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FI:TCP/INS/4553

TECHNICAL COOPERATION PROGRAMME

STRENGTHENING MARINE FISHERIES DEVELOPMENT

INDONESIA

Terminal Statement
prepared for
the Government of Indonesia
by

the Food and Agriculture Organization of the United Nations

Rome, 1998

Table of Contents

2. RESULTS AND CONCLUSIONS

3. RECOMMENDATIONS

Appendix DOCUMENTS PRODUCED BY THE PROJECT


1. INTRODUCTION

1.1 Project background

The growth of the Indonesian fisheries sector during the First Long-Term Development Plan (1968-93) has been impressive. This was achieved through a programme directed at increasing production by improving extension services, the provision of infrastructure, development of package technology, and upgrading of post-harvest and marketing activities. Between 1984 and 1993 production from marine capture fisheries increased from 1 713 000 t to 2 886 000 t, giving an average annual growth of 7.6%.

Continuing on the achievements of the Plan, the Government of Indonesia has planned to expand the development of marine fisheries. This expansion is based on assessments of potential of the various marine resources made in 1991 which indicated that a sustainable harvest of 6.6 million tonnes would be possible. In 1994, the Directorate General of Fisheries (DGF) determined that the additional vessels required to exploit the full potential would require an investment of $US 4.1 billion. Such a massive endeavour led the Government of Indonesia to request technical assistance from FAO to examine the state of marine fisheries in Indonesia and chart the path for its rational development in a sustainable manner.

1.2 Outline of official arrangements

The concept for the project originated in a meeting between the Minister of Agriculture and FAO in early 1994. FAO responded with the project outline in March 1994. A Project Document was subsequently formulated and signed by both FAO and the Government of Indonesia in March 1995. The project, originally scheduled to begin in March 1995 and end in February 1996, actually started in June 1995 and ended in January 1997, in order to accommodate the government request for an in-depth feasibility study for the upgrading of the fishing port of Pekalongan. This study was carried out in December 1996 - January 1997 by the international fishery harbour engineer and a national sanitation and public health engineer. The Directorate General of Fisheries (DGF) of the Ministry of Agriculture was designated the government agency responsible for execution of the project, to which FAO contributed a total of $US 327 200.

The project provided four international consultants: a Team Leader, who was a senior fisheries economist/planner, and experts in the fields of fisheries resource management, fishery harbour engineering, and fishing vessels, as well as national consultants in stock assessment, fish processing, and fish marketing. Preliminary visits by the Team Leader and Management Expert took place from mid-July to late October 1995 and subsequently the entire team of consultants worked together in March and April 1996. This led to a national workshop during the last week of April, which was attended by 38 individuals representing government, industry, and academic interests.

1.3 Objectives of the project

The specific objectives of the project were to:

- reappraise the potential of marine resources, strengthen the management approaches and determine the appropriate composition of the fishing fleet in order to ensure sustainable development;

- carry out feasibility studies to enhance the capability of the ship-building industry, to construct/rehabilitate physical infrastructure at strategic points in priority areas and to improve the delivery of basic support services to the private sector and fishermen; and

- review the current human resources development policy and approaches, and design improved mechanisms and programmes.

2. RESULTS AND CONCLUSIONS

2.1 Fisheries resources, management and changes to fleet composition

Prior to the project, FAO conducted a Workshop on the Assessment of the Potential of the Marine Fishery Resources in Indonesia, which reviewed all available information and, with input from 28 Indonesian and overseas researchers, produced new assessments. The project scrutinized that work and concluded that, because the workshop built on previous assessments, corrected weaknesses, and considered new data, it represented the best available estimates. Unless there is strong scientific rationale to the contrary, it is recommended that the DGF use the estimates produced by the FAO workshop.

After examining the legal basis for fisheries management, a review was carried out of the fisheries management policies of the DGF, placing emphasis on the Exclusive Economic Zone (EEZ) fisheries. Several important fishing ports were visited, opinions from the fishing industry were sought, and information from previous reviews was considered. Special effort was made to determine if the current fisheries management, largely carried out through the licensing system, adequately safeguarded resource sustainability.

The activities of the DGF are largely oriented to development, production, promotion of fleet growth and estimation of future potential. This is quite normal in a developing country with, on the one hand, substantial marine resources and, on the other, large requirements for food, export earnings and industrial growth. Presently there is no major conservation1

/ element in fisheries management. This is probably due to the idea of vast unexploited resources, especially in the EEZ and eastern Indonesia. It should, however, be realized that there is a natural limit to what the marine capture fisheries can produce. This is quite unlike agriculture or aquaculture, in which production can be increased substantially with technical breakthroughs, intensification, fertilization, and other manipulations. In practical terms, the upward sloping lines depicting ever-increasing catches on the Repelita2/ graphs of marine fisheries production will at some point stop. It must be acknowledged that the state of assessment of Indonesia's marine resources is not very accurate and there is a great amount of uncertainty. This results in a need for special caution when projecting resource potential. Recent assessments which consider all relevant stock assessment information indicate that some of the past estimates may have been too ambitious. Even if the earlier optimistic assessments are considered valid, when they are compared to the expected catches of the vessels now fishing, the conclusion is that the limits of some of the fisheries have been reached or surpassed. For others, it indicates that the state of knowledge is so poor that further expansion would be unwise. It therefore appears that a milestone has been reached in the development of fisheries in Indonesia. The major conclusion of this project is that the primary objective of fisheries management in Indonesia should change from that of maximizing production to ensuring the long-term sustainability of fisheries resources.

In addition to a shift in management objectives, there is a need for improvement in several aspects of fisheries management. Substantially more benefits from the fisheries sector would accrue through the enhancement of staff capability in fisheries management matters, administration of the licensing system, procurement of data from fishing operations, and the enforcement of regulations.

The collection of fisheries statistics and data should receive higher priority from the DGF. There is now an urgent need for more accurate and reliable data on the existing fisheries for resource analysis to ensure sustainable exploitation. The present statistical system should be upgraded and the proposed national fisheries management information system implemented as early as possible. The project did not expand on this element, for which assistance was being provided from other sources.

It is thought that there are no large unexploited resources in Indonesia upon which major fleet expansion plans can be based. Demersal fish and shrimp resources are not considered capable of supporting further fleet development in any EEZ area. The small pelagic resources are likely to be able to withstand substantial additional fishing effort, but the economics of the situation may make placing actual numbers of additional vessels an irrelevant exercise. There is some possibility that skipjack and other large tunas may be able to support increased catches; but, rather than formulate long-range expansion plans on this possibility, an incremental expansion with close monitoring of the effect would be best. The replacement of the large foreign tuna fleet, especially the 471 longliners licensed in October 1995, is seen as perhaps the only clear possibility for a substantial expansion of the Indonesian EEZ fleet. It should be noted that this opinion is considerably different from the present tentative plans of the DGF, which call for an extra 285 longliners, 1 775 purse seiners, 1 136 gill netters, and 250 fish net vessels.

It appears therefore that any major increase in the number of Indonesian vessels will arise from the replacement of the foreign fleet. Fleet development plans are thus strongly related to the Government's policy on the localization of foreign fishing in the EEZ. Contrary to policy objectives, the number of foreign vessels licensed to operate in the EEZ actually increased by 43% since the policy to promote localization began in 1990. It can be concluded that to achieve the objective of localization of the EEZ fleet, government policies must be modified. To achieve localization of the EEZ there appear to be three options:

- Changing the economic conditions under which vessels are built in Indonesia.

- Allowing the import of foreign fishing vessels.

- Encouraging vessels from over-exploited fisheries in other parts of Indonesia to displace foreign vessels in the EEZ.

These three options should be carefully evaluated by the Government in the context of overall development policies.

2.2 Institutional strengthening

The lack of a clear chain of command at the management level has constrained the development of the fisheries industry. A large number of ministries, agencies and institutions are involved. In order to forge greater understanding for the smooth functioning and management of the industry, a National Steering Committee on Fisheries should be established. The membership of this committee should comprise all relevant ministries, agencies and institutions, including the Armed Forces Command (Navy) and industry. The chairmanship of the committee should be the Ministry of Agriculture, with the Directorate General of Fisheries serving as secretariat.

In line with the recommended change of management thrust from one of increasing production to that of ensuring sustainability of fisheries, the manpower capability of the DGF and the Provincial Fisheries Service should be upgraded to meet the new challenges. This requires the stepping up of the in-service training programmes in resource management, conservation and enforcement. In addition, the Provincial Fisheries Service needs to be strengthened to include fisheries management functions and responsibilities.

To support initiatives in fisheries resource management, research activities relevant to management should be increased. The vastness of the Indonesian archipelago and the large number of parties involved against a backdrop of limited funding, necessitate the careful coordination and priority setting of research. The Central Research Institute for Fisheries (CRIFI), being the lead agency, should play the role by establishing a Fisheries Research Coordinating Committee. Furthermore, the structure of CRIFI is weak; it has only one institute - the Research Institute for Marine Fisheries - and two small stations in Jakarta to undertake the task countrywide. It should be upgraded and strengthened by a network of field stations in important areas. Increased funding for fisheries research could come from setting aside a portion of the licence fees collected, as provided for in the Ministry of Agriculture Decree No. 816 of 1990.

2.3 Development of small-scale fisheries in Merauke

In line with the Government's policy to develop eastern Indonesia, the potential for the development of the fisheries sector in Merauke, Irian Jaya, was reviewed. The industrial fisheries based at Merauke are spearheaded by private companies and there appear to be no major development problems in this sub-sector. The focus of government intervention in fisheries development should therefore turn to the small-scale fisheries. These fisheries are considerably under-developed and there are promising indications of abundant resources in the coastal zone and mangrove areas. The development of small-scale fisheries cannot be divorced from the associated communities and therefore the development process becomes a complex matter requiring both an intimate knowledge of the target groups and an integrated approach. The suggested concept for development encompasses an institutional framework, a network of centres with low technology micro-infrastructure, fishing vessel development, basic support services and, above all, human resource development to ensure full participation of the people concerned. The formulation of a realistic project would, however, require a detailed survey of the area to provide an accurate information base.

2.4 Upgrading of Pekalongan fishing harbour

Despite the rapid growth in the shore-based infrastructure to meet the needs of the industrial and small-scale sub-sectors, poor design and management techniques of the infrastructure, coupled to a general lack of dedicated fisheries extension work during the handling, processing, distribution and marketing process, have led to a general deterioration of the quality of the landed fish. Post-harvest loss and spoilage in some areas of the fisheries sector is believed to reach 60%. Added to this is the general lack of environmental awareness and hygiene in the majority of harbour areas.

In order that Indonesia may maximize the value and benefits of the landed fish in terms of foreign exchange earnings, post-harvest loss and quality of fish products, the existing fishing harbours should be upgraded to internationally accepted standards to improve onshore facilities, as well as to provide better port management, proper sanitary services and a harbour environment compatible with the food sector.

The technical feasibility study of Pekalongan, a major fishing port in Central Java, reflects current nationwide trends and shortcomings in fishing harbour design, management, infrastructure and post-harvest handling. Designs for infrastructure refurbishment have been detailed and costed for implementing the required changes to make the Pekalongan fishing harbour conform to international fishery standards. Guidelines have also been provided for the introduction of measures required to meet port management and hygiene standards requirements.

3. RECOMMENDATIONS

3.1 Fisheries resources, management and changes to fleet composition

Enhancement of staff capability, generation of the political will to improve the present situation, and case examples of facilitating presently unimplemented control measures are seen as key elements in improving fisheries management in Indonesia. Specific details of proposed strategies are given in the Final Technical Report of the project. To summarize: the present lack of awareness of fisheries management principles should be addressed by exposure of the DGF staff responsible for marine capture fisheries management to areas outside Indonesia where there is both poor and effective management, to view the consequences. It is believed that the political will to improve aspects of fisheries management, such as enforcement, could be generated by calculating the economic costs incurred by the present inefficient system. Full implementation of the apparently sensible "checkpoint" system of vessel control should be undertaken at one port as a model.

With regard to fleet expansion plans, the Government is advised to place more emphasis on the fisheries resource situation than has occurred in the past. In this context, it is recommended that any major build-up of the Indonesian fleet be oriented to the displacement of foreign fishing activity, rather than basing such development on the doubtful notion of large unexploited resources. Since the Government's policy of localizing foreign fishing has not been successful, consideration should be given to changing the conditions for domestic vessel construction, allowing imports in selected fisheries, or encouraging the redirection of effort from other Indonesian fisheries.

3.2 Institutional strengthening

With increasing emphasis on the management of marine fishery resources for long-term sustainable use, research inputs will concurrently need to be stepped up to provide the scientific basis for fisheries management decisions. Accordingly, the Research Institute for Marine Fisheries should be strengthened, both in terms of capability and capacity, to undertake the task in collaboration with fisheries managers, industry and the organizations involved.

There are strong indications that marine fisheries production in Indonesia will level off. In this situation, the improvement in harbour management and facilities can play a significant role in contributing towards the Government's objective of increasing income for the sector. This can be realized through the maximization of economic returns from the catches landed (as opposed to increasing catches). One mechanism to achieve this would be to select a typical fishing harbour for upgrading to international standards, with the aim of increasing the value of the catch, reducing post-harvest losses and improving the quality of fresh fish supplies. This would provide a model in modern design methodology to DGF staff for application to other fishing harbours.

3.3 Development of small-scale fisheries in Merauke

In pursuance of the national policy to promote growth in eastern Indonesia, and based on potential (as described in Section 6 of the Final Technical Report), a comprehensive project for the development of small-scale fisheries in Merauke, incorporating planning, formulation and implementation, has been proposed. The project's objective is to narrow the widening gap between this sub-sector which is under-developed, and that of the industrial sub-sector, which appears to be well-organized with no major development problems.

3.4 New orientation

The main policy objective of fisheries development in Indonesia is to increase the quality of human resources and income in the sector. All along, the strategy employed has been one of growth through production. This has been accomplished and reached to the level where sustainability of resource exploitation is of concern. A change in strategy from one of production to one of management, combined with maximization of the benefits from the catch landed through improvements in post-harvest handling, processing and marketing, would facilitate the continued attainment of the policy objective. Improvement of the Pekalongan fishing harbour is to be regarded as one action towards this end, to be combined with other recommended measures.

Appendix: DOCUMENTS PRODUCED BY THE PROJECT

M. Badrudin (1996). Fishery Resource Potentials in Indonesia. Technical Paper No. 1.

M. Badrudin and R. Gillett (1996). Translations of Indonesian Fisheries Laws Relevant to Fisheries Management in the Extended Economic Zone. Technical Paper No. 9.

FAO (1996). Final Technical Report - Strengthening Marine Fisheries Development in Indonesia.

R. Gillett (1995). Marine Fisheries Resources and Management in Indonesia with Emphasis on the Extended Economic Zone. Workshop Presentation Paper No. 1.

R. Gillett (1995). Preliminary Report of the Fisheries Resource Management Consultant on Aspects of Fishing in the Extended Economic Zone of Indonesia.

R. Prayitno (1996). Fish Marketing. Technical Paper No. 4.

J. Sciortino (1996). Harbour Planning and Management at the Macro Level. Technical Paper No. 7.

J. Sciortino (1996). Integrated Infrastructure Development Proposals for Merauke. Technical Paper No. 3.

M. Shawyer (1996). Fleet and Shipbuilding Component. Technical Paper No. 2.

M. Shawyer (1996). Fleet Development. Workshop Presentation Paper No. 2.

Sunarya (1996). Improvements in Fish Handling, Processing, and Quality Control. Technical Paper No. 5.

C.K. Tan (1995). Inception Report.

C.K. Tan (1995). Interim/Progress Report on Strengthening Marine Resource Development in Indonesia.

C.K. Tan (1995). Travel Report on Marine Fisheries In Maluku Utara and Merauke.

C.K. Tan (1996). Fisheries Statistics and Information System. Technical Paper No. 6.

C.K. Tan (1996). Institutional Strengthening. Workshop Presentation Paper No. 4.

C.K. Tan (1996). Small-Scale Fisheries Development in Merauke. Workshop Presentation Paper No. 3.

C.K. Tan (1996). Workshop Report on Strengthening Marine Fisheries Development in Indonesia held on 23 April 1996, Jakarta.

B. Setiawan and J.A. Sciortino (1997). Upgrading of Pekalongan Fishing Harbour to International Standards. Field Document.

1 / The term "conservation" is intended to denote concern for the sustainability of the resource. This word often causes confusion in the Indonesian context where it is sometimes construed to be the work of another Ministry.

2 / Rencana Pembanguhan Lima Tahun (Five-Year Development Plan).