Uncovering the Challenges of Sustainable Development in North Aceh: A Policy Analysis of Special Transfer Funds

Abstract

This study evaluates the management of two special funds in North Aceh, Indonesia, to promote sustainable development goals (SDGs) after a protracted conflict that brought the region to the brink of poverty and suffering. The special autonomy fund and the revenue-sharing funds for oil and gas are forms of fiscal decentralization provided by the central government to help Aceh recover from the conflict’s effects and natural disasters. Despite receiving these funds for over 13 years, Aceh remains among the poorest regions in Indonesia. This study used policy analyzing process theory to evaluate the management of these funds at the district level, specifically in North Aceh. A qualitative descriptive method that combines semi-structured interviews, field observations, and government documents, were used in this research. We revealed that the policy of managing these special funds has yet to achieve SDGs, particularly in North Aceh. The underutilization of revenue-sharing funds, the limited allocation of districts’ special autonomy funds, and the emphasis on infrastructure development as a priority have hindered progress and well-being, resulting in persistent poverty, unemployment, and continued dependence on transfer funds.