Beyond resource abundance: Evaluating the impact of mining and fiscal transfers on regional sustainable development index
DOI:
https://doi.org/10.61511/ecoprofit.v3i1.2025.1969Keywords:
mining sector, sustainable development, fiscal transfer, panel dataAbstract
Background: The mining sector in Indonesia has long been an important pillar of the country's economy. The region Sulawesi, Maluku and Papua is a region rich in resource nature such as minerals and energy, has contributed significantly to the national economy, especially through the export of mining products. However, along with the growth of the mining sector, various challenges have emerged, not only related to economic aspects, but also environmental and social impacts that threaten the sustainability of development. Natural resource curse theory : this theory states that countries or regions that depend on natural resources natural resources, such as mining, often experience slow economic growth or negative impacts. socio-environmental imbalance, so that its contribution to sustainable development become limited. Methods: Study This use two approach, First that is counting index sustainable development (IPB), and second, using the panel data regression method, covering 10 provinces in the Sulawesi, Maluku and Papua regions. Excluding the three new provinces in the Papua region, namely the Province South Papua, Central Papua, and Mountainous Papua. Findings: The results of the IPB calculations for each province in Sulawesi, Maluku and Papua regions using the development dimension. In general, the regions Papua and parts of Sulawesi showed high IPB achievements in 2024. However, there are disparities which is quite striking between provinces. The highest IPB figure is West Papua and the lowest is Maluku Province. Conclusion: Fiscal transfers of natural resources (SDA) and population have a significant influence. towards IPB, supported by theories and research that show the importance of resource management nature and population dynamics in sustainable development. As for the GRDP of the mining sector found to have no significant effect. The cause may be due to the impact of the natural resource curse and lack of practice mining sustainable. Matter this is what hinder his contribution to IPB. For to support sustainable development, better management of fiscal transfers of natural resources is needed, application of environmentally friendly technology in the mining sector, improving the quality of human resources and infrastructure to manage demographic pressures. Novelty/Originality of this article: This research provides novelty in terms of geographical context specifically in the regions of Sulawesi, Maluku, and Papua. Although This area is rich in natural resources, the implementation of sustainable development policies in this area still limited, especially due to infrastructure constraints, human resources, and differences in social conditions and culture.
References
Arifin, R., Mashhar, A., Sumardiana, B., Ramada, DP, Kamal, U., & Fikri, S. (2024). Indonesian sustainable development policy: How the government ensures the environment for future generations. IOP Conference Series: Earth and Environmental Science, 1355(1). https://doi.org/10.1088/1755-1315/1355/1/012005
Auty, R. M. (2001). Resource Abundance and Economic Development. Oxford University Press.
BPS. (2023). Indonesian Statistics 2023. Badan Pusat Statistik.
Bahri Abd. Rasyid, S., Misran, & Saputra, H. A. (2024). A portrait of green economy governance in sustainable development in Eastern Indonesia. Jurnal Bina Praja, 16(3), 557–572. https://doi.org/10.21787/jbp.16.2024.557-572
Bappenas. (2019). Low Carbon Development: A Paradigm Shift Towards A Green Economy in Indonesia. Badan Perencanaan Pembangunan Nasional Republik Indonesia (Bappenas), 162.
Bappenas. (2022). National Medium-Term Development Plan. Badan Perencanaan Pembangunan Nasional Republik Indonesia (Bappenas).
Barri, A. R. R., Zakaria, S., & Bidullah, T. (2021). The Influence of the Mining and Quarrying Sector on the Gross Regional Domestic Product of Banggai Regency. Productive Scientific Journal, 9(1), 20–26. https://ojs-untikaluwuk.ac.id/index.php/jip
Brida, J. G., Alvarez, E., Cayssials, G., & Mednik, M. (2024). How does population growth affect economic growth and vice versa? An empirical analysis. Review of Economics and Political Science, 9(3), 265–297. https://doi.org/10.1108/REPS-11-2022-0093
Cui, Y., Wang, G., Irfan, M., Wu, D., & Cao, J. (2022). The effect of green finance and unemployment rate on carbon emissions in China. Frontiers in Environmental Science, 10(July), 1–16. https://doi.org/10.3389/fenvs.2022.887341
de Jong, E., & Vijge, M. J. (2021). From Millennium to Sustainable Development Goals: Evolving discourses and their reflection in policy coherence for development. Earth System Governance, 7, 100087. https://doi.org/10.1016/j.esg.2020.100087
Fauzi, A., & Oktavianus, A. (2014). Measuring Sustainable Development in Indonesia - Akhmad Fauzi. In Measuring Sustainable Development in Indonesia (Vol. 30).
Hardjasoemantri, K., & Supriyono, H. (2019). History of the Development of Environmental Law. In Module 1 History of the Development of Environmental Law (p. 17).
Hariram, N. P., Mekha, K. B., Suganthan, V., & Sudhakar, K. (2023). Sustainalism: An Integrated Socio-Economic-Environmental Model to Address Sustainable Development and Sustainability. Sustainability (Switzerland), 15(13). https://doi.org/10.3390/su151310682
Hickel, J. (2020). The sustainable development index: Measuring the ecological efficiency of human development in the anthropocene. Ecological Economics, 167(March 2019), 106331. https://doi.org/10.1016/j.ecolecon.2019.05.011
Humphreys, M., Sachs, J. D., & Stiglitz, J. E. (2007). Escaping The Natural Resource Curse. Columbia University Press.
Imran, M., Alam, M. S., Jijian, Z., Ozturk, I., Wahab, S., & Doğan, M. (2024). From resource curse to green growth: Exploring the role of energy utilization and natural resource abundance in economic development. Natural Resources Forum, 49(2), 2025–2047. https://doi.org/10.1111/1477-8947.12461
Indonesian Mining Institute (IMI). (2018). Report on Indonesia Mining Sector Diagnostic (November Issue). World Bank.
Jamin, M., Jaelani, A. K, Mulyanto, Kusumaningtyas, R, O, & Ly, D. Q. (2023). The Impact of Indonesia's Mining Industry Regulation on the Protection of Indigenous Peoples. Hasanuddin Law Review, 9(1), 88–105. https://doi.org/10.20956/halrev.v9i1.4033
Kapriadi, A. Y. (2022). Indonesian Presidency G20 Collective Ideas towards sustainable recovery and growth. In Addition of Sodium Benzoate and Potassium Sorbate (Anti-inversion) and Stirring Speed as an Effort to Inhibit Inversion Reactions in Sugarcane Juice.
Kersting, N. (2021). Participatory democracy and sustainability: Deliberative democratic innovation and its acceptance by citizens and German local councilors. Sustainability (Switzerland), 13(13). https://doi.org/10.3390/su13137214
Klarin, T. (2018). The Concept of Sustainable Development: From its Beginning to the Contemporary Issues. Zagreb International Review of Economics and Business, 21(1), 67–94. https://doi.org/10.2478/zireb-2018-0005
Kurniawan, R., & Managi, S. (2018). Economic Growth and Sustainable Development in Indonesia: An Assessment. Bulletin of Indonesian Economic Studies, 54(3), 339–361. https://doi.org/10.1080/00074918.2018.1450962
Li, X., Ma, L., Ruman, A. M., Iqbal, N., & Strielkowski, W. (2024). Impact of natural resource mining on sustainable economic development: The role of education and green innovation in China. Geoscience Frontiers, 15(3), 101703. https://doi.org/10.1016/j.gsf.2023.101703
Madany, N., Ruliana, & Rais, Z. (2022). Panel Data Regression and Its Application in Financial Performance on Profit Growth of Idx Lq45 Companies of Indonesia Stock Exchange. VARIANSI: Journal of Statistics and Its Application on Teaching and Research, 4(2), 79–94. https://doi.org/10.35580/variansiunm28
Mancini, L., & Sala, S. (2018). Social impact assessment in the mining sector: Review and comparison of indicators frameworks. Resources Policy, 57(January), 98–111. https://doi.org/10.1016/j.resourpol.2018.02.002
Naryono, E. (2023). Nickel Mine Exploitation In Indonesia, Between A Blessing And A Disaster Of Environmental Damage. Center for Open Science, 1–22.
Olivia, D. (2020). Allocation of Natural Resource Revenue Sharing Funds in the Framework of Decentralization. KADARKUM: Journal of Community Service, 1(2), 85. https://doi.org/10.26623/kdrkm.v1i2.2886
Onifade, M., Zvarivadza, T., Adebisi, J.A., Said, KO, Dayo-Olupona, O., Lawal, A.I., & Khandelwal, M. (2024). Advancing toward sustainability: The emergence of green mining technologies and practices. Green and Smart Mining Engineering, 1(2), 157–174. https://doi.org/10.1016/j.gsme.2024.05.005
Putra Fanolo Hia, S., Damanik, D., & Nainggolan, P. (2024). The Influence of the Agricultural Sector, Mining Sector, and Manufacturing Sector in North Sumatra Province. Journal of Equity, 6(1), 16–28. https://doi.org/10.36985/rbazcb03
Qur'an, AA (2018). Natural Resources in Sustainable Development from an Islamic Perspective. El-Jizya: Journal of Islamic Economics, 5(1), 1–24. https://doi.org/10.24090/ej.v5i1.1621
Rohman, A., Hartiwiningsih, & Rustamaji, M. (2024). Illegal mining in Indonesia: need for robust legislation and enforcement. Cogent Social Sciences, 10(1). https://doi.org/10.1080/23311886.2024.2358158
Rose, A. (2024). Exploring the 4 Pillars of Sustainable Development: A Complete Guide. Lythhouse.
Stacey, N., Gibson, E., Loneragan, N. R, Warren, C., Wiryawan, B., Adhuri, D. S, Steenbergen, D. J, & Fitriana, R. (2021). Developing sustainable small-scale fisheries livelihoods in Indonesia: Trends, enabling and constraining factors, and future opportunities. Marine Policy, 132, 104654. https://doi.org/10.1016/j.marpol.2021.104654
Sulistiawati, R. (2021). Demographic Transition and Economic Growth in West Kalimantan. Proceedings of the SATIESP National Seminar, 164–180. https://feb.untan.ac.id/satiesp-2021/
Sumarjo, C. M., & Mangantar, M. (2022). The Effect of Geopolitical Risk, Profitability and Leverage on Stock Returns of Mining Companies in the Oil and Gas Subsector Listed on the Indonesia Stock Exchange. EMBA Journal: Journal of Economic, Management, Business and Accounting Research, 10(3), 1027. https://doi.org/10.35794/emba.v10i3.43665
Tarigan, N. M. R, Islam, U., & Utara, S. (2024). Analysis of Natural Resource Management in Langkat Regency: Impact on the Local Economy. Regress: Journal of Economics & Management, 3(3), 180–186. https://jurnal.medanresourcecenter.org/index.php/REG/article/view/1523
Ministry of Finance. (2024). Report on Realization of Transfers to Regions.
KLHK. (2023). Indonesian Environmental Quality Index.
Oates, W.E. (1999). An Essay on Fiscal Federalism. Journal of Economic Literature, 37(3), 1120–1149. https://www.jstor.org/stable/2564874
Taufikurahman, M. R., Firdaus, A. H., Ahmad, T., Febriani, D. A, & Permana, A. S. (2023). The Impact of Mining Sector Investment on National and Regional Economic Performance. INDEF Policy Brief.
Wijaya, B. S., Rozi, F. F. P., Sukma, S. R., & Nadirah, K. (2024). Environmental Degradation and Sustainable Development: The Effectiveness of Unep and ASEAN Cooperation in Addressing Environmental Problems in Southeast Asia. Indonesian Journal of International Relations, 8(2), 375–391. https://doi.org/10.32787/ijir.v8i2.530
World Bank. (2020). Indonesia Public Expenditure Review: Spending for Better Results. Worldbank. 1–393. www.worldbank.org/id
World Bank. (2018). Indonesia Systematic Country Diagnostic. World Bank.
Xu, X. (2023). Identifying the Impact of Industrial Agglomeration on China's Carbon Emissions Based on the Spatial Econometric Analysis. Journal of Environmental and Public Health, 1–17. https://doi.org/10.1155/2023/4354068
Yani, A. A, Muhammad, A. Y, Zainal, Z., Arief, M., & Zuada, L. H (2024). Local Political Dynamics of Natural Resource Exploration: A Case Study of Nickel Mining in Sulawesi Island (Issue Wcgss). Atlantis Press SARL. https://doi.org/10.2991/978-2-38476-236-1_21
Yorisca, Y. (2020). Sustainable Legal Development: Efforts to Achieve Sustainable National Development. Indonesian Journal of Legislation, 17(1), 98. https://doi.org/10.54629/jli.v17i1.507
Published
How to Cite
Issue
Section
Citation Check
License
Copyright (c) 2025 Irawan Abae, Abdul Chalid Ahmad, Said Mala

This work is licensed under a Creative Commons Attribution 4.0 International License.