Prudent policy needed to boost fishing industry

Maswandi, Antara, Bengkulu

The rise in fuel prices, which resulted in an increase in diesel fuel from Rp 4,300 (43 U.S. cents) to Rp 6,170 per liter, has had an adverse impact on fishermen, many of whom have stopped operating their boats.

A senior government official said his office had received reports from fish auction facilities in various regencies across the nation that fish production had dropped as boat owners had reduced fishing activities after the fuel price hike on Oct. 1. Indonesia has 240 regencies with direct access to the sea.

Data in October indicated that fish production had dropped considerably compared to the previous month, and also in the corresponding month of last year, said director of fishery development at the Directorate General of Fisheries of the Ministry of Maritime Affairs and Fisheries, Sunoto MES.

He would not go into details, but the drop in fish production can be seen in Bengkulu. A fishing boat owner in the province, Aziz, who owns four vessels, two of which weigh over 30 Gross Tons, said that for a single two-week fishing trip, a 30-GT fishing boat consumed at least Rp 12 million worth of diesel fuel. Azmi said that he operated only one or two of his four boats, while mooring the rest at the wharf. "Sometimes, the boat could return with only three tons of fish. If the average price of fish is Rp 6,000 per kilogram, a boat owner could only arrive at a break-even point," he said.

Another boat owner, A Sun, who has 12 fishing boats, five of which are over 30 GT, complained of the hardship following the fuel price hike which has hiked operational costs by up to 40 percent. A Sun said that boat owners must now be more careful in locating potential catches of fish. Boat crew members used to locate fish sources at random, now, in order to save fuel, they have to decide where they will fish before setting out to sea.

Minister of Maritime Affairs and Fisheries Freddy Numberi has issued a regulation to assist fishermen by setting the price of diesel at Rp 4,300 per liter for fishing boats below 30 GT. The government will still subsidize owners of fishing boats over 30 GT that require up to 25 kiloliters of diesel. The government will also expedite fuel distribution and make efforts so as to maintain a steady supply of fuel. Fishermen are also being encouraged to use a fuel conservation device being developed by a research agency in Semarang which is now in the trial stage.

The device is able to conserve up to 15 percent of fuel. Fishermen can reduce to between 40 percent and 60 percent of their operational costs when using it. However, Sunoto said that he did not know the cost of the device. "I think it's not too expensive. It's being introduced to the public now," he said.

The government has also exempted fish catches from tax (PHP) based on Presidential Decree No. 12/2005 for a period of one year, starting in October, in the hope that it will encourage fishermen to return to fishing.

According to Sunoto, the lifting of the tax which was previously imposed on fishermen at 2.5 percent of their estimated catch, especially for vessels below 30 GT, should receive a positive response.

However, Sunoto acknowledges that the tax exemption might not be of much help in resolving the problem, but nonetheless the government had shown some commitment to assisting fishermen.

Azmi and A Sun said the tax exemption would not make much of a difference to fishermen, but more importantly the government should provide subsidized fuel to poor fishermen.

If the fuel component from the total operational costs could be reduced from 40 percent to below 30 percent, it would make a difference for fishermen.