Prudent policy needed to boost fishing industry

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.