2. THE BASIC FACTORS OF FISHERIES DEVELOPMENT

2.1 Fisheries resources

2.1.1 Introduction

In assessing the status of fisheries resources, the coastal and offshore resources are considered separately. The coastal resources are further treated on a regional basis, namely the west coast of peninsular Malaysia, east coast of peninsular Malaysia and East Malaysia, because the resources in the three regions are rather distinct and at different levels of exploitation. The offshore resources are considered on a broader basis. The areas covered are the South China Sea, which is the most likely fishing ground for offshore operations from the east coast of peninsular Malaysia and East Malaysia, and the Indian Ocean in the case of the west coast of peninsular Malaysia. An assessment of the aquaculture and inland fisheries potential is also included.

Fisheries resources are generally grouped into demersal, pelagic, crustacea and mollusc for this exercise. The demersal resource contains a wide variety of species that live on or just off the bottom. They range from large fish of commercial value, like snappers and groupers, to small ones, which are classified as trash fish for animal feed and fish meal. The pelagic resources are the surface dwelling species, many of which have schooling habits, like mackerel (Rastrelliger spp.), anchovies (Stolephosus spp.), sardines, herrings and tunas. In the crustacea group, prawns and crabs are the more important species, while squids, cuttlefish and bivalves dominate the molluscs.

2.1.2 Coastal resources

The coastal resources are those resources found within 50 miles of the coastline. Included in the coastal resources are the inshore resources. A distinction of the inshore resources is however not possible.

Pathansali (1973), Mohd. Shaari (1973) and Chong (1973) made comprehensive assessments of the coastal resources and their findings are highlighted here.

Five years' catch data (1968–72) are given in Table 9.

West coast of peninsular Malaysia

The highest landing recorded was 282 616 t in 1968. This subsequently declined and fluctuated between 230 499 to 253 157 t between 1969–72. An average landing of 249 607 t was achieved over the five-year period and it is generally believed this would be the maximum yield under current range of operations. The crucial factor here appears to be more of resource management rather than exploitation.

Demersal - Landings of this group decreased from 102 355 t in 1968 to 83 605 t in 1970 and then picked up again to 100 616 t in 1972. Pathansali (1973), using the surplus yield model on landings by trawlers and traditional gears, estimated that the total maximum yield would be in the region of 90 000 to 94 000 t. This implies that the demersal resources in the west coast have been overexploited.

Pelagic - A maximum of 115 759 t of landing was achieved in 1968. This was traced to the exceptional abundance of Rastrelliger during that year. Following this, a declining trend was noted due probably to the change-over to trawling which is more lucrative. The average landing for the five years was 77 851 t. The two major species in this group are Rastrelliger and Stolephorus. Chong assessed that the maximum yields for these two species are around 41 000 and 30 000 t respectively, while the others such as Megalaspis, Decapterus, and Scomberomorus could add a further 10 000 to 20 000 t, to give a total catch of 81 000 to 91 000 t. There is, therefore, a slight scope for expansion of the pelagic fishery on the west coast.

Prawns - The landings of prawns increased from 26 276 t in 1968 to peak at 45 934 t in 1971 and then declined to 36 964 t in 1972. The average landing over the five-year period was 35 274 t and this is rather close to the maximum yield of 35 000 t, as estimated by FAO (1973) and 40 000 t by Pathansali (1973). As such, no significant expansion of the prawn fishery can be expected on the west coast.

Others - The more important species in this group are bivalves (Anadara granosa), Acetes, crabs, squids and cuttlefish. Bivalves, however, constitute about half to two thirds of the total landings, which range from 38 226 t in 1968 to 49 112 t in 1972, giving an average landing of 43 124 t. No significant increase in the landings of this miscellaneous group is expected and the estimated maximum yield is around 40 000 to 45 000 t.

East coast of peninsular Malaysia

A slight increase in landings was noted over the five year period from 1968–72. It picked up from 64 781 t in 1970 to 80 626 t in 1972. Indications are that a sizeable increase in landings is possible with further injection of capital into the fishing industry.

Demersal - Landings of this group showed a gradual increase from 25 295 t in 1968 to 35 103 t in 1971 due to the introduction of trawling. There was, however, a drop of landings in 1972. This decrease was not due to the reduction of resource but the decline in the amount of traditional gear. In support of this statement is the estimate of potential yield derived from results of three demersal trawl surveys carried out in depths ranging from 10 to 50 m. The estimated standing stock from these surveys is 161 000 t and the average potential yield is 80 540 t, as given by Shaari (1973). Thus, prospects for the expansion of the trawl fishery appear to be good on the east coast.

Pelagic - The landings of pelagic fish declined from 31 964 t in 1968 to 24 556 t in 1970 and 28 298 t in 1971. This decline coincided with the reduction in traditional gear licensed. The reasons for this decline, whether consequent upon poor catches or switching to more lucrative forms of fishing, like trawling, are not apparent. It could imply either that the pelagic resource is small or the fishermen are only tapping on the fringes of the greater stock available due to limited fishing technology. The latter explanation appears to be more likely. This is to a certain extent supported by the landings achieved in 1972, which rose to an all time high of 48 793 t. Good catches of Decapterus, herring, Rastrelliger and Selaroides were made. From reports and observations, it is estimated that the potential yield of pelagic schooling species in the east coast waters could be between 56 000 to 75 000 t, if not more.

Prawns - Landings of prawns fluctuated between 1 628 t to 3 120 t, with an average landing of 3 146 t over the five-year period. The fluctuations were due mainly to the effect of the prevailing conditions during the northeast monsoon, when prawns are in season, and the extent of trawling activity. The size of this migrant stock and its biology are, however, not known but it is felt that the catch could be doubled to around 6 000 t, as estimated by Pathansali.

Others - Cephalopods, comprising squids and cuttlefish, constitute more than half of the total landings in this group, which is near to 3 000 t. With more efficient methods, a further increase in the landings of cephalopods can be expected.

East Malaysia

The landings in East Malaysia declined from 48 957 t in 1968 to 38 186 and 39 901 t in 1969 and 1970 respectively. Then in 1971 the landings increased again to 42 745 t, followed by a further increase to 43 184 t in 1972. This trend seems to indicate that landings have more or less reached stability within the present level of investment, technology and range of operations.

Demersal - The demersal landings over the five-year period showed a fluctuating trend. Maximum landing was recorded in 1968 at 29 684 t, following which there was a decline to 18 961 t in 1969. Landings picked up again and in 1972 it was 26 088 t. This indicated that the maximum yield has been reached under current conditions and this appears to be true in the case of inshore waters within the 10 m depth because most of the demersal fishing is presently confined there. However, a recent trawl survey of the region in waters ranging from 10 m to 60 m indicated the presence of a rich resource, which is relatively untapped. The estimated potential yield derived from the survey is 91 427 t. This resource can be harvested through the use of bigger and more efficient trawlers for operation in this deeper range of waters.

Pelagic - The total landings of pelagic species also showed a similar fluctuating trend, with an annual average landing of 9 900 t over the five years. Even so, it is felt that a considerable increase in landings is possible, as the region is still underfished, especially Sarawak. Further, traditional gear such as drift gillnets, dominate the scene and they catch mostly Chirocentrus and Scomberomorus spp. More efficient gear, like purse seines, have yet to be introduced into the region. The introduction of purse seining would most likely bring about increased catches of some other pelagic species such as the tunas, mackerel, clupeiods and Decapterus.

Prawns - Prawns appear to be well harvested in the region and the annual landings have more or less remained stable at the 6 000 t mark. A further increase is possible through more efficient harvesting of the migrant stock during the northeast monsoon season.

Others - No significant increase in landings is expected from this miscellaneous group. The average annual landing is in the region of 2 700 t.

2.1.3 Offshore resources

The offshore resources considered here are those of the South China Sea and the Indian Ocean, which constitute the most likely fishing grounds for the distant water fleet. The expansion of the east coast and East Malaysia fisheries will be in the vicinity of the South China Sea, while that of the west coast will be in the Strait of Malacca and the Indian Ocean. An appraisal of the resource potential for the regions mentioned is made with information from the draft document of the South China Sea Programme and publications of the Indian Ocean Programme. Data collected are given in Table 10.

South China Sea

The South China Sea covers some of the widest areas of relatively shallow shelf in the world. Shelf areas tend to have a higher natural production and more of this production becomes accessible to harvest as fish, crustaceans and molluscs. As such, the South China Sea permits substantial fish catches and present indications are that the resources are not as yet overexploited. Generally the area still offers good prospects for significant increases in total catch.

Demersal - The estimated potential yield of demersal resource for the whole South China Sea area is 3 690 000 t as against the 3 110 000 t of catch in 1971. This means that the area could support a further increase of some 590 000 t of catch, which is located mostly in the central, southern and eastern Sunda Shelf areas. As these areas are adjacent both to the east coast of peninsular Malaysia and East Malaysia, the opportunities for fisheries expansion into these areas are good.

Pelagic - The pelagic species in the South China Sea include the tunas, mackerels, anchovies, scads (Decapterus spp.) and sardinellas. Of these the tuna species are the most important because of their high market value. Tunas can be divided into the larger oceanic species, e.g. yellowfin and bigeye tuna and billfishes and the smaller coastal species, e.g. skipjack and northern bluefin (Thunnus tonggol). The larger oceanic species seem to be well exploited and increased fishing activity will not increase the yield substantially. Considerable opportunities, however, exist for improving catches of the smaller coastal species. Similarly, significant increases in catches can be expected from the other pelagic species, such as mackerel, anchovies, scads and sardinellas. Recent studies carried out for the South China Sea Programme gave the estimated annual potential yields of pelagic fishery resources in the South China Sea and adjacent waters as on the order of 4.2 million t, while the 1971 landings totalled 2 million t. An enormous expansion of the pelagic fishery is therefore possible.

Crustacea - Prawns (Penaeus and Metapenaeus) and shrimps (Parapenaeopsis spp. and Acetes spp.) constitute the major landings of the group. The present catch is 260 000 t, consisting of 200 000 t of prawns and 60 000 t of shrimps. With such a landing it appears that the existing prawn and shrimp resources are well exploited. Further increase of crustacean catches will have to come mainly from crabs. A rough figure of 100 000 t to 150 000 t has been projected as the possible catch.

Molluscs - Cephalopods, e.g. squid, cuttlefish and octopus appear promising for more intensive exploitation by trawls and other demersal gear. Though the actual status of the stock is not known, it is believed that the present standing stock of cephalopods could contribute to a considerable increase in the total production of the region.

Indian Ocean

The Indian Ocean covers a vast area and information on its fishery resources is not yet extensive enough to permit estimates of maximum sustainable yield for most species. Some highlights on the status of certain resources are however given by Cushing (1971) and Hayasi (1971).

Demersal - The offshore demersal ground closest to the west coast of peninsular Malaysia is the Strait of Malacca. The estimated potential yield of the demersal resource is in the order of 400 000 t but the recorded landing in the area is 500 000 t. Thus, the area is already heavily fished and there is not much opportunity for expansion.

Pelagic - Among the pelagic species, the large sized tunas (yellowfin, bigeye, albacore and southern bluefin), with a total estimated sustainable yield of 107 000 to 128 000 t, appear to have been fully exploited. This fishery thus offers no room for expansion. However, the small tunas, schooling pelagic forms and squids have been reported to be relatively untouched. In particular, the skipjack is the most promising species for future exploitation. It is estimated to provide a catch of 200 000 to 400 000 t (Hayasi, 1971).

Crustaceans - The crustacean fishery, especially prawns, is already well developed in the region and offers little scope for expansion.

2.1.4 Inland fisheries/aquaculture

Inland fisheries

Freshwater fish culture is not new to Malaysia. It has a fairly long tradition in the country and contributes significantly toward combating malnutrition caused by protein deficiency, as well as providing a source of supplementary income to the rural people (see Table 11). There are three main aspects of developing freshwater fisheries in the country. These are the development of fish farming in ponds, promotion of paddy field fisheries and the stocking of unused mining pools, lakes, reservoirs and rivers for fish production. In 1972 there was a total of 10 316 freshwater ponds and mining pools covering an area of 3 679 ha under fish cultivation in the whole country, comprising 7 071 ponds (3 394 ha) in the west coast area of peninsular Malaysia, 1 072 ponds (438 ha) in the east coast of peninsular Malaysia area and 2 181 ponds (202 ha) in East Malaysia (Sabah). The estimated freshwater fish production from all sources is in the region of 30 000 t. Potentials for further development of freshwater fisheries in the three regions are enormous and production could easily be doubled.

* Sabah only

Coastal aquaculture

Coastal, or brackishwater, aquaculture is at its infancy stage of development in the country (see Table 11). Presently some cockle culture and prawn farming are being done, mostly in the States of Perak, Selangor and Johore in peninsular Malaysia. The total annual production is in the region of 30 200 t. Both peninsular Malaysia and East Malaysia have very extensive brackishwater areas, of which at least 150 000 ha are suitable for development. Since the present area under cultivation is only about 355 ha, there is considerable room for expansion. Aquaculture can therefore contribute significantly toward increasing the production of valuable species of prawns, fish and shellfish (bivalves and oysters) in the country.

2.2 Fishermen

The fishing industry provides direct employment to about 81 000 fishermen and this represents some 23 percent of the total labour force. The fishing population shows a fluctuating trend over the years. In 1965, it was 78 688 and this decreased to 71 986 in 1968. Following this, there was an upsurge in the number of fishermen, rising to 80 459 in 1969, due to the expansion of the trawl fishery, especially on the west coast of peninsular Malaysia. In the following years, 1970 to 1971, a slight decline in the fishing population was noted but it increased again to 80 931 in 1972 (Table 12). Of this total, some 44 251 (55 percent) are from the west coast of peninsular Malaysia, 25 001 (31 percent) from the east coast and 11 679 (14 percent) from East Malaysia. The Bumiputra people dominate the fishing industry on the east coast, where they constitute more than 90 percent of the fishing population. Bumiputra participation in the fishing industry in East Malaysia is also high, probably in the region of 70–80 percent. However, on the west coast of peninsular Malaysia, the Bumiputra form only about 35 percent of the fishing population.

2.3 Fishing fleet

The present Malaysian fishing fleet consists of about 29 226 boats, having increased gradually over the years. Of this total, some 14 435 (49 percent) fishing boats are operating on the west coast of peninsular Malaysia, 7 184 (25 percent) on the east coast and 7 607 (26 percent) in East Malaysia (Table 13).

2.3.1 Fishing gear

Malaysian fishermen employ a large variety of fishing gear, ranging from traditional fishing stakes, push nets and barrier nets to more modern gear like trawl nets and purse seines. The fishing gears used are classified into 12 major groups and their respective productivities are given in Table 15. In terms of productivity or catch per fishing unit, the more important gears, i.e. gears with relatively higher catch rates, are the trawl nets, seine nets, liftnets and bagnets. The average annual catch of trawl nets ranges from 12.8 t on the east coast to 23.3 t on the west coast and 33.6 t in East Malaysia. Seine nets, which are more prominent in peninsular Malaysia, have a productivity of 29.0 t and 91.5 t of catch per unit of gear on the west and east coast respectively. The liftnets on the east coast are particularly productive, with an average annual catch of 63.7 t per unit of gear, while on the west coast the bagnets feature rather prominently, with a catch of 48.4 t per unit of gear.

2.3.2 Production

The total landings in 1972 were around 355 735 t, of which 230 561 t (65 percent) were from the west coast of peninsular Malaysia, 80 648 t (23 percent) from the east coast and 44 526 t (12 percent) from East Malaysia. The two most important gears in terms of production are the trawl nets and seine nets. Together they land about 57 percent of the total catch in the country. Trawling is particularly well developed on the west coast of peninsular Malaysia, where it accounts for some 41 percent or 94 973 t of catch in the region. This si followed by the seine net group (mostly purse seines) which land 19 percent or 43 128 t of fish. Bagnets also play an important role in the west coast fishery. This group, which harvests the demersal resources, lands some 36 881 t or 16 percent of the catch in the region. The fisheries on the west coast appear to be balanced, as both the demersal and pelagic resources are well exploited.

On the east coast of peninsular Malaysia, the three major gears are the seine nets, trawl nets and liftnets. They catch 29 percent (23 444 t), 21 percent (16 749 t) and 20 percent (15 808 t) of fish respectively and collectively account for some 70 percent of the total landings in the region. It can, however, be noted that pelagic fisheries dominate the east coast, as evidenced by substantial contributions from the seine nets, liftnets and gillnets.

In East Malaysia, trawling and gillnetting are the two most important types of fisheries. Trawling lands some 47 percent of the total catch, with gillnetting accounting for another 38 percent of the catch, making a total of 85 percent for the two fisheries. The other gears are traditional gears with low productivities.

2.4 Structure of the Malaysian fishery

Marine fisheries can be classified into three categories, namely inshore, offshore and distant water fisheries, based on the mode of fishing operations.

The inshore fishery is conducted from shore without vessels or with vessels up to seven miles from the coastline and trips of not more than one day duration.

The offshore fishery is conducted by vessels making trips of two days to three weeks' duration, covering significant distances in the open sea up to 50 miles from the coastline.

The distant water fishery takes place at similar distances or duration with all-weather vessels well over 100 tons equipped with refrigeration facilities other than ice and recreational facilities on board the vessels for the crew.

The breakdown of Malaysian fisheries into the above three categories is given in Table 16.

Of the total 29 226 fishing boats in 1972, some 61 percent are powered with inboard engines, 18 percent with outboard engines and the remaining 21 percent are non-powered. About 82 percent of the west coast fishing boats are powered, of which 72 percent have inboard engines. This is followed by East Malaysia, where the powered boats constitute 81 percent. The majority of the powered boats (about 44 percent) are powered by outboard engines. On the east coast of peninsular Malaysia, the powered fishing boats form 71 percent, of which 65 percent have inboard and 6 percent outboard engines (Table 14).

Although there is a wide range in the engine horsepower used, the majority (about 84 percent) are under 40 horsepower and only a small percentage (about 9 percent) are about 100 horsepower, of which quite a number are industrial engines converted to marine use. Similarly, the sizes of fishing boats used are generally small. About 83 percent of them are under 12 m in length and under 15 gross tons, 13 percent between 12 to 16.5 m and between 15 to 30 t, and about 4 percent are about 16.5 m and 60 t and above. Almost all the fishing boats are made of wood.

Source: Annual Fisheries Statistics, Malaysia, 1972, Fisheries Division, Ministry of Agriculture and Fisheries

Note: * Details on the tonnage of vessels by types of fisheries are not available. The table gives a general indication of fleet distribution by types of gears.

Source: Compiled from Annual Fisheries Statistics, 1972, Fisheries Division, Ministry of Agriculture and Fisheries

2.4.1 Inshore fishery

The Malaysian fishery is principally an inshore fishery, with over 80 percent of the fishing vessels engaged in this sector. The inshore fishery is scattered throughout the length of the coastline. It is characterized by a lack of organization and by the large number and variety of fishing equipment and techniques. The majority of these are traditional gears with low productivity. Although trawling has made significant inroads into the inshore fishery, its scope is limited due to the limited inshore resources.

The inshore fishery on the west coast of peninsular Malaysia is fully saturated. A total of 11 391 boats or some 79 percent of the fishing vessels are engaged in this sector of the fishery.

The inshore fishery on the west coast is dominated by gillnetting, seine netting, handlining and trawling, which together account for 64.4 percent of the total fishing boats in operation. As can be seen, the inshore fishery is quite diversified and both the pelagic and demersal resources are well exploited by the existing gear. As such, there is no further scope for the expansion of the inshore fishery in this region.

On the east coast of peninsular Malaysia, the inshore fishery is also well developed. Some 87 percent of the fishing boats are engaged in this sector of the fishery. Of this 44.7 percent are handline boats, 10.1 percent liftnet boats, 9.7 percent seine net boats, 8.4 percent gillnet boats and 7.0 percent trawl boats. In general, the available inshore resources are already well exploited, especially the pelagic resource, and no significant expansion of the inshore fishery is expected.

The fishery in East Malaysia is essentially inshore, of which the trawl and gillnets feature more prominently. Most of the fishing activities are presently confined to the shallow inshore waters and it is felt that the fishery could grow further by increasing the present range of operations through the introduction of bigger and more powerful boats.

2.4.2 Offshore fishery

An estimated 20 percent of the total fishing vessels are deployed in the offshore fishery. The components of the offshore fishery are trawling, purse seining, gillnetting, liftnetting (tangkol) and traps (bub), using bigger and more powerful boats for extended operation in the coastal waters.

The offshore fishery on the west coast of peninsular Malaysia is well developed. In 1972 there were some 197 purse seiners, 685 trawlers and 2 163 driftnetters engaged in this fishery. Under existing conditions, both the pelagic and demersal resources (with some exceptions) are already well exploited, as indicated by resources surveys made by the Fisheries Research Institute. There is thus not much scope for the expansion of the fishery in this region.

On the east coast of peninsular Malaysia, the offshore fishery is less developed, especially its demersal aspect. There were about 95 units of offshore trawlers in 1972 and, in comparison with the 80 000 t resource potential estimated, the demersal fishery is underdeveloped. The pelagic fishery is, however, fairly well developed as evidenced by some 722 units of driftnets, 135 units of liftnets (tangkol) and 75 units of seine nets operating in the region. A slight expansion of the pelagic fishery is still possible, as the resource can sustain a further increase of 30 000 t over the present catch, as assessed by the Fisheries Research Institute. An interesting fishery on the east coast is the trap fishery, which employs traditional cages called bubus to catch fish in the more distant waters up to 100 miles from the coastline. Medium-sized vessels of around 20 t are used in this fishery and there are some 150 units operating off the east coast.

In East Malaysia, the offshore fishery both demersal and pelagic is underdeveloped. There are relatively few offshore trawlers and driftnet boats operating in the region in comparison with the resource potential. Surveys of the demersal resource in the region indicate the presence of some 90 000 t of fish available for exploitation. There is, therefore, considerable potential for developing the offshore fishery in East Malaysia.

2.4.3 Distant water fishery

The tuna longlining fishery is the only distant water fishery in Malaysia. It is a Malaysian-Japanese joint venture and the company, Malayan Marine Industries (MMI) was established in 1959. The company provides frozen and canned tuna for the export markets. The fish supplies are obtained from eight longline boats owned by MMI, foreign boats (Korean) under contract with the company and other tuna fishing boats (primarily Japanese), which call at Penang to sell their catches. The eight longline freezer boats belonging to MMI are second-hand vessels. The boats vary in size from 250 to 300 t and are equipped with 600 horsepower engines. Each boat carries a crew of 25 fishermen of whom some four to five are Malaysians and the rest are foreigners. As the tuna fishery is generally well developed, due to the great demand for tuna, there is not much scope for its expansion. However, the prospects for developing a distant water fleet to harvest the smaller species of schooling pelagic fish in the South China Sea are good. The resource is estimated to be in the area of 4.2 million t, of which only about 2.0 million t have been exploited.

2.4.4 Fishing effort and productivity

The landings of marine fish increased from 201 562 t in 1965 to 355 735 t in 1972. This represents an average annual growth rate of 9.6 percent for the period. The major increases in landings were, however, achieved from 1965 to 1968, when a peak landing of 395 311 t was recorded. Following this, there was an arrest in the growth of the fishery. The landings for the period 1969 to 1972 fluctuate between 340 351 t to 365 217 t, with an average landing of 350 882 t for the period. During the whole period, an increase in vessels and gear in operation was noted. The fishing fleet increased from 25 779 vessels in 1965 to 29 226 vessels in 1972, giving an average annual growth rate of 0.1 percent. This was also supported by an increase in the number of fishermen from 72 000 to around 81 000, showing an average growth rate of 0.5 percent. Thus, it is evident that an increase in fishing effort in terms of fishing fleet and manpower does not result in an increase in production from 1969 onward.

West coast of peninsular Malaysia

The landings of fish on the west coast of peninsular Malaysia (Table 17) increased from 145 297 t in 1965 to 282 616 t in 1968. This was followed by a gradual decline in landings to 230 499 t in 1972. The increase in landings during the earlier period was attributable to the upsurge of trawling and good catches by the purse seines. The subsequent decline in landings, in spite of an increase in the number of fishing vessels from 13 160 in 1969 to 14 435 in 1972, indicates that the fishery is suffering from over-exploitation of the limited resources. The productivity per fishing boat also reflects the above pattern. It rose from 8.9 t in 1965 to 20.4 t in 1968 and declined to around 16.0 t in 1972. This shows that there is an overcapitalization of the fishery within the present range of operations. The productivity per fisherman showed a similar trend. In 1965 it was 4.2 t and this increased to 8.8 t in 1968. There was then an abrupt drop of productivity to 5.4 t in 1969 due to an influx of labour into the industry. Since then the productivity per fisherman has remained around this figure. There is thus surplus labour within the industry, which, if removed, will not affect the productivity of the fishing operation.

East coast of peninsular Malaysia

Landings on the east coast of peninsular Malaysia show a gradual increase over the years (Table 18). In 1965 it was 56 265 t and this increased to 80 626 t in 1972, giving an average annual growth of 5.7 percent. The number of fishing boats, however, decreased from 6 213 vessels in 1965 to 5 628 vessels in 1968 and then gradually increased again to 7 184 vessels in 1972. This was due to the gradual phasing out of the small non-powered vessels as the range of operations increase and the gradual replacement by powered vessels through mechanization. In 1965 the percentage of powered to non-powered fishing vessels was 57 to 53 percent and in 1972 it was 71 to 29 percent. With the mechanization of vessels and the use of more efficient gear, less manpower was required to operate the fishery. As a result, the fishing population dwindled from 33 594 in 1965 to 25 001 in 1972.

The productivity of both the fishing fleet and the fishermen increased slightly for the whole period. In 1972 the productivity per boat was 11.2 t and the productivity per fisherman was 3.2 t. When compared to the west coast, these figures are still low. The generally low productivity on the east coast is attributed to the lack of capital investment, underemployment and the prevalence of traditional gear in the industry. The modernization of the industry through an infusion of capital will raise the productivity of the fishery in the region.

East Malaysia

The total fish landings in East Malaysia were 50 379 t in 1968 (Table 19). In the following year the landings dropped to 39 611 t, due to a sharp decline in landings from Sabah, and gradually increased to 44 610 t in 1972. The productivity of the fishing fleet and fishermen fluctuate and average in the region of 5.8 t per boat and 3.8 t per fisherman respectively. Similar to the east coast, the low productivity of the fishery is attributed to the lack of investment in bigger vessels and more productive gear. According to surveys by the Fisheries Research Institute, Penang, the demersal resource is rich and could support a substantial growth of the trawl fishery especially in the offshore waters. This will boost the rather low production of the region considerably.

Income of fishermen

One of the outstanding problems of the fishing industry is the low income of fishermen. This is attributed to a lack of capital for modernization and expansion, low productivity, an imperfect marketing system and underemployment in the fishing industry. Apart from this, the majority of fishermen do not own fishing boats and gear, which usually belong to private financiers and entrepreneurs. The ownership pattern is an important influence in the system of payment. Of the price at landing point, only about 25 percent accrues to the fishermen, with 25 percent going to the owners of the production means, i.e. boat and gear, and the remaining 50 percent constitute the cost of operation, covering items such as fuel, ice and food at sea. The average 1972 income of fishermen, as calculated from the price at landing point, is given in Table 20.

The calculated average income of fishermen on the west coast is $1 289 per annum or $107 per month and on the east coast it is $703 per annum or $59 per month. The individual income of fishermen is however dependent on his skill and experience and the type of fishery in which he is operating. Those engaged in the modern sector, e.g. trawling and purse seining, earn a higher income than their counterparts in the traditional sector. This is reflected in the regional disparity of income between fishermen on the west coast, where the modern sector prevails, and the east coast, where the traditional sector dominates the industry.

Berube (1968) classified fishermen into three groups: (a) the lower level group, (b) the fair average group, and (c) the upper bracket group, based on their income.

The lower income group, which earns about $60 a month, constitutes some 75 percent of the total fishing population. Fishermen of this grouping are predominant on the east coast (Report on the Economic Survey of the Fishing Communities in the East Coast, 1971). As fishermen in this group usually operate small fishing boats and traditional gear, they are often affected by bad weather conditions, e.g. during the northeast monsoon season. This serves to reduce their income by an estimated amount of $20 per month. As a result of the low income, they are constantly indebted to financiers, towkays and fish dealers, a crucial factor in the economic development of the industry.

The fair average group comprises fishermen of the more modern and more productive fisheries, e.g. trawling and purse seining. They represent some 15 percent of the total fishing population, with an income range of $100–250 a month. These fishermen are better organized and have passed from the subsistence economy of the lower income group to a market economy.

The upper bracket group represents the top class fishermen such as skippers and engineers and those engaged in the distant water fishery (tuna longlining). The income of fishermen in this group is around $300 per month and those engaged in the distant water tuna longlining fishery may earn up to $600 per month after apprenticeship. Only a small percentage of fishermen (about 10 percent) belong to the upper bracket group.

Surplus fishermen

The fishing industry is one which suffers from a surplus labour problem, as indicated by surveys carried out by the Division of Fisheries. There are too many fishermen actively involved in the industry in relation to the capital investment and resource available in the industry. This is largely due to the nature of the fishing industry, which is based on a free common user resource. It is this lack of ownership and limitation of entry that has led the poorer section of the community to drift into the fishing industry, thus making it a traditional reservoir for the unemployed. This has resulted in surplus labour within the industry, giving rise to underemployment, low productivity and income.

A recent survey conducted by the Fisheries Division in peninsular Malaysia indicates that there is a surplus of 30 percent or 12 900 fishermen on the west coast and 24 percent or 6 400 fishermen on the east coast. As surplus labour is a serious problem of the fishing industry, measures will have to be taken to siphon away the surplus labour into other sectors of the economy or activity as well as to prevent the drift of unemployed into the industry. Some of the broad measures to solve the problem are:

1. the developing of aquaculture to take advantage of the ready pool of semi-skilled manpower available within the industry and divert them into more gainful employment;

2. to develop new areas of activity in fisheries, agriculture and poultry adjacent to fishing villages to absorb the surplus fishermen;

3. to give special facilities and priority consideration for fishermen and members of their families to move out to new development areas and to other occupations;

4. to provide special attention to the educational and vocational training needs of children and youth from fishing communities to equip them for employment in other occupations.

The implementation of the suggested measures would require the assistance of relevant ministries or agencies and a committee to coordinate the activities of the ministries/ agencies involved.

2.5 The capital resources

Malaysia is presently undergoing a phase of unprecedented rapid economic development financed largely by revenue obtained from high commodity prices for her main export items, rubber, tin, timber and oil palms, as well as international borrowing. Aware of the need to build up a manufacturing sector, the country has embarked on a two-stage programme for industrialization. In the beginning preference was given to companies producing import substitute goods under tariff protection. Recently, a shift in emphasis was made in favour of manufacturing for export, with the implementation of the Investment Incentive Act 1968, providing for pioneer-status, tax-holidays and other material attractions for foreign and domestic investors. These developments have created a very much wider scope for capital utilization, as a result of which investors tend to be highly selective and demanding. Under this climate the fisheries sub-sector finds it difficult to generate a reasonably strong “pull”.

In the traditional fishing sub-sector, the village middleman is often the most important source of risk capital, although he exacts a high price for his services in the absence of competition. From the point of view of maintaining the traditional fishing production, his role has not diminished because the semi-commercial nature of traditional fishing operation does not leave a sufficient “surplus” for capital accumulation. More recently, with the introduction of marine engines, a new source of credit has emerged in the form of a network of engine distributor agencies. By way of hire-purchase agreements and other financial arrangements, these agencies have made it possible for a large number of fishermen to mechanize their boats and, in the process, have brought about the rapid rate of mechanization in the last ten years.

The commercial banks and other local lending institutions are even today virtually out of reach of the fishermen. Their reluctance to get involved in this business seems to have sprung from a basic fear of the risky business of fishing and the absence of banking expertise to service the industry's needs. Even the Agriculture Bank has not really come around to address itself to this problem. Mindful of the particular difficulties of the agricultural small-holders and the small businessmen, the Government has established the Credit Guarantee Corporation to facilitate credit lending for small sums without security or collateral. It is still too early to assess the effectiveness of the Credit Guarantee Corporation but it seems to be a step taken in the right direction.

Whilst there is in fact a tremendous interest in the secondary and tertiary industries, viz. ice plants, shrimp freezing, net manufacturing and boatbuilding, etc. public support in any new fishing venture has been indifferent. When the first fishing corporation was formed between domestic and Japanese interests in the early sixties, great difficulties were encountered in raising the local capital contribution. No attempt has since been made by any company to float shares for any fishing venture. But there is no evidence to suggest new interest on the part of the investing public to subscribe to any such shares, if and when they are listed.

There seems to be no lack of public interest in the secondary and tertiary industries. Many of the ice plants are owned by well established agency houses capitalized by foreign and domestic sources. More recently, foreign capital has also moved into the boatbuilding and repair industry. But foreign interest in fishing with equity participation from domestic interests has not yet materialized. There have been a number of enquiries but these representations have yet to be investigated. It is felt that some countries, in fact, wanted to establish fishing bases in Malaysia for their own boats under the guise of partnership fishing. A number of foreign/domestic fishing companies have been established in Sabah and Sarawak for exploiting the lucrative shrimp fisheries. However, there is no comparable interest shown in the finned fisheries. It is fair to point out that at present the basic shore support facilities are not available, nor are there sufficient data on the potential of the fishing industry (other than shrimp) to excite any interest in this area.

It is obvious that the Government will have to provide the bulk of the capital required for the modernization of the fishing industry. The first pre-requisite is, of course, the creation of the basic infrastructure and shore support facilities required by the fishing fleets. The capital outlay has to be made by the Government, as in the case of the other “social overheads”. Given the current healthy state of the economy and the high credit standing of the country among international lending institutions, finance is not a problem. The next problem is how to finance the construction of a modern fishing fleet. The creation of the Fisheries Development Authority clearly implies that the Government is willing to finance at least part of the fleet construction. But, in view of the sheer size of the capital outlay required, it is natural to expect the private sector to play a substantial role. Yet, given the high cost of investment funds (and modern fishing is a capital intensive affair), the private sector will surely need help if it is to participate in the development of the industry. In this area, the Government will have to expect the investors to ask for soft-term loans and vessel subsidies to lighten their financial burden. This is one area which will need to be seriously considered.

2.6 Demand for fish

2.6.1 Fish for direct human consumption

The average per caput fish consumption in 1971 was 26.6 kg, which is partly due to landings remaining at a relatively constant level, with a high growth rate of population. The figure for 1969 was 27.9 kg. Therefore, the 1971 per caput consumption has been taken as a basis for demand projections up to 1995. The population projections for peninsular Malaysia have been prepared by the EPU for the years 1977–1992 (starting from 1972 statistics) and converted during the preparation of the Fisheries Development Plan to five-year periods: 1975–80 …. 1995 according to the five-year planning cycle. The rates of growth for the respective five-year periods have been taken from the EPU projections. Because of the lack of projections for East Malaysia, the respective figures have been worked out in the Fisheries Division for the use in demand projections. The rates of growth are slightly higher than those for peninsular Malaysia because of : (1) higher present rate of growth, and (2) lower degree of urbanization. The annual rate of population growth applied for peninsular Malaysia is 2.994 percent for the period 1971–72 declining to 2.5 percent for 1990–95. The respective rates for East Malaysia are: 3.54 for 1971–72 declining to 2.63 percent for 1990–95.

In the meantime, the EPU has made new population projections, which have been included in Table 21 as LOW (low alternative), while the original ones will hereinafter be called HIGH. The projected population for the particular periods is as follows.

By the year 1995 the total population of the country will be double or more than double of that of 1970. Accordingly, the demand for food will increase at an even higher pace because of the anticipated increase in real income per caput. The growth of per caput income is one of the main policy objectives of the country. The rate of per caput income growth, as envisaged by the Second Malaysia Plan (1971–75) is 2.7 percent per annum.

The projections of demand for fish have been worked out in two alternatives: (1) to cover the demand resulting from population growth at the per caput consumption of 26.6 kg in 1971 and (2) at an anticipated growth in per caput consumption due to increase in income.

In the absence of per caput income projections for the planned period, the following assumptions have been made:

After the above projections had been made the EPU worked out their own projections of per caput income increase, which are as follows:

The above figures are considerably higher than those quoted above but, due to their tentative nature and lack of complete data up to 1995, they are given here merely for information and general orientation in the trends of planned economic development. Moreover, these higher figures are not too significant for future demand projections, since Malaysia already has a relatively high per caput fish consumption and in such cases the absolute value of the elasticity coefficient declines with the increase in per caput income. Thus, when incomes tend toward infinity, the elasticity tend toward zero and the per caput consumption tends to a saturation level. Therefore, the projections presented below are based on the projected lower growth rate of per caput income and the income elasticity for fish and fish products has been assumed as 0.4 (according to recent studies) for the whole period. The total HIGH and LOW damand reflect the population projections accordingly. The projected demand for fish for human consumption is as follows in Table 22.

Table 22

Projected demand for fish for human consumption
Per caput demand = kg - Total demand = metric tons

The demand projections have been made in terms of fresh fish, live weight.

According to the projections, the total increase in per caput consumption under Alternative II is 4.3 kg (16 percent) over the period of 25 years. In other words, it means an annual increase of 172 g per caput/year, which is very moderate. Out of the 690 300 t of projected total demand for 1995 only 96 100 result from the projected increase in per caput demand, the remaining 594 200 t is the demand at the present (1971) per caput consumption.

2.6.2 Demand for fish meal

The demand for fish meal over the three years 1970–72, assessed on the basis of local production and imports, is as follows:

Fish meal is used for feeding pigs and poultry as an important component of their feed. Pork and poultry are, besides fish, two main sources of animal protein for the population. The projected demand for fish meal, being analysed by the Ministry of Agriculture, is not yet available and it has been then assumed that the production of livestock will have to grow at least at the same rate as the population and this will require a parallel growth of the demand for fish meal. This basic assumption has been made to assess the demand for fish meal for the projected periods. The present demand for fish meal has been taken as 10 000 metric tons. Furthermore, it is assumed that, with the increase in catches, the trash fish landings will grow accordingly and these can be utilized for reduction to fish meal.

The projected demand for fish meal is as follows:

It is also advisable to entirely eliminate imports of fish meal since the domestic supplies of raw material fully justify local production. In addition to trash fish, another source of raw material will become offal from the fish processing industry to be developed in the country.

2.6.3 Exports of fish

The net exports of fish in 1972, as shown in Table 3, are in the order of 50 000 t. It is almost impossible to predict the future export possibilities of the country, mainly from the viewpoint of potential overseas markets. No thorough export study is at present available but it can be said safely, that the very rapid increase in exports over the five years, 1968–72 (Table 3) will not be maintained in the future. However, it can be anticipated that some fish species will have an ever growing foreign market. The commodities with good prospects for the future include crustacea and other Grade I fish. Therefore, for the purpose of the development plan, it is assumed that net exports will increase by approximately 2 000 t/a on the average, reaching a level of 100 000 t in 1995.

The following are the projections for the respective periods (live weight - t):

It may occur that the growth in exports will be higher in the next few years, growing at a lower rate in the following ones. It is essential that the fish canning industry be developed in the country to eliminate the imports of common canned fish, however, this does not mean total elimination of imports of fancy fish products not manufactured in the country. Canned fish may also become an export commodity, even to the neighbouring countries, provided the quality standards and prices are competitive.

2.6.4 Total demand for fish and potential resources

The total demand for fish for human consumption, fish meal and exports is summarized below (in metric tons):

For convenience in further considerations, the projected total demand for fish in 1995 will be quoted as 900 000 t. What then is the difference between the projected figure and present catch and wherefrom should the fish come?

The 1972 total landings were 356 000 t.

Since there are no reliable import/export statistics for East Malaysia, nor are there statistics on fish utilization, it has been assumed that the total production equals consumption. Furthermore, it is known that East Malaysia, being an exporter of high quality fish (shrimp), is at the same time importing fish. Until accurate statistics will be available the production has to be treated as consumption without a major error. The 1970 landings totalled 340 000 t.

The incremental catch in 1995 over 1970 will be therefore 560 000 t.

According to a recent assessment by Pathansali (1973), the coastal fishing grounds off the west coast of peninsular Malaysia are at present fully exploited. There is an indication only that the pelagic schooling species could sustain another 10 000 t. The east coast of peninsular Malaysia has, however, an entirely different situation. The abovementioned report gives the following figures for the resource potential and present catch:

FAO estimates of the South China Sea resources potential are as follows:

In addition to the marine resource, it is estimated that fish culture could yield a total of 50 000 t if properly developed (the present production being in the order of 30 000 t). The main areas for development are the mangrove swamps along the west coast of peninsular Malaysia but an increase in output can also be expected from improved and rationally developed freshwater fish culture.

Summing up, it should be said that intensification of operations off the east coast may bring some 150 000 t; 20 000 t may come from aquaculture and the remaining approximately 400 000 t will have to come from offshore fishing operations to be developed in the South China Sea. There is also some scope for lesser tuna fisheries within a radius of 1 000 miles from Penang.