The Sangir people who live on the border between Indonesia and Philippines have long been known for their illegal trade activities across the border. The illegal trade activities rest upon the strings of informal networks that span across the border and were historically the networks that connected the people of Sangihe with those of the Mindanao area of Southern Philippines. The emergence of modern nation-states and their laws on border de- legitimized these trade activities. Yet, even with the illegal status, the trade activities live on. There are local bosses who have major roles in these trading activities, and there are also crew members that are involved in these particular trades. The crew members are largely recruited from the bosses’ kin and are expected to engage in the patronage system until they have sufficient amounts of capital to become a boss on their own. This paper argues that the main reason for the continuity of the trade activities is because they serve as an informal welfare institution. Through ethnographic research method that included observation participation and unstructured interview for one month from 8 November 2018 until 8 December 2018 in one of the village in Sangihe Islands, called kampung Nanedakele, this paper showed that the illegal trading activities are regarded not only as the insurer of prosperity for the people in Sangihe, but also as a mechanism for vertical social mobility. Using James C. Scott’s (1999) perspective on the failure of the state’s schemes, this paper will attribute the failure of the nationalist schemes of the modern nation-state on borders to the disacknowledgement of the local traditional welfare institution.
Border, illegal, trade, welfare institution