Indonesia’s new deregulation law to hurt small fishers, coastal communities

JAKARTA — When Indonesian lawmakers passed a hugely controversial deregulation bill on the evening of Oct. 5, Sulaiman was with his fellow fishermen who had just returned home from the Java Sea.

Sulaiman was dreading the decision that could change his life and those of 800,000 small fishers across Indonesia. Before the passage of the new legislation — known as the omnibus law but formally the Job Creation Act — small fishers were defined by the state as being those with boats of smaller than 10 gross tonnage (GT). That came with certain benefits, including being allowed to operate without a permit, free enrollment in the national health care program, access to fishing gear, and fuel subsidies.

With the passage of the omnibus law, however, the definition of small fishers has been discarded — one of more than 1,100 articles from 75 existing laws that have been overhauled in the government’s deregulation drive. For Sulaiman and his peers, that means the benefits and subsidies channeled toward poor often artisanal fishers will now be open to all, including the operators of large fleets.

“With the implementation of the Job Creation Act in Indonesia, small and traditional fishers will be the first that stand to lose,” Sulaiman told Mongabay on Oct. 13.

Mongabay has reviewed the changes in the Job Creation Act, comparing them with the existing laws they overwrite, and consulted with legal, fisheries and environmental experts. All agree that these changes will hurt the livelihoods of small and traditional fishers and potentially clear the way to overfishing of Indonesia’s waters, with foreign fishing fleets standing to benefit the most. The experts say the new law also threatens the degradation of Indonesia’s coastal and marine ecosystems for the sake of infrastructure development and tourism.

Small fishers

Sulaiman, now 38, has been a fisherman since 1998, right after graduating from middle school. He learned the skills from his parents. They live together on Pari Island, part of a clutch of islets off the coast of Jakarta, Indonesia’s capital.

Sulaiman fishes for mackerel tuna every day, selling most of what he catches at the local market and bringing the rest home. Small and tradition fishers like Sulaiman today account for the majority of Indonesia’s fishing fleet, operating a combined 650,000 boats across the archipelago. But they also constitute one of the poorest professions in the country.

“Only a few voice the interests of small fishers. Meanwhile, we catch the fish that feeds the workers and laborers,” Sulaiman said.

Under the new law, small fishers are no longer defined by the size of their boat. Experts say this is problematic because fishers with bigger boats and more capital can now claim to be a small fisher to obtain the associated benefits.

“The definition of small fisher is very important because it’s connected to exemptions for several requirements and for punishments, and to giving incentives and facilities from the government,” said Stephanie Juwana, a co-founder and director of international engagement and policy reform at the think tank Indonesia Ocean Justice and Initiative (IOJI).

“At the end, such an opaque formula will create riders that cause injustice for the real small fishers,” she added.

The omnibus law also opens the door to an old scourge of Indonesia’s fisheries sector: foreign fishing vessels. In November 2014, Indonesia enacted a ban on these boats in its waters, blaming them for poaching and nearly depleting the country’s fish stocks to unsustainable levels. That ban has been credited with the recovery in fish stocks since then, according to a 2018 study.

But the omnibus law will allow foreign fishers back in — with even less onerous operating requirements than before the ban: Foreign fishing vessel operators will only need to apply for a single permit from the central government and will no longer have to maintain a 70% crew quota for Indonesian nationals.

“The reopening of access to catching fish by foreign vessels in Indonesian territorial waters can worsen its fish stock as some fishing grounds in Indonesia are still overexploited,” Stephanie said.

IOJI said Indonesian fisheries have long been dominated by big corporations funded by foreign investors, operating under a regime of weak compliance, monitoring and law enforcement before the ban on foreign fishers. Besides poaching, IOJI said, the foreign fishing vessels operating in the region tend to also be associated with other crimes, including human trafficking, slavery at sea, and shark-finning.

“IOJI stresses that … giving concession or permit to foreign fishing vessels in territorial waters is a very ill-advised policy,” Stephanie said.

The new law also eliminates the National Commission for Fish Resources Study (Komnasjiskan) which was tasked to ensure sustainable levels of catch, based on scientific assessments. IOJI said Indonesia’s efforts to achieve its sustainable development goals in the fisheries sector would be stifled without the agency.

“Recommendations from the independent scientific community are very important to control the discretionary authority of the [fisheries] minister in his position as a political appointee,” Stephanie said.

Coastal ecosystems

On Pari Island, where Sulaiman lives, fishers have in recent years been fighting against property development and marine pollution. In April 2019, the residents shut down a dredging operation that was scooping up sand for a nearby “floating villa” project. This past August, the island’s southern coast was covered in an oil slick that was thought to have come from an oil tanker or a nearby offshore rig.

The omnibus bill could aggravate that imbalance of development over ecosystem conservation. Among other points, it waives permit requirements for developers, distilling what’s currently a series of licenses from various government institutions and agencies to just a single business license from the central government. The central government now also gets a bigger influence in the zoning plans of coastal areas, small islands and marine conservation zones.

The law opens up coastal and marine areas for mineral and coal mining, geothermal exploitation, the development of artificial islands through land reclamation, and waste dumping. It also relinquishes coastal development projects funded by foreign investors from the obligation of “prioritizing national interests.” The new law also reduces public participation in drawing up environmental impact assessments, locally known as Amdal, limiting the groups who can have a say to just those “directly affected” by the proposed project. That means feedback from environmental experts and activists or people living outside the project’s concession will likely be ignored in the EIA process.

“Environmental impacts cannot be kept localized,” Khalisah Khalid, political coordinator at the Indonesian Forum for the Environment (Walhi), the country’s biggest green NGO, said in a recent online seminar. “Environmental safeguards are often considered as obstacles by bad investors. That’s why reducing these environmental safeguards” was adopted in the omnibus law.

Khalisah said some of the projects that will benefit most from the new law are those labeled as “nationally strategic,” including a government program to develop 10 tourism destinations to rival Bali; land reclamation projects such as Jakarta’s Giant Sea Wall; and coastal coal-fired power plants across the country.

“The thing is that many of these nationally strategic projects violate people’s rights and disregard the carrying capacity of the ecosystem they are located in,” Khalisah said.

For Sulaiman the fisherman, the changes that the Job Creation Act brings to coastal development are very worrying for the future of his home on Pari Island, which the government has identified as a nationally strategic area. Just a short boat ride from Jakarta, Pari and its neighboring islands have long been touted as prime tourism real estate.

“The kind of tourism that’s backed by the government obviously targets the middle and upper market,” Sulaiman said. “That means that the small-scale tourism run by the local people of Pari Island will be crushed. Eventually, the fishers of Pari Island will also be gone.”

‘Illegitimate law’

The passage of the Job Creation Act prompted violent nationwide protests by labor unions, university students and religious conservatives, who have called for it to be annulled. Fishers, maritime activists and legal experts have echoed that call, saying the new law is a systematic effort to benefit political and business oligarchs under the guise of economic growth.

“With the passage of the Job Creation Act, we are looking at ecological apocalypse,” said Susan Herawati, the general secretary of the People’s Coalition for Fisheries Justice, an NGO.

“Opposition to the law isn’t only coming from laborers and students, but also coastal and small island communities, because we don’t see any good intention in it to empower the livelihoods of fishers,” she said.

But Indonesia’s fisheries minister, Edhy Prabowo, praised the new law, saying that fishers would no longer fear criminalization, and that the law would make his own job easier.

“The omnibus law mostly protects businesses from large to small,” Edhy said at a press conference Oct. 7.

Critics of the new law also point to the lack of transparency in the legislative process and potentially criminal conduct by lawmakers, after substantial changes appeared in drafts that circulated after the bill was passed. At least four “final” versions of the Job Creation Act have come out since the Oct. 5 passage, with the longest one clocking in at 1,035 pages and the shortest at 812 — a difference of more than 200 pages. Most laws passed by parliament run about 100 pages. There are substantial differences between the versions, with entire articles omitted from some.

Parliament has dismissed claims it has been making changes to the substance of the legislation, attributing the apparent differences in the lengths of the various versions to formatting changes.

“This violation to the formal process of making the law makes it illegitimate,” Atip Latiful Hayat, a law professor at Padjajaran University, said in an online seminar. He said many experts have labeled the omnibus bill anti-democratic.

“I urge the government to prioritize more the public’s aspirations, and to annul the omnibus law,” he added.

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