ANALYSIS OF THE DISPARITY BETWEEN REGULATION AND REALITY: EVALUATING THE IMPACT OF THE FREE NUTRITIOUS MEAL (MBG) PROGRAM ON THE INCOME AND PROFIT MARGINS OF TRADITIONAL MARKET TRADERS IN ARSO DISTRICT, KEEROM REGENCY, PAPUA

Abstract

The Free Nutritious Meal (Makan Bergizi Gratis/MBG) program is a national priority policy introduced to enhance the quality of human resources while simultaneously providing economic stimuli for micro-enterprises at the local level. As a food buffer zone in Keerom Regency, Papua Province, Arso District is theoretically projected to receive a liquidity injection of up to IDR 8 billion per village annually. This study aims to evaluate the empirical impact of the MBG program on the income and profit margins of traditional market traders in Arso District using a Sequential Explanatory Mixed Methods approach. Quantitative data were obtained from a structured survey of 59 traders across the Arso II Folk Market, Jaifuri Market (Arso III), and Arsopura Market, which were subsequently elaborated qualitatively through interviews with key informants. The quantitative analysis reveals findings that contradict the Keynesian Multiplier projections of macro-policy. The traders' average perception scores across all income and profit indicators fell below the neutral value (µ < 3.00), specifically concerning daily turnover (µ = 2.86), profit margins (µ = 2.78), and the sales volume of primary commodities (µ = 2.76). This low performance is driven by a severe supply chain exclusion rate, wherein 94.92% of local traders are entirely disengaged from raw material procurement. Furthermore, qualitative findings expose institutional distortions, indicating that the Nutritional Fulfillment Service Units (SPPG) tend to prioritize internal supplies, self-cultivation, and closed partnerships, leading to patterns of patronage and nepotism. Instead of improving welfare, the program triggers a negative spillover effect by inducing shortages in agricultural commodities at the market level and inflating wholesale prices due to direct procurement competition with the SPPG, which ultimately compresses the profit margins of small-scale traders. This study recommends a regulatory restructuring of the National Nutrition Agency's (BGN) procurement system by enforcing mandatory purchasing quotas from traditional markets to foster spatial justice in Papua.