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Foreign capital, blamed for depleting Indonesia’s fish stocks, is set to return

  • The Indonesian government has drafted a new regulation to allow foreign investment back into the capture fisheries sector.
  • Marine observers warn this could lead to the return of rampant illegal and destructive fishing by foreign vessels and foreign-funded entities in the country’s waters.
  • Former fisheries minister Susi Pudjiastuti banned all foreign involvement in Indonesia’s capture fisheries in 2016 to protect the country’s fish stocks.
  • Indonesia is the second-largest fish producer in the world and home to one of the highest levels of marine biodiversity.

JAKARTA — The Indonesian government plans to reopen its capture fisheries sector to foreign investment, prompting concerns among marine observers about a return to the rampant illegal fishing practices that previously depleted the country’s fish stocks.

The fisheries ministry has drafted a regulation that, among other things, will welcome back foreign investment in Indonesian companies that catch marine fish. The country’s capture fisheries sector, which serves both the domestic and export markets, has since 2016 excluded from foreign investment in an effort by then-minister Susi Pudjiastuti to tackle illegal, unreported and unregulated (IUU) fishing by foreign vessels in Indonesian waters.

The proposed regulation will allow foreign-funded Indonesian companies to catch fish in seven of the country’s 11 fisheries management areas, or WPP, for 15 years. The fisheries ministry says that despite the foreign investment, Indonesian entities will retain organizational and operational control of capture fisheries in the country’s waters, including all vessels being Indonesian flagged. The ministry will also regulate these companies’ catch quota, vessel size, fishing gear, landing ports, and live fish carriers.

“So no foreign company is coming in to catch fish, it’s still Indonesian legal entities,” Muhammad Zaini, the ministry’s director-general of capture fisheries, said in a press statement. “If the capital is owned by [foreign investors], that’s still fair, but no foreign vessel is entering Indonesia.”

Despite the planned return of foreign capital, the Indonesian government says Indonesian entities will retain organizational and operational control of capture fisheries. Image courtesy of the Indonesian Ministry of Marine Affairs and Fisheries.

The plan, however, has raised concerns among marine observers that it could potentially bring back IUU fishing by foreigners, which was largely blamed for depleting the country’s fish stocks to unsustainable levels. In 2015, the fisheries ministry under Susi published an evaluation of capture fisheries by foreign companies and vessels from 2000-2014, and found that most of their practices were illegal and destructive, and rife with human rights abuses and human trafficking.

The study also found mounting cases of transshipment, where catches are transferred to storage ships mid-sea rather than being brought to port — a practice that, while not illegal, is often indicative of underreporting and laundering of catches. During this period, the evaluation showed, compliance with Indonesian fishing regulations by foreign fishers was extremely low, while monitoring was difficult to carry out. Globally, IUU fishing is estimated to cost countries $10 billion to $23.5 billion annually.

“The planned policy to allow foreign investment and foreign companies to receive an agreement in utilizing fish resources in Indonesian waters must be taken prudently and must be reviewed,” the Indonesia Ocean Justice Initiative (IOJI), a think tank, wrote in a recently published report.

IOJI said Indonesian fishing authorities were still incapable of carrying out optimal monitoring of fishing vessels in the country’s waters, citing inadequate operational capacity, a dearth of patrol boats, and ineffective coordination between marine law enforcement authorities.

IOJI suggested that to boost state revenue from the capture fisheries sector, the Indonesian government should optimize the role of state-owned fisheries enterprises and improve the quality of fish landing data and reports, rather than allow foreign capital back in.

Fish at a market in Labuan Bajo, Indonesia. Image by Rhett A. Butler/Mongabay.

Indonesia, the second-largest fish producer in the world and home to one of the highest levels of marine biodiversity, produced 5.9 million metric tons of seafood from wild capture fisheries in 2015. In 2016, the National Commission for Fisheries Resources Research (Komnas Kajiskan), a government-funded body, reported that Indonesia’s fishing zones were either over- or fully exploited.

By 2018, however, official estimates for the country’s total fish stocks showed a 5% increase from the previous two years, which fisheries experts largely attributed to Susi’s efforts to keep illegal foreign fishing boats out of the country’s waters.

Indonesia’s wild capture fisheries employ around 2.7 million workers; the majority of Indonesian fishers are small-scale operators, with vessels under 10 gross tons (GT). Under the business-as-usual scenario, capture fisheries is projected to expand at an annual rate of 2.1% from 2012 to 2030.

“The plan to allow foreign investment and foreign companies in utilizing fish resources must be balanced with the intensification of monitoring across Indonesia’s regional fisheries managements,” IOJI said.

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