A fishing boat off the coast of Java. Photo: Rhett A. Butler
The Indonesian Financial Services Authority (OJK) has organized dozens of non-bank financial institutions to support the country’s maritime and fisheries sector, a key priority for President Joko “Jokowi” Widodo.
Smaller operators in the sector have struggled to adapt to a new ban on trawlers and seine nets, and one of the OJK’s goals is to make credit for environmentally friendly fishing gear more widely available, as industry groups have requested.
The OJK also wants to boost access to working capital loans and equipment and infrastructure such as boat motors, outboard motors, floating filling stations and mini fish-processing plants.
According to the OJK, 12 finance companies are ready to disburse credit to the sector. There are also 20 life-insurance companies and two general insurers as well as well as three Regional Credit Guarantors (Jamkrida).
“The involvement of these financial institutions is expected to trigger the provision of credit to the marine, fisheries and maritime sector,” Edy Setiadi, an OJK director, told journalists last week in Jakarta.
The initiative is expected to increase credit disbursement in the sector by 30 percent, he added.
“With (Jokowi’s) Nawacita (nine-point agenda), the president has requested that the financial industry – both banks and non-bank institutions – contribute to the sector,” said Irwan Lubis, the OJK’s deputy commissioner for banking supervision.
The first wave of financing will focus on seven cities: Bali (curing fish), Yogyakarta (management and canning of fish in Bantul and Sadeng), Batam (development of local fishing cooperatives), Makassar (shipbuilding and packaging of fish products), Kendari, (development of an integrated industrial park for marine fisheries), Sukabumi (improving fish auction sites) and Sibolga (fish processing).
In 2014, Irwan said, bank financing had disbursed Rp17.9 trillion to the sector, accounting for .49 percent of total national bank financing. Non-bank financing had disbursed Rp1.7 trillion, just .7 percent of total non-bank financing.
Produced in English by Philip Jacobson.
Citations:
- M Ambari. “Sektor Perikanan dan Kelautan Kini Didukung Penuh Industri Keuangan” Mongabay-Indonesia. 5 May 2015.