The International Labour Organization (ILO) and the Swiss Government are deepening their partnership to support sustainable patchouli development in Aceh Province, Indonesia. Backed by the Swiss State Secretariat for Economic Affairs (SECO), the ILO’s Promise II Impact project has spent the past three years strengthening small and medium-sized enterprises in the patchouli value chain by improving access to finance, expanding digitalization, and enhancing production data systems. The initiative aims to increase productivity, transparency, and decision-making capacity while promoting decent work and local economic growth.
Patchouli has long been a cornerstone of Aceh’s local economy, and the sector continues to play a key role in supporting rural livelihoods. Through the project, enterprises are adopting digital production data tools and enterprise resource planning systems that improve traceability, operational efficiency, and eligibility for financing. These innovations are helping farmers and businesses meet international quality standards and compete more effectively in global markets.
A recent visit by SECO representatives and the ILO team to Aceh underscored progress made under the programme. At Syiah Kuala University (USK), discussions focused on strengthening the broader patchouli ecosystem through collaboration between academia, government, and the private sector. The university, alongside the Atsiri Research Center, is playing an important role in linking research and innovation with field implementation, enabling farmers and enterprises to adopt digital tools for production planning, quality assurance, and market engagement.
Field visits to Lhoong village highlighted how innovation is being applied at the community level. Farmers demonstrated the MyNilam application, which connects agricultural production data with business systems to enhance efficiency, traceability, and access to markets and financing. Despite progress, challenges remain, including the need to scale up shared knowledge among farmers and address the price gap between crude patchouli oil and refined products processed outside the province. Expanding local processing capacity is seen as critical to capturing more value within Aceh and increasing rural incomes.
The partnership aligns with Aceh’s medium-term development priorities, particularly efforts to strengthen downstream industries and the creative economy. Continued investment in digitalization, farmer training, and stronger market linkages will be essential to ensuring long-term resilience and inclusive growth in the patchouli sector. The collaboration between the ILO, SECO, academic institutions, and local authorities demonstrates how coordinated action and local ownership can drive sustainable economic development in Indonesia’s rural communities.
