FI:TCP/INS/4553

TECHNICAL COOP RATION PROGRAMM

Strengthening Marine Fisheries Development In Indonesia Final Report

Food and Agriculture Organization of the United Nations Rome, 1996 s: )> "'0 ,0 z 0 0z m (f) -)> LIST OF ACRONYMS AND AB REVIATI NS

AAET Agency for Agricultural Education and Training AARD Agency for Agricultural Research and Development A SEAN Association of South East Asian Nations BAKORKAMLA Badan Koordinasi Keamanan Laut (Marine Security Coordinating Board) BKPI Balai Keterampilan Penangkapan lkan (Fishing Technology Training Centre) BBPT Bad an Pengkajian dan Penerapan T eknologi (Agency for the Assessment and Application of Technology) BPPL Balai Penelitian Perikanan Laut (Research Institute for Marine Fisheries) CPUE Catch Per Unit Effort CRIFI Central Research Institute for Fisheries DAN IDA Danish International Development Agency DGF Directorate General of Fisheries EEZ Exclusive Economic Zone EU European Union FAO Food and Agriculture Organization FFA Forum Fisheries Agency GAPPINDO Gabungan Pengusaha Perikanan Indonesia (Indonesian Fisheries Enterprise Federation) HNSI Himpunan Nelayan Seluruh Indonesia (Indonesian Fishermen Union) IBRD International Bank for ReconstrL~ction and Development (World Bank) IRCS International Telecommunication Radio Call Sign LAN Lembaga Administrasi Negara (National Administrative Board) MSY Maximum Sustainable Yield PPI Pangkalan Pendaratan lkan (Fish Landing Place) PJP Pembangunan Jangka Panjang (Long Term Development Plan) REPELITA Rencana Pembangunan Lima T a hun (Five Years Development Plan) RICF Research Institute for Coastal Fisheries RIFF Research Institute for Freshwater Fisheries SlMKANNAS Sistem lnformasi Manajemen Perikanan Nasional (Fisheries Management Information System) STP Sekolah Tinggi Perikanan (Fisheries College)

ii SUPM Sekolah Usaha Perikanan Menengah (Senior Vocational High School) SUPP Sekolah Usaha Perikanan Pertama (Junior Vocational High School) TCP Technical Cooperation Programme UNCLOS United Nations Convention Law of the Sea UPMB Unit Pembinaan Modernisasi Bertahap (Gradual Modernization Unit) UPT Unit Pelaksana Teknis (T echnic;3l Implementation Unit)

CURRENCY EQUIVALENTS

(MAY 1996)

Currency Unit Equivalent

US$ 1.00 Rp. 2,330.00

Rp. 1.00 US$ 0.000429

111 LIST OF TABLES

Page Table 1.1 Fisheries Production by Year 1 Table 1.2 Fleet Structure, 1993 2 Table 1.3 Fishing Vessels in EEZ 3 Table 3.1 Summary of the Assessment made by the 1995 8 INDONESIAIFAO/ DANIDA Workshop Table 4.1 Details of Licensed Vessels 11 Table 4.2 Average Annual Catches by Vessel Type and Year 12 Table 4.3 MSY Figures Used for Allocating Fishing Effort 12 Table 4.4 Comparison of Expected Catches and MSY 14 Table 4.5 Information on Smaii-Pelagics 17 Table 4.6 MSY Information for Tuna 18 Table 4.7 Information on Fee Levels 21 Table 4.8 Violations of Indonesian Fisheries Regulations 24 Table 5.1 Estimated Foreign Longliner Replacement Costs 36 Table 6.1 Production of Fish by Species/Groups in Merauke, 1993-1994 40 Table 6.2 Number of Fishing Gear by Type in Merauke, 1994 41 Table 6.3 Disposition of Fish in Merauke, 1994 41 Table 7.1 Manpower in Fisheries Institutions, 1994 52 Table 7.2 Fisheries Extension Workers in 1994 53 Table 7.3 Manpower Strength (1996) - Research Institute for Marine Fisheries 54 Table 7.4 Manpower of Research Institute for Marine Fisheries by Educational Qualifications 54 Table 7.5 Distribution of Staff in DGF, 1995 58

IV Ll OF Fl U

Page Figure 4.1 Foreign Fleet Deployment, EEZ Fleet Composition, Composition of Foreign Fleet by Gear, EEZ Composition by Area 10

Figure 4.2 Comparison of Expected Catches with MSY 15

v TABLE OF CONTENTS

Page

Map of Indonesia

List of Acronyms and Abbreviations ii

Currency Equivalents iii

List of Tables iv

List of Figures v

Table of Contents vi

1.0 Introduction 1 1.1 The Importance of Fisheries in Indonesia 1 1 .2 Structure of Marine Fisheries 1

2.0TCP Project 4 2.1 Background 4 2.2 Objective, 5 2.3 Project Area 5 2.4 Activities 5 2.5 Organization 5 2.5.1 International Consultants 5 2.5.2 National Consultants 5 2.5.3 National Counterparts 6 2.6 Implementation 6

3.0Marine Fisheries Resources 7 3.1 Attempts at Resource Assessment 7 3.2 Recommended Resource Assessment 7

4.0Fisheries Management with Emphasis on the Exclusive Economic Zone 9 4.1 The EEZ Fisheries Situation 9 4.1.1 Historical Perspective of Fisheries Management in the EEZ 9 4.1 .2 The Present Situation 11 4.1.3 Catches in the EEZ 11 4.2 Considerations on Allocation of Access and Licenses Among Fleets in the EEZ According to Resource Distribution 11 4.2.1 The Present System 11

VI 4.2.2 Observations on the Present System 12 4.2.3 Suggestions for Improvement of the Present System 16 4.2.4 General Comments on Allocation of Licenses with Respect to Resources 16 4.2.4.1 Demersal fish 16 4.2.4.2 Small Pelagics 17 4.2.4.3 Skipjack and Other Large Tuna 18 4.2.4.4 Shrimp 19 4.2.5 Summary of Considerations on Allocations 19 4.3 Problems and Constraints of the Present Licensing System for Foreign Fleets 20 4.3.1 Localization of the EEZ Fleet 20 4.3.2 Considerations on the Fee Level 21 4.3.3 Administration of the Licensing System 22 4.4 Comments on Enforcement in the EEZ 22 4.5 Other Issues in EEZ Management 25 4.5.1 Observer Programmes 25 4.5.2 Data 26 4.5.3 Gear 27 4.5.4 Leniency with Foreign Fishing 27 4.6 Some Considerations on the Concept of Maximum Sustainable Yield 28 · 4.7 Fisheries Management Plans 29 4.8 Fisheries Research 29 4.9 General Comments on the Status of Fisheries Management 30 4.1 0 Recommendations on Fisheries Management 32

5.0Considerations on Fleet Development 34 5.1 Changing the economic conditions for Indonesian vessel construction 34 5.1.1 High costs and other disincentives 34 5.1.2 Shipbuilding capacity 35 5.1.3 Projected shipbuilding costs 35 5.2 Allowing the import of foreign vessels 37 5.3 Encouraging vessels from over-exploited fisheries to displace foreign vessels 37 5.4 Recommendations 38

6.0Development Of Small-Scale Fisheries In Merauke 39 6.1 Background 39 6.1.1 Location 39 6.1 .2 Status of Fisheries 39 6.1.3 Fishery Resources 39 6.1.4 Production 39 6.1.5 Fishing Fleet 40 6.1 .6 Fishing Gear 40 6.1.7 Post Harvest 41

Vll 6.1.8 Marketing 41 6.1. 9 Infrastructure Facilities 42 6.1.1 0 Human Resources/Fishermen 42 6.21ssues and Constraints 42 6.2.1 Issues 42 6.2.2 Constraints 42 6.2.2.1 Infrastructure 42 6.2.2.2. Marketing 43 6.2.2.3 Post Harvest 43 6.2.2.4. Fishing Vessels 43 6.2.2.5. Human Resources 43 6.3Conceptual Development Approach 43 6.3.1 Potential Project at Merauke 44 6.3.1.1 Infrastructure Requirements 45 6.3.1.1.1 Secondary Landing Centre 45 6.3.1.1.2 Main Centre 46 6.3.1.2 Marketing 47 6.3.1.3 Post Harvest 47 6.3.1.4 Fishing Vessels 48 6.3.1.5 Human Resources Development 48 6.4 Recommendations 48

7.0 Institutional Strengthening 50 7.1 Background 7 .1.1. Role and Function 50 7.1 .1.1 . Directorate General of Fisheries 50 7 .1.1 .2. Provincial Fisheries Service 50 7 .1.1.3. Central Research Institute for Fisheries 51 7.1.2. Manpower 52 7 .1.2.1. DGF and Provincial Fisheries Service 52 7 .1.2.2. Research Institute For Marine Fisheries 53 7 .1.3. Education and Training 54 7 .1.3.1. Agency for Agriculture Education and Training 54 7.1 :3.2. DGF and Provincial Fisheries Service 55 7 .1.3.3. Universities 55 7.2 Issues And Constraints 55 7 .2.1. Organization and Function 55 7 .2.1.1. Sectoral and Inter Sectoral Level 55 7.2.1.2. Directorate General of Fisheries 56 7.2 .1 .2 .1 Data and Statistics 56 7 .2.1.2.2 Fisheries Resources and Management 56 7 .2.1.2.3 Industrial Fisheries/Licensing 56 7 .2.1.2.4 Fishing Harbour 57 7.2.1.2.5 Fishing Vessel 57 7.2.1.2.6 Fish Marketing 57 7 .2.1.2.7 Post-Harvest 57 7 .2.1.2.8 Enforcement 57

viii 7.2.1.2.9 Manpower Strength 58 7 .2.1.3 Provincial Fisheries Service 59 7 .2.1.3.1 Organization 59 7.2.1.3.2 Manpower Strength 59 7 .2.1.4 Research Institute for Marine Fisheries 59 7.2.1.4.1. Organization 59 7 .2.1.4.2. Manpower Strength 59 7 .2.1.4.3 Facilities/Funds 60 7.2.1.5 Education and Training 60 7.3 Recommendations 60 7 .3.1 Directorate General of Fisheries 60 7.3.2 Provincial Fisheries Service 61 7.3.3. Research Institute for Marine Fisheries 62 7 .3.4 Education and Training 62

8.0 Conclusions 64

9.0 Future Directions 66

10.0 References 67

11.0 Diagrams 70

12.0 Appendix 76

lX 1 1. INTRODUCTION

1.1 The Importance of Fisheries in Indonesia Fisheries play an important role in the national economy of Indonesia contributing 3% to the gross domestic product of the country with an export earning of US$ 1.5 billion in 1993. Fish constitute the major protein consumed by the population, representing some 60% of the total animal protein intake in the country with a per capita consumption of 17.5 kg. The fisheries sector is also an important source of employment especially in the rural and coastal areas. Some 4.3 million people are estimated to be engaged in the sector with substantial additional employment in related industries.

The fisheries sector will continue to feature prominently in the economy of Indonesia as the country is one of the largest archipelagos in the world. It consists of more than 17,000 islands with an estimated 81,000 km of coastline and some 5.8 million sq.km of maritime waters. The vast maritime waters of Indonesia comprise 3.1 million sq.km of territorial and internal waters and 2.7 million sq.km of EEZ.

The growth of the fisheries sector over the last decade has been steady. The total production increased from 2,260,989 tonnes in 1984 to 3,795,332 tonnes in 1993 with an average annual growth of 5.9% (Table 1). The bulk of the production representing some 76% of the total is contributed by marine capture fisheries with aquaculture and open waters fishery contributing the remaining 16% and 8% respectively.

Table 1.1 Fisheries Production By Year Marine Inland Inland Year Capture Open Water Fisheries Tot a I Fisheries Fisheries _{_Aquaculture) 1984 1,712,804 269,321 278,864 2,260,989 1985 1,821 ,725 269,266 304,571 2,395,562 1986 1,922,781 273,012 334,097 2,529,890 1987 2,017,350 276,291 376,772 2,670,413 1988 2,169,557 281,264 430,348 2,881,169 1989 2,272,179 296,385 466,704 3,035,268 1990 2,370,107 292,537 499,825 3,162,469 1991 2,537,612 294,477 517,512 3,349,601 1992 2,692,068 300,896 550,368 3,543,332 1993 2,886,289 308,649 600,384 3,795,322 Un1t: tonnes

1-.2 Structure of Marine Fisheries The marine capture fisheries, which is the backbone of the fisheries sector, is dominated by the small-scale fisheries making up 98% of the sector. In 1993, there were 1.9 million fishermen using about 389,000 fishing vessels and a large variety of gears. The fishing vessels are mainly made of wood and small in size. Of these, about 64% are dugouts and sampans which are nonpowered, 21% powered with outboard engine and the remaining 15% equipped with inboard engines (Table 2). The majority of fishing vessels with inboard 2 engine are also small, of which 89% are below 10 GT, 7% 10-30 GT and 4% above 30 GT. The variety of fishing gears used ranges from traditional ones like cast nets and scoop nets to advanced ones like purse seines and tuna long lines. These are classified into 10 major gear groups as follows: shrimp net with by-catch extruder device (BED), seine net, purse seine, gill nets, lift net, hooks and lines, traps, shellfish and seaweed collection, muroami and others.

Table 1.2 1993 Fleet Structure Type/Class Power No. of Units Dugout canoes no 123,760 Plank Boats -Small no 73,452 -Medium no 41,822 -Large no 8,711 Outboard Powered Boats outboard 82,217 less than 5 GT inboard 43,396 5 - 10 GT inboard 9,791 10- 20 GT inboard 2,812 10- 30 GT inboard 1,558 30- 50 GT inboard 1,170 50- 100 GT inboard 351 --- 100-200 GT inboard 213 more than 200 GT inboard 245 Tot a I 389,498

In addition, there is an industrial fleet operating in the EEZ. The number of vessels grew to a peak of 3,072 in 1993 but declined subsequently to 2,387 in 1995. Of the 2,387 industrial vessels in the EEZ, 1,450 are Indonesian and 937 foreign flag (Table 3). The areas of operation are in the Indonesian EEZ waters of the South China Sea, Arafura Sea, Pacific Ocean, Sulawesi Sea, Indian Ocean and the Strait of Malaka. Fishing gears used by these vessels are long line, pole and line, purse seine, gill net and pukat ikan (trawl). 3

T a bl e 1 3 F'IS h"mg V esse I s m. EEZ Year Indonesian Foreign Total 1986 315 79 394 1987 362 323 685 1988 595 922 1,517 1989 931 598 1,529 1990 1,404 654 2,058 1991 1,612 933 2,545 1992 1,459 1,378 2,837 1993 2,127 945 3,072 1994 1,661 1,032 2,693 1995 1,450 937 2,387

The fishing harbours in Indonesia are classified into 3 major types based on their facilities. They are the Oceanic (Type A) Fishing Harbours for fishing activities in the EEZ of Indonesia and international waters; the Archipelagic/Inter Island (Type B) Harbours for activities in the EEZ waters; and Coastal Fishing Harbours (Type C) for supporting fishing activities in the coastal waters. There are a total of 28 fishing harbours comprising 2 oceanic (Jakarta and Kendari), 7 archipelagic (3 in Sumatera and 4 in Java) and 19 coastal ones (16 in western and 3 only in eastern Indonesia). In addition, there are some 560 fish landing places for local fishing activities spread across the country.

The other supporting infrastructure facilities include some 400 ice plants (production capacity of 7,000 tonnes/day), 198 cold stores (freezing capacity of 1050 tonnes/day) and 68 canneries (production capacity of 638,760 tonnes/year). Shipbuilding is also an important component. There are some 142 shipbuilding yards with only 24 yards having the capacity to build fishing vessels over 30 GT.

Fish is consumed mostly in the fresh and preserved form by the local population while those for exports are mostly frozen. The major consumption centres of fish in Indonesia are Java and Bali where the majority, about 62 % of the population reside. The production in these areas are insufficient to meet the demand whereas in the other areas, such as the eastern part of Indonesia, there is a surplus. The distribution of fish is however constrained by the high costs of marketing and transport. As a consequence, a fairly large quantity of the fish landed (amounting to 40%) are processed by traditional means like boiling, salting and drying for domestic consumption. 4 2. TCP PROJECT

2.1 Background The growth of the fisheries sector in the First Long Term Development Plan ( 1968 - 1993) PJP I has been impressive. This was achieved through a programme directed at increasing production by: (i) upgrading extension services, skill and training of fishermen; (ii) devel­ opment and expansion of extension infrastructure facilities; (iii) development of package technology; (iv) development and expansion of production infrastructure; (v) development of post-harvest and marketing activities, and (vi) development of fisheries infrastructure.

During the last decade, production from the marine capture fisheries increased from 1,713,000 tonnes in 1984 to 2,886,000 tonnes in 1993, giving an average annual growth of 7.6% (Table 1 ). The per capita consumption of fish also increased from 13.8 kg to 17.5 kg over the same period. Similarly the export and earnings of fisheries products rose rapidly from 75,695 tonnes valued at US$ 248 million in 1984 to 529,213 tonnes valued at US$ 1.5 billion in 1993.

Continuing on the developments in PJP I, the Second Long Term Development Plan of 25 years P JP II (1994 - 2019) was formulated basbd on estimates of a marine fishery resources potential of 6.6 million tonnes The objective of development in Repelita VI (1994 - 1998), the first Five Year Development Plan of PJP II, are as follows: 1. Upgrade the quality of human resources and incomes in the fisheries sector by optimizing the exploitation of natural resources through the application of knowledge and technologies which give due consideration to the environment and growth of production; 2. Increase the availability and distribution of seafood as well as improving its quality and nutritional value; 3. Generate employment and business opportunities which are productive; 4. Encourage the growth of domestic industries through the processing of raw material to increase the added value of fisheries production; and 5. Gain foreign exchange earnings from fisheries exports.

The targets of development in Repelita VI are: ·1. Increase the per capita consumption of fish by an average growth of 2.4% per annum from 17.46 kg in 1994 to 19.20 kg in 1998; 2. Increase export of fisheries products at the rate of 9. 7% per year from 553,000 tonnes valued at US$ 1.475 billion in 1994 to 800,000 tonnes valued at US$ 2.134 billion in 1998; 3. Basing on the targets of fish consumption and exports, the total production of fish is projected to increase from 3.783 million tonnes in 1994 to 4.587 million tonnes in 1998 at an annual average rate of growth of 4. 9%. Of this, the contributions from the marine capture fisheries are expected to increase from 2.645 million tonnes in 1994 to 3.153 million tonnes in 1998 with a growth rate of 4.5% per year; 4. The fishing fleet for the marine capture fisheries is also projected to increase by another 19,861 vessels of various categories to meet the expansion needs of the sub-sector. In addition, there is also a plan to expand the fishing fleet in the EEZ area by a further 3,446 vessels.

Prior a large scale investment, the Indonesian Government felt that there is a need to ascertain the potential of the marine fisheries resources in the light of more recent studies. 5

This gave rise to the present project which is to re-examine the state of marine fisheries, particularly in the EEZ area, and set the stage for its development in a sustainable manner.

2.2 Objective The main objective of the project is to enable the Government of Indonesia formulate key strategies for strengthening marine fisheries development and management in the country. More specifically, the project will : 1. reappraise the potential of marine resources, strengthen the management approaches and systems and determine the appropriate composition of fishing fleet in order to ensure sustainable development; 2. carry out studies to enhance the capability of the shipbuilding industry, to develop/rehabilitate physical infrastructure in priority areas and to improve the delivery of basic support services to the private sector and fishermen; 3. review the current human resources development policy and approaches of fisheries institutions and propose improved mechanisms and programmes.

2.3 Project Area Marine fisheries resources, fisheries management and fishing vessels were studied at the macro level throughout Indonesia, but emphasis was placed on the EEZ. At the micro or sub-project level on development in eastern Indonesia, the project was site specific. In this regard DGF proposed two potential sites for development namely Bacan in Maluku and Merauke in Irian Jaya. The latter was eventually selected due to its better potential for development.

2.4 Activities The project activities at the macro level covered an appraisal of the marine fisheries resources, its exploitation and management particularly in the EEZ, the fleet structure including the shipbuilding industry, fisheries statistics and information and strengthening of the key institutions involved in fisheries. At the sub-project level, the activities covered fishery infrastructure and support services in marketing, post-harvest handling and processing.

2.5 Organization The project was based at the Directorate General of Fisheries in Jakarta with furnished office and counterpart support. The project team was composed of both international and national consultants in the various fields as follows :

2.5.1 International Consultants 1. Tan Cheng Kiat, Senior Fishery Adviser/Team Leader (6 w/m) 2. Robert Gillett, Fishery Resources Management Expert (4 w/m) 3. Michael Shawyer, Fishing Vessel Expert (2 w/m) 4. Joseph Sciortino, Fishing Harbour Engineering Expert (2 w/m)

2.5.2 National Consultants 1. Badrudin, Stock Assessment Expert (3 w/m) 2. Slamet Prayitno, Marketing Expert (2 w/m) 3. Sunarya, Fish Processing and Quality Control Expert (2 w/m) 6

2.5.3 National Counterparts In addition, the following DGF staff were also assigned to the project as counterpart personnel: Name CounterpartlRole Enni Soetopo Overall Coordination Chief, Sub-Directorate Programme Cooperation

Ketut Widana Resource Management Chief, Sub-Directorate Marine Fisheries Management

Ahmad Farid Fishing Vessels Chief, Sub-Directorate Fishing Vessel

Lasma Tambunan Marketing and Processing Chief, Sub-Directorate Small-Scale Fisheries

Martin Batubara Fishing Harbours Chief, Sub-Directorate Fishing Harbour

Saut P. Hutagalung Resource Personnel Chief, Section Programme/ Project Preparation

The project also recruited Yulianto to serve as the bilingual secretary.

2.6 Implementation The duration of the project covered a period of one year. It started with the arrival of the Team Leader in July 1995 to organize the project and prepare the Inception Report. This was followed by the mission of the Fishery Resource Management Expert and Stock Assessment Specialist in September/October. The Team Leader returned in December to participate in a national workshop and report on activities to date in the Interim/Progress Report. The final mission with the full team present was from March to April 1996, which culminated in the organization of a workshop on 23 April to present the findings and recommendations of the TCP Project. Subsequent to this, the draft Final Report was prepared and submitted at the end of May 1996. 7 3.0 MARINE FISHERIES RESOURCES

The marine fisheries resources of the vast Indonesian area are comprised of a large number of species, with the fish fauna of the country generally recognized to be taxonomically the most diverse in the world. For large-scale stock assessment purposes, the marine resources are usually grouped in seven or less categories: shrimp, small pelagic fish, demersal fish, skipjack, other large tuna, squid, and fish associated with coral reefs. Various attempts have been made recently to determine the magnitude of these resources.

3.1 Attempts at Resource Assessment In the late 1980s a cooperative project between the Directorate General of Fisheries (DGF) and the Central Research Institute for Fisheries (CRIFI) reviewed Indonesia's marine resource potential. This resulted in a publication (Martosubroto et al., 1991) which is still used extensively today. In 1994 the DGF did further work on these estimates which culminated in an approximation of the number of vessels required to fully exploit the remaining potential. In early 1995 the lndonesia/FAO/DANIDA Workshop on the Assessment of the Potential of the Marine Fishery Resources in Indonesia reviewed all available information and, with input from 28 Indonesian and overseas researchers, produced new assessments (Venema 1996). These are summarized in Table 3.1

During the research for the present project, which focuses to some degree on the resources of the extended economic zone (EEZ), it became apparent that the DGF makes use of EEZ resource estimates from the early 1980s (Anon 1983). The potential estimates presently used for management by DGF appear to be a combination of the 1981 report and that produced in 1991.

Although it is recognized that many individuals had input into the various assessments above, for the purpose of simplicity and clarity the Martosubroto et al. (1991), Anon (1983), lndonesia/FAO/DANIDA estimates are referred to in the present report as Martosubroto, DGF 1995, and FAO 1995.

It is not possible to make a strict comparison of the results of the various assessments because the species groups, boundaries, and areas included are not uniform. Although it is not the intention of the present study to dwell on the differences, it should be pointed out there are major discrepancies in the estimates for small pelagics and demersal fish.

3.2 Recommended Resource Assessment As part of the work programme of the present project, an Indonesian stock assessment specialist with a long historical involvement in fisheries research in the country scrutinized the above estimates. The resulting paper (Badrudin 1996) essentially supports the assessments made during the 1995 FAO workshop. Because the workshop built on previous work, corrected weakness, and considered new data, unless there is strong scientific rationale to the contrary, it is recommended that DGF should use the 1995 FAO estimates. 8

Table 3.1 Summary of the Assessments Made by the 1995 lndonesia/FAO/DANIDA Workshop

Region Area Penaeid Demersal Small Pelagic Shrimp Fish Fish (all species) Indian Ocean West of 3.7 78.7 176 Sumatra South of Java 5.4 18.6 48 Bail and Nus a 1.1 67.8 106 Tenggara Sunda Shelf Malacca 19.8 101.1 206 -- Straight South China 21.7 251 504 Sea Java Sea 23.4 199.4 444 (including adjacent shelf area in Makassar Straight) Eastern Makassar 6.5 69.5 215 Indonesia Straight and Flores Sea Banda Sea - - 76 Seram Sea, - 50.2 71 Maluku Sea, Gulf of Tomini Arafura Sea 14.7 131.0 386 Celebes Sea - - 44 Pacific Ocean - - 25 Total 96.3 967.3 2,301

Units: 1 ,CU)s of metric tonnes Source: Venema (1996) 9 4.0 FISHERIES MANAGEMENT WITH EMPHASIS ON THE EXCLUSIVE ECONOMIC ZONE

4.1 The EEZ Fisheries Situation

4.1.1 Historical Perspective of Fisheries Management in the EEZ Indonesia acquired an exclusive economic zone (EEZ) in March 1980 by a government declaration which was subsequently replaced by Law No.5 of 1983 on the Indonesian Exclusive Economic Zone. The EEZ is defined as the area extending 200 miles offshore from the territorial waters except in the case where it overlaps that of neighbouring countries in which case the boundary is to be fixed by international treaty. The main Indonesian EEZ areas are the Arafura Sea, Indian Ocean, Pacific Ocean, Sulawesi Sea, and the South China Sea1.

A large number of vessels from mainly Taiwan, Thailand, and the Philippines exploit several categories of marine resources using four general types of gear. Figure 4.1 summarizes the EEZ fleet operations in the past decade. In general terms it can be seen that: 1. The change in size of the fleet in recent years is due largely to fluctuations in the numbers of Indonesian vessels rather than foreign vessels 2. Progress has been slow in the localization of the EEZ fisheries 3. The size of the Indonesian fleet peaked in 1993/94 4. The foreign fleet's largest component is longliners whose numbers increased remarkably in the late 1980s 5. Much of the foreign fleet activity is in the Indian Ocean 6. There has been considerable variability in the foreign fishing in the South China Sea

In many cases, foreign fishing in Indonesia represents the export of excess fishing capacity from the flag state of the vessel (e.g. Thai trawlers or Filipino purse seiners). Alternatively, some types of vessels are attracted to Indonesia by the relatively cheap labour as in the longline fisheries. Other vessels are in the zone because of diminishing opportunities in other areas, such as the Australian portion of the Arafura Sea being closed to foreign fishing vessels since 1990. There is also the possibility that some vessels are now based in Indonesia after being banned in most other areas (e.g. drift net vessels).

1 /\I though the Straights of Malaka is sometimes considered along with the muin EEZ arcus, it is not specifically dealt with in the report due to its small size and absence of authorized foreign fishing. c c .ill .ill (fJ c (fJ c .!2> ~ .Ql ~ Q) 0 Q) 0 0 ""0 LL J;; &~ II D 1111 D

eas '--'-;...;..;.'"'-'-~-i BU!4 8 s:: 0 \P 'VI 0 Olj! c. OEdfEjnS E 8 ..... (}) (}) u: UB!PUI 1:1:1 Ill

SlaSSa}\'ON Slassa}\'ON

u ro [!! 't "Qj c u J:: (fJ ro ro ~ Q) -~ Q) c (j; ~ .r:. .r:. ~ ~ ~ (fJ .I!! 0 ro 8 Q) B LL 0 0 ~ _J :s c 3: .r:. 1!1 D D D .... .ill ..!ll :5 1!1 ~ ""0 :J 0 <( J;; (/) (/) 0 0 ti D ... 966~ (}) 966~ (!)"' v66~ >...... Q s:: v66~ (}) .... £66~ E (}) >. (}) 0 £66~ u: c.. s:: 066~ Cl ~- 066~ ..... ~ ~66~ (}) 0 ~66~ u. ~ .... u. 0 066~ s:: 066~ s:: Cl 0 ~ \P 686~ 0 'VI 686~ 0 u. c. E 886~ 886~ 0 (.)

8L6~ L86~

986~ 986~ 0 0 0 0 0 0 0 0 0 8 8 8 8 8 8 0 0 ~ ~ 8 co c.o '<:t N '<:t ~ 0 co g '<:t ~

Slassa}\'ON SlaSSa}\'ON 12

Table 4.2 Average Annual Catches by Vessel Type and Gear Tonnage Gill Net Fish Net Long line Single Multi Squid Purse Seine Purse Seine Jigging 60 -100 133 511 70 153 225 32 100 -150 220 836 125 244 440 41 150-200 312 1116 160 359 460 50 200- 300 520 1797 220 598 705 63 300-400 757 2364 301 871 968 90 400-600 788 3264 376 906 1430 121 600-800 868 4243 448 998 1710 186 Unit: tonnes

The MSY figures presently used for allocating fishing effort in the EEZ are:

T a bl e 4 3 MSY F'1gures Use d F or All ocaf mg F'IS h'tng Eff0 rt Species Group Arafura S.China Sea Sula/Pac Indian Ocean Small Pelagics 200,000 382,031 251,000 326,700 Demersal 230,400 191,731 0 134 Skipjack 160,000 0 73,584 15,300 (includes tongkol) Tuna 0 0 43,915 32,000 Shrimp 14,000 0 0 0 Untt=tonnes

4.2.2 Observations on the Present System To determine the relationship in the present system between licensing and resource distribution, an attempt was made by the TCP Project to compare likely annual catches of the fleets to the DGF MSY in the various EEZ areas. To do so, the numbers of the various types of vessels licensed categorized by gear type, by vessel size, and by EEZ area was obtained from the Industrial Fisheries Sub-Directorate. These DGF license numbers were multiplied by the above DGF estimates of annual catches2 to obtain "expected catches" which were then compared to the DGF MSY levels. The results are given in Table 4.4.

Leaving aside temporarily the question of the validity of the DGF assumptions (MSY, annual catches), a number of features are apparent from the table. These include: 1. Demersal fish: expected catches substantially over the MSY in the Arafura (Figure 4.2) 2. Small pelagics: substantial biological potential for expansion of catches in most EEZ areas (Figure 4.2) 3. Large tunas: in some areas expected catches exceed MSY, in other areas the reverse occurs 4. Skipjack: expected catches are less than the 1995 DGF MSY in all areas

The above examination of the DGF system for licensing vessels for EEZ fishing suggests that additional attention should be paid to the resource situation to safeguard its sustainability. Although the system is nominatively based on resource availability, the outcome is somewhat different.

2 1\ number of e~timations had to be made including catches of vessel~ in the 30 to 60 tonnes class, catches of shrimp net vessels, and catches of pole/line vessel~ 13

Certain aspects of the above methodology deserve closer attention. It should be noted that for the critical demersal fisheries in the Arafura and South China Sea, the excess of the expected catch over MSY would increase significantly if the more recent Martosubroto or 1995 FAO estimates of MSY were used3 . The total amount of expected catch over MSY further increases due to any unauthorized foreign and Indonesian fishing and any fishing in the EEZ by vessels smaller than 30 GT which are licensed by the provinces.

3 It should be noted, however, that the areas covered by the estimates are not the same. 14

Table 4.4 Comparison of Expected Catches and MSY Expected catch = (No. Licensed vessels in each size category) X (expected annual catch) Expected Indonesian Expected Expected Total DGF EEZ Fleet Catch Authorized EEZFieet Catch MSY Foreign Fleet Catch Arafura Pole/Line 0 0 0 (see gill net below) Long line 0 0 0 0 Purse Seine 0 0 0 200,000 (small pel~gicsl Gill Net 21,661 4,588 26,249 160,000 (large pelagics) (SJ, Tongkol} Fish Net 146,868 299,603 446,471 230,400 (demersal fish} Shrimp Net 938 (only shrimp 0 938 (only shrimp 14,000 vessels) vessels) Sulawesi Pole/Line( skipjack, 26,300 0 26,300 see p/s Pacific some juvenile large below tuna) Longline 2,215 7,288 9,503 43,915 (large tuna) Purse Seine 10,717 15,026 25,743 73,584 (skipjack, some (plus 26,300 p/1 skipjack juvenile large tuna) catch from above)= 52,043 Purse seine 0 0 0 0 (small pelagicsj Gill Net 1,346 2,577 3,923 ? Fish Net 0 11,217 11,217 0 (demersal fish) Indian Pole/Line 0 0 0 (see purse Ocean seine bel owl Long line 37,900 19,645 57,545 32,000 Purse Seine 859 2,392 3,251 15,300 (skipjack, some skipjack juvenile large tuna) Purse seine 0 0 0 326,700 (small pelagics) Gill Net 480 3,120 3,600 ? Fish Net 0 0 0 134,000 (demersal fish) Shrimp Net 0 0 0 0 S. China Pole/Line 0 0 0 0 Sea Longline 50 0 50 0 Purse Seine 22,174 1,565 23,739 382,031 (small pelagics) small pelagics Gill Net 3,837 2,527 6,364 ? Fish Net 148,787 49,784 198,571 191,731 (demersal fish) Shrimp Net 0 0 0 0 Total 424,132 419,332 Un1t: tonnes 15

Demersal Fish

Vl ()) c:: lli!l Projected Catch c:: .£ lli!lDGFMSY

Arafura S.China Sea Sula/Pac

Figure 4.2 Comparison of Expected Catches with MSY

Small Pelagics

400000

350000

300000

250000 Vl ()) I! Projected Catch c:: 200000 c:: .£ 1<1 DGF 1995 MSY 150000

100000 50000

0 Arafura S.China Sea 16

The table of annual catches is an important component of the license allocation system. It is a useful tool that could be even more useful if improvements are made to correct certain deficiencies. These include: 1. Although there were 1250 vessels in the 30 to 60 GT category licensed to fish in 1995, this size category is not covered by the table. 2. The accuracy of the table is critical but it was not possible to gauge this aspect during the TCP Project. A very limited amount of anecdotal information, however, suggests that for at least one gear type (group tuna purse seiners) there is a substantial under­ estimate of the average annual catch. 3. The catches of shrimp net vessels and pole/line vessels are not covered. 4. It may not be reasonable that a single estimate would be accurate in all the EEZ areas of Indonesia. For example, the annual catches of a 200 GT gill net vessel may vary considerably between the South Pacific and the Arafura. 5. A particular gear type may make large catches of non-target species groups which is not readily apparent from the table. For example, it appears as though fish net vessels actually catch more shrimp than shrimp net vessels. 6. The "gill net" category may cover more than one type of gear, for example both bottom set nets and driftnets. 7. The estimated annual catches are likely to be much greater during a phase of low exploitation than when MSY is being approached.

4.2.3 Suggestions for Improvement of the Present System It may be possible to overcome some of the difficulties in the present EEZ license allocation system by instituting changes in four areas: 1. The MSY applied to the fishery should be derived from the best scientific evidence available (Section 3.2). Where there is considerable uncertainty over the resource situation, a conservative MSY should be adopted. Discussions at DGF concerning the altering of the level of MSY should include scientists who have researched the fishery. 2. Considering inter alia the large amount of unauthorized and unaccounted fishing likely to be occurring in some of the EEZ areas, the total allowable catch should be set accordingly below the MSY 3. The table of annual catches should be enhanced. Information from the fishery, observers (Section 4.5.1 ), gear technologists, verified landings, and other sources should be used to overcome the deficiencies cited above. The table should be updated regularly and independently checked for accuracy. 4. A procedural mechanism should be instituted so that when the expected catch for a fishery reaches the level of the total allowable catch, additional licensing for that fishery legally ceases.

4.2.4 General Comments on Allocation of Licenses with Respect to Resources Taking into consideration data from the present license system, more recent resource estimates, information from industry, and limited observations on the fishery, some general comments on license allocation for the important species groups can be made.

4.2.4.1 Demersal fish Even using the relatively generous DGF 1995 MSY, these fish appear to offer no opportunity for fleet expansion in the important fishing grounds of the Arafura Sea and South China Sea. Presently, the expected catch of the Indonesian fish net fleet is about equal to the recent FAO 17

1995 MSY and that of the authorized foreign fleet is about double that MSY. For the South China Sea, the catches by the authorized vessels is close to the DGF 1995 MSY, but the proximity of the area to the trawl fleets of Thailand suggests substantial unauthorized foreign fishing. Reports of falling catch rates from industry in both areas give support to the contention of over-exploitation4. For the Indian Ocean EEZ the situation is less clear, but as the shelf is relatively narrow, it is likely that the demersal resources are largely inshore of the EEZ. If so, significant offshore fleet expansion from the present absence of licensed vessels is unlikely.

In summary, fleet expansion based on demersal resource in the EEZ does not appear possible, but rather a fleet reduction by removal of foreign vessels should occur. The international obligation to license vessels where Indonesian capability is lacking should not be considered applicable to the fishery. It should be noted that Australia ceased licensing foreign fishing vessels to fish in their sector of the Arafura Sea in 1990.

The present tentative plans of the DGF are for a fleet expansion of 95 and 19 fish net vessels in the Arafura and South China Sea areas respectively. These plans are based on the differences between generous MSY estimates and reportecf5 landings. In addition, they appear not to consider the amount of unauthorized fishing or any precautionary margin below the MSY.

4.2.4.2 Small Pelagics Large scale harvesting of small pelagics in the EEZ presently only occurs in the South China Sea where 132 Indonesian and 13 foreign purse seiners were licensed in 1995. All three MSY estimates of the pelagic resources in the EEZ areas show substantial quantities. The main point of difference in the estimates appears to be for EEZ areas off the shelf, especially in the Indian Ocean and to a lesser degree in the Sulawesi/Pacific area. The assumption that the density in offshore areas is large is probably invalid and therefore the MSY figures associated with that methodology should be discounted. Both the FAO 1995 MSY estimate (covers both EEZ plus inshore areas) and DGF 1995 MSY estimate (only EEZ area) show a total potential of about 1 ,200,000 tonnes:

T a bl e 4 51 n f ormatton on Srna II P e I aatcs FAO 1995 MSY DGF MSY 1995 DGF Estimates of Reported 1993 Catch (EEZ+Inshore) (EEZ) EEZ Catches (only EEZ) (EEZ+Inshore) Arafura 386,000 200,000 21,006 21,000 S.China Sea 504,000 382,031 45,719 113,000 Indian Ocean 330,000 326,700 2,950 297,00 Sula/Pac 69,000 251,000 14,788 48,000 Total l 1,289,000 1,159,731 84,463 479,000 Unit: tonnes

4 In addition, the statistics of the Merauke Fisheries Service show a drop in the total catch of the three major Merauke-based fishing companies operating fish net vessels from 35,604 tonnes in 1994 to 24,785 tonnes in 1995. 5 For exntnple, the repo1ied landings of demersal fish in the Arafura Sea EEZ are given as 170,747 tonnes while the expected catch of the fish net \'cssols liucnsud lo fish in Ihe Arnfurn is 44(>,•171 lonncs. 18

The above table suggests that there is considerable potential in the Arafura Sea and South China Sea. It should be noted, however, that because of the proximity of the South China Sea to Thailand, considerable unauthorized fishing is likely, resulting in less potential. The table also implies that much of the potential of small pelagics in the Indian Ocean area is inshore of the EEZ and that' this is being exploited.

The tentative fleet expansion plans of the DGF call for an additional 1,705 purse seiners, 979 gill netters, and 78 fish net vessels to fully exploit the potential of small pelagic fish resources in the EEZ. These plans raise the following issues: 1. Although substantial biological potential of small pelagics in some areas is not disputed, the economic feasibility of such a fishery is not clear. It appears to be a case of relatively low-value species caught at considerable distance from market opportunities. Accordingly, it may not be a realistic exercise to allocate vessels to what may be non-economic fisheries. The viability situation may, however, change in the future. 2. It should be stressed that, if the present situation is not economically viable, that the conditions will be even less favourable as the point of maximum sustainable yield is reached due to falling CPUE. 3. Plans to acquire fairly large gill net vessels may be in conflict with the international moratorium on drift nets (Section 4.5.3). 4. Movement of vessels from over-exploited small pelagic fisheries in other areas of Indonesia to the EEZ may be more desirable than the construction of new vessels.

In summary, it appears as though a substantial amount of small pelagics could be caught annually in the EEZ and that the present catch is quite small, at least in the Arafura Sea. Depending on the economics of the fishery, fleet expansion plans may be premature.

4.2.4.3 Skipjack and Other Large Tuna In many respects allocation of EEZ licenses for tuna fisheries is the most complex of the species groups: Insufficient knowledge of the resource, poor statistics on landings, the fact that the fisheries interact with those in both the inshore area and in other countries, and an unknown but probably large amount of unauthorized foreign fishing.

Presently the DGF uses the following estimates for MSY:

Table 4.6 MSY Information for Tuna Skipjack Other Large Tunas Arafura 160,000 0 (includes tongkol) Sula/Pac 73,584 45,915 Indian Ocean 15,300 32,000 S.China Sea 0 0 Total 88,884 77,915 Units: tonnes

Various attempts have been made on assessing this valuable resource. Although Martosubroto gives a potential of 294,800 and 186,000 tonnes for skipjack and yellowfin 19

respectively6, the report of the IND/FAO/DANIDA workshop states "there is a consensus among tuna specialists that at this state of knowledge of these resources nobody can make reasonable predictions of the potentials of these species".

In very general terms, some data and anecdotal reports from fishermen indicate declining CPUE from the various fisheries within the Indonesian Archipelago. However, from a larger perspective, extensive research throughout the western Pacific suggests considerable interaction with Indonesian fisheries. In this vast area there are indications of potential for increased skipjack catches and somewhat less increases for yellowfin. Historical trends from the eastern Indian Ocean suggest that the longline fishery for the tuna is mature and large increases in production are not expected. Eastern Indian Ocean skipjack does not appear to be heavily exploited.

Given this somewhat contradictory information on the state of resources, it is not possible to realistically allocate licenses according to resource distribution nor to prudently formulate resource-based fleet expansion plans7. At this stage the best that can be done is, in areas where potential is deemed likely, to carry out an incremental fleet expansion programme in accordance with careful monitoring of CPUE of that and adjacent tuna fisheries. The present practice of DGF of using the difference between a very uncertain MSY and probably inaccurate estimates of present catches to determine "remaining potential" for fleet expansion and subsequent numbers of vessels requires reconsideration. Thought should also be given to how tuna fleet expansion plans of neighboring countries are to be accommodated.

It is important to note that in October 1995, 50% of all foreign vessels authorized to operate in Indonesia were tuna longliners. The replacement of this fleet (471 longliners) by Indonesian vessels does represent a real opportunity which can be planned for. Filipino purse seiners (50 licensed in October 1995 in the Sulawesi/Pacific area), although utilizing a somewhat higher technology than longliners, could also eventually be targeted for localization.

4.2.4.4 Shrimp The only EEZ area where shrimp vessels are licensed to fish is the Arafura Sea where the expected catch of 50 mainly small vessels is 938 tonnes per year. The MSY used by the DGF, 14,000 tonnes, is about the same as that suggested in the 1995 FAO estimates. This alludes to the reality that most shrimp in that area is caught by fish net vessels, probably in contravention to gear regulations.

There is general recognition that the shrimp fishery in the Arafura is over-exploited. Effort reduction plans of 50% of that of 1995 have been suggested by biologists. The potential for expansion of the fishery is therefore non-existent.

4.2.5 Summary of Considerations on Allocations 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

°For all waters under Indonesian jurisdiction 7 For example, the management of a luna cannery in Bitung which is experiencing major difficulties in obtaining adequate supplies of raw tuna altribules the predicament lo ovcrl~'-optimislic stock assessments obtained during the period when feasibility st11dies were undertaken for the llli'<'SliiiCIIl 20 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. Rather than formulate long-range expansion plans on this possibility, it is recommended that incremental expansion be car.ried with close monitoring of the effect. The replacement of the large foreign tuna fleet, especially the longliners, is seen as perhaps the only clear possibility for expansion of the Indonesian EEZ fleet.

It should be noted that this opinion is considerably different than the present tentative plans of DGF which call for an extra 285 longliners, 1775 purse seiners, 1136 gill netters, and 250 fish net vessels.

4.3 Problems and Constraints of the Present Licensing System for Foreign Fleets

4.3.1 Localization of the EEZ Fleet The major issue with respect to licensing policy for foreign fleets is the mechanism used for achieving the objective of replacing foreign fishing activity with Indonesian operations. In 1990 the system of licensing foreign fishing vessels to fish in the EEZ of Indonesia was replaced by a scheme in which foreign vessels are only allowed in the zone if they have been chartered to an Indonesian company. This policy is an attempt to encourage a transfer of technology, provide additional employment (at least 30% of the crew must be Indonesian), and increase the supply of fish (all the catch must be landed in an Indonesian port). The policy of localization of EEZ fishing activity is considerably affected by the Letter of Instruction from Minister of Research and Technology 557 of 1985 in which the purchase of fishing vessels from overseas was prohibited.

The localization scheme has met with mixed success. Although it potentially could result in greater benefits to Indonesia, there are three major problems: 1. The government is in a position of attempting to reconcile localization in EEZ fishing with localization in the shipbuilding industry and these objectives are sometimes incompatible. 2. Many of the companies presently involved in chartering foreign vessels are not bonafide fishing companies and therefore have limited interest in the transfer of technology or maximizing employment and supply of fish. 3. Enforcement of the legal requirements has been weak.

The reality of the situation is that between 1990 when the present policy began and the end of 1995 the number of Indonesian vessels licensed to fish the EEZ is about the same (Figure 4.1 ). The major factor thought to constrain the expansion of the local fleet are the costs associated with purchasing domestically constructed vessels (cost of vessel, cost of available financing, production time). The industry can use foreign chartered vessels but cannot purchase and operate these as Indonesian vessels. Because of this, the number of foreign vessels licensed to operate in the EEZ actually increased 43% in the 1990-1995 period.

One of the major objectives of the chartering system instituted in 1990 was a transfer of technology from foreign companies to the local chartering company. That transfer can only realistically take place if the local company has an interest in fishing. Unfortunately, many of the Indonesian firms to which vessels were chartered to are not involved in the fishing business and have no strong desire in acquiring new fishing technology, but rather are 21 passive recipients of money from being associated with foreign vessels. As the license fees for foreign vessels are lower under the chartering scheme than formerly, the net result in many cases appears to be a transfer of income from the government to private Indonesian chartering firms. To rectify this situation, a policy should be instituted so that only bonafide Indonesian fishing companies with historical involvement in the fishery concerned are permitted to be foreign vessel charterers.

Considerations on future fleet structure are given in Section 5 below.

4.3.2 Considerations on the Fee Level The government levy on foreign fishing vessel chartering is based on the concept that this revenue should be 5% of the landed value of the catch and that landed value can be related to fish hold volume. Ministerial Decree8 No.816 of 1990 specifies the following fees levels:

Although a thorough evaluation of this scheme is beyond the scope of the TCP Project, the fee system is currently being reviewed, and therefore some comment is appropriate. There have been three recent estimates of the catch by authorized foreign vessels in the EEZ:

Table 4 7 Information on Fee Levels Source of Actual Estimate Approximate Value at US$1500 per License Fee9 as Estimate Foreign tonne Percentage of Component of Landed Estimate Value DGF (1995) 559,709 275,000 tonnes $412,500,000 1.9% tonnes of fish are caught in the EEZ by licensed Indonesian and foreign vessels Agrodev foreign catch 140,000 tonnes $21 010001000 3.7% (1994) of about 140,000 tonnes Present study 419,000 419,000 tonnes $628,500,000 1.2% ("expected catches", tonnes for Section 4.2.2) foreign vessels

The above table should be considered a crude approximation: the landed value may require considerable adjustment and the time frame for the three studies are not the same. A more careful analysis should therefore be undertaken with more complete data. Nevertheless, the gin this report "ministerial decree" refers to Ministry of Agriculture decree. 9 According to the Industrial Fisheries Sub-Directorate, fiscal year 1994/1995 produced total license revenue of 19,142,255,281 Rp (USS 8,507,669) for 1032 vessels. About US$7,724,500 should therefore be generated by the 937 foreign vessels licensed in 1995. 22 preliminary conclusion is that the government expectation of obtaining 5% of the landed value of the catch is not being realized.

4.3.3 Administration of the Licensing System The capability and authority of the unit of DGF responsible for licensing appears to be inadequate. This unit, the Industrial Fisheries Sub-Directorate, appears to have insufficient knowledge of the fisheries they are licensing which results in inability to judge the reliability of the information they are required to handle. Although the unit handles large amounts of data and is frequently required to produce summary reports, much of this must be done manually as there appears to be only limited amount of computerization. The limited amount of interaction with other units of DGF also seems to detract from its efficiency. This results in the inability of the licensing unit to correct obvious difficulties as they arise due to its compartmentalized nature. For example, it appears to be common knowledge in the unit that many of the foreign fleets are sharing licenses, but there is the perception that the licensing unit is not able to improve the situation. Similarly, non-compliance with data provision requirements of licensing continues.

Experience in other regions of the world have shown that a licensing unit can be an effective agent of enforcement due to its ability to refuse a license .. It is generally acknowledged that the enforcement of EEZ fishing legislation is very weak in Indonesia. Some of this deficiency, however, could be circumvented by the licensing unit assuming a much more prominent role. This is discussed in Section 4.4 on enforcement. In short, the ability to refuse a license could be an effective enforcement tool.

It should be noted that the amount of revenue lost through not having a capable lead unit in the licensing scheme is likely to be substantial. For example, the Filipino group purse seine fishing based in Bitung generated US$309,809 in revenue last year. Industry sources indicate that perhaps 36,000 tonnes of tuna valued at US$ 27 million is being captured by these vessels. Considering the expectation of receiving 5% of the landed value of the catch as a license fee, through inadequate licensing capability perhaps a million dollars per year is being lost from authorized operations at one port.

4.4 Comments on Enforcement in the EEZ A key weakness in the Government's EEZ policy is the enforcement of existing regulations. Many of the problems in the management of fisheries in Indonesia relate to enforcement difficulties and improvements in other aspects of fisheries management will have little positive effect unless this weak link in the system is improved.

As the Navy has a leading role in enforcement of the EEZ regulations, many previous reports have suggested that improvements will happen by increased coordination between DGF and the Navy. While this should certainly be pursued, the reality of the situation is that fisheries do not rank very high in the Navy's priorities, the Navy may have some conflict of interest in enforcing EEZ regulations, and the Navy lacks technical capability in many fisheries matters. Accordingly, DGF should give consideration to simultaneously developing enforcement initiatives which are independent of the Navy through the power of the licensing unit to refuse a license. Examples of this are: 1. Strengthening the licensing unit at DGF to enable enforcement of data requirements by licensing. The lack of data is a serious and persistent problem which could be at 23

least partially resolved in the EEZ fisheries by the licensing unit having a policy of requiring proof of having submitted catch data during the previous period (a "no data, no license" policy)w. 2. If the licensing unit were to have additional technical capability, vetting the data for accuracy would be possible. Improper reporting would disqualify the vessel from a license renewal 3. The licensing unit could make substantial progress in enforcing the vessel marking requirement (Ministerial Decree No. 144 of 1993, see below). Although having vessels which are easily identified is basic to effective surveillance, there appears to be little interest on the part of officials in the field in enforcing the existing legislation dealing with marking of vessels. The licensing unit could rectify the problem by requiring on the license application a picture of the vessel properly marked. 4. The requirement that all fish caught in the Indonesia EEZ be landed in an Indonesian port could be at least partially enforced by the licensing unit refusing to renew licenses from vessels which have landed in Indonesia a suspiciously small amount of catch in the previous year.

With regards to the earlier recommended increased cooperation with the military, it appears as though many officials in the DGF and the provincial fisheries office are uncertain about the role, procedures, capability, limitations, and hardware available for enforcement of the EEZ. Conversely, the military is likely to be unsure of licensing procedures, fishing patterns, recent innovations in fishing gear, and trends in fleet deployment. An increased understanding of each other's roles is likely to contribute to the desired increased cooperation between DGF and the Navy. It is therefore suggested that an enforcement! fisheries profile for Indonesia be prepared which includes items for the benefit of both parties: fishing areas, fleets, areas where unauthorized foreign fishing is likely, topics of concern, surveillance/enforcement hardware, standard procedures, case studies and responsibilities/jurisdiction of the various agencies.

10 Sonw licenses refusals on the basis not providing data may have occurcd, but the "no data, no license" policy referred to is a strict regime in which no license is granted without the required data having been furnished in the previous licensing period. 24

The violations of Indonesian fisheries regulations in 1992 and 1993 are:

T a bl e 4 8 v·10 I a f 1ons o f In d ones1an FIS h enes . Regu Ifa 1ons Type of Total No. No. Indonesian No. Foreign Total No. No. Indonesian No. Foreign Violation Violations Violations Violations Violations Violations 1993 Violations 1993 1992 1992 1992 1993 Outside 11 3 0 38 3 35 specified fishing area Unspecified 33 33 - 213 25 100 fishing gear Using 25 25 - 15 15 - explosives Using 12 12 - 57 17 40 Cyanide, chemicals Using trawl 65 3 62 142 45 97 gear Insufficient - - - 10 - 10 local crew Destruction 36 36 - 50 50 - of coral reef Fishing w/o 142 10 132 500 30 470 license Improper ------design/size of vessel Other 177 36 141 103 41 62 Total 501 150 343 1136 234 902 Snurce: Unpubl. data, Directorate of Resource Management, DGF

From the above it can be seen that the most common type of violation by foreign vessels is fishing without a license. Consideration should therefore be given to taking steps to make unlicensed fishing easier to detect. Although the identification of vessels is basic to a surveillance programme, one notable feature of the foreign fleets observed during the TCP Project was the absence of the legally required vessels markings. It should also be noted that the regulations themselves (Ministerial Decree No. 144 of 1993) are somewhat unclear. It is recommended that Indonesia modify the vessel marking requirements to international standards. All vessels should be marked with their International Telecommunication Radio Call Sign (IRCS) in accordance with the 1989 FAO standard specifications for identification and marking of fishing vessels, which for example, requires letters/numbers of at least 600 mm in height for vessels between 15 and 20 metres in length. More complete information on this subject is available in FAO Fisheries Technical Paper No.338.

Ministerial Decree No.144 of 1993 states that a foreign fishing vessel must use a designated port as a base for operation and that the vessel is to be checked by a government official before a trip for compliance with license, gear, marking, crew, and logbook requirements (the "check point" system). Although this appears to be sensible, straightforward, and relatively easy to enforce, the implementation of the decree has been slow. For example, not a single foreign fishing vessel observed in Benoa during the TCP Project had the required identification markings. It is recommended that this basic system be fully implemented before the DGF attempts more sophisticated enforcement of EEZ. 25

The major enforcement concerns in the EEZ are unauthorized fishing, and non-compliance with the data, gear, crew, and catch disposal requirements. In general terms, the legal framework, technical skills, and physical capability for enforcement is not lacking. The major constraints to effective enforcement appear to involve administration, priorities, jurisdiction, and institutional relationships. Political will to improve the situation seems to be lacking. In other countries sufficient political will has been generated through a realization of the revenue lost by ineffective systems.

4.5 Other Issues in EEZ Management

4.5.1 Observer Programmes Due to the difficulty of monitoring fishing vessel activity in the EEZ, an observer programme is often considered an important component of EEZ fisheries management. An observer programme is the placement of individuals aboard vessels to watch the actual fishing activity and record data, especially that which cannot be obtained at the unloading point. Programmes in which Indonesian government observers are placed aboard foreign fishing vessels would facilitate: 1. Learning more about the various fishing operations 2. Upgrading the capability of DGF by practical field experience 3. Improving the quality of the data from fishing vessels 4. Greater compliance by foreign fishing vessels with EEZ regulations 5. Creation of a consciousness in the fleet that the government is serious about monitoring fishing activity 6. Research in support of stock assessment

It appears as though fisheries observers have rarely been used in Indonesia. During the TCP Project the desirability of an observers programme was discussed with numerous individuals in DGF and provincial fisheries services and there was virtually unanimous support for having such a programme. Concern was raised, however, on whether vessel operators would allow observers aboard. It should be noted the government does have the power to place observers: 1. Article 14 of Government Regulation No.15 of 1984 on Fisheries Management in the EEZ states that in the course of activity in the EEZ any foreign fishing shall take on board any inspector appointed by the Minister and allow them to inspect the vessel 2. Article 9 of the Ministerial Decree No.475 of 1985 on Rules Governing Permits for Foreign Fishing in the EEZ stipulates that the master of a vessel for which a fishing license has been obtained shall accept on board an inspector to monitor fishing activities

Observer work in Indonesia should begin with pilot work in a priority area. Due to logistics, concern, and lack of information, the Filipino group purse seiners based in Bitung may be an appropriate starting point. The first observer trips snould be undertaken by individuals in a position to carry out training for others and possibly to supervise future observers.

Well-trained observers are an essential component of an effective observer programme. There is the possibility that the initial observers may be able to take advantage of existing observer training opportunities overseas. During the TCP Project, the Forum Fisheries 26

Agency (FFA) indicated a willingness to accept Indonesians in their future observer training workshops.

The observer programme should commence with a small number of objectives, perhaps verification of data and obtaining knowledge on the fishery, and then expand as competence is acquired. It should be decided fairly early in the planning process if one of the objectives should be onboard enforcement. If so, close liaison with the Navy is essential.

4.5.2 Data Virtually all m1ss1ons visiting Indonesia in the past decade to review marine fisheries resources, stock assessment, or fisheries management have concluded that there is an urgent need for better data from the existing fisheries. The situation is especially acute in the EEZ. The data predicament in the tuna fisheries demonstrates the severity of the problem: The report of the Indonesia/FAG/ DANIDA Workshop on the Assessment of the Potential of the Marine Fishery Resources in Indonesia states: "It is not clear how the BPPLIDGF group has been able to produce estimates of the potential of skipjack and other large tunas. There is a consensus among tuna specialists that at this state of knowledge of these resources nobody can make reasonable predictions of the potential of these resources. The only source of information is the performance of the present fisheries and it appears that good information on that performance is very difficult to obtain". Even though tuna is the second most important fishery commodity exported from Indonesia, due to lack of data it is not possible to make reasonable fleet expansion plans (Section 4.2.4.3), address crucial questions raised by artisanal fishermen concerning falling catch rates, or effectively cooperate internationally with countries that share the resource.

Although there are adequate legal and institutional mechanisms for obtaining this data, the. required data is not being collected on a number of fisheries and there does not appear to be a concerted effort to improve the situation. Despite it being widely recognized that the lack of such data is a major constraint to the effective development and management of the EEZ fisheries, enforcement of the legal data requirements is weak. A list of violations related to the fisheries laws prepared by DGF recently (Table 4.8 above) has ten categories for various types of violations but no category specific for non-compliance with the reporting requirements.

The EEZ data problems are not confined to the foreign fleet, but also involve Indonesian vessels. In at least one recent review of the EEZ fisheries situation it was suggested that once the EEZ fleet is localized, data problems will diminish. The opposite may, however, be the case as local vessels may have more ability to resist enforcement.

It also should be mentioned that, even for the fleets that provide data, verification of the accuracy of that information appears to be lacking. In Merauke the TCP Project observed that even though data was provided by the fishing companies to the Provincial Fisheries Service, it is unverified. Because of the tax on the exported catch, there is an incentive to under-report and the result has been confirmed by industry representatives.

The improvement of the situation will not be an easy task. Over 2,000 vessels are licensed to fish in the EEZ and offload at a large number of ports. Nevertheless, considering the long history of recommendations on the subject which the TCP Project considers as valid, DGF 27

must attach a much greater importance to the issue than in the past. Suggestions to assist in improving the data situation alluded to earlier in this report include: 1. Full implementation of the data-related requirements of the checkpoint system (Section 4.4), including verification, should be given top priority by DGF. 2. Immediate adoption of a "no data, no license" policy 3. Use of observer information to gauge the accuracy of reported data

4.5.3 Gear The terms of reference for the TCP Project specify that attention should be given to specific conservation measures, including that involving gear. A different approach is, however, suggested: to achieve conservation objectives, any available resources should be channeled into creating more effective enforcement of existing gear legislation rather than devising additional regulations. Nevertheless, some comment on gear may be appropriate.

In this regard, the "fish net" vessels, especially those in the Arafura deserve scrutiny. Trawling was banned in most of Indonesia by Presidential Decree No. 39 of 1980 and subsequently implemented incrementally by a variety of ministerial decrees and presidential instructions/decrees. Although there is much confusion over the term, it appears as though "fish net" ("pukat ikan") is a euphemism for trawl gear or gear that would function similarly. The reality of the situation is that 36% of all foreign fishing vessels licensed to fish in Indonesian waters in October 1995 were using "fish nets". As a matter of priority DGF should regularize the situation: 1. The term "fish net" should be replaced by the correct technical name of the gear. 2. The relationship of fish net gear to the trawl ban should be clarified. 3. The relationship of fish net gear to shrimp net gear should be clarified.

Another issue concerns the use of large gill nets. In October 1995 a total of 279 Indonesian and foreign gill net vessels over 100 GT were licensed to fish in the EEZ. This situation may be in conflict with United Nations General Assembly Resolution 44/225. If Indonesia permits its vessels to fish with pelagic driftnets in excess of 2.5 km in length it will be a contravention of the internationally agreed moratorium.

4.5.4 Leniency with Foreign Fishing Is Indonesia too lenient with foreign fishing ?. To determine this often-asked question, it may be useful to compare conditions of access between the actual situation in Indonesia and prevailing conditions in some neighboring countries.

From Section 4.3.2 it can be seen that the Indonesian government is likely to be obtaining less than 2% of the landed value of fish as a license fee. There are no burdens placed on the foreign vessels by observer programmes, catch reporting requirement are not rigidly enforced, there are no radio reporting requirements, vessels are able to disregard any marking requirements, and (at least for the fish net fleet) the gear regulations appear to be unenforced. Even if a successful prosecution occurs the maximum monetary fine stipulated by the Fishery Law is 100,000,000 Rp (US$ 44,150). Chartering to local companies and disposal of catch in an Indonesia port is, however, required in principle, but not strictly enforced.

By comparison any foreign fishing activity in the EEZ of 14 Pacific Island countries, New Zealand, and Australia is licensed under regionally agreed uniform minimum terms and 28 conditions of access. These terms include requirements for uniform vessel identification, catch and position reporting, transhipment, catch and effort logsheets, and observers. With regards to license fees, the average access arrangement between a Pacific Island country and overseas vessels is around 4.4%1 1 of the landed value of the catch. Subsequent to successful prosecution, many fines in the Pacific Islands have exceeded ten times the maximum fine in Indonesia.

For the above, it can be concluded that Indonesia has relatively lenient access terms compared to neighbors to the east.

4.6 Some Considerations on the Concept of Maximum Sustainable Yield Several observers have noted the large importance that the DGF attaches to the concept of maximum sustainable yield, or how it is often expressed in Indonesia, potential yield. Development projections, fleet expansion plans, foreign fishing allocation, ideas on development opportunities, objectives of fishery management and many aspects of the work programme of the DGF revolve around the notion of MSY.

The faults associated with using maximum sustainable yield as a management concept are numerous and mostly relate to over-simplifying the dynamics of an exploited fishery. The drawbacks of MSY have been mentioned in several reviews of the fisheries management situation in Indonesia. Nevertheless, the concept is embodied in both the Indonesian fisheries legislation and in the UNCLOS treaty and the reality is that it will be a central feature in Indonesian fisheries management for the foreseeable future. The concept of MSY, due to its simplicity can play a very useful role in the country, providing that its shortcomings are acknowledged and compensated for. It may therefore be useful to discuss the major difficulties of the use of MSY in Indonesia. 1. Imprecision: In a recent examination of the subject, a recognized international authority on stock assessment stated that he was not aware of any fishery in the world where a sustainable quota could be truthfully said to be assessable within an accuracy of 40% (Wallets 1996). This should be compared to the perception of accuracy of MSY in Indonesia as exemplified by several 1995 publications of the DGF which give the accuracy of overall MSY exploitation to 1/1 0 of a percent. 2. Institutionalization: Once established, MSY figures become entrenched and are used amazing periods of time without modification. The Martosubroto MSY has been used for many years without modification and many of the MSY figures used for EEZ resources date from a publication from the early 1980s. The situation is mirrored at the provincial level; the 1995 Merauke District Fisheries Service Annual Report uses an MSY calculated in 1975 to show remaining potential. 3. Non-Economic: The implied management objective in many cases is attaining MSY. This notion disregards the possibility that, due to declining CPUE as MSY is attained, a non-economic fishery may result. 4. Mis-conception in Overexploited Situation: If the MSY is greater than present production in an overexploited situation, more fishing will actually decrease the catch.

11 World flank (I 995) estimates that in I 993 total access fees for the Pacific Islands region were about USS56 million and the total catch value was l JS$1.2 billion. 29

5. Non-Consideration of Best Scientific Evidence: Although MSY should be established using the best scientific evidence available, specialized researchers do not always have input on the establishment of MSY at DGF. 6. Non-Precautionary: Perhaps the greatest shortcoming of the use of MSY in Indonesia is the common practice of subtracting estimated present catches from MSY to determine "remaining potential". There is no precaution against any uncertainty of MSY, inaccuracy of reported catches, unauthorized fishing, or any natural fluctuation in stock abundance. It should be noted that the Code of Conduct for Responsible Fisheries is especially relevant here: "In the case of new or exploratory fisheries, States should adopt as soon as possible cautious conservation and management measures, including inter alia cautious catch limits and effort limits."

As mentioned by several reviewers in the past, fisheries management by MSY is most appropriate in the early development stages of a fishery. As effort increases, the concept becomes less relevant and information from the fishery assumes a greater importance in determining any remaining potential. Expressed in simplistic terms, as a fishery grows, thinking on remaining potential should undergo a change from "How close are we from MSY ?" to "what is the CPUE doing ?" An appropriate example is now occurring in the Arafura Sea demersal fishery. Although a comparison of MSY to the estimated landings still shows substantial potential (landings not close to MSY), if the catch per unit of fishery were to be monitored, the likely recent decline would be indicative of limited remaining potential.

It should be noted that an over-reliance on MSY may result in the economics of the fishery not receiving adequate attention. As a fishery develops, information should be collected to enable bio-economic analysis.

4. 7 Fisheries Management Plans There does not appear to be any conventional fisheries management plans for Indonesia's EEZ fisheries. There are general notions of objectives such as full utilization and localization of EE.Z fishing, but these have yet to be set in the framework of formal plans for each important fishery.

The advantages of fisheries management plans are numerous. The plan formulation process requires that attention be focused on issues that may currently be over-looked, such as the setting of specific objectives and discussion of alternative means to accomplish the objectives. The plan formulation process also encourages input from the fishing industry. The plan once formulated can serve as a mechanism to assure coordination between the various units of DGF and other agencies which is much needed in a system which tends to be compartmentalized. Finally, the plan is a useful tool to evaluate performance of the managers, discourage deviation from policy, and introduce a degree of transparency into the system. It should also be mentioned that a management plan is internationally-recognized as being a valuable tool: the Code of Conduct for Responsible fisheries encourages the formulation of fisheries management plans.

4.8 Fisheries Research Venema (1996) details the institutes involved in fisheries research in Indonesia, examines difficulties, and offers suggestions for improvement. He discusses among other items concentration of research effort in Jakarta, minimal production of high quality scientific papers, 32

There will be tremendous demands on the fisheries management staff of DGF. Capability of the staff must be enhanced through training and acquisition of additional expertise. Special attention should be focused on the staff obtaining a thorough knowledge of the fisheries to be managed and to applying the principles embodied in the Code of Conduct of Responsible Fisheries, with emphasis on the precautionary principle. A network of fisheries managers in Indonesia may be a useful mechanism for increasing the awareness of fisheries management principles.

There is a need to draw attention to the consequences of ineffective fisheries management. Accordingly, consideration should be given to carrying out a comprehensive study of the economic losses due to unauthorized catches by foreign vessels, inefficiencies in the licensing system, low fee for foreign fishing access, weak enforcement, and other difficulties.

4.10 Recommendations on Fisheries Management

1. The major conclusion of this component of the TCP Project is that a shift of objectives of fisheries management should occur. To assure that maximum benefits accrue from the fisheries, the objectives must change from increasing landings to assuring sustainable exploitation. 2. To assure sustainable exploitation, the collection of accurate data from the fisheries should receive much more priority from DGF than in the past. 3. The replacement of the large foreign tuna fleet, especially the longliners, is seen as perhaps the only clear possibility for expansion of the Indonesian EEZ fleet. 4. A comprehensive study of the economic losses due to an ineffective management system should be carried out.

Other priority recommendations are: 5. License allocation • Additionc::l attention should be paid to the resource situation • Precaution catch limits should be set • The body of information used to determine the expected catches should be enhanced • A mechanism should be established so that when the allowable catch level is reached, additional licensing for the fishery ceases 6. Localization of the EEZ Fleet • To achieve the objective of localization of the EEZ fleet, government policies should be modified by either allowing the purchase of foreign vessels for certain fisheries or positive incentives to purchase local vessels 7. Administration of the Licensing System e The technical capability of the unit responsible should be enhanced e The section should not be purely an administrative unit, but should take an active role in enforcement through its ability to refuse a license 8. Enforcement in the EEZ e The implementation of the existing checkpoint system should be accelerated and should be fully functional prior to considering more complex schemes • Consideration should be given to mechanism to generate the political will for effective enforcement 33

9. Observer programmes • As there is much to be gained from an observer programme, DGF should consider implementation of such a programme 10. Foreign Fishing Conditions • Because Indonesia appears to be relatively lenient, conditions commensurate with those of neighboring countries should be considered 11. MSY • The concept of MSY can play a very useful role in the country, providing that its shortcomings are acknowledged and compensated for • More attention should be paid to the precautionary principle in setting levels 12. Fisheries Research • There should be substantially more input from DGF on the establishment of research priorities 34 5.0 CONSIDERATIONS ON FLEET DEVELOPMENT

From Section 4.2.5 it can be seen that there are no large unexploited resources in Indonesia upon which fleet expansion plans can be based. It appears that any major increase in the number of Indonesian vessels will arise from the replacement of the foreign fleet. Fleet development plans are therefore strongly related to the government's policy on the localization of foreign fishing in the EEZ

From Section 4.3.1 it can be seen that, contrary to policy objectives, the number of foreign vessels licensed to operate in the EEZ actually increased 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.

The EEZ fisheries are largely export oriented and as such Indonesian vessels in the EEZ are competing in the international market with vessels from other regions in the world. In the recent past the international market and other factors have resulted in conditions whereby Indonesian-built vessels are generally not competitive, hence the number of Indonesian-built vessels in the EEZ has not grown. To achieve localization of the EEZ there appears to be three options: 1. Changing the economic conditions under which vessels are built in Indonesia. 2. Allowing the import of foreign fishing vessels. 3. Encouraging vessels from over-exploited fisheries in other parts of Indonesia to displace foreign vessels in the EEZ.

It should be stressed that, whatever option is to be pursued, the sustainability of the resource base should be a major consideration. In this regard, Section 4.2.5 contains justification that the foreign longline tuna fishery should be targeted in the near future for localization. The above three options are therefore discussed below in the context of replacing the 471 foreign longliners licensed in 1995.

5.1 Changing the economic conditions for Indonesian vessel construction

5.1.1 High costs and other disincentives A recent study (Thompson/Clarke, 1996) showed that vessel construction costs in Indonesia were substantially more expensive than overseas. There is considerable speculation on why this occurs in a country with a relatively low wage structure. High import duties, a shortage of skilled tradesman, and top-heavy administration in some vessel construction firms appear to be the major contributing factors.

Aside from the relatively high cost of contracting a fishing vessel in Indonesia, research carried out during TCP/INS/4553 showed additional difficulties associated with the construction of an Indonesian vessel: 1. High cost of credit. 2. Extended construction times and delays. 3. Considerable delays in import procedures. 4. High duty on fishing equipment and machinery. 35

Shipbuilders, responding to the complaints about construction delays, state the causes are the short lead times and small order numbers being placed. This has the effect of not being able to plan far enough in advance for such purchases as main engines, auxiliaries and deck equipment, most of which have to be imported causing major delays to construction schedules. It is generally accepted that larger orders placed well enough in advance would allow the shipyards to not only plan well ahead on import purchases but also to refine and speed up production schedules after the first vessels are built and the "learning curve" levels off and the benefits of economies of scale are realized. Prototype or "one off' construction is very rarely profitable, this is especially so if the yards do not have prior experience in fishing vessel construction.

5.1.2 Shipbuilding capacity According to information supplied by the Indonesian Shipbuilders Association (IPERINDO) and the Department of Industry, the steel shipbuilding capacity of the major yards is about 150,000 GT per year. This figure actually includes the construction of freighters and tankers which are larger than most fishing vessels that may be needed. It is also a maximum capacity; for practical purposes production rates of 100% are never reached. To put this figure in context, if it were possible for the shipyards of Indonesia to work at full (1 00%) efficiency for a full year producing fishing vessels of 300 GT they could theoretically produce 500 such ships. Yards, however, also have commitments to build other types of vessel such as cargo ships, tankers and ferries, which further reduces their capacity to build fishing vessels.

There are only 24 yards reported with the capacity to build fishing vessels over 30 GT: 6 government owned yards (steel construction) 6 private commercial yards (steel) 5 private commercial yards (fibreglass) 3 private commercial yards (modern wood boatbuilding) 2 government owned yards (modern wood boatbuilding)

The above does not, however, consider the large numbers of traditional wood boatbuilders to be found in Riau Sumatra, Kalimantan, Sulawesi and other locations along the archipelago.

5.1.3 Projected shipbuilding costs Interviews with shipyard management, a review of the various studies of shipbuilding in Indonesia, information from DGF, and knowledge of the fisheries indicate that the cost of replacing the 471 foreign longliners licensed in October by Indonesian vessels would be: 36

Table 5.1 Estimated Foreign Longliner Replacement Costs (New vessels, Indonesian built, steel) Boat Size GT Number of Total GT Cost per Sub Total (US$) Boats Tonnes ($US) 60 364 21840 9420 $205,732,800 100 96 9600 9420 $90,432,000 150 5 750 9420 $7,065,000 200 0 0 9420 $0 300 3 900 10736 $9,662,400 400 2 800 10736 $8,588,800 600 1 600 10736 $6,441,600 T o t a I $327,922,600

It must be stressed that, especially in the tuna longline fishery, Indonesian vessels are in direct competition with vessels fishing in other parts of the world where vessel construction costs may be much lower than in Indonesia. In this context it should be noted that the thirty 300 GT longliners presently being constructed by PT lki in Ujung Pandang are reported to cost US$ 6.4 million apiece ($21 ,333 per GT), which appears quite expensive by international standards.

Analysis was carried out during the TCP Project in which Indonesian and foreign shipbuilding costs were combined with Indonesian and foreign credit costs. North American construction costs now appear to be about 25% lower than Indonesian costs. Appropriate foreign credit appears to be about 10% less than commercial Indonesian credit for fishing vessel financing. Assuming no change in efficiency over a 15 year financing period, the combination of the cost differential from both construction and financing results in Indonesian built and financed vessels costing slightly over 100% greater than in North America. If all the 471 long liners were to be built in Indonesia, these greater costs translate into the new fleet costing approximately a half billion dollars more.

The localization of the foreign longline fleet (and other foreign fleets in general) by Indonesian-constructed vessels requires special action so that the vessels are cost competitive. These measures may include: 1. Presidential Decree No.4 of 1996 (reducing the value added taxation on certain materials for vessel construction) should be expanded to cover other non-locally available materials used in fishing vessel construction. 2. The delays and bureaucratic inefficiencies in the import process should be investigated and rectified. 3. The possibility of reducing vessel costs by economies of scale (building large numbers of similar vessels) should be investigated. 4. Attempts should be made to reduce the cost of credit for vessel construction. Although government policy does not permit new concessionary "soft" loan programmes in the agriculture sector, there are loan schemes established prior to 37

1990 (such as the $106 million IBRD fund) which could be made available for fishing vessel financing. 5. The Letter of Instruction from Minister of Research and Technology 557 of 1985 (banning the import of foreign fishing vessels) states that there will be a provision for assistance for technology, design, quality control, and other factors required for domestic construction by Indonesian shipyards by the government agency BPPT/PT PAL directly or indirectly without charge. The possibility that this assistance could be used to reduce the costs of construction should be studied.

5.2 Allowing the import of foreign vessels Another option for localization of the EEZ fishery is to allow the import of foreign new and used fishing vessels. Construction costs in North America appear to be about 25% lower than in Indonesia (Table 5.1 ). Vessel construction in some Asian countries is likely to be even lower. In addition, new vessel foreign purchase arrangement often are accompanied by credit at concessionary rates.

Regarding used vessels, recent fleet reduction schemes by other countries in Asia and Europe are making considerable numbers of good used fishing vessels available at reasonable cost. For instance, the European Union fleet reduction plan includes incentive to owners who sell their vessels to regions outside the EU. Used fishing boats can be purchased at very favourable prices for fast delivery from countries with surplus fleets. Costs of such used boats are reported to be in the region of one quarter to one third of new build prices in Indonesia.

It should also be mentioned that with the increased economic globalization, conditions in all areas of the economy, including fisheries, are char.ging. With reduction of worldwide tariff and non-tariff barriers, it is likely that eventually the ban on import of foreign fishing vessels will be softened or eliminated, especially on vessels originating in other ASEAN countries.

Should the option of importing foreign vessels be pursued, special care should be given to assure the additional vessels participate only in fisheries which have potential for supporting additional effort.

5.3 Encouraging vessels from over-exploited fisheries to displace foreign vessels Recent assessments have shown that some of the small pelagic stocks in Indonesia are over­ exploited. During visits to fishing ports by the TCP Project, it was noted that the deck layout and configuration of the Indonesian wooden purse seine vessels in the size range of 50 GT and larger would allow them to be easily converted to tuna long line fishing for the fresh fish market.

The type of longline equipment most suitable for these vessels in the fresh tuna fishery would be the monofilament reel system. This equipment is relatively compact and can be installed without major alterations or modifications to the vessel. Recent inquiries to the supplier of such equipment to vessels operating in the Pacific show the following costs for the additional gear required to convert a 50 GT vessel with a 50 nautical mile long line: 38

Reel and mono-filament line US$ 40,000 Tackle US$ 12,000 Electronics US$ 9,000 Spare parts US$ 1,000 Total US$ 62,000

Most of the larger size boats in the purse seine fleet appear capable of operating in the EEZ waters, as they are quite heavily built. Many vessels from north central Java for instance already travel long distances from home ports and fish in areas such as the South China Sea and North Sulawesi which have bad weather seasons during the SW and NE monsoons.

5.4 Recommendations In order to achieve the objective of localization of the EEZ fisheries while striving to maintain international competitiveness, government policies with respect to procurement of fishing vessels should be modified. Three options for such change are proposed above. These should be carefully evaluated by the Government in the context of overall development policies. 39

6.0 DEVELOPMENT OF MALL~SCALE FISHERIES IN MERAUKE

6.1 Background

6.1.1 Location The District of Merauke is located in the south eastern corner of Irian Jaya, bordering Papua New Guinea. It is the largest district of Irian Jaya co11stituting 29% of the province in terms of area. Merauke has a coastline of 1,050 km. Fronting this coastline is the productive Arafura Sea. The size of the Indonesian territorial and EEZ waters in the Arafura Sea is 75,000 sq.km

6.1.2 Status of Fisheries The fisheries in Merauke can be classified into two broad categories namely small-scale and industrial fisheries. It is however dominated by the small-scale sub-sector.

The small-scale sub-sector is characterized by the existence of a large number of small fishing villages scattered along the coastline with poor accessibility and facilities. In the case of Merauke, there are some 200 such fishing villages in the district. A fairly large number of fishing vessels are used but they are mainly dugout canoes and plank-built sampans, the majority of which are non-powered. The fishing gears employed are mainly traditional ones for fishing in the nearby estuarine and coastal areas. Productivity is generally low and access to market poor. As such, the small-scale fishing communities are generally under developed.

On the other hand, there is the fairly well organized and often self sustaining industrial sub-sector spearheaded by fishing companies. There are four such fishing companies operating in Merauke namely PT Djarma Aru, PT Timika, PT Pelagis and PT lstana. They operate a fleet of large vessels ranging from 30 - 200 GT employing trawl and gill nets aimed at the demersal resources.

6.1~3 Fishery Resources Merauke District has an extensive mangrove forest fringing its coastline. The mangrove eco-system is still in a relatively undisturbed condition harbouring productive fishery resources such as shrimps, mangrove crabs and some important fish species notably sea perch, and milk fish. There are also indications that the shallow territorial and internal waters of the coast of Merauke are abundant in demersal resources. Results of a limited survey (Badrudin and Rusmadji, 1988) showed very high catch rates (7.3 tonnes/sq.km) for trawling in coastal areas. When these preliminary indications are extrapolated to the entire territorial and internal waters, a large biomass is suggested. This presents considerable fishery development possibilities, especially for the small-scale fisheries.

6.1.4 Production The fish landings recorded by the Merauke District Fishery Service are mainly from the small-scale fisheries and the local industrial fleet. It can be seen from the statistics collected that the fisheries production has increased significantly from 12,950 tonnes in 1990 to 44,600 tonnes in 1994. The main species of catch are sea perch, sharks, cat fish, pomfrets, milk fish, 40 chub mackerel, mullet, threadfin and ray (Table 6.1 ). The rapid increase is mainly due to the operation of the industrial fleet.

Table 6.1 Production of Fish by Species/Groups in Merauke 1993-1994 NO. Species/Groups 1993 1994 1 l

6.1.5 Fishing Fleet In 1994, a total of 1,805 fishing vessels was recorded comprising 1,402 non- powered, 97 outbo8rd and 306 inboard engine vessels. Generally the small non-powered and outboard engine vessels are used by the small-scale fishermen. On the other hand, the larger and better equipped inboard engine vessels are employed by the industrial establishments. PT Djarma Aru has a fleet of 60 gill netters, PT lstana 28 trawlers, PT Timika 25 trawlers and PT Pelagis 11 trawlers.

6.1.6 Fishing Gear A total of 7,000 units of fishing gear was operated in 1994. However, the majority of the fishing gears are traditional ones like the beach seine, gill net, hand line, castnet and traps. Trawl nets are also employed mainly by the industrial establishments (Table 6.2). 41

Table 6.2 Nurn bero f F IS h'mg G ear b y T ype m. Merau k e, 1994 Type Number of Units Fish Net 27 Shrimp Net 23 Beach Seine 130 Floating Gill Net 265 Fixed Gill Net 1756 Bottom Line 20 Others 4726

T o t a I 6947 Source : Dlnas Penkanan Tk.ll Merauke

6.1. 7 Post Harvest The handling, preservation and processing of fish by the small-scale sub-sector are unsatisfactory. Limited attention is paid to proper handling of the fish caught on board the fishing vessels, ice is seldom used for preservation and processing is mainly in the form of salting and drying. Catches of the industrial fleet are, however, processed on board vessels as frozen products for direct export. The disposition of the fish landings in Merauke District are in the order of 90% frozen, 9% fresh, 0.5% dried/salted and 0.5% other (Table 3).

Table 6.3 Disposition of Fish in Merauke, 1994 Description Volume (tonnes) % Fresh fish 3968.50 8.98 Dried/Salted 190.10 0.43 Frozen 39970.30 90.48 Others 46.80 0.11 Tot a I 44175.70 100.00 Source: Annual F1shenes Stat1st1cs, 1994, F1shenes Serv1ce of !nan Jaya

6.1.8 Marketing Marketing appears to be a major problem of the small-scale fisheries. It has constrained production due to market limitation. The uptake of the catches is subject to the dictates of the fish collectors as there are no other alternatives at the village level.

Exports of fish from Merauke are mainly in the frozen form. There is some inter-island trading of fresh fish, dried/salted fish, sharks fins and swim bladders. The amounts are small because of the high cost of transportation as well as the long duration of transport. The lack and high cost of transportation have constrained the marketing of all types of fisheries products.

Merauke has a wet fish market located in town. It is in a rather poor state of hygiene with running water not readily available, no hose-down facilities, unsuitable drainage and no cold storage. Fresh fish on display is generally in poor condition. 42

6.1.9 Infrastructure Facilities There is a newly completed Fish Landing Place (PPI) located 11.5 km upstream of the existing commercial jetty in the Maro River estuary. This Fish Landing Place has failed to attract the fishing industry due to its distance and difficulty of access. Furthermore, the industrial fishing companies operating from Merauke prefer to use the existing commercial jetty and its adjacent deep water anchorage for victualing and transhipment of frozen products to reefer vessels for export. An industrial fishing company, PT Djarma Aru even has its own landing facilities at Wanam to facilitate its self-contained operations.

Ice is available in Merauke at a price of Rp 1,500 for a 15 kg/block. It is produced by two existing ice plants with a total capacity of 2 tonnes per day. Cold storage facilities are not available.

6.1.1 0 Human Resources/Fishermen There are 16,598 fishermen in Merauke District, constituting 6% of the total population in the area. Of these, 6,318 or 38% operate on full time basis, 2,104 (13%) are part-time major and the remaining 8,176 (49%) are part-time minor. They are largely small-scale fishermen. Merauke District with its sparse population has also been identified by the Government as an area for the transmigration programme.

6.2 Issues and Constraints

6.2.1 Issues The Arafura Sea is an active fishing ground. There are 536 licensed industrial vessels operat­ ing in the Indonesian sector of the area. The majority of these vessels however do not operate from Merauke Town. Only a relatively small industrial fleet of 124 vessels use Merauke District as a fishing base. The existing commercial jetty with its deep water anchorage is ade­ quate to meet the operating needs of the vessels. Supporting shore facilities are not needed as the catches are directly frozen on board the vessels and later transhipped to reefers for export. Industrial fishing companies operating from Merauke also prefer their own shore-based facilities to suit their operational requirements. Thus the construction of another fishing harbour in Merauke may not be prudent at this stage. It may suffer the same fate as the existing Fish Landing Place (PPI).

On the other hand, the small-scale fisheries in Merauke are unorganized, fragmented and in an under-developed state. It has been left behind in the mainstream of development and needs to be upgraded to improve the socio- economic conditions of the fishing communities.

6.2.2 Constraints The sr.1all-scale fisheries sub-sector suffers from a number of constraints in its development. The constraints addressed relevant to the scope of the TCP Project are as follows:

6.2.2.1 Infrastructure The small-scale fishing operations in Merauke District are conducted from a large number of bases scattered along the 1,050 km coastline. These fishing bases are actually the villages of the fishing communities. In these areas, shore-based infrastructure facilities for fish landing, 43

handling, processing and marketing are virtually non-existent. As a result, the fish found in Merauke is generally not well preserved.

6.2.2.2. Marketing The marketing of the catches of small-scale fishermen is unorganized. Fish are landed at the fishing villages in remote areas and await the arrival of fish collectors to buy the catches. Under such a situation the fishermen have limited bargaining power. There is a lack of marketing institutions, like cooperatives, to look after the interest of the fishermen.

The transport of fish is also constrained by the poor infrastructure in the rural coastal areas. Accessibility to these areas is only by boat, motor-cycle or bicycle. The expedient transport of fish, a perishable commodity is a problem. Presently, there is a lack of transportation services, be it by sea, land or air. Where it exists, the cost is relatively high. Some traders have carried out some inter-island marketing of fresh and preserved fish but found the margin of profit neglible except for the high-value species and products due to the high cost involved and time taken to reach its destinations. Marketing information and communication are also poor.

6.2.2.3 Post Harvest The proper handling, cleaning, preservation and processing of fish practiced currently are far from satisfactory, resulting in high post-harvest losses, severe quality deterioration and drop in prices. Ice is seldom or sparingly used. An examination of the quality of fresh fish in Merauke market indicated their poor state. Similarly, the dried shark skin exported from Merauke fetched a low price of only Rp 500 per kg.

It does not appear that there are proper landing, handling and storage facilities at the landing sites in the fishing villages. The standard of hygiene is low and there is a general lack of awareness of the importance of post harvest handling and preservation of fish.

6.2.2.4. Fishing Vessels The small-scale fishing fleet used in Merauke is comprised mainly of dugout canoes and small plank-built boats or sampans. A majority of these (78%) are non-powered. The problem with these traditional boats is that they are not suitable for all-weather use and have a limited range of operation. As such there are limitations on its utilization and capacity to fish.

6.2.2.5. Human Resources The small-scale fishermen in Merauke have very low basic education. They have limited knowledge and skills on fishing, handling, processing and marketing. As such, they are not able to reap the full benefits of their efforts.

6.3 Conceptual Development Approach The small-scale fisheries appear to offer the best prospects for sustainable development through the exploitation of the market opportunities now appearing on the horizon. This development should aim to increase the value of the landed catch through better handling and preservation techniques apart from increasing the volume of the catch.

A people-centred development would involve the entire coastal fishing communities in the district in the decision making process and at the same time, through community-based 44 management schemes or cooperatives, safeguard the existing inshore natural resources and habitats from irresponsible and short-sighted industrial exploitation.

Given the fragmented nature of the small-scale fisheries, this development should preferably be implemented through a network of integrated fish landing centres. An integrated fish landing centre is a self-contained entity able to receive or collect fish from peripheral or secondary centres, package or process it in suitable form and export it to a different region or country. For such an entity to function properly, it has to be located at the main centre of activity of a number of coastal communities or secondary centres.

As shown in Diagram 1, the project should only be formulated once accurate field data has been collected, the resource potential and marketable species identified, the market (local, regional or overseas) secured and means of reliable transport to the desired market developed.

A typical development project formulation would consist of four major components: 1. Organization of an institutional framework for the management of the main centre and secondary centre, such as a cooperative; 2. Development of the infrastructural needs covering both the main centre and the outlying secondary fishing centres; 3. Formulation of the fleet development needs to suit existing local conditions; 4. Formulation of an extensive extension programme at village level to satisfy manpower development needs.

At the implementation stage, all four major inputs should be coordinated from the proposed main centre; technical backstopping may be carried out from more distant centre, like a provincial capital. At each secondary centre or coastal fishing community, low-tech micro infrastructure should then be installed in accordance with the project objectives and lines of communication and/or collection systems refined in line with demand.

6.3.1 Potential Project at Merauke The District of Merauke encompasses a total of 18 subdistricts, of which five are coastal; Merauke, Agats, Atsy, Kimaan and Okaba. Despite the fact that the Team only spent a few days at Merauke and cannot possibly formulate a definitive integrated development project, conditions in Merauke town indicate that there is scope for such a project as outlined in Diagram 1.

There are promising indications that the mangrove ecosystem, internal waters, and territorial sea of Merauke District have substantial demersal resources. This presents considerable development opportunities. Market for fresh-on-ice snapper and barramundi and live crab which are abundant have been tentatively identified as follows : 1. Darwin for the snapper and barramundi 2. Singapore for the crab.

Other possible secondary markets which could be developed include inter-island trade for smoked and salted fish. Moreover, the airline flying to Merauke is also planning direct flights to Darwin. Referring to the flow chart in Diagram 1, Merauke satisfies the first condition for a main centre but weak on reliable statistical data. The airline, on the other hand, holds the key 45 to the export route and should be brought in on the development plan at an early stage to ensure that efforts by the local entrepreneurs or exporter are matched by the airline in such areas as flight schedules, preferential cargo capacity and competitive cargo rates. Before an integrated development programme can be formulated, Merauke subdistrict has to be surveyed properly for stocks, vessels, gear, demographics and environmental conditions. Once the above data has been collected and analyzed and the export route agreed upon, the project formulation proper may start. This would entail the identification of secondary centres amongst the coastal communities around Merauke town (the proposed main centre). The basic function of these centres would be twofold : 1. to reach as far downstream in the collection system as possible with new ideas and ~raining, cooperative effort, credit schemes, ice, potable water, hygiene etc; 2. to streamline the collection effort and move away from the current fragmented situation.

In other words, these centres would act as focal points for the fishermen where collective fish deliveries would be maintained on a regular basis to meet the export demand.

6.3.1.1 Infrastructure Requirements Both the secondary landing centres (coastal village communities) and the main centre (in this case Merauke town) must be equipped with suitable infrastructure, geared to the real needs of the proposed development.

6.3.1.1.1 Secondary Landing Centre The secondary landing centres would be at the downstream end of the fish collection system. As such the infrastructural requirements would be very basic. Depending on such things as volume of catch and species, the infrastructure would probably consist of a small, fenced-off enclosure with : 1. A simple, covered, concrete-paved work area; 2. An insulated, containerized ice store with a proper, mechanical ice crushing machine; 3. A local fresh water supply augmented by a rain water collection system with basic chlorination facilities and possibly, a sea water based hose down system; 4. Fish washing and packing table and stainless steel scales; 5. Cooperative office and supplies store geared to local needs (hooks, twine, fuel in jerricans, basic spares, chlorination tablets and soap etc.); 6. Adequate supply of locally made fish boxes or baskets to be circulated amongst the local fishermen for the post harvest handing of fish and ice; 7. Suitable toilet facilities and basic sewerage system.

If boats are normally beached at the proposed secondary centres, jetties should not be included in the infrastructure. At the initial stage it would be assumed that the village or community has no power supply except for small personal generators and that the insulated ice store would be suitable for storing ice in block form for a number of days. The site for this facility should be chosen carefully, with particular attention being paid to the distance from the coastline, flooding during the rainy season, levels and falls of the ground (must be suitable for sewerage systems), proximity of village wells, etc.

The link between a secondary centre and the main centre at Merauke would be either by road or sea. Secondary centres in the immediate vicinity of Merauke which are served by a road would be linked to the exporter's operation by an insulated, or better still, a refrigerated truck. 46

Secondary centres beyond the existing road network would be linked by a collector vessel. Typically, this vessel would consist of an existing 30 GT vessel converted to carry block ice and iced fish in an insulated hold. To avoid contamination of the fish by fuel, a different vessel must be used to carry fuel to the villages (such as kerosene, petrol and diesel) in jerricans and basic supplies for the cooperative such as soap, chlorine in tablet form, basic spares etc.

6.3.1.1.2 Main Centre At the main centre itself, the entrepreneur or exporter, whether dealing in iced fish or smoked fish, would build up his own infrastructure to handle the stream of products coming out of the secondary centres. Preferably, such private sector facilities should be concentrated inside an industrial estate 'located as near as possible to the market route, such as the commercial harbour or airport. Basic facilities common to all entrepreneurs should include chlorinated water, electricity, sewerage reticulation and telecommunication links.

The collector vessel together with the supply boat would typically sail with ice, and return on the same day with good quality fresh fish on ice. Port facilities would consist of rented use of a commercial jetty to off load and victual the collector vessel. Dedicated facilities such as the existing PPI would not be required for such an operation.

A fresh-on-ice fish exporter's packing hall, for example, would typically require the following: 1. A packaging hall constructed to the highest standards of hygiene with a sealed epoxy floor, drains and filters; 2. Stainless steel working benches; 3. Chlorinated fresh water supply and storage system with a mobile high pressure cleaning machine; 4. Proper toilet facilities connected to a waste disposal system; 5. Cold room for overnight storage of pre-packed products as a backup against flight cancellation; 6. A supplier of airfreight packing boxes for fish together with a hygienically safe storage for the boxes on the premises; 7. Refrigerated or insulated truck to carry airfreight boxes with fresh fish from the packing hall to the airport.

The facility would have to conform to the standard specifications for good management practice for fish and fisheries products published by DGF.

Ice for the whole operation would come from either existing commercial ice-making establishments or the exporter himself. Great attention would have to be paid to any proposed expansion of the ice production facilities. Whilst Merauke already has a commercial venture making block ice, a flake ice machine would be cheaper, occupy less space and produce ice "on tap". However, weight for weight, flake ice takes up more space than block ice and melts faster. The relative merit of whether to produce block or flake ice would have to be studied in depth between the exporter (who needs flake ice) and the collector (who might prefer block ice). Similarly, a smoked fish exporter would build his infrastructure to suit his trade.

In most cases, the collector would be another entrepreneur or a boat owner contracted by the exporter and the fishermen's cooperative to transport the fish and return cargo for a fee. 47

6.3.1.2 Marketing The marketing system to be developed will have to be appropriate to the socio-cultural and economic scenario of the area. Such a system can only be developed through a careful study of the ground conditions, taking into account the interest of parties involved such as the producers/fishermen, traders, consumers and those in transportation. A bottom-up integrated approach would offer the best chance of success. Some aspects that could bring about significant improvements on fish marketing in Merauke include:

Organization Organize the fishermen into a more cohesive group through the establishment of cooperatives. This is to enable the fishermen to pool their efforts together in safeguarding their resources and interests by having better bargaining power for their catches and procurement of inputs. Transportation Promote the inter-island marketing and export of fish and fisheries product from Merauke, through policy intervention to secure air and sea services at competitive rates, for the transportation of fish from Merauke to consumption centres in other parts of the country and for export. Market Information Improve the monthly marketing information system compiled by the Merauke District Fisheries Service. Presently the information is rather general and may be suitable only for official use. It should be expanded to include a close monitoring of price fluctuation of fish due to seasonality and the supply and demand situation. Such information will be more valuable to the fishermen and fish traders.

6.3.1.3 Post Harvest The areas in which post harvest activities could enhance the quality of fish and fisheries products include: Fresh Fish Handling and Preservation Follow good handling practices on board the fishing vessels once the fish is caught. Clean the fish with sea water and keep it in insulated boxes containing ice. Upon reaching shore, sort out the fish, weigh and wash it with clean water. Then pack the clean fish with ice on alternate layer basis in styrofoam boxes for dispatch to market destinations. Crabs The rather abundant mangrove crab resource in Merauke has a ready inter-island and export market. To obtain a premium price, the crab must be transported live to market centres. This can be done by cleaning, tying and packing it on a layer by layer basis in a ventilated styrofoam box with shelves inside. If the destination is far, layer the shelves with wet saw dust or damp paper as well to maintain moisture inside the styrofoam box. Another alternative is to steam the crab and then remove its meat for export in chilled or frozen form with proper packaging. The whole process must observe strict hygiene standards and comply with quality management practices. Shark Skin The removal of skin from the shark can be further improved by applying the correct technique to ensure that it comes off as one piece. Similarly the processing of the skin can also be improved. This can be achieved by removing the remaining meat 48

from the skin first, brining it and then stretching out the skin properly for sun-drying. In this way the quality of the shark skin produced will be higher, resulting in a better pnce.

6.3.1.4 Fishing Vessels An improvement of the present traditional fleet could bring about development in the small-scale sub-sector. Vessel developments for this would revolve around the system of catcher boats and transport/carrier vessels in line with the project concept outlined.

Catcher vessels of the 5 GT class that have been successfully promoted by DGF (in similar situations) appear appropriate for Merauke. There may however be a need for some modification or strengthening for beaching to suit the local conditions.

The transport or carrier vessels should be larger in the range of 30 GT. They are for trans~Jorting the catches from the secondary centres to the main centre and simultaneously carrying ice and other supplies to the centres. Dedicated refueling boats may be necessary to avoid contamination of diesel spills.

6.3.1.5 Human Resources Development The success of the proposed development programme hinges on a concerted extension input to prepare, educate and train the fishing communities towards adopting changes for their betterment. This is not an easy process. It requires a properly planned programme covering the psychological, social, cultural, technical and economic aspects to effect the desired changes. Time and patience are needed before the development programme can bear fruit. A start has to be made and the sooner the better. In a similar manner, the extension workers have to be prepared for implementing the programme.

6.4 Recommendations The small-scale fisheries in Merauke offer considerable opportunities for development. There are still underutilized fishery resources in the estuarine and coastal waters to support the development. The success of the development programme is dependent on the expedient transport of fresh fish and fisheries products to inter-island and overseas market destinations. Policy intervention to secure commercial air freight services at competitive rates is recommended. As an air service from Merauke to Darwin by the National Airline is in the pipeline, it is timely to act now.

An intimate knowledge of the local fishing communities is also necessary to enable the design of compatible programmes and extension approaches geared towards the situation.

The available information on the small-scale fisheries sub-sector such as fish stocks, vessels, gear, landings, marketing, demographics and the environment is not adequate to enable the formulation of projects tailored to needs. It is recommended that a detailed survey of Merauke District be carried out incorporating:

1. Assessment of the potential of the target species; 2. Frame survey (fishing vessels and gear) 3. Demographic studies including cultural and anthropological aspects; 4. Socio-economics; 49

5. Marketing channels; and 6. Post harvest practices

The survey would provide the accurate information base for the realistic formulation of the proposed integrated development project on small-scale fisheries for Merauke up to technical and economic feasibility level. 50

7.0 INSTITUTIONAL STRENGTHENING

7.1 Background

The main institutions directly involved in the administration, development and management of the fisheries industry in Indonesia are the Directorate General of Fisheries, Provincial Fisheries Service (Dinas Perikanan Propinsi), and the Central Research Institute for Fisheries (CRIFI). DGF and CRIFI are separate institutions under the Ministry of Agriculture while the Provincial Fisheries Service come under the purview of the Ministry of Home Affairs.

7.1.1 Role and Function

7.1.1.1 Directorate General of Fisheries The DGF is the agency responsible for the overall planning, development and management of the fisheries industry in the country. In a recent reorganization of the Ministry of Agriculture (Minister of Agriculture Decree No. 796/Kpts/OT. 21 0/12/94), the Directorate General of Fisheries has been restructured. It now has a secretariat and six directorates namely Programme Development, Production, Enterprise and Processing, Resource Management, Infrastructure and Seed Development or Aquaculture (Diagram 2). Apart from the directorates, DGF has fisheries development centres in various fields. These are located in the regions to serve as technical implementation units. The Centre for Development of Marine Fisheries (Balai Pengembangan Penangkapan lkan/BPPI) in Semarang is the only one for marine fisheries. Fishing ports and special projects are also under the direct responsibility of DGF while the operations of the government owned fisheries companies come under its supervision.

7.1.1.2 Provincial Fisheries Service At the provincial level, the administration of the local fisheries industry is under the Governor while in the district (Kabupaten), it is under the Head of the District. These regional offices draw their authority from the Ministry of Home Affairs (Minister of Home Affairs Decree No. 5 of 1980). In general, the main role of the Provincial Fisheries Service (Dinas Perikanan Propinsi) and its branches is to implement the fisheries programmes under the technical guidance of DGF. As such, the organizational structure of the provincial and district fishery services are similar to that of DGF with the exception that there is no section on fishery resource management as depicted in Diagram 3, the Irian Jaya Provincial Fisheries Service.

The main functions of the regional services are dissemination of information and technology, provision of technical back-stopping through extension and the collection of statistics. This is done through the regional offices at provincial, district and sub-district level. They are supported by a network of stations and sub-stations at ground level which serve as the technical implementation or extension units. Another important function of the Provincial Fisheries Service is the issuance of fishing licenses for local fishing vessels up to 30 GT using engine of not more than 90 HP. Licenses for fishing vessels beyond this range, as well as those operating in the EEZ of Indonesia, are under the jurisdiction of the DGF. ;)I

7.1.1.3 Central Research Institute for Fisheries The Agency of Agricultural Research and Development (AARD) of the Ministry of Agriculture is the agency responsible for planning, implementing and coordinating agricultural research and development. Fisheries research comes under its purview with the Central Research Institute for Fisheries (CRIFI) as the institution charged with the task. CRIFI has a network of three research institutes. They are the Research Institute for Marine Fisheries (RIMF) in Jakarta, Research Institute for Freshwater Fisheries (RIFF) in Sukamandi and Research Institute for Coastal Fisheries (RICF) in Maros (Diagram 4).

The institute directly involved in marine fisheries development is the Research Institute for Marine Fisheries (RIMF) in Muara Baru, with two installations, one in Ancol and the other in Slipi. Prior to the Minister of Agriculture Decree No. 796/Kpts/OT.21 0/12/94, RIMF had two other stations namely in Ambon and Semarang carrying out work in oceanic fisheries (Ambon), pelagic and demersal resources (Semarang). They are now under the Institute for Assessment of Agriculture Technology at the provincia/level.

The role of Rll\llF is to conduct research on marine fisheries biology, oceanography, ecology, fishery resources, fishing technology, post harvest and socio-economics with the objective of providing sound scientific information for development and management. This include generating data and information on fishery resources potential and level of exploitation, fishing technology including vessel and gear design, post harvest technology to improve quality of catch and product, scientific information on the aquatic environment for fishery resource management and the improvement of fishermen's return through entrepreneur-ship, agribusiness and marketing developments. To carry out its research activities, RIMF has five research groups namely in fisheries biology, fisheries oceanography, gear technology, post harvest, and socio-economic issues. They are supported by an administrative division and two sections in planning and technical services. The structural organization of RIMF is given in (Diagram 5).

The research facilities of RIMF include office buildings, laboratories, libraries and workshops. In addition, RIMF has six research vessels ranging in size from 4 GT to 180 GT. The biggest KM Bawal Putih ( 180 GT) built in 197 4 is for pelagic resource survey; KM Mutiara IV ( 115 GT) also built in 197 4 is for demersal resources and crustacean surveying; KM Sardine IIa (64 GT) for fishing technology of small pelagic in collaboration with fishermen; KM Penelitian I (20 GT) for aquatic environment and fishing technology study; KM Kerapu (7 GT) and KM Banyar (4 GT) for aquatic environment survey.

The research outputs of CRIFI relating to policy issues are sent to DGF for use in the national planning, development and management of the fisheries industry. Research findings and technologies which require field verification are disseminated to the Institute for Assessment of Agnculture Technology in the provinces for trial and adoption. The research results are also made available to fishermen and the industry as a whole. Scientific works done are written up as articles for publication in the Fisheries Research Journal of Indonesia. 52

7.1.2 Manpower

7.1.2.1 DGF and Provincial Fisheries Service The total manpower strength of DGF and Provincial Fisheries Service inclusive of their installations is 5,290 personnel. The distributions are 590 in DGF, 2919 in the 27 provinces comprising 2,068 central government and 851 local government funded staff, 848 in the various fishery harbours, 587 in the development centres and network of stations, 265 seconded to government owned fishing companies and 81 in the various projects (Table 7.1 ).

Table 7.1 Manpower in Fisheries Institutions, 1994 Degrees Non Degrees No. Location Total IV Ill II I 1 Directorate General of Fisheries 70 294 215 11 590 2 Development Centres 5 148 345 89 587 3 Projects 3 32 45 1 81 4 Government Owned Company 7 68 189 1 265 5 Fishing Harbour 12 167 616 53 848 6 Provincial Fisheries Service 17 802 1249 0 2068 (Central Government) 7 Provincial Fisheries Service 76 351 422 2 851 (Local Government) Tot a I 190 1862 3081 157 5290 Note: I, II, Ill and IV represent grade of serv1ce With IV being the highest grade.

In terms of qualifications, 5 have Ph. D., 31 Master Degrees, 1, 389 Bachelor Degrees, 849 Diploma Holders, 2,541 High School Graduates, 115 Junior School Graduates, and the balance with lower level education. Of these, 3,665 are considered as technical and 1,625 non-technical staff (Repel ita VI, 1994 ).

Apart from the above, there is a network of agriculture extension workers in the field. In fisher­ ies, there were 4,103 extension workers spread out in the 27 provinces in 1994. About 8% of them have tertiary education (Table 7.2). The agricultural extension workers, including those in fisheries are now under the Centre for Agriculture Extension, Ministry of Agriculture. Prior to 1994, they were under the DGF. With the new arrangement, the extension workers are now under the control of the Provincial Fisheries Service. They are also expected to expand their scope of work to cover agriculture as a whole, apart from their own specialized fields. 53

Table 7 2 Fisheries Extension Workers in 1994 Province Degree Non Degree Total DIAceh 6 87 93 Sumatera Utara 11 102 113 Sumatera Barat 22 142 164 Ria u 10 106 116 Jamb i 6 93 99 Sumatera Selatan 7 192 199 Bengkulu 5 63 68 Lampung 8 55 63 DKI Jakarta 9 14 23 Jawa Barat 6 237 243 Jawa Tengah 27 229 256 Dl Yogyakarta 6 63 69 Jawa Timur 16 373 389 B a I i 9 112 121 Nusa Tenggara Barat 19 118 137 Nusa Tenggara Timur 8 185 193 Timor Timur 2 16 18 Kalimantan Barat 11 209 220 Kalimantan Tengah 14 173 187 Kalimantan Selatan 24 105 129 Kalimantan Tirnur 16 61 77 Sulawesi Utara 20 215 235 Sulawesi·Tengah 8 104 112 Sulawesi Tenggara 16 140 156 Sulawesi Selatan 8 271 279 Maluku 13 144 157 Irian Jaya 9 178 187 Total 316 3787 4103

7.1.2.2 Research Institute For Marine Fisheries The present (1996) manpower strength of RIMF is 221, comprising 82 established researchers and 7 non-classified ones; 36 established technicians and 11 non-classified ones; 3 established computer operators and 1 non- classified ones; 7 established librarians and 2 non-classified ones; 2 filing clerks; 51 administrative staff and 19 supporting workers (Table 7.3). In terms of qualifications, 97 (44%) of the staff posses university degrees with 14 having Ph. D., 25 Master Degrees and 58 Bachelor Degrees. The balance is composed of 19 (8%) Diploma holders and 105 (48%) are from lower levels of schooling (Table 7.4). 54

Table 7.3 Manpower Strength (1996) Research Institute for Marine Fisheries No. Position Total Number 1 Researchers 82 2 Researchers (Non Classified) 7 3 Librarian 7 4 Librarian (Non Classified) 2 5 Computer operator 3 6 Computer operator (Non Classified) 1 7 Technicians 36 8 Technicians (Non Classified) 11 9 Filing clerks 2 10 Administrative staff 51 11 Support workers 19 Total 221

Table 7.4 Manpower of Research Institute for Marine Fisheries by Educational Qualifications Institution Level of Qualification 83 82 S1 SM SLTA SLTP so Total RIMF Muara Baru 9 8 38 9 50 5 6 125 Laboratory Ancol 0 3 7 0 5 1 3 19 Laboratory Slipi 4 14 9 10 15 4 5 61 Demon pond Kamal 1 0 4 0 9 0 2 16 Tot a I 14 25 58 19 79 10 16 221 S3 Ph.D. S2 Master Degree S1 Bachelor Degree SM Diploma SLT A Senior Vocational School SL TP Junior Vocational School SD Primary School

7.1.3 Education and Training

7.1.3.1 Agency for Agriculture Education and Training The Agency for Agriculture Education and Training (AAET) of the Ministry of Agriculture, is the agency responsible for human resources development in agriculture including fisheries. The role of AAET is to plan, develop, implement or assist institutions in the implementation and coordination of training in the agriculture sector. The programmes of AAET cover administrative and management training for officers of the lower echelon level, technical training locally or abroad for officers, and extension education cum training for farmers and fishermen in collaboration with related institutions. Training for the top echelon level personnel is by the National Administrative Board (Lembaga Administrasi Negara/LAN) and National Defence Institute. 55

The implementation of training is usually done by the respective technical implementation units (Unit Pelaksana Teknis/UPT) of MET, DGF and Provincial Fisheries Service. At the AAET level, there is already a structured fisheries education system. This comprises the Fisheries College (Sekolah Tinggi Perikanan/STP) in Pasar Minggu equivalent to a college level study of 3 to 4 years with degree status; Senior Vocational High School (Sekolah Usaha Perikanan Menengah/SUPM) and Junior Vocational High School (Sekolah Usaha Perikanan Pertama/SUPP) which conduct vocational fisheries courses of 3 years duration at different levels. MET also conducts shorter training courses at its Fishing Technology Training Centres (Balai Keterampilan Penangkapan lkan/BKPI) in Belawan, Tegal, Banyuwangi, Ambon, and Bitung.

7.1.3.2 DGF and Provincial Fisheries Service At the DGF and Provincial Fisheries Service level, extension training is being provided to both extension staff and fishermen at various levels. They are carried out at the Centre for Marine Fisheries Development (Balai Pengembangan Penangkapan lkan/BPPI) in Semarang and the various extension units (Unit Pembinaan Modernisasi Bertahap/UPMB) at the provincial level. Some of these units have their network of stations (Loka) and sub-stations (Panti) at the district (Kabupaten) and sub-district (Kecamatan) level respectively.

7.1.3.3 Universities In addition, there are some 11 national and private universities providing fisheries education from the diploma to degree level. Some of these institutions such as the Fisheries Faculty of the Bog or Agriculture Institute conduct post graduate courses up to Ph. D. level as well.

7.2 Issues And Constraints

7.2.1 Organization and Function

7.2.1.1 Sectoral and Inter-Sectoral Level A number of ministries, agencies and institutions are involved in the administration, development and management of the fisheries industry in Indonesia. At the sectoral level, the three key institutions DGF, Provincial Fisheries Service and CRIFI are separate organizations. VVhile DGF and CRIFI are under the Ministry of Agriculture, the Provincial Fisheries Service come under the Ministry of Home Affairs. Although there is some demarcation on the roles and functions of each, there is a lack of consultation and coordination in the formulation and implementation of fisheries policy and programmes.

At thR inter-sectoral level, the scenario is similar. The State Ministry of Research and Technology and Ministry of Industry and Trade exert a strong influence on the issues of fishing vessel and fish processing plants. The Arm Forces Command (Navy) on the other hand is the lead agency in fisheries enforcement. Others include the Ministry of Cooperatives which promote fisheries cooperatives; the Directorate General of Sea-Communication which deals with the i8suance of sea worthiness certificate, classification of vessels and harbour regulations; and Indonesian Institute of Sciences through its agency, National Institute of Oceanography which does work in marine sciences. Very often, there is a lack of understanding and co-ordination in the discharge of these functions, which have an adverse effect on the activities of the fisheries industry as a whole. 56

The lack of a clear chain of command not only affects the implementation of programmes and achievement of goals in fisheries, but also gives rise to conflict of interests at sectoral, departmental and institutional level.

7.2.1.2. Directorate General of Fisheries Coming down to DGF level, the structural provisions of a secretariat and six directorates with their sub-directorates (Diagram 2) are generally appropriate for it to discharge its responsibility in the planning, development and management of the fisheries industry. The major drawback being the absence of fisheries extension, which is now centralized in the Ministry of Agriculture under the Centre of Agricultural Extension since 1994. This has to some extent diluted extension services to the fisheries sector as there is also a change of extension system from the monovalent to the polyvalent one.

Further, within the DGF itself, there are areas which require strengthening and streamlining in line w1th the growing development and management needs of the industry.

These are the sub-directorates of data and statistics, fisheries resources, fisheries management, industrial fisheries/licensing, fishing harbour, fishing vessel, marketing, post harvest and enforcement.

7.2.1.2.1 Data and Statistics The sub-directorate of data and statistics has to be beefed up because it is now in the process of upgrading its scope of work from one oriented towards production statistics to a comprehensive data-base of fisheries management information system (SIMKANNAS). Focus will also be given to the collection of data on fisheries in the EEZ. Presently, this is not done on a routine basis. Compilations are made from whatever reports that are provided by fishing companies without checking for accuracy. As a result, there is insufficient reliable data on the fishing activities in the EEZ.

7.2.1.2.2 Fisheries Resources and Management The sub-directorates of fisheries resources and management have a major role to play in guiding and regulating the development of the industry on a rational basis. At the moment, the thrust of the management approach is towards maximizing production without much provision for conservation of the resources. The conservation aspect has been neglected largely due to a lack of awareness that the industry has reached a stage where the emphasis on growth should give way to conservation in the interest of sustainability.

7.2.1.2.3 Industrial Fisheries/Licensing The sub-directorate of industrial fisheries development which deals with the licensing of fishing in EEZ has several inadequacies. Licensing is also an activity which is subject to influence and pressure. This has given rise to a number of problems. The allocation of access is one. Often, without much interaction with the fisheries resources and management sections, licenses are issued. The capability of the sub-directorate appears limited. It does not seem to have sufficient knowledge of the fisheries being licensed.

As a result, the scrutiny of fishing operations in the EEZ through licensing is weak. The handling of data and collection of fee are still unsatisfactory. This is manifested in the lack of 57

data on the EEZ fisheries and substantial loss of revenue. In this respect, the sub-directorate has yet to fully exercise its authority on license refusal for non-compliance.

Apart from the above, the issuance of fishing licenses is a rather long drawn affair involving 13 different agencies and going through some 30 processes to obtain permits ranging from actual fishing to the use of vessel, equipment, manpower etc. DGF is only involved in 2 of the 30 processes.

7.2.1.2.4 Fishing Harbour · The shortcomings of fishing harbours are in the areas of berth management, onshore facilities, hygiene and environmental awareness. The utilization of the quays are not well controlled. They appear to be used as general quays instead of as offloading ones. This has given rise to unnecessary congestion and delay in offloading the catches from vessels. Onshore facilities are also lacking. Water for cleaning the auction floors is in short supply, cold rooms are lacking and toilets are insufficient. Most people in the harbour area lack awareness that the fishing port is part of a food processing chain and the importance of hygiene. As such the harbours do not appear to be well maintained as evidenced by rampant pollution of the environment.

7.2.1.2.5 Fishing Vessel In general, the staff of the fishing vessels sub-directorate are well-qualified for their work. There are naval architects, marine engineers, fishery engineers and draughtsmen. Their numbers are however small, with a maximum of 2 each. They are responsible for design work, technical assistance, inspections and safety of vessels.

7.2.1.2.6 Fish Marketing One of the major constraint of fish marketing in Indonesia is the expedient transport of fresh fish from the sparsely populated production areas in eastern Indonesia to the densely populated demand centres in Java. The matter is complicated by the findings of the TCP Project that further expansion of catches would mainly involve the small pelagics, which are of low value. This poses considerable future challenge to the marketing of fish in Indonesia.

7.2.1.2.7 Post-Harvest The post-harvest handling of fish in Indonesia is generally in a poor state. There is lack of appreciation tha.t once fish is landed, it will start to deteriorate. Hence it needs to be properly handled and preserved in a hygienic manner. As a result, post-harvest losses both in terms of quantity and quality are considerable.

7.2.1.2.8 Enforcement Enforcement is one of the weakest link in the present management system. There are two aspects of enforcement. One is in the technical aspect relating to control of resource exploitation and the other is the physical aspect on compliance of laws and regulations.

On both counts, enforcement has been minimal and weak. DGF's efforts in the technical aspects of enforcement in data requirements and vessel marking through licensing are still unsatisfactory. It has yet to fully exercise its authority on refusal to issue or renew a license for non-compliance as its main mechanism to improve enforcement. 58

Similarly, the enforcement authority, Coordinating Board for Sea Security (BAKORKAMLA) headed by the Navy does not seem to accord high priority on fisheries matters due to constraints in resources such as facilities, equipment and funding. This is further compounded by the lack of understanding between fisheries and the military on jurisdiction in enforcement matters. Many officials in the DGF and the Provincial Fisheries Service are not clear on the role, procedures, capability, limitation and facilities available for enforcement of the EEZ. On the other hand, the military especially Navy is unsure of licensing procedures, fishing gear, fishing operations and trends in fleet development including deployment. An increasing understanding would facilitate cooperation.

7.2.1.2.9 Manpower Strength In terms of manpower strength, DGF has a very good ratio of officers with adequate qualifications. Of the 560 positions accounted for out of 590 in the establishment, some 51% possess degrees, 8% with diplomas and 41% are mostly high school and junior high school graduates (Table 7.5). With such a relatively high ratio of qualified personnel, the present strength of 590 is generally sufficient for the performance of its role in planning, development and management at the national level. The main weakness however lies in the inadequate grooming of officers for undertaking the complex task of developing and managing the industry. In this respect, fisheries involve a multitude of disciplines ranging from fishery biology to fishing vessel, gear and post-harvest technology. Expertise in the appropriate disciplines are still lacking and need to be built up to enable the knowledgeable and effective performance of duties.

Table 7.5 Distribution Of Staff In DGF in 1995 Directorate Level of Qualification S3 S2 S1 DIPL. HS JHS OTHER Total Secretariat 2 5 44 13 94 2 12 172 Programme 0 4 33 5 24 0 2 68 Production 0 0 42 3 21 0 2 68 Enterprise 1 5 35 5 16 0 0 62 Resource Management 0 5 43 6 14 0 0 68 Infrastructure 0 0 39 5 25 1 0 70 Seed Development 0 2 24 6 19 0 1 52 Tot a I 3 21 260 43 213 3 17 560 S3 Ph.D. S2 Master Degree S1 Bachelor Degree DIPL Diploma HS Senior Vocational School JHS Junior Vocational School

Degree 51% Diploma 8% Non Degree 41% 59

7.2.1.3 Provincial Fisheries Service

7.2.1.3.1 Organization The organizational structure at the provincial level generally follows that of DGF with the exception that it still retains the extension section but does not have one on fisheries management. The thrust of Provincial Fisheries Service is thus on increasing production through extension and issuance of fishing licenses. They also collect fisheries data and statistics for compilation by DGF at national level. With the increasing pressure on the fishery resources through increased exploitation, the need to monitor and manage the activities of the industry has become very urgent. This capability has to be built up at the Provincial Fisheries Service level as soon as possible. The capacity to collect reliable and timely data and statistics at the provincial. and district level is still wanting. The personnel involved are not adequately trained to do their job properly.

7.2.1.3.2 Manpower Strength The manpower strength of the 27 Provincial Fisheries Service totalled 2,919 comprising 2,068 central government and 851 local government supported staff. In terms of qualifications, 40% of the central government and 50% of the local government staff are degree holders while the remaining are high school and junior high school graduates. In addition, the Provincial Fisheries Service is back-stopped by a network of field extension workers stationed at the Agricultural Extension Centres. There are some 4,103 fishery extension workers in 1,718 Agricultural Extension Centres throughout the country. The majority (92%) of the fishery extension workers have high school qualifications only. Similar to DGF, a large number of the Provincial Fisheries Service personnel are not trained on their job functions. Thus they generally serve as only fishery administrators lacking technical orientation in the process.

7.2.1.4 Research Institute for Marine Fisheries

7.2.1.4.1. Organization In terms of organization, the existing set-up of a RIMF with only 2 installations, all located in Jakarta is far from satisfactory. This has resulted in research activities being unevenly spread out. Large areas of marine waters especially in eastern Indonesia which are important but are not covered. Up to date facilities and equipment are also lacking. Taking the case of research vessels as example, two of the more appropriate vessels KM Bawal Putih I (180 GT) and KM Mutiara IV (115 GT) are more than 20 years old and not functioning well.

7.2.1.4.2. Manpower Strength Indonesia has a vast expanse of internal, territorial and EEZ waters amounting to 5.8 million sq.km. In comparison with the large area and am9unt of work to be covered, a mere total manpower strength of 221 with 82 researchers only is definitely inadequate. There may be others involved such as the universities, Ministry of Research and Technology and the Research and Development Centre for Oceanography but their roles are insignificant except for the latter. As a result, the research inputs are relatively low and thinly spread out. Research activities are also scattered and there is generally a lack of documentation of previous work. 60

7.2.1.4.3 Facilities/Funds The lack of manpower is further compounded by the shortage of operating funds and facilities. At the moment, the limitation of operating funds constitutes the most serious constraint. This has prevented researchers from the proper implementation of their research programmes. A good example is the case of the research vessels operated by RIMF. The average utilization of the vessels is only 40 days per year.

7.2.1.5 Education and Training The foundation for fisheries education and training has already been established in Indonesia covering both formal and informal/extension types. Formal fisheries education is provided by universities, colleges and vocational schools at senior and junior high school level. This is supplemented by an informal extension education a:ld training programme carried out by the technical implementation units (Unit Pelaksana Teknis/UPT) of the institutions concerned.

At the national level, there are the development centres (Balai) while at the provincial level there are the extension and development units with a network of stations (Loka) and sub-station (Panti) at the district and sub-district level respectively. Although the system of fisheries education and training is fairly well established, there are constraints on the provision of quality education.

Churning out numbers is not a problem but producing appropriately trained manpower is. The quality of graduates is affected by the lack of infrastructure facilities, equipment, qualified instructors in sufficient numbers and last but not least operating funds. Due to the lack of facilities such as laboratories, workshops, equipment and tools, the courses tend to be theoretical resulting in the students lacking in practical skills. With the rapid development in fisheries science, the courses will also have to be modified and upgraded in keeping with the innovations and requirements of the industry.

7.3 Recommendations

7 .3.1 Directorate General of Fisheries 1. Forge greater co-ordination amongst the ministries and agencies involved by forming a high level National Steering Committee on Fisheries Development and Management. The membership of this Steering Committee should comprise the Ministry of Home Affairs (Provincial Fisheries Service), State Ministry of Research and Technology (fishing vessel), Ministry of Trade and Industry (cold storage and processing facilities), Ministry of Communication (harbour, classification of vessels and certification of sea worthiness), Ministry of Cooperatives, Navy (enforcement), National Institute of Oceanography, Indonesian Fishermen Union (Himpunan Nelayan Seluruh lndonesia/HNSI), Indonesian Fisheries Enterprise Federation (GAPPINDO), and the Ministry of Agriculture including DGF and CRIFI. The chairmanship of the Steering Committee should be the Ministry of Agriculture with the DGF serving as secretariat. The main objective of the Steering Committee is to enlighten the parties involved on the policy, strategies and programmes of the fisheries sector to gain support as well as cooperation in its implementation. This is to eliminate the lack of coordination that is impeding the development and management of the sector. 61

2. Although a high number (51 %) of DGF staff are university graduates, their education in fish8ries is general in nature. With rapid development of the industry and its increasing complexities, they have to be upgraded in their knowledge and skill to meet the new demands of developing and managing the industry based on sound information. Presently the percentage of staff receiving in-service training is still low. Only 4% of the staff have post graduate fisheries qualifications. The in-service training programme has to be stepped up. In this reg3rd, the personnel division of DGF has drawn up an elaborate programme in Repelita VI for manpower training but unfortunately this is not given priority. Some consideration needs to be accorded to strengthening the capability of DGF particularly in: a) Upgrading of the fisheries statistics and implementing the proposed National Fisheries Management Information System by deploying more staff with computer science qualifications to the sub-directorate and providing them with the training to operate and maintain the integrated data base system developed. b) Enhancing resource analysis, management and conservation by training the staff involved in the principles, techniques and methodology applied in the field to improve their knowledge and skill for enhanced performance. Conducting study tours to areas with effective fisheries management as well as those with disaster. De-centralizing and increasing the management staff at the field/provincial level. c) Broadening the knowledge of key staff involved in licensing by attending short courses in fisheries management, attachment to an operational and effective licensing unit abroad on control of fishing effort and computerizing the work of the sub-directorate. In addition, reducing the bureaucracy of licensing by adopting a one­ stop agency approach. DGF would be the best lead agency for this as it is a fisheries matter. d) Improving harbour design and management by sending staff involved for training overseas in topics such as management techniques, environmental engineering, waste disposal and water supply. Providing local training to harbour master and health inspectors to implement the enforcement of laws in the field. e) Conducting marketing work focussed on the inter-island trade of low price small pelagics which are plentiful. Providing training in marketing and distribution analysis, marketing research and market information system. f) Enhancing the capacity of the fishing vessel section by increasing the relatively small number of technical staff, who have to oversee one of the largest fleets of fishing vessels in the world. g) Improving post harvest practices by havir.g a nation-wide extension programme directed at the fishermen, extension workers and those connected with the industry on the importance and need to maximize return. h) Compiling a fisheries enforcement profile to facilitate understanding and cooperation between fisheries and enforcement agencies.

7.3.2 Provincial Fisheries Service 1. Establish a fishery management section in the organization structure of the Provincial Fisheries Service to complement that of DGF and implement measures developed. The Provincial Fisheries Service can also serve as the supervision arm of DGF for overseeing the port-related activities of the industrial fleet licensed for operation in the respective provinces. This can be effected through the delegation of power by DGF to the Provincial Fisheries Service. At the moment, there is a gap in this area as DGF has no physical presence in some locations and it would be too costly to establish one. 62

2. The collection of fisheries statistics and data is done at the provincial level. As the reliability and accuracy of fisheries statistics are much dependent on the field staff, they should be properly trained to carry out the task and supervised. Adequate funds should be provided to enable the field staff to go to fishing centres to collect data. Equipment such as calculators and computers should also be provided to facilitate processing and storage of data col­ lected. 3. Fisheries extension workers have a key role to play in the sustainable development and management of the fisheries industry. They are the agents to bring about changes in the attitude, knowledge, skills and/or behaviour of the fishermen. This would require a more concerted training programme for extension workers to continuously upgrade their knowledge and skills in the production, post harvest, marketing and management aspects so that they can be more effective. Further, the change in the grouping of extension workers by commodity or monovalent approach to a multi or polyvalent one encomposing the whole field of agriculture is a setback to fisheries because of its high demands. The interests of the fisheries sector would be better served to retain the previous system.

7.3.3. Research Institute for Marine Fisheries 1. Increase the allocation for fisheries research. One way is to set aside a portion of the license fee collected for it. The Minister of Agriculture Decree No. 816 of 1990 provides for the license fees to be used for fisheries development. This will enable the researchers to carry out more research activities and make better use of the research vessels for resource surveys.

2. In view of the comparatively small budget available for research and the large number of parties involved, it would be prudent to coordinate research activities. This would not only avoid duplication of efforts but also ensure that they are complementary. In this way, the limited research funds will be more efficiently utilized. The AARD with CRIFI as the secretariat and others involved particularly DGF and the universities as members would constitute an effective platform for a Fisheries Research Coordinating Committee. The main task of the Committee would be to establish research priorities in line with the needs of fisheries managers and the industry as well as to ensure collaboration in its implementation.

3. Upgrade the capability of the researchers in line with the increasing complexities and demand of fisheries science. An intensified post-graduate or applied training programme would boost the much needed category of trained scientists to serve the managers and industry better. In addition, as the pool of researchers is rather small, there is a need to increase the number. This should be done on a gradual basis with matching increase in research funds to ensure optimum utilization of manpower.

4. The present organizational framework of RIMF has to be expanded. Establish a network of research field stations located in important fishing areas to conduct studies and collect data for a more accurate assessment of the fisheries to avoid over exploitation.

7.3.4 Education and Training 1. Refurbish the network of development centres, technical implementation units and their stations with the necessary infrastructure facilities, equipment, and tools to enable the conduct of a more practical oriented training programme. 63

2. Upgrade the knowledge and skill of the existing instructors to enable them to be more effective.

3. Allocate sufficient funds for the proper conduct of training courses. 64 8.0 CONCLUSIONS

The review of the fisheries resources concluded that the results of the FAO Workshop on the Assessment of the Potential of Marine Fishery Resources in Indonesia which built on previous assessments, corrected weaknesses, and considered new data represent the best available esti­ mates of the resource. Unless there is strong scientific rationale to the contrary, it is recommended that DGF should use the estimates produced by the FAO Workshop in 1995.

The indications are, there is no large unexploited resources upon which major fleet expansion plans can be based. Demersal fish and shrimp resources are not considered capable of supporting further fleet expansion 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 nl)mbers 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, it is thought that incremental expansion be carried with close monitoring of the effect would be best. The replacement of the large foreign tuna fleet, especially the longlines, is seen as perhaps the only clear possibility for a substantial expansion of the Indonesian EEZ fleet.

The replacement of the foreign fleet is in line with the governments policy on the localization of foreign fishing in the in the EEZ. In order to achieve the objective of localization of the EEZ fisheries while striving to maintain international competitiveness, government policies with respect to fishing vessels development should be modified. Three options are proposed namely support for building vessels locally, allow import of foreign vessels and conversion of vessels from over-exploited fisheries to displace the foreign vessels in the EEZ. These should be carefully evaluated by government in the context of overall development policies.

The fisheries policies of Indonesia are largely oriented to development, production and fleet qrowth. This is quite normal in a developing country with, on one hand substantial marine resources and on the other, large requirements for food, export earnings, and industrial growth. Presently there is no major conservation 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 national limit to what the marine capture fisheries can produce. From the study of the expected catches of 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 in the development of fisheries in Indonesia has been reached. The major conclusion of this project is that the primary objective of fisheries management in Indonesia requires change from being one of maximizing production to be one of assuring 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 enhancement in staff capability in fisheries management matters, admin­ istration of the licensing system, procurement of data from fishing operations, and enforcement of regulations. Likewise, the management capability at the Provincial Fisheries Service level, which at present is minimal has to be developed and upgraded in tandem with that at the national level. 65

The lack of a clear chain of command at the management level has impeded the development of the fisheries industry. A number of ministries, agencies and institutions are involved. In order to forge greater coordination and understanding for the smooth functioning of the industry, it is recommended that a National Steering Committee on Fisheries Development and Management be established. The membership of this Steering Committee should comprise all the ministries, agencies and institutions connected, Arm Forces Command (Navy) and the industry represented by the Indonesian Fishermen Union and the Indonesian Fisheries Enterprise Federation. The chairmanship of the Steering Committee should be the Ministry of Agriculture with the Directorate General of Fisheries serving as secretariat.

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

The industrial fisheries based at Merauke are spearheaded by private companies and there appear to be no major development problems in this sub-sector. Therefore, the focus of government intervention in fisheries development should 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, network of centres with low tecnology micro-infrastructure, fishing vessel development, basic support services, and above all human resource development to ensure full participation by the people concerned. The formulation of a realistic project would, however, require a detailed survey of the area to provide an accurate information base. 66 9.0 FUTURE DIRECTIONS

In addressing the major recommendations of the TCP, a number of project outlines have been prepared for further action. They cover the areas of fisheries management, supporting marine fisheries research, fishing port management and development of small-scale fisheries in order of priority.

Regarding fisheries management, the most effective approach would be to generate political will and awareness on the importance of fisheries management. The generation of political will can be accomplished by demonstrating in clear terms to high level policy makers the losses associated with the inefficiencies of the present system. The creation of awareness among officials responsible for fisheries management of the consequences of a lack management can be addre::>sed through a study tour.

The next step would be to enhance the capability of staff in key areas of fisheries management through training. This involves .the sending of senior staff to attend short courses in fisheries management, training of fisheries observers for placement aboard commercial vessels to oversee actual fishing activities and record data, and the full implementation of the check point system on control of fishing vessels activities in the EEZ at one port to serve as a model of what should occur at the other check points.

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

As the increase in marine fisheries production will level off, the maximization of benefits from the catches landed can contribute significantly towards the government's objective of improving income from the sector. An effective measure to achieve this is to select a typical fishing harbour for upgrading to international standards with the aim of increasing the value of the catch, reducing the post harvest loss and improving the quality of fresh fish supplies. This will provide a showcase in modern design methodology for application to other harbours.

In line with the government's policy to develop the fisheries in eastern Indonesia, a comprehensive project for the development of small-scale fisheries in Merauke, incorporating planning, formulation and implementation has been proposed. The project 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.

The outline of the project proposals is given in the Appendix. 67

10.0 REFERENCES

Agrodev ( 1994 ). Fisheries Management. Working Paper No. 1. Fisheries Sector Project Indonesia, Asian Development Bank, TA. No. 1791-INO. Anon (1983). Hasil evaluasi potensi sumber daya hayati perikanan laut di perairan Indonesia dan perairan ZEE Indonesia 1983. Direktorat Jenderal Perikanan and Badan Penelitian Perikanan Laut, Jakarta. Anon ( 1995). Balai Penelitian Perikanan Laut (Research Institute for Marine Fisheries) Organisasi dan Tata Kerja Balai Penelitian Perikanan Laut 1995. Anon (1995). Introducing Central Research Institute for Fisheries (CRIFI). Agency for Agriculture research and Development, Ministry of Agriculture. Baclrudin, M. ( 1996). Fishery resource potentials in Indonesia. Technical Paper 1, Workshop on Strengthening Marine Resource Development in Indonesia, TCP/INS/4553. Badrudin, M. (1996). Fishery Resource Potentials in Indonesia. Technical Paper Number 1, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Badrudin, M. and R. Gillett (1996). Translations of Indonesia Fisheries Laws Relevant to Fisheries Management in the Extended Economic Zone. Technical Paper Number 9, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Badrudin, M. and Rusmadji (1988). Exploratory Fishing in the Coastal Waters of Yamdena, Aru Islands, Tembaga Pura, Teluk Saleh and Alas Strait. Jurnal Penelitian Perikanan Laut, No. 49. Dinas Perikanan Daerah Kabupaten Dati II Merauke. Laporan Tahunan 1994. FAO (1994). An Introduction to Monitoring, Control, and Surveillance Systems for Capture Fisheries. FAO Fisheries Technical Paper 338. Food and Agriculture Organization of the United Nations, Rome. FAO (1996). Final Report - Strengthening Marine Fisheries Development in Indonesia. FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". FFA (1993). Treaty on Fisheries with the USA Observers' Manual. Forum Fisheries Agency, Honiara. GilleU, R. (1995). Marine Fisheries Resources And Management In Indonesia With Emphasis On The Extended Economic Zone. Workshop Presentation Paper Number 1, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Gillett, R. (1995). Preliminary Report of the Fisheries Resource Management Consultant on Aspects of Fishing in the Extended Economic Zone of Indonesia. FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Governement of Indonesia (1990). Surat Keputusan Menteri Dalam Negeri No. 5/1990 (Ministry of Home Affairs Decree No. 5 of 1990). 68

Governement of Indonesia (1994). Surat Keputusan Menteri Pertanian No. 96/Kpts/OT.21 0/2/ 1994 Tentang Organisasi dan Tata Kerja Departemen Pertanian (Ministry of Agriculture Decree No. 96/Kpts/OT.21 0/ 2/1994 Regarding the organization and Function of the Ministry of Agriculture, Jakarta, February 1994). Martosubroto, P., N. Naamin, and Ben B. Abdul Malik (eds.) (1991 ). Potensi dan Penyebaran Sumberdaya lkan Laut di perairan Indonesia. Direktorat Jenderal Perikanan, Puslitbang Perikanan, Puslitbang Oseanologi LIPI. Overseas Agrofisheries (1992). Studies of Fisheries Development Potential In Eastern Indonesia, Volume I. Pemerintah Daerah Tingkat I Propinsi Irian Jaya, Dinas Perikanan Daerah. Buku Tahunan Statistik Perikanan Tahun 1994. Prayitno, R. (1996). Fish Marketing. Technical Paper Number 4, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Rogge Marine (1988). Sub-Project: PPI Merauke. Feasibility Study Province Irian Jaya. Sciortino, J. (1996). Harbour Panning and Management at the Macro Level. Technical Paper Number 7, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Sciortino, J. (1996). Integrated Infrastructure Development Proposals for Merauke. Technical Paper Number 3, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in lnJonesia". Shawyer, M. (1996). Fleet and Shipbuilding Component. Technical Paper Number 2, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Shawyer, M. (1996). Fleet Development. Workshop Presentation Paper Number 2, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Sunarya (1996). Improvements in Fish Handling, Processing, and Quality Control. Technical Paper Number 5, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Tan, C.K. (1995). Travel Report on Marine Fisheries In Maluku Utara and Merauke. FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Tan, C.K. (1995). Interim/Progress Report on Strengthening Marine Resource Development in Indonesia. FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Tan, C.K. (1996). Fisheries Statistics and Information Systems. Technical Paper Number 6, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Tan, C.K. (1996). Institutional Strengthening. Workshop Presentation Paper Number 4, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". Tan, C.K. (1996). Small-Scale Fisheries Development in Merauke. Workshop Presentation Paper Number 3, FAO Project TCP/INS/4553, "Strengthening Marine Fisheries Development in Indonesia". 69

Thompson Clarke Shipping Pty. Ltd ( 1996). Evaluation of Australian and Indonesian Marine Engineering Industry Collaboration Opportunities. Department of Industry Science and Technology and Indonesian Department of Industry. Venema, S. (ed.) (1 996). Report on lndonesia/FAO/DANIDA Workshop on the Assessment of the Potential of the Marine Fishery Resources in Indonesia. Report of Activity No.15, GCP/INT/575/DEN, Food and Agriculture Organization of the United Nations, Rome. Walters, C. (1 996). Sharing the high cost of effective fisheries management. Proceedings of the Third Australian Fisheries Managers Conference, Fisheries Management Paper No.88, Fisheries Department of Western Australia. World Bank (1 995). Building a Resilient Economic Base for the Twenty-First Century. Report No.13803-EAP, World Bank. 70

11.0 DIAGRAMS

Diagram 1 General Model for the Development of Small-Scale Fisheries

Diagram 2 Organization Chart, Directorate General of Fisheries

Diagram 3 Organization Chart, Provincial Fisheries Service, Irian Jaya

Diagram 4 Organization Chart, Central Research Institute for Fisheries

Diagram 5 Organization Chart, Research Institute for Marine Fisheries 71 Diagram 1

GENERAL MODEL FOR THE DEVELOPMENT OF SMALL SCALE INSHORE FISHERIES

liDENTIFY MARKET (1) AND SPECIES TO BE .j TARGETED BY THE SMALL SCALE FISHERIES I I CARRY OUT DETNLED : IDENTIFY AND/OR DEVELOP MARKET ROUTE STOCK ASSESSMENT FRAME SURVEY FROM THE AREA UNDER STUDY TO THE DEMOGRAPHIC DISTRIBUTION IDENTIFIED MARKET ENVIRONMENTAL AUDIT (GIT) (2)

I I FORMULATE (3) INTEGRATED DEVELOPMENT PROGRAMME II I I _I I I

FORMULATE BASIC INFRASTRUCTURE ORGANIZE INSTITUTIONAL FRAMEWORK DEVELOPMENT NEEDS FOR OUTLYING FORMULATE FLEET DEVELOPMENT DRAW UP PLANS FOR AN EXTENSION FOR A COMMUNITY-BASED MANAGEMENT VILLAGES IN RELATION TO PROPOSED NEEDS TO SUIT LOCAL ENVIRONMENT (5), PROGRAMME IN POST HARVEST SYSTEM OF THE INSHORE FISHERY SUCH MNN CENTRE OR TOWN SUCH AS WATER, COLLECTOR VESSELS, ICE BOXES & FISH HOLDS HANDLING HYGIENE AND ENVIRONMENTAL AS COOPERATIVES ICE STORAGE AND BASIC SOCIAL NEEDS MANAGEMENT (4) SUCH AS ROAD NETWORKS I I I IMPLEMENTATION OF PROGRAMME- PURCHASE OF INFRASTRUCTURE HARDWARE, FLEET ADNPTATION, EXTENSION PROGRAMME, MAN POWE~ DEVELOPMENT AND INDENTIFICATION OF SECONDARY CENTRES COORDINATION OFFICE AT MNN CENTRE (6) I I I l SECONDARY CENTRE COMMUNITY A SECONDARY CENTRE COMMUNITY B SECONDARY CENTRE COMMUNITY C SECONDARY CENTRE COMMUNITY ..

INSTALL MICRO INFRASTRUCTURE INSTALL MICRO INFRASTRUCTURE INSTALL MICRO INFRASTRUCTURE ················ DEVELOP AND REFINE COLLECTION DEVELOP AND REFINE COLLECTION DEVELOP AND REFINE COLLECTION ...... SYSTEM SYSTEM SYSTEM ·················

NOTES : (1) MarKet may be Provmclal capital. insular markets or overseas destmatmn (2) GIS or geographlcalmformatlon system 1s a deta1le

ORGANIZATION CHART Diagram: 2 DIRECTORATE GENERAL FISHERIES

DIRECTOR GENERAL

PERSONNEL FINANCE lAW & REGULATION AMINISTRATION DIVISION DIVISION D

DIRECTOR PROGRAMME PRODUCTION ENTERPRISIE RESOURCES INFRASTRUCTURE AND PROCESSING MANAGEMENT

ADM. SECTION ADM. SECTION ADM. SECTION ADM. SECTION ADM. SECTION ADM. SIECTION

DATA AND FRESHWATER FISHERIES RESIOURCES FISHERIES RESOURCES FISHERIES INFRAS FRESHWATER STATISTICS SO AQUACULTURE SO. so POTENTIAL SO. PLANNING SO. SEED SO.

PROGRAMME BRACKISHWATER SMALL-scALE FISHERIES AQUACULTURE \NFRAS BRACKISHWATlER FORMUlATION SO AQUACULTURE. SO. FISHERIES SO. MANAGEMENT SO DEV. SO SEED DIV.

PROGRAMME CO- MAR\- INDUSTRIAL AQUACULTURE FISHERY HARBOUR OPERATION SO CULTURE SO FISHERIES SO MANAGEMENT SO so.

ANALISYS AND CAPTURE FISHERIES FISHING CONTROU l'ISHERJES \NFRASTR. S1EED QUALITY EVALUATION SO FISHERIES SO. PROCESsiNG SO ENFORCEMENT SO. IMPLEMENTATION SO. CONTROL SO.

FISHING FISHERIES BOAT SO MARKE11NG SO

AQUACULTURE SEA FARMING FISHING TlECHNIQUE DEVELOPMENT DEVELOPMENT DEVELOPMENT CENTRE CENTlER CENTRE 73

ORGANIZATION CHART PROVINCIAL FISHERIES SERVICE, IRIAN JAYA Diagram: 3

CHIEF OF PROVINCIAL FISHERIES SERVICE

ADMINISTRATION DIVISION

I I I I PERSONNel FINANCE: INl f::RNAL AFFAIR JREGULATION ~~~ AFFAI, SUB-DIVISON SUB-DIVISION SUB-DIVISION .R. SUB-DIVISION r SUB-DIVISION

I I I I I PROGRAMS PRODUCTION FARM OPERATOR QUALITY DEVELOP EXIENSION rl SERVICES SERVICES r-1 SERVICES MENT SERVICE ---1 SERVICES

FISHING LICENSE EXTENSION EXTENSION HDATASECT!ON - SECTION r-- SECTION - PROGRAMME - PROGRAMME SECTION SECTION

r-- FORMULATION & AQUACULTURE OPERATION MARKETING INFO EXTENSION MGT. SECTION - SECTION r-- GUIDANCE - SECTION r----- FACILITY SECTION SECTION

EVALUATION & PRODUCTION INVESTMENT MARKETING SKILL 1-- - '---- '--- REPORTING SEC INPUTS SECTION - SECTION FACILITY SECTION SECTION I 1 FRESHWATER AQ BRACKESHWATER FISH QUALITY STATION AQ. STATION LABORATORY 74

Diagram: 4 ORGANIZATION CHART CENTRAL RESEARCH INSTITUTE FOR FISHERIES

MINISTRY OF AGRICULTURE (MOA)

AGENCY FOR AGRICULTURAL RESEARCH AND DEVELOPMENT (AARO)

CENTRAL RESEARCH INSTITUTE FOR FISHERIES (CRIFI)

I I RESEARCH INSTITUTE RESEARCH INSTITUTE FOR RESEARCH INSTITUTE FOR FOR MARINE FISHERIES FRESHWATER FISHERIES COASTAL FISHERIES (RIM F) (RIFF) (RSCF) JAKARTA SUKAMANDI MAR OS

RESEARCH STATION FOR RESEARCH STATION FOR FRESHWATER FISHERIES COASTAL FISHERIES (RSFF) (RSCF) PALEMBANG GONDOL 75

ORGANIZATION CHART DIAGRAM: 5 RESEARCH INSTITUTE FOR MARINE FISHERIES

HEAD OF RESEARCH INSTITUTE FOR MARINE FISHERIES

1------1 ADMINISTRATION 1 I

PERSONNEL UNITI FINANCIAL UNIT

I 1

r----1 TECHNICAL SERVICES 1------, WORK PLAN SECTION SECTION

SUB SECTION ON SUB SECTION SUB SECTION LABORATORY SUB SECTION f:lN COOPERATIOt> ON INFORMATION EQUIPMENT FIELD EQUIPMENT

RESEARCHER GROUP AND OTHER FUNCTIONAL STAFF 76

12.0 APPENDIX

PROJECT OUTLINE

I. Estimation of Economic Costs of Ineffective EEZ Management. II. Awareness of the Principles of Fisheries Management. Ill. Training in Fisheries Management. IV. Training in Fisheries Observers. V. Facilitation of Fisheries Management and Enforcement. VI. Strengthening Research Institute for Marine Fisheries to Support Fisheries Management. VII. Feasibility Studies for the Upgrading to International Standards of the Fishing Harbour at Pekalongan. VIII. Integrated Development of Small-Scale Fisheries in Merauke. 77

I. Estimation of Economic Costs of Ineffective EEZ Management

1. Background and Justification One of the major conclusions of the management component of TCP/INS/4553 was that the direct costs to Indonesia of ineffective management in the EEZ are quite large. These costs include:

(i) Value of catch of unauthorized foreign fishing vessels (ii) Loss due to relatively low foreign fishing fees and lenient conditions of access (iii) Loss due to inefficient licensing procedures (iv) Lost employment and reduced amount of fish landed in Indonesia (v) Poor enforcement of existing regulations

At present it appears as though there is inadequate political will to improve the situation. Some countries which have had a similar dilemma, have rectified the situation by demonstrating the economic costs of not having effective management.

2. Objective The objective of the project is to generate the political will to improve the present weak management system in the EEZ. This is to be accomplished by demonstrating in clear terms to high level policy makers the losses associated with the inefficiencies of the present scheme.

3. Work Programme The work programme would consist of the following components: (i) Estimation of the amount and value of unauthorized foreign fishing in Indonesia. This would require site visits and discussions with knowledgeable individuals in Benoa, Bitung, Jakarta, Strait of Malaka, Thailand, and the Philippines; (ii) Detailed comparison of the access fees, conditions and penalties presently being obtained by Indonesia to that being obtained by neighboring countries; (iii) A careful case study of the Bitung tuna purse seine fishery with respect to licensing procedures to show losses associated with authorized fishing in the present scheme; and (iv) Estimation of the losses incurred through weak enforcement of the existing regulations (non-disposal of catch in Indonesia, less than 30% local crew, etc.).

4. Input Two man/months of fisheries management consultant input. Consultant must have: (i) Expertise on the regional tuna and trawl fisheries (ii) Knowledge of the Indonesian fisheries legislation, especially that concerning the EEZ (iii) Fishing contacts in neigbouring countries Travel: (i) Internal (Bitung, Benoa, Strait of Malaka) (ii) International (Thailand, Philippines)

5. Budget Fisheries management consultant ( 2 m/m x US$ 14,000) US$ 28,000 Travel US$ 10,000 Total 38,000 78

II. Awareness of the Principles of Fisheries Management

1. Background and Justification One of the major conclusions of the management element of TCP/INS/4553 was that the objectives of fisheries management are largely oriented to production increases and do not include a major component of conservation. Although conservation should be regarded as concern for the sustainability of the resources and therefore be a central feature of fisheries management, in lndunesia there is the perception that conservation should be the work of another ministry. In short, there is a lack of awareness of principles of fisheries management. In striving to increase production from marine resources, the consequences of a lack of fisheries management do not appear to well understood.

2. Objective The objective of the project is to generate an awareness among those at the Directorate General of Fisheries responsible for marine capture fisheries management of the consequences of a lack of management. Conversely, the project will also attempt to demonstrate the tangible benefits of proper management.

3. Work Programme The work programme would consist of the following components: (i) Study tour by the three most senior staff of the Fisheries Management Sub-Directorate of the Directorate General of Fisheries to the fisheries of the Gulf of Thailand. They will meet with both fisheries managers and commercial fishermen to learn first-hand of the consequences of ineffective management and how the situation occurred. (ii) Study tour by the same three individuals to Darwin, Australia which is a base of operation for many of the vessels which fish in the Australian sector of the Arafura Sea. As above, they will meet with both fisheries managers and commercial fishermen to learn first-hand of the fisheries situation and learn of the differences in benefits between this well-managed fishery and that of the Gulf of Thailand.

4. Input Travel and daily subsistence allowance for three Indonesians for two weeks: 5 days in Thailand and four days in Australia. An FAG-sponsored escort would be required in Thailand. Due to the large interest of Australian fisheries managers in promoting management in the Arafura Sea, it is likely that the federal or state government would provide a host.

5. Budget DSA (3 x 14 days x US$ 150) US$ 6,300 Travel [3 x US$ (450+ 880)] US$ 3,990 T o t a I US$ 10,290 79

Ill. Training in Fisheries Management

1. Background and Justification One of the major conclusions of the management element of TCP/INS/4553 was that the objectives of fisheries management are oriented to production increases and do not include a major of component of conservation. This is largely because of a lack of staff at the Directorate General of Fisheries (DGF) with training in fisheries management. The section at the DGF responsible for 'managing what is probably the world's largest fishery, consists of nine individuals, none of whom have had any formal fisheries management training.

2. Objective The objective of the project is to increase the capacity of the DGF to manage marine fisheries. It is felt that this is not likely to occur by visits of short-term consultants, but rather through enhancement of existing Indonesian human resources.

3. Work Programme It is proposed that two senior staff of the Fisheries Management Sub-Directorate are sponsored to attend short courses in fisheries management. These courses should be oriented to the conditions in a tropical developing country. It is not essential that the courses be of a long duration; on the contrary, considering the work responsibility of the DGF management staff, short course(s) would probably be more desirable.

There are several opportunities for such a course. Hull University in Humberside, United Kingdom, regularly offers short courses in tropical fisheries management. The International Oceanographic Institute at University of the South Pacific has also offered similar courses of about 6 weeks in duration and courses are presently being planned for late 1996.

There may be advantages of having the two individuals attend courses at different times.

4. Input Travel, course fees, and subsistence allowance at fellowship rates for two staff of the Management Sub-Directorate.

5. Budget Course Fees (2 x US$ 3,500) US$ 7,000 DSA (2 x 42 days x US$ 150) US$ 12,600 Travel (2 x US$ 2,200) US$ 4,400 Tot a I 24,000 80

IV. Training of Fisheries Observers

1. Background and Justification An observer programme is the placement of individuals aboard commercial vessels to watch the actual fishing activity and record data, especially that which cannot be obtained at the unloading point. Programmes in which Indonesian government observers are placed aboard foreign fishing vessels would facilitate: (i) Learning more about the various fishing operations (ii) Upgrading the capability of DGF by practical field experience (iii) Improving the quality of the data from fishing vessels (iv) Greater compliance by foreign fishing vessels with EEZ regulations (v) Creation of a consciousness in the fleet that the government is serious about monitoring fishing activity (vi) Research in support of stock assessment

It appears as though fisheries observers have rarely, if ever, been used in Indonesia. During TCP/INS/4553 the desirability of an observers programme was discussed with numerous individuals in DGF and provincial fisheries services and there was virtually unanimous support for having such a programme.

2. Objective Because well-trained observers are an essential component of an effective observer programme, the objective of this assistance is to properly train observers.

3. Work Programme Observer training should include: the role of an observer, introduction to the fisheries to be observed, introduction to fisheries laws, catch estimation, verification techniques, conversion factors, gear types, introduction to navigation, biological sampling, species identification, sampling techniques, logbooks, documentation of irregularities, and the observer trip report.

Because of the importance of tuna fisheries and the lack of data or even knowledge of these fisheries, it is suggested that the observer training be oriented initially to tuna fisheries. Due to simplicity, the longline fleet should be targeted first.

4. Input Consultants: (i) One man/month for international consultant for course preparation (ii) Actual course: two international consultants, two local instructors, for 3 weeks

Trainee costs: Internal transport and support costs for 10 to 12 students for 2 weeks

Others: Course materials, classroom, local transport 81

5. Budget 1 Consultant on fisheries observers (1 m/m x US$ 4,000) 14,000 2 International consultants/instructors (2 x 0.75 w/m x US$14,000) 21,000 2 Local instructors (2 x 0.75 w/m x US$ 2,500) 3,750 Training for 12 participants (12 x 14 days x US$ 40) 6,720 Travel (12 X US$ 500) 6,000 Materials 5,000

Total 56,470 82

V. Facilitation of Fisheries Management and Enforcement

1. Background and Justification Ministerial Decree No.144 of 1993 states that a foreign fishing vessel must use a designated port as a base for operation and that the vessel is to be checked by a government official before a trip for compliance with license, gear, marking, crew, and logbook requirements (the "check point" system).

Although this appears to be sensible, straightforward, and relatively easy to enforce, the implementation of the decree has been slow. Even for locations cited as examples as successful implementation, the system is not yet operational. For example, not a single foreign fishing vessel observed during the TCP/INS/4553 had the required identification markings. This basic system is a prerequisite to much more sophisticated systems now being considered by DGF. The legal framework, technical skills, and physical capability for implementation of the checkpoint system do not appear to be lacking. The major constraints to effective enforcement appear to involve administration, priorities, jurisdiction, and institutional relationships.

2. Objective The objective of the project is to achieve full implementation of the checkpoint system at one port to serve as a model of what should occur at the other checkpoints. Data aspects of the checkpoint system will receive special attention.

3. Workplan Because of the importance of tuna fisheries and the. lack of data, it is suggested that the, port selected for the project be Benoa due to the large foreign longline fleet. The consultant will identify the major constraints to full implementations, suggest solutions, and, as appropriate, facilitate the implementation of the solutions.

4. Input The project will require: (i) One man/month of consultancy by fisheries management specialist (ii) Full-time counterpart

5. Budget

Fisheries Management Consultant (1 m/m x US$ 14.000) 14,000 Travel 1,000 Total 15,000 83

VI. Strengthening Research Institute for Marine Fisheries to Support Fisheries Management.

1. Background and Justification The shift towards the sustainable management and conservation of the marine fishery resources will require sound scientific basis for fisheries management decisions. Presently, the research inputs in marine fisheries are not only relatively low but also lack applicability to fisheries management. This arose because of the weak structural organization of the Research Institute for Marine Fisheries located in Jakarta and the lack of priority setting in research activities relevant to management needs.

2. Objective The objective of the project is to develop an applied research programme geared towards fisheries management needs and establish an appropriate institutional framework to undertake the task effectively.

3. Work Programme The work programme would include : (i) identifying priority research areas in support of fisheries management; (ii) reviewing the existing research infrastructure to ensure the adequate facilities for the conduct of research activities; and (iii) upgrading the capability and capacity of present research institution and staff to implement the programmes drawn up.

4. Input Three man/months of a marine fisheries research consultant. The consultant must have expertise in tropical fisheries research and wide experience in the organization and management of research institutions. The consultant is expected to travel and interact with the industry, organizations, institutions and universities involved during the course of the consultancy to enable the development of realistic proposals.

5. Budget Marine Fisheries Research Consultant ( 3m/m x US$ 14,000) US$ 42,000 Travel US$ 4,000 Total US$ 46,000 84

VII. FP.asibility Studies for the Upgrading to International Standards of the Fishing Harbour at Pekalongan.

1. Background and Justification Despite the rapid growth in the shore-based infrastructure (dedicated fishing harbours) to tackle 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 have led to a general deterioration of the quality of the landed fish. Indeed, post-harvest loss and spoilage in some areas of the fisheries sector is believed to reach 60 %. Even traditionally processed fish (boiled, salted or dried) is in low quality. Added to this situation is the general lack of environmental awareness and hygiene of the majority of the people employed in the harbour area.

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 local fish products, the existing fishing harbours should be upgraded to internationally accepted standards to provide better port management, improved onshore facilities, proper sanitary services and a harbour environment compatible with the food sector.

2. Objective The objective of the project is to increase the value of the landed catch, reduce the post-harvest loss and improve the quality of fresh fish supplies at one fishing harbour to serve as a model for application in other harbours.

3. Work Programme The work would involve : (i) A detailed survey of existing situation; (ii) Essential preliminary engineering investigations to prepare layouts and designs; (iii) Detailed cost estimates of all the physical elements and structures; and (iv) The introduction of modern post-harvest techniques.

4. Input A fishing port engineer for 2 months to undertake the feasibility study and make overall evaluation and recommendation for follow-up investment.

5. Budget Fishing harbour consultant (2 m/m x US$ 14,000) US$ 28,000 Travel US$ 2,000 Total US$ 30,000 87

(d) Duty Travel 40,000

(e) Contract 60,000 Costs required to appoint a local consultancy company to design and undertake the frame survey in the project area

(f) General Operating Expenses 33,000 Costs of miscellaneous field operation such as communication, preparation of reports and minor expendable equipment

(g) Training and Fellowship 100,000 Costs to train both the extension workers and fishermen in preparing them to participate in the project

Grand Total 1,472,000

3.3.2. Government The government is expected to provide the following inputs : (a) Furnished office promise; (b) Counterpart staff; (c) Administrative support e.g. secretarial aid, local transport and communication; (d) Land for building of infrastructure facilities; (e) Capital costs of infrastructure and equipment; and (f) Fishing vessel construction.