in the village still relies heavily on seasonal patterns, with rice planting and harvesting occurring once a year. In addition to agriculture, the community also depends on income from small-scale trading, though this sector remains secondary compared to farming. For residents in several villages in Merangin, such as Tanjung Alam Village, cinnamon functions as a savings crop, sold only when they need funds for significant expenses such as children’s education, weddings, or pilgrimages. In addition to cinnamon, residents also grow coffee and secondary crops to meet daily needs. Rice is also grown as the main food source, with the harvest stored in village granaries for year-round use. This agricultural system reflects the community’s dependence on local natural resources, which also ensures the sustainability of their livelihoods.

Village Monograph of Tanjung Alam

Tanjung Alam Village has a population of 324, most of whom are farmers. Accessibility to the village is still limited, being 145 km from the regency capital, requiring approximately five hours of travel. Village facilities include one elementary school, a mosque, and limited transportation options such as motorcycles. Although cinnamon farming is the main source of income for the community, a few residents also work as traders or government employees, though in smaller numbers.

The seasonal calendar used by the community shows planting and harvesting patterns for major commodities such as rice, coffee, cinnamon, and rubber, as well as periods of scarcity when food sources become limited. In addition to farming, the community engages in activities such as hunting and fishing. Overall, the economic structure of Tanjung Alam Village remains highly dependent on the agricultural sector, with cinnamon playing a significant role in the village’s economy.