INDONESIA BUSINESS AND INVESTMENT DIALOGUE : Focus on fisheries sector MINISTRY OF MARINE AFFAIRS AND FISHERIES REPUBLIC OF INDONESIA Jakarta, 9 March 2017
INDONESIA BUSINESS AND INVESTMENT DIALOGUE :
Focus on fisheries sector
MINISTRY OF MARINE AFFAIRS AND FISHERIES REPUBLIC OF INDONESIA
Jakarta, 9 March 2017
• Surveillance of marine and fishery resources;• Fish Quarantine, Quality control, food safety and bio
safety
• Marine spatial, conservation and bio diversity• Business Sustainability• Marine and fishery products competitiveness
• Human Resouces scaling up• Innovation in technology
SOVEREIGNTY
SUSTAINABILITY
PROSPERITY
SEA IS OUR FUTUREBANGSATo achieve sovereign, independent, and sustainable management of
marine and fisheries resources for the people’s prosperity
GOVERNMENT VISION : SEA IS OUR FUTURE
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Combating IUUF
…
Regulatory Reforms…
Investment and financial inclusion
…
Research & HRD
integration
Orientation for Fisheries GDP
Growth
…
Stages for Fisheries Reform
GOODGOVERNANCE
Moratorium for ex-foreign fishing vessel (Ministerial Regulation
No. 56/2014)
Establishment of PresidentialTask Force to Prevent and Eradicate Illegal Fishing(Presidential Decree No. 115/2015 - Task Force on Illegal Fishing Eradication)
• Analysis and Evaluation (AnEv)on 1,132 ex-foreign vessels (187 Companies) followed by administrative sanctions (revocation and suspension of business and fishing licenses
Acceleration of Fisheries IndustryPresident’s Instruction No.7/2016
Joint CommuniqueIndonesia – Papua New GuineaIndonesia – East TimorIndonesia – PalauIndonesia – New ZealandIndonesia – Australia
Demolition of
236 Illegal fishing vessels
• Investigation on human trafficking Benjina and Ambon
Kementerian Kelautan dan Perikanan Republik IndonesiaJl. Medan Merdeka Timur No. 16, Jakarta 10041 | www.kkp.go.id4
MMAF POLICIES
Ratification of Port State Measure Agreement (PSMA)
Ban on transshipment(Ministerial Regulation No. 57/2014)
Set on Live fish transport vessels and landing port Ministerial Regulation No. 15/2016
290188 Foreign fishing vessels102 Indonesian fishing vessels
Catched vessels
Capture fisheries business only for 100% domestic investorsPresidential Regulation No 44/2016
Improvement license services : (One Stop Services/PTSP), Licensing outlet & Online service
Ban on Using Unsustainable Fishing Gear (Ministerial Regulation No. 2/2015)
Regulation on catching lobster, crab and swimming crab with specific size and condition(Minister Regulation No. 1/2015)
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Need Reformation and Investment:1. Investment without reformation, will cause profit loss in long term
2. Reformation without investment will cause profit loss in short term, but keep long term profit because there are recovery of fish biomass.
3. Reformation and Investment, will prevent short term profit loss and to ensure fish resources will be better in long term
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Result of study : Impact of Fisheries Policy and Projection (UCSB-MMAF, 2016)
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1. Direct impact : IUU Fishing eradication policy eliminates 30-35% fisheries exploitation in Indonesia. Pairs with independent data from NOAA and Google Satellite figure in the same results.
2. Impact on 2035 : (1) Without IUU Fishing eradication policy from MMAF, 81% fish biomass will be decreased; (2) IUU policy without sustainable governance, will decrease fish biomass 26%; (3) IUU policy and governance, will increase 25% of fish biomass
Result of study : Impact of Fisheries Policy and Projection (UCSB-MMAF, 2016)
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Projection 2050: Consistent fisheries reformation policy, will increase fish biomass 224%, increase the catches 100%, and economic benefit USD 3,7 billion.
In 2050 global fish biomass will increase up to 619 million tones, catches 16 million tones, and fisheries profit US$ 53 billion.
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Result of study : Impact of Fisheries Policy and Projection (UCSB-MMAF, 2016)
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NATIONAL FISHERIES INDUSTRY ACCELERATION PROGRAME(Presidential Regulation No. 3/2017)
Sustainable Aquaculture
Fisheries Product Processing Industry
Sustainable Fishing
ACCELERATION TO DEVELOP NATIONAL FISHERIES INDUSTRY
(INPRES 7 / 2016)
Regulation, Institutional &
FinancingZoning and Region
Development
PROGRAM AND ACTION PLAN OF NATIONAL FISHERIES INDUSTRY
Sustainable Fishing
Sustainable Aquaculture
Fisheries Product
Processing Industry
• Revitalize national shipyard and increase local fishing vessel industries’ capacity
• Law enforcement and license transparency to prevent IUU Fishing• Complementary facilities and infrastructure in Fishing Port • Provide energy needs for domestic fishing vessels• Skills training and fishermen certification
• Reduce feed cost in aquaculture production component • Complementary facilities and infrastructure for increasing fishpond production• Building business relation with small medium scale farmer • Skills training and farmer certification
• Acces of electricity and cold chain for raw material supply of fisheries industry• Ease access of transportation, export and import • Ease access of skilled labor • Facilitate of tax and import tariff and export• Standardize business and fish processing industry • Optimalize warehouse receipt system for fisheries product and seaweed• Acceleration Roadmap of National Seaweed Industry • Increasing access and domestic fish consumption • Increase and expansion of foreign market • Diversification and improvement of marine and fisheries product quality
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Zoning and Region
Development
Regulation, Institutional &
Financial inclusion
• Transparency of location license & management license in coastal area and small islands
• Acceleration of national marine spatial planning to support sustainablility of fisheries industry
• Location determination and prepare facilities and infrastructure in Integrated Fisheries Industry (SKPT) as National Strategic Project
• Harmonize Fisheries Law with Shipping Law associated with integration of port management, port authority, license, certification of crew, berthing port freighter, and addition of special port in eastern part of Indonesia as a hub
• Financial support and capital access Acceleration of the procurement of goods and service, additional capital investment for fisheries state-own enterprises and dan expansion finance access non-National Budget (APBN) for business (BLU, KUR, Bank Credit)
• Improvement of data & information through One Data• Increase group’s status into a Cooperative• Minimize security risk of fisheries industry in the outermost island
Zoning and Region
Development
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PROGRAM AND ACTION PLAN OF NATIONAL FISHERIES INDUSTRY
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Develop new industry base on outer islands for export gateway
Location plan in 12 SKPT 2017 & sea toll roadmap 2017
12 location for SKPT 2017
1. Natuna2. Saumlaki3. Merauke4. Mentawai5. Nunukan6. Talaud7. Morotai8. Biak Numfor9. Mimika10. Rote Ndao11. Sumba Timur12. Sabang
Source: - Sea Toll Rute: Ministry of
Transportation, 2016- SKPT 2017: MMAF, 2016
Integrated Marine and Fisheries Zone
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Modernize 5 Existing Fishing Ports
• Place for fish auction• Ice flake machine• Integrated Cold Storage capacity 500 ton• Refrigerator vehicle
• Landing Center and shelter• Place for fish auction I and II• Modern Fish Market (for retail and wholesaler)• High grade fish market• Ice flake machine• Refrigerator vehicle
PPS Nizam ZachmanMuara Baru, Jakarta
• Place for fish auction• Ice flake machine• Refrigerator vehicle
PPP Sendang Biru Malang, Jawa Timur
• Place for fish auction• Ice flake machine• Integrated Cold Storage kapasitas 500 ton• Refrigerator vehicle
PPN PengambenganJembrana, Bali
Jayanti Cianjur
PPS Bitung, Bitung Sulawesi Utara
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5• Port• Ice flake machine
EXISTING CONDITION
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TOTAL INVESTMENT IN FISHERIES SECTOR IN INDONESIA, 2016
Source : The Investment Coordinating Board of the Republic of Indonesia
Subsector Project Investment (Rp. Million)
Aquaculture 17 601,218.3 Fishery Capture 3 7,400.3 Fish Processing 72 2,571,152.9 Trade 19 79,611.9 Grand Total 111 3,259,383.4
Subsector Investment (Rp. Million)
Aquaculture 193,880Fishery Capture 574,571Fish Processing 269,865Trade 694,995Fishery Services 493,256Grand Total 2,226,568
Source : OJK
Investor Countries In Indonesia, 2016
1827991.7
488372
331593.1
238967.4
113737.1
96467.8
74986.5
39210.9
32029.7
8777.7
4000
3173.7
62.9
12.7
0.2
0 500000 1000000 1500000 2000000
Indonesia
Hongkong, RRT
Japan
Singapore
British Virgin Islands
R.R. Tiongkok
Philipina
South Korea
Taiwan
India
United States
Malaysia
Australia
Italia
Pakistan
Fisheries Sector Investment in Indonesia2016 (Rp. Million)
Source : The Investment Coordinating Board of the Republic of Indonesia
FISH PROCESSING Value (IDR. Million) Industry of fish processing and Preserved 125,518 Industry of Processing and Preserved for Aquatic Product 119,792 Smoked/grilled fish industry and other fish processing and preserved industry 15,000 Frozen Fish Industry 29 Fish Processing and Export Industry 29
Aquaculture21%
Fish Processing
78%
Trade1%
JAPANESE INVESTMENT PER SUB SECTOR IN INDONESIA, 2016
Detailed of Japanese Investment on Fish Processing Industry
SOURCE : TRADEMAP, 2017
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ASEAN – INDONESIA – JAPAN TRADE
381,745
453,151
384,202
458,533
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000
Japan's exports to Association ofSouth-East Asian Nations
(ASEAN)
Indonesia's exports toAssociation of South-East Asian
Nations (ASEAN)
ASEAN –Japan Trade in Fishery Sector , 2014-2015
2014 2015
466,236
564,886
836,910
474,876
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
Japan Export to Indonesia Indonesia Export to Japan
Indonesia- Japan Trade in Fishery Sector , 2014-2015
2014 2015
PRAWNS AND TUNAS MAIN EXPORTERS TO JAPANYoY Kwartal 3 Tahun 2012-2016 (USD 000)
BUSINESS OPPORTUNITY
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Industries Demand on Cold Storage1,32 million tons (2015) ~ 1,7 million tons (2017)
970
2,532
383259
831
326
23 117 11 4 31 140
500
1,000
1,500
2,000
2,500
3,000
Sumatera Jawa Bali & NusaTenggara
Kalimantan Sulawesi Maluku &Papua
Ketersediaan (ribu ton)Demand (thousand tons) Availibility (Thousand tons)
• 200 thousand ton of CS are operated• 1,5 million ton of additional CS capacity are needed
• Additional power supply are needed• Power supply estimation:
Cold storage 200 ton = 142 KVA per unit UPI + Cold Storage 500 ton = 750 KVA per unit UPI + Cold Storage 1000 ton = 1.200 KVA per unit Ice Flake Machine 10 ton = 130 KVA per unit Ice Flake Machine 1,5 ton = 12,5 KVA per unit
Kementerian Kelautan dan Perikanan Republik IndonesiaJl. Medan Merdeka Timur No. 16, Jakarta 10041 | www.kkp.go.id
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FROZEN59%FRESH
10%CANNED
9%
SMOKED1%
DRIED8% SURIMI
2%
EXTRACTED5%
OTHERS6%
Jenis Pengolahan
Fishery Industries/
UPI(Unit)
Capacity(Ton/Year)
Frozen 421 1.572.515 Fresh 69 166.732 Canned 64 491.460 Smoked 10 31.268 Dried 58 83.764 Surimi 14 63.000 Extracted 35 90.480 Others 47 53.345 Total 718 2.552.564
Number of fishery industries byprocessing types (2015)
Volume of fishery products byprocessing types (2015)
SMOKED0%
FROZEN67%
KATSUOBUSHI2%
CANNED13%
DRIED2%
OTHERS6%
FRESH7%
SURIMI3%
Produk Olahan Volume (Ton)Frozen 414,735 Katsuobushi 12,383 Canned 80,752 Dried 11,574 Others 39,433 Fresh 42,814 Surimi 18,747 Smoked 382 Total 620,819
Cold Storage is the Main Key for Fishery Industries Fresh and frozen are precious products
Source : DG of Product Competitivenes , 2015
Kementerian Kelautan dan Perikanan Republik IndonesiaJl. Medan Merdeka Timur No. 16, Jakarta 10041 | www.kkp.go.id
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Cold Storages are Mostly Distributed in Western Indonesia
Sumber: Dirjen PDSPKP, 2016
Cold Storage (MMAF, 2009-2015) Single Cold Storage (MMAF, 2016) Cold Storage (Private/Importer)
INVESTMENT REGULATION
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Certain types of activities are fully opened for FDI, despite some investments arepartially restricted or closed. Key areas relevant to the fisheries sector are detailedbelow
Presidential Regulation 44 /2016: Foreign Direct Investment
II. Investments that require partnerships with SMEs :
1. Rearing of Fish2. Hatchery of Fish3. Processing of Fishery Products4. Manufacture of wooden ships5. Manufacture of device and fittings of
wooden ships for marine tourism and fishing
CLOSED to FDI1. Capture Fisheries2. Fishing of species listed in Convention
on International Trade in Endangered Species of Wild Fauna and Flora)
3. Salvage of Sunken Ship Treasure4. Sea Sand Quarrying
Subject to haverecommendation from
the Minister of Forestry and Environment
Coral/Ornamental Coral Culture
I. Business in fisheries sector that is fully opened for FDI is investment in Cold Storage
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Despite, for inclusive economy, some investments require SMEs’ partnerships
INCENTIVE AVAILABLE FOR FISHERIES SECTOR
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TAX ALLOWANCE
Government Regulation No.18/2015
Total net income reduction by 30% of the investment, that are charged respectively 5% per year in the 6
years period
Accelerated depreciation and
amortisation
Imposition of income tax on
dividends which paid to foreign tax
subject of 10% (ten percent), or a
lower rate according to the
avoidance of double taxation
agreement
Compensation losses longer than
5 (five) years
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Criteria and/or conditions of income tax facilities for investment
As per Decree of the Minister of Marine Affairs and Fisheries No. 17/PERMEN-KP/2015
*) Gov Reg No 18 /2015 jo Gov Reg No 9 /2016
BUSINESSES LOCATION RECEIVING TAX ALLOWANCE FOR PROCESSING*)
: FISH FREEZING INDUSTRY: OTHERS AQUATIC BIOTA FREEZING
INDUSTRY
Papua
Papua Barat
Maluku
MalutSulutGorontalo
Sultra
Sulteng
SulbarKalsel
Kaltim
Kaltara
NTTNTBBali
Jatim
DIY
JatengJabar
BantenDKI Jakarta
Lampung
SumselKep. Babel
Kep. Riau
NADSumut
Riau
Bengkulu
JambiKalteng
Kalbar
SulselDKI Jakarta
Jawa Timur
Jawa Tengah
Jambi
*) Gov Reg No 18 /2015 jo Gov Reg No 9 /2016
BUSINESSES LOCATION RECEIVING TAX ALLOWANCE FOR PROCESSING*)
: FISH PRODUCT PROCESSING INTO FLOSS, PASTE AND SURIMI
: PROCESSING AND PRESERVATION OF FISH AND OTHERS AQUATIC BIOTA (EXCEPT SHRIMP OR PRAWN) INDUSTRY
Papua
Papua Barat
Maluku
MalutSulutGorontalo
Sultra
Sulteng
SulbarKalsel
Kaltim
Kaltara
NTTNTBBali
Jatim
DIY
JatengJabar
BantenDKI Jakarta
Lampung
SumselKep. Babel
Kep. Riau
NADSumut
Riau
Bengkulu
JambiKalteng
Kalbar
SulselDKI Jakarta
Jawa Timur
Jawa Tengah
Jambi
*) Gov Reg No 18 /2015 jo Gov Reg No 9 /2016
BUSINESSES LOCATION RECEIVING TAX ALLOWANCE FOR PROCESSING*)
Papua
Papua Barat
Maluku
MalutSulutGorontalo
Sultra
Sulteng
SulbarKalsel
Kaltim
Kaltara
NTTNTBBali
Jatim
DIY
JatengJabar
BantenDKI Jakarta
Lampung
SumselKep. Babel
Kep. Riau
NADSumut
Riau
Bengkulu
JambiKalteng
Kalbar
SulselDKI Jakarta
Jawa Timur
Jawa Tengah
Jambi
: PROCESSING AND PRESERVATION OF SHRIMP/PRAWNS PACKAGED INTO CANS INDUSTRY
: OTHER PROCESSING AND PRESERVATION FOR OTHERS AQUATIC BIOTA INDUSTRY
*) Gov Reg No 18 /2015 jo Gov Reg No 9 /2016
BUSINESSES LOCATION RECEIVING TAX ALLOWANCE FOR AQUACULTURE*)
: MARINE FISH FARMING (GROUPER, SEABASS, SILVER POMPANO)
: FRESHWATER FISH FARMING IN FLOATING CAGE (TILAPIA AND PANGASIUS)
Papua
Papua Barat
Maluku
MalutSulutGorontalo
Sultra
Sulteng
SulbarKalsel
Kaltim
Kaltara
NTTNTBBali
Jatim
DIY
JatengJabar
BantenDKI Jakarta
Lampung
SumselKep. Babel
Kep. Riau
NADSumut
Riau
Bengkulu
JambiKalteng
Kalbar
SulselDKI Jakarta
Jawa Timur
Jawa Tengah
Jambi
THANK YOU
MINISTRY OF MARINE AFFAIRS AND FISHERIES REPUBLIC OF INDONESIA