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Investigation hints at cronyism in awarding of Indonesia lobster export permits

  • A report by Indonesian investigative publication Tempo has identified political ties between the country’s fisheries minister and a slew of companies recently awarded licenses to export lobster larvae.
  • Among the owners, directors or executives of several of those companies are politicians from the Gerindra party of which minister Edhy Prabowo is a senior member.
  • Two other companies that received export licenses are run by a former fisheries ministry official who was fired in 2017 after being convicted and jailed for smuggling lobster larvae and money laundering.
  • The decision to resume exports is itself hugely controversial, with experts saying it’s not sustainable and threatens Indonesia’s already declining lobster populations in the wild.

JAKARTA — An investigative report has revealed the political links between Indonesia’s fisheries minister and a slew of companies recently awarded permits for a controversial lobster export program that experts say is unsustainable.

Minister Edhy Prabowo in May reversed a ban on exports of lobster larvae imposed by his predecessor, Susi Pudjiastuti. Within less than two months, his office had granted export permits to 31 companies out of the 100 that applied. Among the owners, directors or executives of several of those companies are politicians from the Great Indonesia Movement Party, or Gerindra, according to the investigation by news magazine Tempo.

Edhy is a senior Gerindra member and close confidant to party chairman Prabowo Subianto, who is the defense minister. Tempo found that the latter’s relatives, namely brother Hashim Sujono Djojohadikusumo and niece Rahayu Saraswati Djojohadikusumo, are among those behind some of the companies.

Fisheries Minister Edhy Prabowo, center, has lifted a ban on the export of wild-caught lobster larvae. Image courtesy of the Indonesian Ministry of Maritime Affairs and Fisheries.

Other politicians identified in the investigation are Eka Sastra, a former lawmaker for the Golkar party, of which Prabowo Subianto was previously a member before he founded Gerindra, and Fahri Hamzah, a former deputy speaker of parliament.

Tempo looked into the history of 25 newly licensed exporters. Most of them had only been established less than three months ago, meanwhile the rest had only expanded into marine crustacea fisheries recently, the publication found.

Besides politicians, the report found the ministry also granted export permits to two companies run by a former fisheries ministry official named Buntaran. Buntaran was fired in 2017 by Susi after being convicted of smuggling lobster larvae and money laundering.

Tempo also highlighted a potential violation by one of the newly licensed exporters, PT Royal Samudera Nusantara. The company in June attempted to export a batch of lobster larvae to Vietnam, but missed the charter flight out. According to Tempo, the failed attempt would have been the company’s second exported batch since the ban was lifted in May. The chairman of the company’s board is Ahmad Bahtiar Sebayang, a deputy chairman of the Tunas Indonesia Raya wing of the Gerindra party.

Experts calculate that under the terms of the new export framework, the first exports out should only be possible early next year — and certainly not within a month of the ban being lifted. That’s because the fisheries ministry requires exporters to demonstrate a “sustainable harvest” from their lobster farms. They also have to release 2% of their harvest back into the wild. The ministry currently allows the wild harvesting of nearly 140 million lobster larvae: 70% is allocated for domestic cultivation in aquaculture farms, while the rest are for export.

“The thing is the designers of the export imagined the quota would be billions of larvae,” an anonymous source at the fisheries ministry said as quoted by Tempo. “So don’t be surprised that the capture quota of the larvae will soon be revised with a much bigger number.”

Exporting wild-caught lobster larvae is a lucrative business, but threatens an already declining wild population of the crustacean. Image courtesy of the Indonesian Ministry of Maritime Affairs and Fisheries.

Since the publication of Tempo’s investigation on July 4, Edhy has defended his office’s decision to grant export permits to companies affiliated with his party, saying the application process was open to all.

“There are two or three names that have been linked to me and immediately I’m being wildly judged,” he said in a statement on July 7. “Is it because I’m the minister, all of my friends can’t have business? I think that’s not what’s important, but the fairness instead. I am not giving special treatment to my best friends.

“There’s a special team that decides on the permits, which includes all of the directors-general and inspector-general [of the fisheries ministry],” he added. “Go ahead and audit, check, the fisheries ministry is very open.”

But fisheries experts say the findings are yet the latest example of corruption and cronyism in the Indonesian government. The country ranks 85th out of 198 on Transparency International’s Corruption Perceptions Index.

“The minister’s claim that the resumption of exports will improve the welfare of lobster fishers has now been disputed because the policy will only benefit those companies and politicians behind them,” said Susan Herawati, secretary-general of the NGO Coalition for Fisheries Justice (KIARA), in a July 6 statement received by Mongabay.

Irzal Effendi, an aquaculture professor at the Bogor Institute of Agriculture (IPB), called on the politicians involved in the companies to focus on developing the country’s lobster aquaculture industry, protecting the wild populations, and improving the livelihoods of fishers.

Experts and observers say the lack of monitoring and law enforcement in the export chain, coupled with inadequate infrastructure to develop a viable lobster aquaculture industry domestically, threatens to deplete the wild population.

“Strict and systematic monitoring must be carried out by the fisheries ministry over the permits that have been granted to companies,” Irzal told Mongabay. “The ministry should involve academics to do the monitoring.”

Baby lobsters confiscated from a failed smuggling attempt. Image by Suryadi/Mongabay Indonesia.

Lobsters are among Indonesia’s top fisheries commodities, but the illegal export of larvae and baby lobsters cost the country 900 billion rupiah ($62 million) in lost revenue in 2019 alone, according to the PPATK, the government’s anti-money-laundering watchdog. The larvae are typically sold to buyers in Vietnam, Singapore and China, where they can be raised and sold when mature at much higher prices.

But fisheries experts and conservationists say the quota and requirements will not be enough to spur companies into investing in Indonesia’s lobster aquaculture sector, or to stop illegal lobster exports.

The fisheries ministry says the latest estimate of potential wild lobster stock in the country’s waters is 27 billion. But the National Commission for Fisheries Resources Research (Komnas Kajiskan) reported in 2016 that lobsters in six out of 11 fisheries management areas in Indonesia were overfished, while the rest were being harvested at maximum capacity.

With rumors circulating of an impending cabinet reshuffle, KIARA’s Susan said Edhy should be replaced as minister. She said Indonesia’s fisheries minister should be someone who prioritizes the interests of small and traditional fishers, who make up the bulk of the country’s fisheries industry.

“Edhy Prabowo no longer deserves to sit in the position of fisheries minister because he doesn’t work on behalf of the people’s interests, especially lobster fishers,” she said.

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