A bold new initiative aimed at transforming Papua’s rural economy is underway with the formation of Kopdeskel Merah Putih (Village Red White Cooperatives)—a village-based cooperative model officially launched this week to promote economic self-reliance and reduce dependency on costly external supply chains.
The cooperative movement, spearheaded by Indonesia’s Deputy Minister of Cooperatives and SMEs, Ferry Irawan, marks a significant policy shift toward empowering indigenous Papuan communities through grassroots economic structures. The program is designed to combat longstanding challenges, including the high cost of staple goods and the limited market access faced by villages in Papua.
“It is time for the Papuan people to become subjects—not just objects—of development,” Ferry stated during a public dialogue held in Papua Barat. “Through the Kopdeskel Merah Putih, villages will have the infrastructure to manage their own supply chains and take part in building an inclusive national economy.”
A Local Solution to High Living Costs
One of the core motivations behind the establishment of Kopdeskel Merah Putih is the high price disparity for basic necessities in Papua compared to other regions. Goods that are affordable in Java or Sulawesi often cost double or even triple in remote Papuan areas due to logistical bottlenecks and underdeveloped transportation infrastructure.
The cooperative model provides a mechanism to bulk-purchase goods directly from producers or distributors outside the region, then transport them under the cooperative’s management to rural Papuan villages. This reduces dependency on middlemen and helps stabilize prices.
“Prices of rice, sugar, cooking oil, and even construction materials have long been a burden for rural Papuans,” said Ferry. “Now, by organizing as cooperatives, villagers can bypass predatory pricing and assert more control over local distribution systems.”
Empowering Rural Governance and Unity
The “Merah Putih” name—referencing Indonesia’s red and white national flag—is not just symbolic. It underscores the cooperative’s goal of uniting villages under a shared economic identity, while strengthening national integration through localized empowerment.
These cooperatives will operate at the Kopdeskel level and are structured to work in coordination with village leaders, indigenous institutions, and provincial cooperatives. According to government officials, each cooperative will be run democratically by local residents, with support from trained facilitators and access to low-interest financing.
“We’re building a people-first economic model,” said Deputy Minister Ferry. “The villagers themselves decide what’s best for their economic development—from agricultural production to retail management.”
Pilot Projects in Papua Barat and Beyond
The formation of Kopdeskel Merah Putih has begun in multiple districts across Papua Barat and Papua, including pilot villages in Manokwari, Fakfak, and Sorong. Early feedback has been positive, particularly from community members who have struggled to maintain small businesses in the face of unstable supply chains and inflated operating costs.
Papuan village head Yulianus Krey from Sorong district praised the cooperative approach. “This is the first time we’ve had direct access to goods without waiting weeks or months. It changes everything—from food security to our ability to support our children’s education.”
The Ministry of Cooperatives and SMEs plans to expand the program to more than 200 villages by early 2026, with support from regional banks, provincial governments, and national logistics companies. The program also includes capacity building initiatives to help rural entrepreneurs improve business literacy, product packaging, and digital marketing.
A Long-Term Vision for Inclusive Growth
Beyond just cost savings, Kopdeskel Merah Putih is being hailed as a model of inclusive economic growth, aligning with Indonesia’s broader vision of “one-price, one-nation” economic justice. By turning villages into productive hubs—rather than passive recipients of aid—the model seeks to decentralize economic opportunity and bridge the development gap between eastern and western Indonesia.
Ferry emphasized that the cooperative approach also respects cultural values and local wisdom, ensuring that Papuan identity is preserved as rural communities modernize. “This is not a one-size-fits-all model,” he said. “Each cooperative will reflect the spirit of its people. We are simply providing the tools and the trust.”
Challenges Ahead
Despite the enthusiasm, some challenges remain. Papua’s rugged terrain, limited road networks, and inconsistent internet connectivity pose logistical hurdles. There are also concerns about corruption, elite capture, and ensuring transparency in cooperative management.
To address this, the Ministry has initiated a monitoring and evaluation framework with civil society participation, and is investing in digital tools for cooperative accounting and mobile-based reporting systems to promote accountability.
“We know there will be difficulties,” said Ferry. “But the alternative—continued dependence and inequality—is far worse. With transparency, cooperation, and training, we believe Papua’s villages can lead the way in economic resilience.”
Conclusion
With the launch of Kopdeskel Merah Putih, the government is not only providing a short-term solution to the high cost of living in Papua but also charting a long-term course toward rural economic independence. It is a step toward placing Papuan communities at the center of their own development, where they are not merely participants, but leaders in shaping a more equitable national economy.
If successful, the model could become a blueprint for village-based economic systems throughout Indonesia’s eastern regions—anchored in cooperation, culture, and community sovereignty.
