CHAYANOV’S SYNDROME AS FACED BY ‘BAP’ AGRIBUSINESS CORPORATION AND THE PEASANT COMMUNITIES LIVING IN AND NEARBY THE FORESTRY ESTATE CONCESSION

The survival of the fittest apparently applies in stages of agribusiness development. What had become concern of Chayanov during pre-communist era in Rusia as being highlighted by D. Thorner (1966) for its relevance in the world of today, it has also become serious matter within economic life of modern Indonesia. The same concern given by the Government of Indonesia (GOI) has been clearly implied by the enactment of the Act #23/1997 and Act #25/2007 coined with Act #40/2007, which have to be responded by every large scale company. Among others is PT-BAP, an industrial forestry company established in 2004 acting as supplier to pulp & paper company that exist already in Sumatra but lack of raw material. This paper is based on a research work in 2017 that was aimed at examining the effectiveness of GOI policy on mandatory CSR viewed from the stand point of large scale company that gave response to the regulation by allocating fund for empowering people living in the surrounding. There were 3-objectives of the study: 1) How successful was the CSR program while facing which policy constraints and being supported by which conducive determining factors?; 2) What kind of benefits and how much financial gain particularly that the CSR could generate annually for the peasant community?; 3) What potential problems that might lead to which social conflict, should the CSR program become actually failed or non-existence? The research findings revealed that the CSR program launched by PT-BAP has so far been warmly accepted by the targeted people although not much significant achievement in terms of additional income that could be obtained by them each year since 2015. Several technical constraints and social hindrances existed, against which some strategic improvement in extension service and innovative business process must be introduced. Otherwise, the so called social entropy (psychological, ecological, economic and cultural entropies) would sooner or later bring social disputes to the company causing socio-anthropological disturbance to the industrial forestry agribusiness. Serious attention must be given in order to avoid Chayanov syndrome.