Fisheries industry up for $1b in investment

Fisheries industry up for $1b in investment

Rendi A. Witular, The Jakarta Post, Jakarta

Hoping to take advantage of Indonesia's vast, largely untapped
maritime resources, investors from China, Thailand and the
Philippines are currently filing with the government investment
proposals worth a total of some US$1 billion.

The investment, expected to start flowing early next year,
will be spent mostly in eastern Indonesia, including Maluku and
Papua, Minister of Fisheries and Maritime Affairs Freddy Numberi
told The Jakarta Post.

"The investors are currently filing their proposals with our
ministry, while at the same time seeking land to set up their
fishing processing plants. Several of them will operate in Ambon,
Merauke and Timika," said Freddy.

He said five investors from China were planning to invest a
total of $500 million, while two investors from the Philippine
and three from Thailand were likely to invest a total of $500
million.

With 5.8 million square kilometers of ocean, Indonesia has the
potential to yield 6.4 million tons of fish per year. The United
Nation's Food and Agriculture Organization has set catch limits
at 80 percent of the total potential yield of the area, or some
5.12 million tons per year.

However, the value of Indonesia's fishery industry remains low
at about Rp 46.6 trillion (US$4.52 billion), or 2.21 percent of
gross domestic product. According to some local fisheries, this
is due in part to a lack of support from the government.

The situation is also exacerbated by the practice of illegal,
unregulated and unreported fishing, which reportedly cause the
country losses of about $1.9 billion per year in lost revenue
from legal fishing.

As part of the fight against illegal fishing, Freddy said his
ministry had revoked the licenses of 237 foreign fishing vessels
between October and August for misusing their licenses, as well
as the licenses of several local vessels for not having proper
certification.

"We have revoked the licenses of several fishing vessels owned
by foreign and local companies. Most of the vessels are owned by
Chinese companies. There are also some used vessels from Taiwan
that have been seized for poaching," he said.

At present, 705 registered foreign fishing vessels are
operating in Indonesian waters, with some 302 vessels from
Thailand, 286 from China and 117 from the Philippines.

The ministry announced earlier this year that it would not
issue new licenses to foreign vessels to fish in Indonesian
waters, to help reduce illegal fishing as well as to provide more
opportunities for local fishermen.

Starting in 2007, the ministry expects there to be no more
fishing vessels from the Philippines, Thailand and China to be
operating in the country, after their current contracts expire.

A bilateral agreement with the Philippines on fishing in
Indonesian waters will expire next December, with Thailand in
September next year and with China July next year.

However, vessels from these countries can continue to operate
in Indonesia under a joint investment or joint operation scheme,
which requires them to establish processing and supporting plants
in Indonesia, and sell the majority of their catch in the
domestic market.