CHALLENGES IN PUBLIC POLICY: LESSONS LEARNED FROM INDONESIA S FISHERY SECTOR

Transcription

1 CHALLENGES IN PUBLIC POLICY: LESSONS LEARNED FROM INDONESIA S FISHERY SECTOR SUSI PUDJIASTUTI Minister of Marine Affairs and Fisheries of The Republic of Indonesia 31 March 2018

2 INDONESIA S VISION TO BE THE WORLD S MARITIME AXIS Two-thirds of Indonesia s territory is covered by the ocean (5.8 million km 2 ), with the second longest coastal lines in the world (95,181 km) OCEANS ARE THE FUTURE OF OUR NATION President Joko Widodo, State speech on 20 October 2014 Territorial Sea Border ZEE Sea Border Border of Indonesian Maritime Domain Based on the 1982 LOSC Provisions 2

3 STATE REVENUE FROM FISHERIES SECTOR IS LOW DUE TO IUU FISHING Sample case: Merauke (Papua) and Ambon (Maluku) Financial Report of Pingtan Marine Enterprise Ltd Operation * Regional Revenues for Fisheries Sector in Papua Province ,600,000,000 1,400,000,000 1,200,000,000 1,000,000, ,000, ,000, ,000, ,000,000 Unit in Million USD Source: Pingtan Marine Enterprise Ltd., 10-Q May 10, 2016 The operation of one vessel per year could gain net income of US$ 800 thousand-1million (>Rp 10 billion). Before the moratorium, there were 156 vessels operating (>Rp 1.5T per year) Unit in Rupiah Source: Financial Bureau of KKP, 2015 For Papua Province, it is estimated that the PAD received in 2014 is only Rp 1.3 Bilion 2014 Revenues of Thai Union Group PCL US$ 3.44 Billion Thai Union is the largest tuna canning company in the world, 44% of its sales are tuna products PAD for Fisheries Sector 2014 Maluku Province Rp 11.6 Billion (US$ 860 thousands) The world's tuna breeding ground is in the ocean near Maluku (WPP ) 3

4 IUU FISHING DESTROYS OUR MARINE ECOSYSTEM & BIODIVERSITY The dearth of catch fish supply also impacts the aquaculture productivity Overfishing by super trawling boats Coral damage as the impact of bottom trawling Photo source:

5 SAVINGS FROM STATE BUDGET DUE TO PREVENTION OF FUEL SMUGGLED BY ILLEGAL VESSEL. Fishermen queueing for fuel Transhipment 5

6 DURING THE LAST 10 YEARS, THE LIVELIHOOD OF FISHERMEN ARE DECREASING There is a decrease in the number of Fishermen Household according to BPS Agriculture Census Picture Number of Households in Fishing Business ,800,000 1,600,000 1,400,000 1,200,000 Decrease 44,9 % 1,000,000 Pintur Crab Fisherman 800,000 1,600, , , , ,000 - Source: BPS Agriculture Census 2003 & Fish Catching Business Usaha Penangkapan Ikan Ketinting Fisherman 6

7 THE MAJORITY OF INDONESIAN FISHERMEN ARE SMALL-SCALE FISHERMEN Ex-foreign fishing vessel is only a small part of fishing vessels in Indonesia National Fisheries Vessels Motor Boats Motor Boats >30 GT Outboard motor boats 41% Motor Boats 32% 5-10 GT 19% GT > 30 GT 6% % GT 4% Ex- Foreign boats 28% Boat without motor 27% < 5 GT 69% Domestic Boats 72% 7

8 POVERTY & REVENUE INEQUALITY IN INDONESIA The poverty rate is still high in the capture fisheries sector Statistics of Poverty & Income Equity in Indonesia Province with a High Relative Poverty (percent) Relative Poverty (% population) Absolute Poverty (million people) Gini coefficient Gini Ratio ¹ ¹ ¹ Province The poor¹ Papua 28.5% Papua Barat 25.4% Nusa Tenggara Timur 22.2% Maluku 19.2% Gorontalo 17.7% ¹ percentage based on total population by province in March 2016 Provinces with a High Absolute Poverty (million people) Province The poor Jawa Timur 4.78 Jawa Tengah 4.51 Jawa Barat 4.49 Sumatra Utara 1.51 Nusa Tenggara Timur 1.16 Source : Badan Pusat Statistik,

9 ONE IN THREE INDONESIAN CHILDREN EXPERIENCES STUNTING High consumption of fish can significantly contribute to the development of child nutrition Malnutrition Condition in Indonesia Indicator Prevalence of short toddlers 36,8 35, The prevalence of underweight children Prevalence of low birth weight <2500 gr 13,6 13,3 12,1 11,5 11,1 10,2 Source: Riskesdas, 2013 Children from a traditional village in Sumba Island, East Nusa Tenggara. UNICEFIndonesia/2014/Hasan Almost 9 million Indonesian children under 5 years old are too short for their age 9

10 Strong governance is the basis to maintain the sustainability of productivity enhancement of marine and fishery resources in Indonesia Sovereignty Mission 3 Pillars of MMAF issions Prosperity Mission 1 2 DG OF SURVEILLANCE: Supervise the Management of Marine and Fishery Resources QUARANTINE & QUALITY CONTROL AGENCY: Fish quarantine, quality control, fishery product safety, and fish biological safety Sustainability Mission DG OF MARINE SPATIAL MANAGEMENT: Marine Spatial management, conservation and biodiversity DG OF CAPTURE FISHERIES & AQUACULTURE: Sustainability of capture fisheries and aquaculture DG OF PRODUCT COMPETITIVENESS: Competitiveness and logistic system of marine and fishery products 6 RESEARCH & HR AGENCY: Science and technology innovation, human resources and community empowerment STRONG FISHERIES GOVERNANCE 10

11 STEPS TO ERADICATE IUU FISHING Size and condition restrictions on the capture of Lobster, Crab and Swimming Crab Ministerial Reg. No. 1/2015 Prohibition of the use of Trawl and Seine Nets fishing gear Ministerial Reg. No. 2/2015 SINKS 363 Illegal Fish Vessel 342 Foreign Fish Vessel 21 Indonesian Fish Vessel Road map of capture fisheries management GOOD GOVERNANCE Prohibition of transhipment at sea for overseas destination Ministerial Reg. No. 57/2014 Ratification of Port State Measure Agreement (PSMA) Fishing Business is only for 100% Domestic Investment Presidential Reg. 44/2016 Moratorium on permits for ex-foreign vessels Ministerial Reg. No. 56/2014 Analysis and Evaluation of 1,132 Ex-Foreign Vessels Handling Benjina Slavery case: 1020 people Joint Communique on IUUF with 10 Countries India, Norwegia, Palau, Papua Nugini, Selandia Baru, Timor Leste, Australia, Sudan, Rusia, Srilanka Regulate the live fish carriers & loading port Ministerial Reg. No. 15/2016 Improve the Licensing Services: shorten the time & document processes through One-Stop Integrated Service, Regional Licensing Outlets, and Online Services Establishment of Indonesian Presidential Task Force to Combat Illegal Fishing (115 Task Force) (Presidential Reg. No. 115/2015) 11

12 FIRST STEP OF DIPLOMACY AGAINST IUU FISHING Meeting with Six Ambassadors to Establish Commitments that the IUU Fishing is a Common Enemy 12

13 ONE ROOF ENFORCEMENT FOR FISHERY CRIME Establishment of 115 Task Force (Presidential Regulatopn No. 115/2015 on Illegal Fishing Eradication Task Force) 13

14 HISTORY OF ISSUED PERMITS FOR EX-FOREIGN AND FOREIGN FISHERY VESSEL License & Charter System of Foreign fishing vessels began in 2001 and ended in In 2008, Indonesia imposed the nationalization of foreign vessels (all Indonesian or ex-foreign) 2,500 Number of Permit for Ex-Foreign Fishery Vessels, Charters & Licenses 2,000 1,500 1, Moratorium & De-registration Eks-Asing Ex-Foreign Charter (Asing) (Foreign) Lisensi License (Asing) (Foreign) Sarwono Kusumaatmadja Rokhmin Dahuri Freddy Numberi Fadel Muhammad Sharif Cicip Sutarjo Susi Pudjiastuti Foreign Vessel Charter License Bilateral Arrangement Integrated Capture Fishing Enterprises Industrialization of Integrated Capture Fisheries 0% Foreign Investment for Capture Fisheries 14

15 TERMINATION OF EX-FOREIGN VESSEL OPERATIONS Based on data analysis & evaluation result, 100% of foreign vessels have committed IUUF violations Percentage of foreign vessels country of origin in Indonesia: Origin Flag of Ex-Foreign Vessel and Operation Area in Indonesia Riau Islands (± 60 Vessels) North Sulawesi (± 200 Vessels) West Papua (± 90 Vessels) Taiwan 19% Thailand 25% Australia 2% Philippine 9% Japan 9% China 33% Other 4% Korea 1% Panama 1% Sino Vessels Bali (± 150 Vessels) Maluku (± 240 Vessels) Papua (± 140 Vessels) 15

16 FISHERMAN'S STORY ABOUT "CITY IN THE MIDDLE OF THE SEA" The mass number of foreign ships captured in the Arafura Sea is visible from the bright lights captured by NASA satellite. Since the moratorium on foreign ships, local fishermen have filled the WPP 718 fishing area. Night Satellite Image, Acquisition of 2012 (NASA) Night Satellite Image, 2016 Acquisition (NASA) 16

17 SINKING OF SHIPS IS MANDATED BY THE FISHERIES LAW Creating a Deterrent Effect to eliminate IUUF in Indonesian waters NO. Vessel s Flag TOTAL 1 Vietnam Philippines 76 3 Thailand 22 4 Malaysia 51 5 Indonesia 21 Article 69 of the Fisheries Law (31/2004 jo.45/2009) Scope of Authority: Article 69 (3): Stop, check, carry and hold the vessels suspected or reasonably suspected of violation in the Area of Fisheries Management Article 69 (4): On the basis of sufficient preliminary evidence, may take special action in the form of burning and / or sinking of a foreign-flagged fishing vessel on the basis of sufficient initial evidence 6 Papua New Guinea 2 7 China 1 8 Belize 1 9 Nigeria* 1 TOTAL (Nov 2014-Nov 2017) 363 *) Information: MV Viking 17

18 MV VIKING The illegal fishing monument in Pangandaran after the MV Viking was grounded 18

19 THE HIGH ACTIVITIES OF ILLEGAL & UNDOCUMENTED FISH EXPORT The existence of transhipment policy creates opportunity for illegal exports and unrecorded fisheries production The alleged illegal Export of Albacore Tuna Frozen (HS ) from Indonesia to Thailand in 2000 and 2010 Thailand Silver Sea 2 Vessel Monitoring Result of Airborne Surveillance Maritime Border Command (27 July 2015) Kg Import of Frozen Albacore Thailand from Indonesia Impor Albacore Frozen Thailand dari Indonesia Export of Frozen Albacore from Indonesia to Thailand Ekspor Albacore Frozen Indonesia Ke Thailand 2000 There are differences about 271,419 kg (52%), With value US$ 1,070,630 Terdapat Selisih Kg (52 Persen) dengan Nilai US $ Kg Import Impor of Albacore Frozen Albacore Frozen Thailand from dari Indonesia Ekspor Export Albacore of Frozen Frozen Albacore Indonesia from Indonesia Ke Thailand to Thailand Kg Kg There are differences about 2,352,724 kg Terdapat Selisih sebesar Kg (69,20 (69,20%), Persen) dengan With value Nilai US$ 8,326,839 US $ Source : Analyzed from UN-Comtrade 2011 data JAKARTA 19

20 SILVER SEA 2 20

21 CASE: FISHING BOATS AS DRUGS SMUGGLING TOOL Sunrise Glory fishing boat flying Singaporean flag was nabbed by Indonesian Navy on February 7, 2018 in Batam, Riau Islands It smuggled 1.37 tons of methamphetamine and hid 41 rice sacks Image Source: 21

22 FISHERIES CRIME AS TRANSNATIONAL ORGANIZED CRIME It takes commitment and international cooperation to eradicate IUUF & other crimes on fishing vessels Human trafficking Drug Smuggling Protected Animals Smuggling Oil Smuggling Image Source: 22

23 TRANSPARENCY & USE OF TECHNOLOGY FOR VESSEL SUPERVISION Example: Indications of transhipment on the high seas area using Global Fishing Watch Katuei Maru 88 Vessel (Japan) and Mahakam Jaya Vessel 23

24 TRANSPARENCY & USE OF TECHNOLOGY FOR VESSEL SUPERVISION Example: Indications of transhipment on the high seas area using Global Fishing Watch Sun Tian Fa 168 Vessel (Taiwan) and VMS vessel (#125358) 24

25 PRESIDENTIAL REGULATION NO. 44 OF 2016: Partiality and investment opportunities offered in the field of marine and fisheries BUSINESS CATEGORY OPEN For foreign investment 100% without special provisions Cold Storage OPEN WITH REQUIRED TERMS Requirements reserved for SMEs Fish breeding OPEN WITH CERTAIN REQUIREMENTS Specific requirements such as location, capital size & institutional recommendation Excavation of sea sand (100% domestic capital) Capture fisheries (100% domestic capital and KKP special permits) Cultivation of ornamental coral (recommendation from KLHK) OPEN WITH PARTNERSHIP REQUIREMENTS Requires to partner with SMEs Fish hatchery and enlargement Drying, fumigation, fermentation & surimi Marketing, Distribution & Export CLOSED Prohibited from doing any business, either domestic or foreign investors Fish listed in CITES Utilization of natural corals Lifting of the sinking ship 25

26 FISH FIN LOGISTIC Logistics are driven by "fish fins, using the outer islands as export gateways of fishery products Hongkong Davao / Cebu Palau Malaysia 800 km 936 km Phuket Hawaii 7,500 km Integrated Marine and Fishery Centers in the Border and Outer Islands Christmas Island 529 km Darwin 1,000 km Cairns 2400 km Brisbane/Perth 26

27 INTEGRATED MARINE & FISHERIES CENTER (SKPT) PROGRAM Building new region-based industries in the outer islands, closer to export gateway Location Plans for 12 SKPT in 2017 & Sea Toll Routes 2017 Location Plans for 12 SKPT in Natuna 2. Saumlaki 3. Merauke 4. Mentawai 5. Nunukan 6. Talaud 7. Morotai 8. Biak Numfor 9. Mimika 10. Rote Ndao 11. Sumba Timur 12. Sabang Source: - Sea Toll Routes: Ministry of Transportation, SKTP 2017: KKP,

28 PROHIBITION & ENFORCEMENT OF MINIMUM SIZE OF TRAWL Rules of Sustainability Pillars: Ministerial Reg. No. 01/2015 jo. Ministerial Reg. No. 56/2016 and Ministerial Reg. No. 02/2015 jo. Ministerial Reg. No. 71/2016 Illustration of Danish Seine (Cantrang) Operation Limiting Size of Lobsters, Crabs, Swimming Crab Commodity Size of Karapas Weight P P Length of Warp Rope Diameter Circle Area 1,000 m Ha 3,000 m Ha 6,000 m Ha Location Fish Target By-Catch Brondong (IPB, 2009) Tegal (UNDIP, 2008) 51% 49% 9 species 16 species 46% 54% SURIMI 21 species (dominantly Petek) FISH FLOUR The facts are: 1. The net will shrink, if the vessel is used to hold the net (same as trawl) 2. Average depth of Java sea is m, then the net begins to lift if the rest of the warp rope is close to 2x the depth or about 200m 3. On a vessel that uses >3000 m, the swap areas will be along 1300m 4. Many small fish will get caught, thus, not sustainable Lobster (Panulirus spp.) Crab (Scylla spp) Rajungan (Portunus spp.) Open season for crabs spawn : 15 Des-5 Feb Closed season for crabs Spawn: 6 Feb-14 Des The failure of lobster seeds smuggling in Tanjung Priok > 8 cm > 200 gram > 15 cm > 200 gram > 10 cm > 60 gram 28

29 AUTHORITY OF MARINE SPACES MANAGEMENT & MARINE RECLAMATION PERMI T Central and Provincial Governments have their own authority in managing the utilization of marine space and the issuance of reclamation permits in marine areas Marine Spatial Management Marine Reclamation Permit Central Govt. Authority Province Govt. Authority Central Govt. Authority Province Govt. Authority* Marine area > 12 nautical miles (Government Regulation) Inter-provincial marine area (Presidential Regulation) Marine Area of National Strategic Territory (Presidential Regulation) Marine Area of Specific National Strategic Territory (KKP Ministerial Regulation) Marine area 12 nautical miles (Local Regulation with input from KKP-Minister) National Strategic Territory The territorial waters 12 nautical miles outside of the central govt. authority Specific National Strategic Territory Water across provincial area National vital object Fishery Port managed by KKP Minister Fishery Port managed by Provincial Government * Permit of Reclamation Site on Land >25 Ha, must be completed with Recommendation from MMAF Minister * Permit for the implementation of reclamation on land> 500 Ha must be completed with Recommendation from MMAF Minister Source : UU No 27/2007 revised by UU No 1/2014 and UU No 23/2014; UU No 27/2007 revised by UU No 1/2014, Perpres No 122/2012 Permen KP No 17/2013 revised by Permen KP No 28/

30 MANAGEMENT OF CONSERVATION AREAS AND COASTAL AREAS Under the supervision of Minister Susi Pudjiastuti, the Ministry of Marine Affairs and Fisheries (KKP) paid special attention to the sustainability of fisheries resources. During the past three years, the various policies implemented have shown results. REHABILITATION OF COASTAL AREAS Thousands Million Coastal vegetation Mangroves PROTECT THE WATER RESOURCES Million Of crabs and other species were released into their habitat Breakwaters Of whitetip shark and hammerhead shark were rescued The value of protected fishery resources went up (Rp billion) CONSERVATION AREA MANAGEMENT Conservation areas are increased Million Ha increased Thousands Million Ha Rescued turtles 30

31 Area (million Ha) WATER CONSERVATION AREA IN INDONESIA Sumber : Ditjen PRL, 2017 KEMENTERIAN KELAUTAN & PERIKANAN REPUBLIK INDONESIA 31

32 LETTER FROM THE MINISTER OF MARINE AFFAIRS AND FISHERIES 7 NOV PHP Exemption for Fish Vessels <10 GT and Termination of Fishing Equipment that Damages the Environment 32

33 BUDGET EXPENDITURE PRIORITIES FOR MMAF STAKEHOLDERS Refining budgets and improving efficiency so that the aids given to the community are properly used and right on target Processing and Marketing Aids Priority Unit 80% Budget for STAKEHOLDERS Aids for Fishery Business Actor Fishermen Fish Farmers Groups Received coaching Ice Flake Machine Coaching and Training Aids Thousand Thousand People Salt Farmers Cold chain system facilities Obtained competency certificate insurance premiums for fishermen Fishing gear Fishing vessels Facilities and infrastructure for aquaculture Fish seeds Fish foods Warehouse Salt maker tarp (geoisolator) Beneficiaries of production facilities 33

34 THE POSITIVE IMPACT OF MMAF POLICY IN THREE YEARS 34

35 FISHERIES POLICY REFORM WILL INCREASE FISH STOCK & REVENUE Research Results of MMAF Research & HR Agency, together with the University of California Santa Barbara (UCSB) Investasi tanpa reformasi Reformasi tanpa investasi Investasi dan reformasi *Nilai apabila dibandingkan dengan tidak adanya investasi DAN tidak ada reformasi 35

36 FISHERIES POLICY REFORM WILL INCREASE FISH STOCK & REVENUE Research Results of MMAF Research & HR Agency, together with the University of California Santa Barbara (UCSB) Projections 2050: If the fishery reform policy is carried out consistently, it can increase the fish biomass 224%, increase the catch 100%, and increase the economic profit USD 3.7 billion. And if done globally, by 2050, fish biomass will increase to 619 million metric tons, catch to 16 million metric tons, and fishery profits of USD 53 billion. 36

37 Sumber : Badan Pusat Statistik, 2017 Growth (%) GROWTH OF FISHERY SECTOR TO NATIONAL ECONOMY The fishery sector is growing above the national economy Quarterly GDP Growth Rate (%) Year (Quarter III) , , , s.d Triwulan III , Nilai Fisheries PDB GDP Perikanan Growth Dalam Value in Rp. IDR miliar Until Q * Nasional Pertanian Perikanan The growth of GDP value of fishery is always above the national GDP and agricultural sector s GDP value. Until Quarter III 2017, the growth reached 6.79% and the value is Rp169, billion 37

38 INCREASING FISH CONSUMPTION Indicator of increased economic growth in domestic fisheries sector Fish Consumption per year(kg/kap/year) * , 17% 15, 14% 76, 69% CONSUMER PREFERENCE Fresh fish Processed Fish Salted fish Kg/Kap/tahun 1. Fish consumption is increasing to 21.9% during with the consumption preference classification as follows: Fresh fish 76%, Processed Fish (KIMJ) 19%, Salted Fish 15% 2. The average of fish consumption is increasing in every province 3. Fish is increasingly popular Sumber : BPS,, processed Ditjen PDS, 2017 * Temporary figures

39 INCREASING FISH STOCK Indicator of restored health of marine resources after fisheries policy reform The Number of Fish Resource Potential (MSY) in Indonesia (million ton / year) ,93 12,54* ,19 6,4 6,41 6,52 7, *) Ministerial Decree, Kepmen KP No. 50/KEPMEN- KP/2017 MINISTER OF MARINE AFFAIRS AND FISHERIES OF INDONESIA 39

40 GEMAR MAKAN IKAN CAMPAIGN Cooking competition at the Presidential Palace 15 August 2017 If you do not eat fish, I will sink you. 40

41 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 THE FISHERMEN S PROSPERITY INCREASES The Fisherman Business Exchange Value (NTUN) has the most significant increase compared to other indicators NT Rata-Rata NTN 104,63 106,14 108,24 109,86 NTUN 107,37 108,63 117,57 123,01 NTPi 101,42 99,65 98,96 99,09 NTUPi 105,90 106,61 108,62 110, NTN NTPi NTP NTUN NTUPi NTUP NTP : Nilai Tukar Perikanan NTUP : Nilai Tukar Usaha Perikanan NTN : Nilai Tukar Nelayan NTUN : Nilai Tukar Usaha Nelayan NTPi : Nilai Tukar Pembudidaya Ikan NTUPi : Nilai Tukar Usaha Pembudidaya Ikan Sumber : Badan Pusat Statistik,

42 JAWA TIMUR RIAU SULAWESI TENGGARA BANTEN DI YOGYAKARTA SULAWESI TENGAH BALI JAWA BARAT NUSA TENGGARA BARAT KALIMANTAN TENGAH JAWA TENGAH KALIMANTAN SELATAN KEP. BANGKA BELITUNG KEP. RIAU KALIMANTAN TIMUR LAMPUNG RATA-RATA NASIONAL JAMBI SULAWESI BARAT SULAWESI UTARA SUMATERA BARAT NUSA TENGGARA TIMUR SUMATERA UTARA SULAWESI SELATAN GORONTALO MALUKU PAPUA BENGKULU KALIMANTAN BARAT DKI JAKARTA MALUKU UTARA PAPUA BARAT ACEH SUMATERA SELATAN TERMS OF TRADE COMPARISON OF FISHERMEN TERMS OF TRADE IN EACH PROVINCE IN 2014 & 2017 In 2017, the highest FER is in East Java region where previously, in 2014, Bali had the highest FER PROVINCE

43 FISHERIES NON-TAX REVENUE REACHED THE HIGHEST RECORD IN 2017 As the regulation and law enforcement improved, state revenues increased Fishery Income for * (Rp Billion) Billion Rupiah The highest achievement in the last 10 years ( ) Foreign Vessel and Ex-foreign Vessel still operates Indonesian fishermen and Domestic Vessel Source : (9 January 2018) 43

44 THE SIZE OF TRADITIONAL FISHERMEN S CAPTURE INCREASED. Skipjack tuna on the coast of Kaimana Chinese grouper in Merauke Lobster catches in the Aru Islands 44

45 MALUKU: FRESH TUNA EXPORTS INCREASED Fishermen who fishing rod to fish do not need to go far to get tuna fish Harian Kompas, Wednesday, 18 October

46 INDONESIA S FISH BALANCE OF TRADE TO BE NO. 1 IN ASEAN The Trade Balance of Thai Fish and Vietnam has dropped dramatically in Balance in Value, Seafood Products in ASEAN (US$ Thousand) Indonesia Thailand Viet Nam Myanmar Philippines Lao Cambodia Brunei Darussalam Malaysia Singapore Source: International Trade Center,

47 THANK YOU SUSI PUDJIASTUTI Minister of Marine Affairs and Fisheries of The Republic of Indonesia 12 March 2018

48 FISHERIES CONTRIBUTION ON NATION S GDP IS NOT OPTIMAL The potential of marine and fisheries resources is big. However, there is only little amount of data recorded. Unit : Percentage (%) Share of fisheries to national GDP at constant price Share Perikanan terhadap PDB Nasional Harga Konstan 48

49 THE NATIONAL FISHERIES INDUSTRY IS STILL CENTRALIZED IN JAVA Fish Processing Unit is dominated by Micro, Small and Medium scale businesses Distribution of Fish Processing Industry 2015 Explanation Composition of fish processing unit (UPI) based on revenue per year: 1,2% Total UPI : unit Large Scale= 718 unit* Micro, Small, Medium scale = unit** Revenue per year : UPI Micro Scale <=Rp. 300 milion UPI Small Scale Rp. 300 million Rp. 3 billion UPI Medium Scale Rp. 3 billion Rp. 50 billion UPI Large Scale > Rp. 50 billion 98,8 % Source: *) Sertifikat Kelayakan Pengolahan (SKP) 2015 **) BPS,

50 COLD STORAGE DISTRIBUTION IS STILL CONCENTRATED IN THE WESTERN PART OF INDONESIA The construction of cold storage is constrained by electricity supply, water supply network & other supporting infrastructure Cold Storage KKP ( ) Single Cold Storage KKP (2016) Private Cold Storage (importer) 50

51 THE FISH IS CAPTURED IN THE EAST, BUT THE EXPORT GATEWAY IS IN THE WEST Export Results of Fishery Products by Region of Origin ( ) 653, , , , , , SUMATERA REGION 24, , KALIMANTAN REGION 2,784, ,571, , , , , SULAWESI REGION 19, , , , MALUKU & PAPUA REGION 668, , , , , , BALI & NUSA TENGGARA REGION EXPLANATION: VOLUME 2015 (TON) VOLUME 2016 (TON) NILAI 2015 (USD RB) JAWA REGION NILAI 2016 (USD RB) REGION VOLUME (TON) VALUE (USD 000) TREND * * * VOLUME (%) VALUE (%) SUMATERA 151, , , , JAWA 668, , ,571, ,784, KALIMANTAN 24, , , , BALI & NUSA TENGGARA 38, , , , MALUKU & PAPUA 19, , , , SULAWESI 175, , , , TOTAL 1,077, ,077, ,944, ,173, Source: BPS (Processed by PDS) * Temporary Data 51

52 USD juta USD juta EXPORT RATE FROM FISHERIES BASED ON MAIN COMMODITIES IN * 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, ,871 1, ,161 1,454 4,642 1, ,294 1,229 1,225 1, Source: BPS, processed by Ditjen PDS-KKP * Temporary figure December ,944 1, ,172 1, ,514 1, ,217 1, ,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 C-S-G Lainnya R-K RL T-T-C Udang Total Increased 1. Squid-Cuttlefish-Octopus 21.41% per year 2. Shrimp 10.40% per year 3. Portudinae (rajungan)-crab 6.15% per year 4. Seaweed 6.02% per year Decreased Tuna-Mackerel-Skipjack1.9% per year Other commodities 3.20% per year Increased 1. Portudinae (rajungan)-crab 27.81% 2. Seaweed 26.69% 3. Squid-Cuttlefish-Octopus 17.70% 4. Tuna-Mackerel-Skipjack16.57% 5. ShriMp rose to 11.31% Decreased Other commodities 10.03% Shrimp product in 2017 does not include crackers and shrimp pasta because the HS code changed in In 2016, this product s volüme reached thousand tons with the value of USD million 52

53 Value (USD Juta) Value (USD Juta) EXPORT RATE FROM FISHERIES BASED ON TARGETED COUNTRY IN * 5,000 5,000 4,642 4,514 4,500 4,500 4,161 4, ,871 3,944 4,000 4, , , , , , , , , , ,500 1,000 1,844 1,000 1,817 1,333 1,454 1, , US Japan ASEAN Tiongkok UE Lainnya Total Increased USA 11.38% per year China 10.80% per year EU 3.52% ASEAN 0.45% per yer Decreased Japan 4.19% per year Other countries1.62% per year Increased: China 14.47% USA12.92% EU 9.69% Japan 7.81% ASEAN 3.28% Decreased Other countries 2.94% Source: BPS processed by Ditjen PDS-KKP (474 produk HS 10 digit 2012 & 484 product HS 8 Digit 2017 ) * Temporary figures

54 KEY MARKET GOALS OF INDONESIAN FISHERY PRODUCTS IN 2017 (USD MILLION*) USA 36.42% (USD ml) Japan 13.48% (USD 672 ml) ASEAN 11.31% (USD 564 ml) China 8.99% (USD 449 ml) EU 6,92% (USD 345 ml) SOURCE: BPS, PROCESSED BY DITJEN PDS TEMPORARY FIGURES, DECEMEBER

55 Indonesian Export Rate Growth Trend Increased Higher Than Other Competing Countries During Export Rate (USD Million) 25,000 During , export rate growth trend was higher than any other competing countries: 20,000 15,000 10,000 5,000 o o o o o o o o Indonesia rose 2.31% per pear China rose 2.29% per year Viet Nam rose 1.45% per year Philippina rose 0.32% per year Singapura fall 0.66% per year Malaysia fall 3.52% per year Thailand fall 7.73% per year Dunia rose 2.57% per year * China Viet Nam Thailand Indonesia Philippines Malaysia Singapore Source: ITC calculations based on UN COMTRADE downloaded on 9 August 2017 (292 product HS 6 digit 2012) * Temporary figure 55

56 Nilai Neraca (USD Ribu) Nilai Neraca (USD Milyar) INDONESIAN GROWTH OF BALANCE OF TRADE IS HIGHER THAN MOST COMPET ING COUNTRIES DURING * China 11,270,507 11,761,796 12,649,812 11,504,690 11,452,509 Indonesia 3,408,381 3,642,666 4,158,516 3,499,954 3,691,279 Thailand 4,823,527 3,704,161 3,644,042 2,840,139 2,452,222 Viet Nam 5,246,212 5,712,248 6,489,084 5,196, ,888 Philippines 665,971 1,011, , , ,788 Malaysia -246, , , , ,528 Singapore -702, , , , ,759 During , Indonesian growth of balance of trade is higher than most competing countries: o o o o Indonesia rose 2.67% per year China rose 0.60% per year Thailand rose 15.14% per year Vietnam rose 21.39% per year o The Philippines rose 6.75% per year Sumber: ITC calculations based on UN COMTRADE didownload 9 Agustus 2017 (292 produk HS 6 digit 2012) * Data sementara 56

57 NORTH SULAWESI: PRODUCTION OF FISHING CAPTURE INCREASED Production from North Sulawesi is widely distributed for domestic industry & consumption Volume of Domestic Product-Exit Through Bitung Seaport 2012-July 2017 (Kg) Production Volume By Destination, Jan-Jul 2017 (Top 5) 70,000, ,000, ,000, ,000, Destination Jakarta Surabaya Merauke Timika Denpasar Volume 20,880, kg 5,234, kg 156, kg 118, kg 105, kg 30,000, ,000, ,000, % Unit in kilogram Source: BKIPM Manado Data up to 2017 based on the issuance of Health Certificate *July 2017 Production Volume by Commodity, Jan-July 2017 (Top 5) Commodity Tongkol Layang Baby Tuna Tuna Cakalang Volume 11,123, kg 7,544, kg 3,023, kg 2,490, kg 1,709, kg 57

58 NORTH SULAWESI: FROZEN/FRESH TUNA EXPORT GIVES HIGHER VALUE Canned products require a lot of raw materials but the resulting value is not better than fresh-frozen products Export Volume of Tuna, Mackerel, Skipjack The Origin of North Sulawesi Jan-July 2016 & 2017 (ton) Value & Export Volume Based on Destination Jan-July 2017 (Top 5) Cakalang Tongkol Tuna Destination Value (US$) Vol (ton) USA 20,826, ,610 Saudi Arabia 9,227, ,305 Japan 12,701, ,586 United Kingdom 3,179, Thailand 3,182, Jan-Jul 2017 Jan-Jul 2016 Export Value of Tuna, Mackerel, Skipjack The Origin of North Sulawesi Jan-July 2016 & 2017 (USD thousand) Value & Export Volume Based on Commodity Jan-July 2017 (Top 5) Cakalang Tongkol Tuna Jan-Jul 2017 Jan-Jul 2016 Commodity Value (US$) Vol (ton) Canned Fish 29,073, ,700 Frozen Tuna 19,698, ,118 Dried Smoked Fish 7,556, Fresh Tuna 5,013, Pre-Cooked Fish 3,180, Source: BKIPM Manado Data Up to July

59 Jateng Jakarta Jatim Sulut Sulsel Jabar Lampung NTB Bali NTT Banten Lainnya MARINE AND FISHERY INVESTMENT GROWTH IN 2017 Quarter III) Based on Country of Origin (Rp Billion) 797,76 (19.8%) Based on Targeted Province (Rp Billion) 644,50 (16.0%) 461,22 (11.4%) 429,72 (10.7%) 375,67 (9.3%) 229,90 (5.7%) 219,42 (5.4%) 118,67 (2.9%) 118,25 (2.9%) 117,67 (2.9%) 111,83 (2.8%) 404,50 (10.0%) Singapura Philipina Belgia Tiongkok Jepang Lainnya Source: BKPM dan OJK, processed Ditjen PDS-KKP (s/d TW 3 Tahun 2017) On Q there has been PMA realization in capture fishing business with the value of Rp 346 Billion, after validating with the Investment Coordinating Board, the realization of PMA aforementioned was in 2014 Realization estimation in 2017 Rp 5.37 Trillion 59

60 (Quarter III) VALUE OF FINANCING OF MARINE AND FISHERY ENTERPRISES YEAR 2017 Bank Credit Value Realization: Rp6,49 Trillion Number of Debtor Realization: 38,667 Debtor Ratio of Non Performing Loan (NPL) 2.17% Non Bank Financing Value Realization: Rp Billion Number of Debtor Realization: 34,786 Debtor Ration Non Performing Financing (NPF) : 1.93 % Total capital in 2017: Rp7.03 Trillion (234% from target Rp3 Trillion) Growth of Certification of Processing Feasibility kredit (SKP) reached 14.7%, exceeds Finansial Services Authority (OJK) target in 2017 as much 8-10% 60

61 STEPS TO IMPROVE THE PROSPERITY OF FISH FARMERS Kunci Key Intervention Intervensifor Program Aquaculture Budidaya: Program Mengurangi Biaya Produksi dari Harga Pakan Cut the production cost which comes from fish feed 4 Priority Program Recovery of fish ponds in 20 areas The performance is getting better Production Value Increased Quarter Quarter Billion Billion 4 Integrated Aids Exchange rate of the fish farmers increased Revitalization of 250 unit of floating net cages Development of 210,000 ha of Minapadi Field Distribution of Catfish Bioflock in 60 regions Procurement Billion Of floating net cages in Karimun Jawa, Pangandaran, and Sabang Distribution Of 40 units Excavator Distribution Of 100 Million fish seeds Recovery Of 20 locations Aquatic ecosystem 61

62 DEVELOPMENT ACCELERATION IN NATIONAL FISHERY INDUSTRY MMAF seeks to accelerate the business growth of fishery indsutry to boost economic development, fishermen s prosperity, and to increase national fish consumption ( ) UPSTREAM HULU Meningkatkan produktivitas dan Increasing kesejahteraan national nelayan nasional productivity and fishermen s welfare 1,410 Bantuan Aid of fishing kapal penangkapan ikan vessels Million Benih Fish seeds ikan are disebar spread 2,807 13,717 Aid Bantuan of fishing alat equipment penangkapan ikan Bantuan Aid of aquaculture sarpras usaha budidaya infrastructure Perikanan 252 Bioflok Bioflock DOWNSTREAM HILIR Increase the competitiveness of marine and fisheries products DEVELOPMENT 361 units Ice Flake Machine 104 cold storage packages OPEN Opportunity for foreign business in 5 foreign businesses QUALITY improve product to strengthen competitiveness PROMOTE incessantly conducted KKP every month to spur exports and investment expansion BOOST TARGET Through various steps, MMAF targets export production and contribution for economy to keep increasing until 2019 Export (billion US$) Fish Production (million ton) Growth of Fishery GDP (%) : per Q 3 62