Strengthening Sustainable Rural Economy through BUMDes-Based Community Economic Empowerment

Abstract

This study aims to explore how Village-Owned Enterprises (Badan Usaha Milik Desa/BUMDes) drive community economic empowerment toward a sustainable rural economy in Sukodadi Village, Paiton District, Probolinggo Regency, focusing on the bamboo weaving business group Anyaman Bamboe. The study was motivated by the persistent dependence of rural households on informal income, limited access to capital, and the underuse of local resources, even as village funds continue to grow. A qualitative case study approach was used, with data collected from July to August 2026 through participant observation, in-depth interviews, and document analysis involving village officials, BUMDes managers, and craftsmen from around 20 households. The findings show that BUMDes supports the craftsmen through three forms of empowerment: mentoring on product development, capital loans of IDR 3–10 million repaid through monthly deductions from consignment sales, and market access supported by partners PJB and POMI Paiton, which provide an additional income of around IDR 500,000–1,000,000 per month. Community participation is driven by strong kinship-based social capital among craftsmen in one hamlet, while their direct links with outside partners remain limited. Sustainability is supported by the use of bamboo as a renewable local resource, although the regeneration of young craftsmen and competition with factory-made products remain key challenges. This study contributes to understanding how village-level economic institutions can integrate economic, social, and environmental dimensions, and offers practical insights for other villages seeking to strengthen BUMDes as an instrument of sustainable development.