FisheriesSubsidiesIDN-Ghofar DKK PDF

Selected Indonesian Fisheries Subsidies:
Quantitative and Qualitative Assessment of

Policy Coherence and Effectiveness
By A. Ghofar, D.K. Schorr, and A. Halim
The Nature Conservancy - Coral Triangle Center

Sanur, Bali, Indonesia
December 2008
The Authors
(Note: Institutional affiliations are given for

purposes of identification only)
Abdul Ghofar is a senior member of the Faculty

of Fisheries and Marine Science at Diponegoro
University in Semarang, Indonesia (email:
aaghofar@indosat.net.id); David Schorr is an
independent consultant based in Washington, DC,
with expertise in international fisheries policy and
environmental aspects of globalization (email:
davidkschorr@msn.com); Abdul Halim is Program
Manager at The Nature Conservancy - Coral
Triangle Center in Bali, Indonesia (email: ahalim@
tnc.org).
Copyright :
The Nature Conservancy – Coral Triangle Center,

Jl. Pengembak No. 2 Sanur, Bali 80228, Indonesia.
2008.
All photos copyright of The Nature Conservancy,

except photo on page 9 used with permission
from Jones/Shimlock - Secret Sea.
Selected Indonesian Fisheries Subsidies: Quantitative and Qualitative Assessment of Policy Coherence and Effectiveness
Acknowledgements
This study was commissioned by The Nature Conservancy through its Coral Triangle Center
(CTC) in Bali, Indonesia, and was carried out in cooperation with the Government of
Indonesia’s Ministry of Marine Affairs and Fisheries (MMAF) and MMAF’s senior advisory
body, the Komnas Kajiskan.
The authors acknowledge the invaluable support and help of many individuals during
data gathering and field observations, especially from key staff of the MMAF DG-Capture
Fisheries (DJPT), MMAF DG-Marine Coasts and Small Islands (DJ-K3PK), DG-Fisheries
Product Processing & Marketing (DJ-P2HP), the MMAF Secretariat General, the Komnas
Kajiskan, and the Provincial Fisheries and Marine Services in Semarang, Surabaya, Denpasar,
Mataram and Kupang, the District Fisheries and Marine Services in Pekalongan, Batang,
Pati, Banyuwangi, Jembrana, Lombok Timur, Kota and Kabupaten Kupang. Extensive
and useful discussions were also held with key staff at Gappindo (Indonesia’s Fisheries
Entrepreneurs Association) MPN (Indonesia’s Fisheries Society) and HNSI (Fishermen
Association of Indonesia), whom we deeply appreciate.
The authors received invaluable help and support during the field work in those districts,
from Dr. A. Suherman of the Diponegoro University (UNDIP) Fisheries Department,
Mr. I. Gede Wiadnya of the Nature Conservancy, Ir. Mian S. Sitanggang of the MMAF,
Mr. Sarjani, and Mr. Suhadi, MM, Chief, Fisheries Enterpreneur in Juwana - Pati, Central
Java, without whom data collection would not have been effective. Special thanks are
due to Dr. Purwito, Chief of Komnas Kajiskan, Dr. Victor Nikijuluw of MMAF, and Rili
Djohani, TNC’s Country Director, whose continuous support and encouragement made
this publication possible. Maps and some translation services were provided by Arief
Darmawan and Juliana Tomasouw of TNC CTC. And also Mr. Imran Amin of TNC CTC
for layout and design, to whom the authors express their gratitude.
Finally we thank the intrepid fishermen of the districts in which this study was carried
out for their generous time in interviews and discussions. It is our hope that this study
will contribute to their continued development and the security of their livelihoods—and
to the sustainable future of all of Indonesia’s marine fisheries and fishing communities.
Special thanks are extended to Mr. Sarjani, a prominent fisherman in Juwana, Pati, whose
long and intelligent efforts have contributed greatly to the independence and prosperity
of many Indonesian fishermen. Our sincere gratitude is always due to the late Mr.
Badaruddin, who passed away in August shortly after providing invaluable assistance to
our field research team.
Naturally, however, the analysis and conclusions presented in this study—and any errors
they may contain—remain the sole responsibility of the authors.
i
Table of Contents
Acknowledgements...................................................................................................i
Table of Contents...................................................................................................... ii
Abbreviations and Acronyms................................................................................... iv
I. Introduction....................................................................................................... 1
A. Indonesian fisheries at the crossroads............................................................... 1
B. The goal: healthy ecosystems, sustainable livelihoods...................................... 2
II. Data Underlying this Report................................................................................ 5
III. An Overview of Indonesia’s Fisheries Subsidies . ................................................7
A. The definition of “fisheries subsidy”.................................................................. 7
B. The scale of Indonesia’s fisheries subsidies ...................................................... 8
C. The kinds of Indonesia’s fisheries subsidies ...................................................... 9
D. Indonesian fuel subsidies................................................................................. 11
E. The “risk profile” of Indonesia’s fisheries subsidies......................................... 12
IV. The Perceptions of Fishermen........................................................................... 16
V. Discussion: Policy Coherence & Effectiveness..................................................... 19
A. The first issue—sustainability.......................................................................... 19
B. Other issues — effectiveness, equity, and transparency.................................. 21
VI. Conclusions & Recommendations...................................................................... 24
A. General conclusions......................................................................................... 24
B. Recommendations........................................................................................... 25
Appendix A — Definitions of “Fisheries Subsidy”.................................................... 28
Appendix B — Tabel 6 Exploitation Levels of Major Indonesian Fisheries................ 32
APPENDIX TABLES................................................................................................... 33
Appendix Table 1 —Total Subsidies by Authority and Year (Rp)............................. 34
Appendix Table 2 —Total Subsidies by Authority and Year (USD)......................... 35
Appendix Table 3 — MMAF Budgets, by Program & Year...................................... 36
Appendix Table 4 — Provincial & District Budgets, by Program & Year................. 38
Appendix Table 5 — Activities by Risk (MMAF DG-Capture Fisheries)................... 43
ii
Appendix Table 6 — Activities by Risk (MMAF DG-Marine Coasts &

Small Islands)................................................................................................... 51
Appendix Table 7 — Activities by Risk (MMAF DG-Product Processing &
Marketing)....................................................................................................... 60
Appendix Table 8 — Survey Results (Bali Strait Fishers)......................................... 65
Appendix Table 9 — Survey Result (Java Sea Fishers)............................................ 67
Appendix Table 10 — Survey Results (Nusa Tenggara Fishers)............................... 71
Literature Cited...................................................................................................... 75
Endnotes................................................................................................................ 78
iii
Abbreviations and Acronyms
Abbreviation English Meaning Equivalent in Bahasa Indonesia

APEC Asia-Pacific Economic Cooperation Kerjasama Ekonomi Asia-Pasifik
ASCM WTO Agreement on Subsidies and Perjanjian WTO tentang subsidi dan
Countervailing Measures Countervailing Measures
BBM Fuel Oil Program Bahan Bakar Minyak

DJ-KP3K MMAF DG-Marine Coasts & Small Direktorat Jenderal Kelautan Pesisir dan
Islands Pulau-Pulau Kecil
DJ-P2HP MMAF DG-Fisheries Product Direktorat Jenderal Pengolahan dan
Processing & Marketing Pemasaran Hasil Perikanan
DJPT MMAF DG-Capture Fisheries Direktorat Jenderal Perikanan Tangkap
FAO U.N. Food and Agriculture Organisasi Pangan dan Pertanian PBB
Organization
FMP Fisheries Management Plan Rencana Pengelolaan Perikanan (“RPP”)
Komnas Kajiskan National Commission for Fish Komisi Nasional Pengkajian Sumberdaya
Resources Assessment Ikan
MMAF Ministry of Marine Affairs and Departemen Kelautan dan Perikanan
Fisheries (“DKP”)
MPA Marine Protected Area Kawasan Konservasi Laut
OECD Organization for Economic Organisasi untuk Kerjasama Ekonomi dan
Cooperation and Development Pembangunan
PEMP Coastal Community Economy Pemberdayaan Ekonomi Masyarakat Pesisir
Empowerment Program
PUPTSK Small Scale Fishing Enterprise Pengembangan Usaha Perikanan Tangkap
Development Program Skala Kecil
Rakornas National Coordination Meeting Rapat Koordinasi Nasional
WTO World Trade Organization Organisasi Perdagangan Dunia
I. Introduction
A. Indonesian fisheries at the crossroads
Indonesia is blessed with many rich and prolific fisheries—fisheries that provide livelihoods
to nearly 5.5 million Indonesians and are the primary source of dietary protein for more
than half of the nation’s 225 million people. But even Indonesia’s fisheries are not
limitless. After decades in which both private sector economics and government policies
encouraged a dramatic expansion of fishing (see Table 1 – Indonesia’s Fishing Fleet
and Fisheries Production), many of Indonesia’s most valuable fisheries have reached or
exceeded their biological limits. The future of Indonesia’s fisheries—and of communities
that depend on them for income and food—now depends on policies to halt overfishing
and to manage Indonesian fisheries for long term sustainability.
Table 1 – Indonesia’s Fishing Fleet and Fisheries Production

Number of decked vessels Total catch (tones)
Based on FAO 2002, Fig. 15 Source: FAO 2008

Indonesia’s fishing fleets have been among the fastest growing in the world, rising more than 600% from 1975 to
1994, and continuing to grow to the present. Catches also rose steadily . . . until 2003.
The need to shift Indonesia’s fisheries policies towards sustainability has been
clearly recognized by the Komnas Kajiskan (“National Commission for Fish Resources
Assessment”), the eminent stakeholder committee that advises the Ministry of Marine
Affairs and Fisheries (MMAF). In 2007, the Komnas issued a report warning that more
than half of Indonesia’s fisheries are fully- or over-exploited, with another quarter in
“uncertain” condition (see Figure 1 and Appendix B). As the Komnas noted in a formal
policy recommendation accompanying the report:
Indonesia’s capture fisheries are threatened by a precipitous decline due to
over-exploitation of major income-generating fish stocks. This puts at risk
incomes and job opportunities of Indonesia’s coastal communities. Given
that millions of people in Indonesia are dependent upon small-scale fishing
for protein and cash, the current focus on continued expansion of fisheries is
endangering economic development and food security.1
Fortunately, the process of reform has begun, guided by new Indonesian legislation.
Fisheries Law No. 31/2004 requires an end to policies focused only on expanding
production, while Law No. 27/2007 calls for improved management

of coastal zones and small islands. Taken together, this new legal
Indonesian framework enshrines sustainable fisheries and marine ecosystem
management at the core of Indonesian fisheries policy.2 As a
fisheries critical step towards fulfilling this vision, the Komnas Kajiskan
today are at has also recommended the prompt creation and implementation
an important of fisheries management plans (FMPs) in all priority Indonesian
crossroads, fisheries.3
poised between However, the shift towards sustainable fisheries in Indonesia is still
in its early phases. The old emphasis on expanding production
the “industrial continues to be found in elements of MMAF policy and practice.
development” For example, as recently as 2007, MMAF strategic plans continued
models of the to call for the continuous expansion of Indonesia’s wild capture
past and the fisheries production by approximately 3% per year.4
“sustainable Indonesia—and MMAF as the steward of its valuable fisheries—is
thus passing through a time of significant transition. There is good
management”
evidence that the policy trends are positive. Official publications5
model of the as well as recent policy statements issued by the Director General
future. In of MMAF’s Capture Fisheries division6 suggest dynamic movement
this context, it within MMAF towards policies that emphasize long-term
sustainability. But the task is not small, especially considering the
is important breadth of MMAF’s responsibilities for fisheries across dozens of
to consider increasingly autonomous provinces and districts.
how fisheries In this context, there is a pressing need to focus new attention
subsidies are on the role of subsidies in Indonesia’s fishery sector. As noted
being used. below, Indonesia makes significant use of subsidies as part of its
sectoral strategy. But, as history has shown in developed and
developing countries around the world, inappropriate subsidies
can contribute to fleet overcapacity and overfishing. Indonesian
policymakers and stakeholders are increasingly aware of ongoing
international efforts at the World Trade Organization (WTO), the
U.N. Food and Agriculture Organization (FAO), and elsewhere to
curtail harmful subsidies and to prevent them from contributing
further to the global overfishing crisis.7
B. The goal: healthy ecosystems, sustainable livelihoods

The fundamental question presented in this report is whether
Indonesia’s fisheries subsidies are currently used in a manner
consistent with the core principles at the heart of Indonesia’s
fisheries legislation. These core principles begin with the goal
of maximizing the contribution of the fisheries sector to the
welfare of Indonesia’s fisheries-dependent communities, with
a high priority on poverty reduction and improved livelihoods.
2
Figure 1 — Status of Indonesia Fishery Resources
Status of Fisheries Resources

per Fishery Management Area
and per Stock Category 6
3
But the ability of fisheries to provide livelihoods and food security ultimately depends
on the long-term sustainability of fishing itself. The contribution of fisheries subsidies to
Indonesia’s economic development thus depends on the success of Indonesia’s fisheries
management. This essential triangle—explored more deeply in the discussion of policy
coherence in Section V, below—is summarized graphically in Figure 2.
Figure 2 -- The Critical Problem: Policy Coherence
The inextricable links among the economics of fishing, the husbandry of fisheries resources,
and the development of Indonesian communities is already clearly acknowledged in
Indonesian fisheries policy.8 It has also been noted in leading reviews of Indonesia’s
fisheries sector, such as one recently conducted by the Asia Development Bank.9 The
goal of this report is to advance dialogue over the degree to which Indonesian fisheries
subsidies are playing the positive role desired by the government and by stakeholders.
Although this report is restricted to a preliminary review of selected subsidy programs, it
is hoped that the conclusions presented in Section VI will serve as a solid basis for further
discussion and reform.
4
II. Data Underlying this Report
This report is based primarily on two sets of data collected by our research team from
July 2007 to February 2008. The first set consists of budgetary information received from
MMAF and from a small number of provincial and district level authorities. Much of this
information is being made public for the first time. The authors wish to acknowledge
and thank MMAF and local authorities for their remarkable openness and cooperation
throughout this study.
Notwithstanding the high level of cooperation from MMAF and others, however, the
budgetary data presented in this study is only partially representative of all Indonesian
fisheries subsidy programs. Given limited resources for field research, we have been
unable to conduct a comprehensive review. However, we have been able to collect
budgetary data from three key MMAF departments: DG-Capture Fisheries (DJPT); DG-
Fisheries Product Processing & Marketing (DJ-P2HP); and DG-Marine Coasts & Small
Islands (DJ-KP3K). Limited provincial and district level data was also collected in some of
the sites where we conducted local case studies. Largely excluded from our study were
subsidies that are provided by national ministries other than MMAF, as well as subsidies
granted at the provincial and district level outside of our case study sites. For an overview
of the data made available for this study, see Table 2.
Table 2 — Budget Data Obtained for this Study

Jurisdictional
Administering Authority Years Covered
Level
DG-Capture Fisheries (DJPT) 2005-07
National (MMAF) DG-Fisheries Product Processing & Marketing (DJ-P2HP) 2005-06
DG-Marine Coasts & Small Islands (DJ-KP3K) 2005, 2007
Bali Province (Fishery & Marine Service) 2005-06
Central Java Province (Fishery & Marine Service) 2006
East Java Province (Fishery & Marine Service) 2005

Provincial
East Lombok Province (Fishery & Marine Service) 2005
East Nusa Tenggara Province (Fishery & Marine Service) 2006
West Nusa Tenggara Province (Fishery & Marine Service) 2006
Banyuwangi District (Fishery & Marine Service) 2004
Batang District (Fishery & Marine Service) 2004-05
District/ Local Kota Kupang & District (Fishery & Marine Service) 2007
Pati District (Fishery & Marine Service) 2005-06
Pekalongan District (Fishery & Marine Service) 2005

The second set of data underlying this report came from a series of field interviews
conducted by our research team with over eighteen hundred Indonesian fishermen.
These surveys were designed to learn about the impact of fisheries subsidies from the
perspective of fishermen, and to “spot check” what kinds of subsidies are evident on the
ground in a few specific localities. The sites for these case studies were selected to cover
major Indonesian fisheries of several different kinds. Surveys were conducted in fishing
communities located in five provinces and involving fishermen active in seven different
fisheries (see infra Section IV).
These two data sets were collected through an inclusive process of research and stakeholder
consultations that comprised:
(i) Preliminary discussions with, and data collection from, MMAF and national
stakeholders, including through an initial stakeholders workshop held in Jakarta on
16 May 2007 (co-convened by TNC and the Komnas Kajiskan);
(ii) Discussions with, and data collection from, five provincial Marine Fisheries Services in
Semarang (Central Java), Surabaya (East Java), Denpasar (Bali), Mataram (West Nusa
Tenggara), and Kupang (East Nusa Tenggara);
(iii) Discussions with, and data collection from, ten district- and town-level Marine Fisheries
Services in Pekalongan, Batang, Pati, Banyuwangi, Muncar, Jembrana, Lombok Timur,
Kabupaten Kupang, and Kota Kupang;
(iv) Observations and discussion with key fishermen and/or informal leaders at the case
study sites;
(v) Collection of survey data from 250-300 fishers at each of seven sites;j
(vi) Preliminary data analysis and summarizing;
(vii) Results verification with officials at district and provincial levels and with MMAF in
Jakarta;
(viii) Discussions with stakeholders at a second workshop held in Bogor (West Java) on
17 June 2008, to receive feedback on a summary (in Bahasa) of an early draft of this
paper; and
(ix) Discussions with MMAF and Komnas Kajiskan at a third workshop in Jakarta on 25 July
2008, for input into the conclusions and recommendations section of this paper.
It is hoped that the final draft of this report will be formally presented to national MMAF
officials and stakeholders convened by the Komnas Kajiskan. It is also proposed that these
be followed by further follow-up meetings at MMAF and with provincial and district
stakeholders.
6
III. An Overview of Indonesia’s Fisheries Subsidies
A. The definition of “fisheries subsidy”

As described more fully in Appendix A, the term “fisheries
subsidy” can be the subject of substantial technical and political
debate. In many cases, the specific meaning of the term
depends on the context in which it is used. Most narrowly, The fact
the term has a legal definition at the World Trade Organization
(WTO), where the technical concept of a “subsidy” delimits the that an
government activities disciplined by the WTO Agreement on
Subsidies and Countervailing Measures (the “ASCM”” or “WTO expenditure
Subsidies Code”). More broadly, a purely economic definition
may consider a subsidy to be any commercial benefit that is not is included
monetized and “purchased” by its beneficiary. The Organization
for Economic Cooperation and Development (OECD) tends this
in this
way, at times defining “subsidy” to include uncompensated study does
commercial benefits transferred entirely among private actors,
and reserving the term “government financial transfers” for not mean
subsidies provided by the public sector. Technical discussions
within the FAO have concluded that no single, simple, and that it is or
universal definition of “fisheries subsidy” is possible, and have
identified at least four basic kinds of “public-to-private” benefits should be
that may be covered by the term.
considered
This paper need not look far into this definitional discussion.
We are mainly focused on direct and indirect financial transfers a “subsidy”
that have both budgetary consequences for the Government of
Indonesia and real-world impacts on the health of Indonesian as defined by
fisheries and fishing communities. Accordingly, we adopt
an approach that examines “fisheries subsidies” of four basic the WTO.
kinds:
• Direct government payments, loans, or in-kind transfers of
goods (such as subsidized fuel, ice, or bait) or services (such
as training) to fishermen or fishing enterprises;
• Indirect transfers in the form of goods, services, or activities
from which fishers derive an immediate benefit (such as port
infrastructure, marketing and promotion programs); and
• Tax rebates or other tax relief offered to fishermen or fishing
enterprises;
• Direct programmatic spending on conservation and
management of fisheries.
By calling these government expenditures “subsidies” we do not
intend to take sides in any policy debate. For example, being
included in this study does not mean that an expenditure is or should be considered a subsidy
under the rules of the WTO. Expenditures on conservation and fisheries management
almost certainly fall outside the WTO definition. We include such expenditures here
for two reasons: first, a balanced review of Indonesia’s fisheries subsidies requires
some consideration of the government’s investments directly in sustainability; second,
(as discussed in Appendix A), other leading discussions of fisheries subsidies, and some
governments, routinely include management costs in their catalogue of fisheries subsidies,
and so for the sake of comparison with the international literature it is useful to include
them here as well.
B. The scale of Indonesia’s fisheries subsidies

The total value of Indonesia’s fisheries subsidies remains difficult to ascertain precisely,
particularly in light of the limited sources of data available for this study. Nevertheless, in
an effort to provide a “guesstimate” of Indonesia’s total, we considered three sources of
information:
First, we looked at the MMAF and sub-national authority budgets available to us, as
summarized in rupiah in Appendix Table 1 and in U.S. dollars in Appendix Table 2 In
estimating the overall scale of Indonesian subsidies, we began by looking at MMAF
expenditures in 2005, the most complete year for which we have data. The three directorate
generals participating in this study provided subsidies in 2005 totaling Rp306.3 billion
(USD $33.7 million). These figures do not include fuel subsidies, discussed separately (see
Section III.D).
We then looked at provincial and district level data in the localities for which data was
provided. Over the three years 2005-07, data from these five provinces and seven districts
suggest average yearly subsidies that approach Rp80 billion (USD $8.8 million) per year.10
It is very difficult to extrapolate from this data to calculate total provincial and local
fisheries subsidies nationwide. However, our data may allow a very rough estimate of this
figure. Most of the subsidies for which we have provincial and local data come from the
provinces of Bali and the two Nusa Tenggaras. Taken together, these provinces appear to
have provincial and local subsidies in excess of Rp54.4 billion (USD $6.0 million) per year.
The FAO reports that in 2004 the provinces of Bali and the Nusa Tenggaras accounted
for 5.59% of Indonesia’s total marine catch. (FAO 2007) If subsidies were distributed
evenly across Indonesia’s catch (which, of course, may not be the case, especially since
the fisheries studied here are among the more important of Indonesia’s fisheries), this
would suggest total provincial and district subsidies in the range of Rp973 billion (USD
$107 million) annually.
By combining the foregoing, we arrive at a total of roughly Rp1,280 billion (USD $140
million) per year from the main MMAF subsidy programs plus provincial and local sources
nationwide. Some additional subsidies certainly are provided from other national-level
programs, but our study gives no basis for estimating these.
As a complementary method of estimating overall Indonesian fisheries subsidies, we
have considered two previously published studies available in the international literature.
The first was a regional study sponsored by APEC governments in 2000 and produced
8
by the international accounting firm PricewaterhouseCoopers.11 We

That study was conducted in dialogue with the Government of
Indonesia, among others. It reported Indonesian fisheries subsidies conservatively
totaling approximately USD $250 million (Rp2,273 billion) per estimate annual
year, excluding fuel subsidies. A second study was published in Indonesian
2006 by the Fisheries Centre of the University of British Columbia
(Canada).12 That study—which in the case of Indonesia relied fisheries
heavily on the APEC figures plus other information—estimated subsidies
the Indonesian total to be USD $343.2 million (Rp3,120 billion) to be Rp 1,280
per year, excluding fuel.
billion (USD
The figures offered by the APEC and UBC studies are substantially
higher than our own estimates. There may, however, be several $140 million),
reasons for this, such as the inclusion in those studies of programs not including
we would tend not to count as subsidies (e.g., investments from
subsidies to fuel
international development banks) and of programs some of which
may have been dedicated to aquaculture. Nevertheless, those ...
studies suggest that Rp1,280 billion (USD $140 million) per year
may be a conservative estimate. the total is
equivalent to
C. The kinds of Indonesia’s fisheries subsidies
≈ 10% of the
Indonesia makes use of fisheries subsidies in many different forms
and for different purposes. Drawing on preliminary interviews and
total value of
desk studies, we originally identified six basic kinds of Indonesian Indonesia’s
fisheries subsidies programs: fisheries and
1. Coastal community development subsidies, mainly ≈ 30% of its
through the Coastal Community Economy Empowerment
Program (“Pemberdayaan Ekonomi Masyarakat Pesisir, or fisheries exports.
“PEMP”);
2. Fishing enterprise development programs, mainly through
the Small Scale Fishing Enterprise Development Program
(“Pengembangan Usaha Perikanan Tangkap Skala Kecil” or
“PUPTSK”), which consists of several subsidiary programs
for optimizing specific fishing or fisheries-related activities
(known as the “OPTI” programs);
3. Fuel subsidies, mainly through the Fuel Oil Program
(“Bahan Bakar Minyak” or “BBM”);
4. Various supports for fisheries and marine conservation,
 Jones/Shimlock - Secret Sea
management, and rehabilitation;

5. Fishing harbor infrastructure subsidies, mainly through the
Development of Infrastructure Program (“Pengembangan
Sarana Prasarana” or “PSP”); and
6. Other programs, including price supports and subsidized
credit programs for providing easily accessible capital to
fishing, processing, and marketing activities.
9
However, a more detailed profile of Indonesian fisheries subsidies emerges from the
data we collected in the field. As a general matter, that data is not consistently organized
into the program categories just listed. This may be due to flux in the administrative
names of programs, or to differing terms in budgetary and other administrative usage.
In any case, a summary of subsidies broken out into the program categories used in the
budget materials is set forth for MMAF in Appendix Table 3 and for provincial and district
authorities in Appendix Table 4.
Even the program descriptions in the budgetary materials are rather broad. For a better
understanding of how Indonesia’s fisheries subsidies are actually used, we further
categorized the available budget data on an activity-by-activity basis, relying on the brief
activity labels associated with each budget line. The thirteen classification categories we
used are included in Table 3.
Table 3 — Distribution of Subsidies by Activity Type (excluding fuel)
Activity Type Object of Subsidy % of Total
Infrastructure Port facilities (not otherwise categorized as “Value 20.1%

Added Equipment & Activities”)
Conservation & Management Fisheries management activities & programs 17.5%
Fisheries Development A program category used by MMAF to describe various 11.5%

activities meant to increase production from fisheries
Directly Capacity-enhancing Gear or vessel acquisition, repair, modernization, etc. 10.4%

(i.e. direct additions to physical fishing capacity)
Value Added Equipment & Physical infrastructure and activities (other than 11.8%
Activities training) for processing/handling to improve value or
value added
Marketing and Promotion Programs to help market fish products (including export 5.8%
promotion) or to increase fish consumption,
Access to Credit Loans & loan guarantees (where use is not sufficiently 5.3%
restricted to allow categorization into another category)
Skills (fishing) Training in fishing techniques 1.3%
Social Safety Net Income supports, unemployment relief, etc. 1.0%
Operating Costs (exclusive of fuel) Operating costs of fishing (e.g., bait, ice) 0.8%
Skills (value-added) Training in handling/processing techniques 0.4%
Other Subsidy type not clear or not included in other 13.9%

categories
Total 100.0%
After classifying the subsidies in this manner, we calculated roughly the percentage of
funds used in each category. This calculation was, however, complicated by the fact that
much of the budget data was available only for one or two years in the 2005-07 period (see
Table 2). For the three MMAF directorate generals participating in this study (together
10
comprising 88% of the budgetary data collected), complete data was available only for
2005. The data from provinces and districts were also spread across several years, with
most jurisdictions providing data for only a single year.
To compensate for the uneven temporal distribution of available data, we ran the numbers
three different ways,14 all of which produced roughly the same results, with no activity
type varying by more than a few percentage points. Accordingly, Table 3 averages the
results of the foregoing methods to give the proportional distribution of subsidy amounts
by activity types across the basket of programs we studied. The totals are presented
graphically in Figure 3.
Figure 3 — Distribution of Subsidies by Activity Type (excluding fuel)
D. Indonesian fuel subsidies

The foregoing discussion does not take account of fuel subsidies, which the fishery sector—
like other economic sectors in Indonesia—has received in large amounts. The BBM fuel
subsidy program mentioned in the previous section is a nationwide program aimed at
small businesses. The portion of this national program made available to fishermen is
administered by MMAF.
Estimating the quantity of fuel subsidies granted to Indonesia’s fishery sector is difficult,
since fuel subsidies are disbursed in the form of low cost fuel, and thus do not appear as
an item on MMAF program budgets. Still, according to information provided by MMAF,
the total value of fuel subsidies received by Indonesian fishermen was Rp3,558 billion
in 2005 and Rp3,624 billion in 2006—approximately USD $390-400 million per year15.
By comparison, the UBC study mentioned earlier (Sumaila & Pauly (2006)) estimates
11
Indonesian fuel subsidies at Rp1,554 billion (USD $171 million) per year. Meanwhile, a
press report from the Antara news service in April 2006 reported that Indonesian fishers
consume approximately 2.61 billion liter of fuel each year at a subsidy rate of Rp829
per liter.16 This would give an annual subsidy level of around Rp2,163 billion (USD $238
million) per year. Other news reports further suggest that calculations of the legally
available fuel subsidy for fishermen understate the real situation, since some fishers
illegally purchase even more heavily subsidized fuel at prices intended to support poor
households.17
By any measures, fuel subsidies for Indonesia’s fishery sector are very high—possibly as
much as four times higher than our estimates for all other Indonesian fisheries subsidies
combined (see Section III.B).
The fuel subsidy policy, however, appears to be undergoing rapid change, at least with
regard to other sectors of the economy. In 2005, the government announced its intention
to phase out fuel subsidies, and promulgated Presidential Regulation No. 22/2005,
which raised the national price of fuel by 29%. The impact on the fisheries sector was
immediate and severe, leading to a substantial outcry. A few months later, the President
issued a second decree—Presidential Regulation No. 55/2005—ordering a new subsidy
for small-scale fishers. The following year, Presidential Regulation No. 9/2006 extended
this relief to nearly all fishermen, regardless of their vessel size.
Although the national policy of reducing fuel subsidies generally continues—another
28.7% rise in the basic national price was announced just a few months before completion
of this study18—so far as we are aware there has been no reduction in fuel subsidies to
the fishery sector. Indeed, at least one report suggests that the government considers
the fishery sector one of the last where fuel subsidies will be eliminated.19 And as fuel
prices rise sharply, political pressure to maintain or increase fuel subsidies for fishers also
rise.20
In sum, fuel subsidies remain a very significant contribution to the underlying economics
of Indonesia’s fishery sector. As discussed below, these and other direct subsidies to
operating costs must be considered among the most likely to have a direct influence on
fishing activities. Because such subsidies immediately intensify fishing activities, they
are considered “high risk” subsidies in the discussion in the next section of this paper.
E. The “risk profile” of Indonesia’s fisheries subsidies

The central question raised by this paper is the extent to which fisheries subsidies make
a coherent and effective contribution to the sustainable management of Indonesia’s
fisheries and marine environment. The limited resources available for this study have
prevented a direct measurement of the impacts of fisheries subsidies in Indonesia.
As a first step towards answering this question, we offer instead an overview of the
“risk profile” of Indonesia’s fisheries subsidies as a whole. This profile aims to classify
subsidy types according to their potential for contributing to overfishing or overcapacity,
or conversely, their potential to promote sustainability. The profile was assembled by
adding a probable “risk level” to each of the subsidized activity categories discussed
above (see Table 3), as follows:
12
Table 4 — Subsidized Activities and Risk Ratings
Subsidy Types Risk Rating

Directly capacity-enhancing Very High
Operating Costs Very High
“Fisheries Development” Very High
Access to Capital High
Infrastructure Moderate
Marketing & promotion Moderate
Other Moderate
Skills (fishing) Moderate
Social Safety Net Moderate
Skills (value added) Low (Positive?)
Value added equip & activ. Low (Positive?)
Conservation & Mgmt Likely to be Positive
These risk categories are consistent with the international literature on classification
of fisheries subsidies and their potential impacts.21 Basic economic theory, as well
as documented experience, has clearly shown that direct subsidies to fishing capital
or effort (such as subsidies for vessel construction or modernization, or subsidies
to operating inputs such as fuel) have a very high potential for contributing to
overcapacity and overfishing. UNEP, among others, has rated such subsidies as
“harmful” (and not just “possibly harmful”) in any fishery that is not fully managed
under a strict “property rights” management regime.22 This kind of management
regime remains the exception rather than the rule globally (even in developed
countries), and is not yet practiced in Indonesia. Moreover, subsidies for “fisheries
development” are classically associated with efforts to raise fisheries output, such
the “old style” Indonesian fisheries policy discussed in Section I.A, above.
Below the subsidies that are classified as “very high risk” in Table 4, other subsidy
types are given decreasing risk assignments. “Access to Capital” has been rated a
“high” risk because it is closely associated with direct investments in fishing capacity.
The remaining subsidy categories are rated from “moderate” to “low (positive?)”
risk, or even “likely to be positive”. Again, both economic theory and case studies
such as those cited above have shown that subsidies with an indirect relationship
to fishing capacity and effort have some risk, but are significantly less likely to
contribute to overfishing. Subsidies that increase value added can obviously have
a positive impact on resource management (if steps are taken to avoid encouraging
intensification of fishing), and management subsidies are in principal considered
positive.
In short, the risk classifications used here are based on the degree to which certain
classes of subsidies have the potential to contribute to unsustainable fishing
capacity or effort. However, placing Indonesian subsidies into these categories is
not intended as a definitive judgment of the quality of any specific program. These
classifications are based on the activity titles in government budgetary documents—
13
the actual operation of the programs was not reviewed. Apart from the possibility of
miscategorizing a program in this manner, it is possible that even programs considered
“high risk” can have reduced risks if they are implemented in well-regulated fisheries.23
Nevertheless, the risk categories used here can assist policymakers and stakeholders
in identifying subsidy programs that could benefit from priority attention and possible
reform.
When the available data was reviewed according to these categories, and with fuel
subsidies excluded, it was found that approximately 25% of expenditures were in the
“Very High” or “High” risk categories, 45% in the “Moderate” risk category, and 30% in
the “Low” or “Likely to be Positive” categories (see Figure 4). Again, given the partial
nature of the data available, it is not possible to extrapolate these findings to the whole of
Indonesian fisheries subsidies.
Figure 4 — Overall Risk Profile (available data 2005-07)
If the risk analysis is limited to MMAF data (i.e., excluding provincial and district subsidies),
two noteworthy results appear. First, the overall risk profile shifts somewhat towards
higher risk, with the combination of “Very High” and “High” moving from 25% of the total
to 32% (see Figure 5). Second, the available data suggest significant variability in the
risk profile for MMAF subsidies from year to year, as evident in Figure 6. It is especially
interesting to note that MMAF substantially increased its “directly capacity enhancing”
subsidies in 2006-07, due mainly to new spending on vessels and gear by DG-Capture
Fisheries (see Appendix Table 3). On the other hand, spending on the lowest risk and
positive categories also increased substantially.
14
Figure 5 — MMAF Risk Profile (available data 2005-07)
Figure 6 — MMAF Risk Profiles (available data, by year)
Finally, it is again necessary to consider fuel subsidies. If fuel subsidies (which fall squarely
within the “operating costs” category) are counted at the 2005-6 levels of Rp3,600 billion
per year (as MMAF data suggest), then the percentage of “High Risk” subsidies in the
MMAF portfolio would rise to more than 90%.
15
IV. The Perceptions of Fishermen
As noted above, extensive field interviews were carried out with fishers in seven fishing
communities located in five provinces and involving fishermen active in seven different
fisheries. The sites for these surveys are summarized in Figure 7 and Table 5.
Table 5 — Field Study Locations
Province Locality Fisheries

Pekalongan Java Sea demersal
Java Sea small
Central Java Batang handline & “cotok” and
pelagic purse seine
Pati “cantrang”
East Java Banyuwangi
Bali Strait Oil Sardine purse sein
Bali Jembrana
Alas Strait squid
West Nusa Off Nusa Tenggara, shark
Lombok Timur (”oras”-lampara
Tenggara long line
type)
Kota Kupang port
(Tenau) Sawu Sea tuna
Oebaba (landing handline
East Nusa
site)
Tenggara24 Sawu Sea small pelagic
Oesapa fishing
purse seine
village
Kabupaten Kupang
Figure 7 — Field Study Locations (Map)

The surveys yielded both quantitative and qualitative (anecdotal) information. Even the
quantitative data, however, is a reflection of the subjective experiences and perceptions
of fishermen. Given the limited scope of this study, it has not been possible to measure
objectively the impacts of subsidies on the respondents. Moreover, it has been impossible
to correlate the responses with the implementation of specific fisheries subsidies programs,
because respondents were almost always unaware of the administrative source of the
subsidies they received.
The results of our surveys are summarized for Bali Strait fishers in Appendix Table 8, for
Java Sea fishers in Appendix Table 9, and for fishers in the Nusa Tenggaras in Appendix
Table 10. Due to local variations in the conditions for carrying out surveys, reliable data
was not available for all questions in all locations. Despite these limits, however, it has
been possible to draw several useful conclusions from the survey results. The quantitative
tabulations of survey responses revealed the following:
• The types of subsidies most commonly received or experienced by our respondents
were port infrastructure, fuel, and subsidies to gear/vessels, all of which were widely
in use. Training was offered in all but two sites, but was received by only a small
number of respondents in those sites. Other types of subsidies were received only
sporadically.
• Nearly all respondents who had received subsidies for gear/vessels, for fuel, or for
infrastructure reported that these subsidies resulted in the intensification of fishing.
In the cases of infrastructure and fuel, nearly all respondents reported the subsidies
also increased their income. However, the data suggests that gear/vessel subsidies
may have produced fewer income gains.
• The subsidy type apparently most useful to fishers was infrastructure, which nearly
all respondents had experienced and which nearly all respondents reported had
improved their activities, raised fish prices, and raised income.
• Subsidies for improving sanitation and preserving fish (e.g., on-board ice boxes) were
received by relatively few respondents, but were highly rated for their effective impact
on quality and price.
• Subsidized training programs were given mixed reviews by their recipients. While most
recipients did find the trainings useful, in some localities between 20-30% of recipients
did not feel the training had improved their fishing or fish handling or increased their
income.
• Access to subsidized capital appears to have been very limited.
In addition to these quantitative results, the surveys produced anecdotal reports about
subsidy programs. These reports were usually in the form of complaints, mainly from
fishers who had not received subsidies rather than from those who had. In many cases,
fishers complained that subsidies had been administered with “inappropriate selection
criteria”—i.e., in the opinion of the respondents, the wrong fishers got the subsidies. This
does not mean, of course, that the subsidies were inappropriately administered in fact. It
does, however, clearly show that fishermen believe there was poor administration, or at
least unfairness, in how subsidies were distributed. To the extent that government policy
is to reduce conflicts among fishers, this is a point worth keeping in mind. The distribution
17
of subsidies between localities is also noteworthy. For example, in the two Bali Straight
survey sites, one (Jembrana) had 82 fishers out of 300 reporting gear/vessel aid, while in
the other (Banyuwangi) only six out of 300 reported receiving such aid.
A second common complaint was that subsidies were not properly tailored to meet local
conditions. This was true of training programs, where respondents in several localities
complained that the programs were either repetitive of what fishermen already knew or
were not relevant to local realities. More disturbing were a handful of anecdotal reports
that inappropriate gear or vessels were provided through subsidies. In at least one case,
several new vessels were provided to one locality in the Java Sea fisheries, but then
remained unused on the beach because they were not the kind of vessels used by local
fishers. (In this case, administrative errors may have benefited sustainability, since the
Java Sea fisheries are already suffering from overcapacity).
Third, where access to subsidized capital was experienced, there were at least some
problems because the recipients considered the subsidized loans to be grants that did not
require repayment. This suggests that an effort to use more “market-like” instruments
in the place of handouts may require additional efforts to educate fishermen about the
nature of the subsidies in question.
18
V. Discussion: Policy Coherence & Effectiveness
The data collected and analyzed for this study provide a solid basis for a preliminary
discussion of the policy coherence and effectiveness of Indonesia’s fisheries subsidies.
As noted above, the ultimate goal of Indonesian fisheries policy is to ensure the long-
term welfare and development of Indonesia’s fisheries-dependent communities. But with
Indonesian fisheries now at a crossroads, it is clear that achieving poverty reduction and
durable economic growth depends on policies that are balanced and integrated. The key
elements of such a balanced and integrated approach are clearly set forth
in Indonesian fisheries legislation. In the Law of the Republic of Indonesia No. 31 of
2004 Concerning Fisheries, Article 2—the first substantive article of the law—states in its
entirety:
Fisheries management shall be carried out under the principles of benefit,
equality, partnership, equal distribution, integration, transparency, efficiency.
and sustainable preservation.
(“Pengelolaan perikanan dilakukan berdasarkan asas manfaat, keadilan,
kemitraan, pemerataan, keterpaduan. keterbukaan, efisiensi, dan kelestarian
yang berkelanjutan.”)
The core concepts embedded in this legislative mandate—equity/fairness, participation/
transparency, effectiveness (efficiency/benefits), and sustainability—are precisely those
against which the policy coherence of Indonesia’s fisheries subsidies should be tested.
In speaking of “integration” (“keterpaduan”), Article 2 even establishes the principle of
policy coherence itself.
A. The first issue—sustainability

In light of the heavily exploited condition of many important Indonesian fisheries, we begin
with a focus on sustainability, and on identifying areas where current fisheries subsidies
may be working against durable livelihoods and long-term development. Even subsidies
that appear to have short term benefits must be considered harmful if they encourage
fisheries depletion. In the context of national fisheries many of which are already showing
signs of overcapacity and overfishing, policies in favor of sustainability must emphasize at
least three areas of action:
• effectively managing fisheries through fisheries management plans that set
appropriate limits on fishing capacity and effort, and that in appropriate cases
establish a network of multi-use marine protected areas (MPAs) to protect
spawning grounds and other critical habitat elements;
• maximizing the value of fishery products through quality improvement, value-
added processing, and gains in efficiency that raise incomes without exerting
increased pressure on fully- or over-fished stocks; and
• restructuring the sector where it is necessary to do so, including through programs
to reduce fishing capacity and to promote alternative livelihoods.
While some of Indonesia’s fisheries subsidies are doubtless

consistent with these goals, it is not possible to be fully satisfied.
Too many of Indonesia’s fisheries subsidies risk working in
the wrong direction, and too few of them are implemented
in an administrative context that ensures their coherence.
Several indications of “room for improvement” arise from our
research:
First, as already mentioned in Section III.E, a substantial
portion of Indonesia’s fisheries subsidies are in the highest
two categories of risk for unintentionally contributing to
overcapacity or overfishing. For subsidies administered by
MMAF, these high risk subsidies may be more than 30% of
overall subsidy spending, without even considering massive
fuel subsidies.
Most disturbing in this regard is evidence that spending on
directly capacity-enhancing subsidies has been increasing
precisely at a time when coherent policies require limiting the
size of fleets and emphasizing the three areas of action noted
above. The sharp increase during 2006-07 in MMAF’s budget
for subsidies to vessels and gear (see the fourth budget line
listed in Appendix Table 3) was accompanied by declarations
from national political leaders in favor of distributing vessels to
“fishermen throughout Indonesia” and for keeping Indonesia’s The experience
ship building industry working at full capacity.25 Our field surveys of fishermen
confirm significant levels of subsidies to vessels and gear in
many of the localities we studied. Unfortunately, capacity- suggests that
enhancing subsidies were a significant factor in communities
targeting fisheries that are already fully- or over-exploited. Indonesia
The Java Sea is a particularly important case where this should shift
kind of policy incoherence has been evident, and especially
dangerous. The Java Sea is home to some of Indonesia’s most
away from
prolific fisheries, producing between a quarter and a third of subsidies to
total national marine fishery production.26 It has long been
recognized that the Java Sea is suffering from overcapacity capacity/effort
and overfishing. In fact, national and international experts
have concluded that capacity-enhancing subsidies were an
and towards
important factor leading to these twin problems.27 subsidies
In 2005, MMAF issued a management plan recognizing that
that increase
almost all of the major Java Sea fish stocks are overexploited—
exceeding sustainable utilization levels by 37% overall, and increasing
as much as 49% in the case of the pelagic stocks.28 The first
element of the MMAF plan emphasizes the need to reduce product value
fleet capacity, especially for the small pelagic fleet.
20
MMAF’s approach to the fisheries management plan (“FMP”) for the Java Sea is an example
of precisely the kind of leadership that will be necessary to secure a sustainable future for
Indonesia’s fishing communities. But even as some offices within MMAF are calling for
capacity reduction, subsidized vessels and gear continue to be introduced into the fishery.
At both the national and local levels, these actions are working at cross-purposes with
MMAF’s own sustainable management goals.
Recent policy pronouncements, such as highlighted at a recent MMAF “National
Coordination Meeting” (“Rakornas”) held in Jakarta in March 2008, indicate MMAF’s
intention to implement tighter controls on fishing capacity and effort throughout Indonesia’s
fisheries.29 To be fully effective, however, such controls will have to be accompanied by
steps to ensure that fisheries subsidies programs do not work in a contrary direction.
B. Other issues — effectiveness, equity, and transparency
Sustainability is not the only good reason to shift subsidies away from promoting capacity
and effort—both effectiveness and “customer satisfaction” would suggest the same.
As noted above, our field surveys indicate that subsidies to gear and vessels were less
effective in raising catches or incomes than other subsidy types. Even where fishers
reported that the subsidies did increase fishing intensity, improvements in catches did not
always follow. This result is not surprising, particularly in the context of a growing number
of over-exploited fisheries where decreasing “catch per unit effort” is a standard sign of
stock depletion.30
In contrast, fishers reported their highest level of improved livelihoods from subsidies to
promote product quality or value-added processing. Again, this makes sense wherever
fisheries resources are under pressure or where the cash value of fish depends heavily on
product condition. The experience of fishermen interviewed for this study thus suggests
that Indonesian subsidies policies should be shifted away from subsidies to capacity/effort
and towards increasing product value, not only for the sake of long-term sustainability but
also for the sake of short-term effectiveness at promoting economic growth and poverty
reduction.
Another factor that may reduce the effectiveness of Indonesian fisheries subsidies is
the tendency of subsidies to erode the independence and initiative of fishermen. While
difficult to capture in quantitative data, the tendency of subsidies to create dependencies
and to reduce entrepreneurial spirit was evident to our field researchers in many of their
interviews. In this regard, we note that efforts within MMAF to encourage use of “market
based” subsidies (such as subsidized capital loans) may present one means for addressing
this problem, but are not yet a significant proportion of Indonesia’s fisheries subsidies
programs.
The effectiveness of Indonesia’s fisheries subsidies is also clearly being diminished by
problems of misadministration. During our field research we repeatedly heard stories
about subsidized vessels or gear being provided in a manner unsuited to the local fishery.
In one example, a subsidy seemed to have been designed more to benefit a particular boat
builder than to aid the development of the local fishery. No effort was made to ensure that
21
the vessels to be built were useful to the fishermen, and the boats have remained on the
beach since delivery.
Unfortunately, we also heard of cases that appeared to involve outright theft or
corruption. We were told more than once, for example of cases in which the flow of fuel
from subsidized fuel stations was interrupted because the station operator sold fuel but
failed to pay distributors for his shipments. In another case, our researchers were told of
a local government official who had not previously been a fisherman receiving a boat and
entering the fishery.
Even where effectiveness is not being reduced by misadministration (or outright fraud),
Indonesia’s fisheries subsidies sometimes appear to fall short of the goal of “equity”
emphasized in Art. 2 of the framework law. As noted in Section IV, our researchers
encountered widespread complaints about the distribution of subsidy benefits. In several
cases, respondents voiced the opinion that family or social connections influenced the
selection of recipients more than objective need. In other cases, subsidies appeared
to be biased towards industrial or export-oriented fleets, rather than favoring small-
scale, locally-oriented enterprises. For example, in Jembrana the government subsidized
construction of a fueling station for disbursing subsidized diesel fuel. Around Jembrana,
however, diesel is used almost exclusively by an industrial scale purse seine fleet—leading
smaller scale hand-liners (who use kerosene) to complain of unfairness in the construction
of the diesel station.
Finally, we consider the principle of transparency also enshrined in Article 2 of Law 31/2004.
We note that the law emphasizes this principle alongside the closely linked principles of
partnership and participation. Public access to official information about fisheries subsidy
programs is essential for both accountability and stakeholder involvement—both of
which are fundamental conditions of good policy. Experts and civil society groups around
the world have been calling for increased transparency in fisheries subsidies for nearly
a decade,31 and these calls for have been repeated frequently by governments in the
context of international negotiations at the FAO and the WTO. Unfortunately, concrete
action to improve public access to information has remained the exception rather than
the rule in both developing and developed countries, and much important information
about fisheries subsidies is today still beyond public reach.
In this regard, the positive attitude of Indonesian government officials in supporting and
cooperating with this study—and in particular in providing detailed budgetary materials—
provides an unprecedented level of transparency about the fishery subsidy programs of
a major developing country. Providing such transparency always involves risk, and any
government that takes this risk must be prepared for public discussion of its policies and
practices. But the principles of partnership and participation point precisely to the need
for such dialogue as necessary for successful government. By beginning to open its books
on fisheries subsidies as it has for this study, the Government of Indonesia is demonstrating
both wisdom and true international leadership.
Nevertheless, we cannot ignore the lack of a regular mechanism for the routine publication
of information about Indonesia’s fisheries subsidies. For proper administration of subsidy
programs, occasional studies such as this one cannot provide the necessary public access to
22
information. Moreover, as decentralization proceeds in Indonesia’s government structure

generally, improvements in the transparency of subsidy programs will be needed just
to ensure that MMAF and other national officials are kept aware of subsidy activities of
provincial and district governments.
23
VI. Conclusions & Recommendations
As noted in Sections I and II, this study must be considered preliminary in nature and
limited in scope. On the other hand, the study presents what the authors believe is
the largest and most detailed set of data yet to be published about fisheries subsidies
in a major developing country. The budgetary information made available by MMAF
and local officials, in combination with extensive interviews of hundreds of fishermen,
provides a solid basis for a number of important conclusions and recommendations.
A. General conclusions
Conclusion 1 — The total level of subsidies granted to the Indonesian fisheries sector
is significant, and almost certainly has an impact on the scale and kind of fishing
carried out in Indonesia’s domestic fisheries. We conservatively estimate total fisheries
subsidies nationwide to be on the order of be Rp1,280 billion (USD $140 million) per
year, exclusive of fuel subsidies. Fuel subsidies in the fishery sector, while difficult to
calculate and in constant flux, likely amount to trillions of rupiah (hundreds of millions
of dollars) annually. These figures compare with a total value of Indonesian fisheries
of approximately USD $5 billion per year,32 and with total Indonesian fisheries exports
valued at approximately USD $1.5-2.0 billion per year.33 In other words, if fuel subsidies
are included, total Indonesian fisheries subsidies could amount to almost 10% of the
value of Indonesia’s fisheries and nearly 30% of Indonesia’s fisheries exports.
Conclusion 2 — Some fisheries subsidies in Indonesia are clearly supportive of sustainable
fisheries management and conservation. In a growing number of fisheries, funding is
being directed at establishing fisheries management plans, as called for by the Komnas
Kajiskan. Moreover, significant subsidies are being directed at activities to improve the
value extracted from fisheries without requiring intensified fishing. In some program
areas, funding for improved fisheries management is clearly on the rise.
Conclusion 3 — A substantial amount of subsidy funding continues to flow towards uses
that are not consistent with sustainable fisheries management. The overall risk profile
of Indonesia’s fisheries subsidies is dangerously slanted towards high risk subsidies,
and there is direct evidence of many cases in which subsidies are increasing fishing
capacity and effort in fisheries that are already heavily exploited. Moreover, our field
research revealed significant problems with effectiveness, equity, and transparency in
the administration of Indonesia’s fisheries subsidies.
Conclusion 4 — Significant levels of policy incoherence and ineffectiveness are detracting

from the overall effectiveness of Indonesian fisheries subsidies. These problems appear
to result from two underlying causes. First, as discussed in Section I, Indonesia is still
in the early stages of a major transition away from policies aimed at ever-expanding
production, towards the sustainable management of fish stocks and marine ecosystems.
However, the “culture of sustainability” has not yet been fully disseminated within MMAF,
and outside of MMAF there remains a pressing need to educate policymakers, fishers, and
the public generally about the challenges facing Indonesia’s fisheries. Second, current
administrative structures within MMAF appear inadequate to ensure policy coherence
in subsidy administration. There is simultaneously a lack of centralized planning and
monitoring of subsidy programs and a lack of proper involvement of local officials and
stakeholders in subsidy design.
B. Recommendations
MMAF leadership and the Komnas Kajiskan are well aware of the challenges discussed above,
and many steps towards reform are already underway. The specific recommendations
set out below are, therefore, intended to reinforce the positive trends already evident in
Indonesian fisheries policy.
Recommendation 1 — MMAF should take immediate steps to eliminate subsidies

that are directly at odds with sustainable management goals. Specifically, a process
should be launched to review subsidies in all Indonesian fisheries that are nearing
or have already surpassed full exploitation. In such fisheries, subsidies that directly
increase fishing capacity or effort should be phased out rapidly. More generally,
wherever fisheries management plans are already in place, subsidies should be
reviewed to determine their consistency with the FMPs.
Recommendation 2 — Special attention should be given to the use of fuel subsidies

in the fishery sector. While it is clearly necessary to take account of the impact of
high fuel prices on fishermen’s livelihoods, it is equally important to recognize the
direct impact fuel subsidies can have by encouraging overexploitation. MMAF and
stakeholders should consider conducting a detailed study of the impacts of fuel
subsidies in order to develop a balanced plan for reform.
Recommendation 3 — MMAF should make increased use of positive subsidies. In

particular, both sustainability and “customer satisfaction” could be increased by
shifting subsidies towards infrastructure and training for improving product quality
and value. Where FMPs are not yet in place, subsidies should also be used to facilitate
FMP development, including through support for increased local stakeholder
involvement.
25
Recommendation 4 — MMAF should give increased emphasis to developing and

implementing fisheries management plans. Where appropriate (as is often the case
in near-shore demersal fisheries, among others), such FMPs should be coordinated
with and include the establishment of a network of multi-use marine protected
areas (MPAs) to protect spawning grounds and other critical habitat elements. FMPs
should explicitly address the use of subsidies in the relevant fisheries. To do this, the
FMP process will need to move beyond traditional approaches to consider in detail
the kinds of public investments needed to improve sustainability and economic
efficiency under specific local circumstances. In other words, FMPs should include an
explicit “subsidies needs analysis” on a fishery-by-fishery basis, taking account of the
major issues in each fishery, the economics of the fishery, the existing infrastructure,
and the real world status of existing management systems (including key elements
of “monitoring, control, and surveillance”). Once an FMP is in place, mechanisms
should be created for continuous monitoring of subsidies to ensure their consistency
with the management plan.
Recommendation 5 — MMAF should continue to explore and accelerate specific

steps to increase its effective administrative control over Indonesia’s fisheries
subsidies. New administrative structures should aim at several key goals:
A. Improving centralized development of subsidy policy and strengthening

centralized monitoring and review of subsidies expenditures, in order to ensure
that subsidies are supportive of national goals and to increase coordination
across MMAF offices. For example, it should not be possible for one office
in MMAF to subsidize new vessels in a fishery while another office calls for
capacity reduction in the same fishery.
B. Increasing the involvement of local officials and stakeholders in designing

subsidies programs. Even as MMAF increases centralized policymaking and
monitoring of subsidies, the specific “subsidy needs analyses” should be
undertaken at the local level. This may require not only increasing local MMAF
capacities, but also establishing better mechanisms for communications
between central MMAF offices and local officials.
C. Improving inter-ministerial coordination. Although not examined in detail

here, subsidies being provided to fishing communities by ministries other than
MMAF appear to be significant. Inter-ministerial coordination is especially
important in today’s context of transition, when many non-specialists are
unaware of fisheries overexploitation and unfamiliar with the “sustainable
management” policies that are now required,
26
Recommendation 6 — MMAF should take strong steps to improve the financial

accountability and transparency of subsidy programs. In fact, stronger bookkeeping
and reporting mechanisms are likely to be necessary for the success of administrative
reforms such as suggested under Recommendation 5. Records showing the flow of
funds and the basis for the distribution of subsidies should be mandatory. MMAF
should consider establishing a public record of its fisheries subsidies, including routine
publication of detailed budgetary information. MMAF should also explicitly commit
to achieving full compliance with existing or future WTO rules on transparency and
notification of subsidies.
Two “golden threads” run through these conclusions and recommendations. The first is
the tool of fisheries management planning. FMPs are fundamentally tools for localizing
and implementing fisheries and ecosystem management. If FMPs are properly developed
and implemented—and if they are made a core function within MMAF, so that all MMAF
offices interact with them in any fishery where they are active—they can go a long way to
promoting the reforms suggested above.
The second golden thread is the thread of transparency and accountability. At present,
fisheries subsidies are designed and administered in an atomized fashion, with different
offices pursuing different programs for different purposes. It will never be possible or
desirable to centralize programs completely. But where coordination is necessary—as
it so obviously is where subsidies are concerned—increased information flow within
and outside of MMAF is required. Where local stakeholders are to be involved, this also
implies an increased flow of information to the local level.
There is good reason to be hopeful about the future of Indonesia’s fisheries and its fisheries
subsidies policies in particular. The trends within the ministry and stakeholder groups
are generally positive. But this study reveals that substantial work needs to be done
to ensure genuine policy coherence both within MMAF and between MMAF and other
national and local authorities. The pursuit of substantive policies that embrace a “culture
of sustainability” and administrative practices that embrace a “culture of accountability”
are the fundamental elements of success.
≈≈≈
27
Appendix A — Definitions of “Fisheries Subsidy”
FAO
The U.N. Food and Agriculture Organization (“FAO”) is the leading intergovernmental
body with expertise and governance responsibilities over fisheries on a worldwide basis.
The issue of fisheries subsidies first came to international attention as a result of FAO
analytic work in the early 1990s,34 and the FAO houses the International Plan of Action for
the Management of Fishing Capacity, which is the only international legal instrument yet
to be adopted that addresses the need for eliminating harmful fisheries subsidies. The
FAO has, however, never formulated a single clear definition of “fisheries subsidy”. The
question has never been presented for political decision by FAO members.35 Moreover,
an in-depth technical consultation on “Identifying, Assessing and Reporting on Subsidies
in the Fishing Industry” conducted by the FAO in 2002 was unable to produce a simple or
precise definition.36 Rather, as was reported in the 2002 edition of FAO’s biannual State
of World Fisheries and Aquaculture (SOFIA), “This discussion drew the conclusion that
no single definition could be agreed to.”37 Instead, the FAO has noted a series of broad
descriptions of what may constitute a “fisheries subsidy”, and has identified at least four
general categories into which fisheries subsidies can be classified. Among the broad
general formulas used to describe “fisheries subsidy” for the FAO expert consultation
were the following:38
“[A] direct or indirect payment, economic concession, or privilege granted by
a government to private firms, households, or other governmental units in
order to promote a public objective.”
“[A]ny government intervention—or lack of intervention—that affects the
fisheries industry and that has an economic value.”
“[A] subsidy should be something that is out of the ordinary, i.e. something
that is done – or not done – outside of normal practices:
“[G]overnment actions or inactions that are specific to the fisheries
industry and that modifies (sic)—by increasing or decreasing – the
potential profits by the industry in the short-, medium- or long-term.”
The 2002 expert consultation also identified four categories of activities that can be
covered by the term “fisheries subsidies”:39
Category 1 — Direct governmental payments that reduce costs or increase
revenues for producers in the short term (e.g., grants to purchase or modernize
fishing vessels);
Category 2 — Government interventions other than direct payments that reduce
costs or increase revenues for producers in the short term (e.g., tax waivers,
below-market loans, goods or services);
Category 3 — Lack of government intervention that reduce costs or increase
revenues for producers in the short term (e.g., failure to impose or enforce limits
28
on target catch or bycatch) (also known in some contexts as “failures to internalize

environmental costs”);
Category 4 — Government interventions other than direct payments that reduce
costs or increase revenues for producers in the medium or long term (e.g., effective
fisheries management measures).
The FAO has noted that the combination of Categories 1 and 2 comes closest to being
coextensive with the WTO definition (see below), while governments and stakeholders take
different views about whether Categories 3 and 4 are properly considered “subsidies.”
WTO
The WTO Agreement on Subsidies and Countervailing Measures (“ASCM”) defines a
subsidy as any “financial contribution” by a government (or by a public or private entity
on behalf of a government) that confers a specific “benefit” on a domestic industry. A
“financial contribution” may be in the form of a direct transfer of funds (e.g., a grant or
loan) or “potential” transfer (e.g., a loan guarantee), the provision of goods or services, a
price support, or the foregoing of tax or other revenue otherwise due. The requirement
that a benefit be “specific” to an industry (or, in some cases, to a region) is intended to
exclude government interventions that produce general public benefits (such as social
security or police services), and thus bears some relation to the idea articulated by the
FAO Draft Guide (quoted above) that “a subsidy should be something that is out of the
ordinary.”
As a general matter, government financial transfers to the fisheries sector (roughly
equivalent to FAO Categories 1 and 2, discussed above) fall within the WTO definition of a
subsidy, and thus come under existing WTO subsidy disciplines.40 Fisheries management
services, except perhaps in very particular and unusual cases, do not fall within the WTO
definition. Failures to internalize environmental costs (e.g., the short-term benefits of
allowing overfishing) are certainly not covered by current WTO rules.
In the context of the current Doha Round, governments have agreed to “clarify and
improve” the ASCM’s treatment of fisheries subsidies,41 and have further agreed to adopt a
prohibition on fisheries subsidies “that contribute to overcapacity and overfishing”, taking
account of the need for “special and differential treatment” of developing countries.42
As of this writing (October 2008), the negotiations had produced a draft “Chair’s Text”
outlining a proposed annex to the ASCM on fisheries subsidies.43 While many aspects of
the Chair’s Text have raised debate and even some controversy, the fisheries subsidies
language was broadly accepted as a basis for further negotiations.
At the negotiating table, the question of defining “fisheries subsidy” has raised issues that
can be roughly divided into the questions “What is meant by ‘fisheries’?” and “What is
meant by ‘subsidy’?”
29
With regard to the concept of “fisheries”, the Chair’s Text proposes limiting the reach of
new disciplines to:
• subsidies that confer benefits on “fishing vessels or service vessels” or on their
operations (where “fishing vessel” are “vessels used for marine wild capture fishing
and/or on-board processing of the products thereof” and “service vessels” are
“vessels used to tranship the products of marine wild capture fishing from fishing
vessels to on-shore facilities; and vessels used for at-sea refuelling, provisioning
and other servicing of fishing vessels”);
• subsidies that confer benefits on the “landing, handling or in- or near-port
processing activities for products of marine wild capture fishing”;
• subsidies to “port infrastructure or other physical port facilities exclusively or
predominantly for activities related to marine wild capture fishing”;
• subsidies that provide “income support for natural or legal persons engaged in
marine wild capture fishing”; and
• subsidies in the form of “price support for products of marine wild capture
fishing”.
The proposed rules thus appear to exclude subsidies relating to inland fisheries and to the
non-fishing aspects of aquaculture.
With regard to the concept of “subsidy” the Chair’s Text appears to clarify two points:
First, on the controversial question of “foreign access payments” the text strikes a balance
by explicitly excluding government-to-government access payments but by treating as
“subsidies” the onward transfer of access rights from the government that has acquired
them to its domestic industry.44 Second, the text implicitly excludes fisheries management
services from the definition of “subsidy”. In many cases, the text would require that
certain fisheries management services be provided as a condition precedent to the use
of non-prohibited fisheries subsidies. These services are clearly treated as an essential
public good, and not as subsidies in themselves.
OECD
The OECD—which has conducted more extensive technical work on quantifying fisheries
subsidies than any other intergovernmental organization—has adopted the term
“government financial transfers” (“GFTs”) in place of the more common term “subsidies”,
and has given GFTs a broad economic definition:
“The [OECD] Committee [on Fisheries] has used the term “government
financial transfers” in preference to the more general term “subsidies”.
This is because, in general usage, subsidies encompass more than just
the explicit transfer of money from the public purse to the sector. Since
subsidies in general also include implicit transfers from consumers to
the industry, GFTs are considered to be a subset of the whole range of
subsidies. . . . Government financial transfers are defined as the monetary
value of interventions associated with fishery policies, whether they are
from central, regional or local governments. GFTs include both on-budget
30
and off-budget transfers to the fisheries sector. . . . Three categories of

GFTs are identified: direct payments; cost-reducing transfers; and general
services. A fourth category of transfer, market price support, is included in
the classification scheme but was not addressed in the study on Transition
to Responsible Fisheries. The extent of cost recovery undertaken by
countries is also included in the classification.”
A. Cox, “OECD Work on Defining and Measuring Subsidies In
Fisheries” (OECD 2003) ¶¶ 3-5 (emphasis added).
Cox explicitly notes that there is controversy over whether “general services” such
as governmental fisheries management activities should be counted as a GFTs, and
reports that OECD governments differ in their approach to the matter. (Id. at ¶ 9.) The
fisheries subsidies data collected by the OECD from its members thus varies somewhat
in scope from government to government. For purposes of reporting to the OECD, some
governments clearly have treated budgetary expenditures for fisheries management
services as “subsidies”.
UBC Fisheries Centre

The Fisheries Centre of the University of British Columbia in Canada has done more
technical work quantifying fisheries subsidies than any other non-governmental entity,
and is the only entity that has attempted a global quantification of fisheries subsidies that
includes developing countries. In its major publication setting out worldwide estimates
of fisheries subsidies on a country-by-country basis,45 UBC reviews several approaches
to defining “fisheries subsidy”, but apparently declines to adopt a specific definition of
its own.46 It is clear from its data and analysis, however, that the Centre adopts a fairly
broad definition that includes expenditures for management services, which it generally
classifies as “good” (as opposed to “bad” or “ugly”) subsidies.
31
Appendix B — Tabel 6
Exploitation Levels of Major Indonesian Fisheries
Stock Status Key: Source: Komnas Kajiskan (2007a)

U : Under exploited F : Fully exploited UN : Uncertain
M : Moderately exploited O : Overfished
APPENDIX TABLES
33
Appendix Table 1 —Total Subsidies by Authority and Year (Rp)
Authority 2004 2005 2006 2007 Grand Total

National   306,311,772,132 200,887,801,076 150,489,170,246 657,688,743,454
  DJPT (DG-Capture Fisheries)   172,836,601,907 101,185,688,133 98,669,804,134 372,692,094,174
DJ-KP3K (DG-Marine Coasts &
  Small Islands)   97,833,875,377   51,819,366,112 149,653,241,489
DJ-P2HP (DG-Fisheries Product
  Processing & Marketing)   35,641,294,848 99,702,112,943   135,343,407,791
Provincial   37,194,419,694 40,136,598,691   77,331,018,385
  Bali   6,797,908,333 2,532,611,420   9,330,519,753
Central Java Province (Fishery &
  Marine Service)     13,942,014,600   13,942,014,600
  East Java Province   29,848,319,004     29,848,319,004
East Lombok Province (Marine &
  Fishery Service)   548,192,357 5,557,683,390   6,105,875,747
34
  West Nusa Tenggara Province     10,818,619,281   10,818,619,281
  East Nusa Tenggara Province     7,285,670,000   7,285,670,000
District/ Local 1,904,542,000 4,636,700,500 3,447,225,000 2,450,750,000 12,439,217,500
  Banyuwangi 193,520,000       193,520,000
  Batang 1,711,022,000 450,000,000     2,161,022,000
  Kota Kupang       2,450,750,000 2,450,750,000
  Pati Marine and Fisheries Dept   2,410,271,000 3,447,225,000   5,857,496,000
  Pekalongan   1,776,429,500     1,776,429,500
Grand Total 1,904,542,000 348,142,892,326 244,471,624,767 152,939,920,246 747,458,979,339
(This table includes only data made available for this study)
Appendix Table 2 —Total Subsidies by Authority and Year (USD)
Authority 2004 2005 2006 2007 Grand Total

National   $33,694,295 $22,097,658 $16,553,809 $72,345,762
  DJPT (DG-Capture Fisheries)   $19,012,026 $11,130,426 $10,853,678 $40,996,130
  DJ-KP3K (DG-Marine Coasts & Small Islands)   $10,761,726   $5,700,130 $16,461,857
DJ-P2HP (DG-Fisheries Product Processing &
  Marketing)   $3,920,542 $10,967,232   $14,887,775
Provincial   $4,091,386 $4,415,026   $8,506,412
  Bali   $747,770 $278,587   $1,026,357
Central Java Province (Fishery & Marine
  Service)     $1,533,622   $1,533,622
  East Java Province   $3,283,315     $3,283,315
East Lombok Province (Marine & Fishery
35
  Service)   $60,301 $611,345   $671,646
  West Nusa Tenggara Province     $1,190,048   $1,190,048
  East Nusa Tenggara Province     $801,424   $801,424
District/ Local $209,500 $510,037 $379,195 $269,583 $1,368,314
  Banyuwangi $21,287       $21,287
  Batang $188,212 $49,500     $237,712
  Kota Kupang       $269,583 $269,583
  Pati Marine and Fisheries Dept   $265,130 $379,195   $644,325
  Pekalongan   $195,407     $195,407
Grand Total $209,500 $38,295,718 $26,891,879 $16,823,391 $82,220,488
(This table includes only data made available for this study)
Appendix Table 3 — MMAF Budgets, by Program & Year

2005   2006   2007  
Directorates / programs
(Rp) (USD) (Rp) (USD) (Rp) (USD)
DJPT (DG-Capture Fisheries) 172,836,601,907 $19,012,026 101,185,688,133 $11,130,426 98,669,804,134 $10,853,678
UN Code Of Conduct for
Responsible Fishing 988,789,888 $108,767 4,561,059,960 $501,717 1,967,975,960 $216,477
Development of capture fisheries   4,302,249,761 $473,247 4,302,249,761 $473,247
Development of fishery statistics 128,938,600 $14,183 1,219,907,199 $134,190 1,297,107,199 $142,682
Development of fishing vessels and
gears   64,682,894,912 $7,115,118 75,958,790,841 $8,355,467
Development of small scale
fisheries 1,218,115,500 $133,993      
Fishing license 3,148,315,165 $346,315      
Fishing port   11,275,895,928 $1,240,349    
Improve service on fishing licensing 751,301,686 $82,643 15,143,680,373 $1,665,805 15,143,680,373 $1,665,805
Investment and job creation 1,313,530,616 $144,488      
36
OPTIHANDIS 10,907,392,409 $1,199,813      
OPTIKAPI 149,427,692,053 $16,437,046      
OPTISARKAN 1,952,819,795 $214,810      
Service and control of fishing
license 2,999,706,195 $329,968      
DJ-KP3K (DG-Marine Coasts &
Small Islands) 97,833,875,377 $10,761,726     51,819,366,112 $5,700,130
Conservation of marine national
park 5,725,442,200 $629,799      
Development and management of
coastal small-island resources 10,762,650,600 $1,183,892      
Development of fisheries resources 54,123,179,500 $5,953,550      
Management and utilization of
small islands 17,838,589,777 $1,962,245      
2005   2006   2007  

Directorates / programs
(Rp) (USD) (Rp) (USD) (Rp) (USD)
DJPT (DG-Capture Fisheries) 172,836,601,907 $19,012,026 101,185,688,133 $11,130,426 98,669,804,134 $10,853,678
Marine resources management     37,430,262,452 $4,117,329
MCRMP - marine and coastal
resources management program     14,389,103,660 $1,582,801
Spatial plan for coastal and small-
islands 9,384,013,300 $1,032,241      
DJ-P2HP (DG-Fisheries Product
Processing And Marketing) 35,641,294,848 $3,920,542 99,702,112,943 $10,967,232    
Business development : processing
& marketing fishery products 2,306,260,047 $253,689 5,175,790,380 $569,337    
Improve quality and development
of processing for fishery product 4,462,325,838 $490,856 52,238,585,238 $5,746,244    
Improve public service, HR
37
development and good governance 12,472,325,998 $1,371,956 22,494,908,676 $2,474,440    
Marketing development and
improvement of fishery products 16,400,382,965 $1,804,042 19,792,828,649 $2,177,211    
Grand total 306,311,772,132 $33,694,295 200,887,801,076 $22,097,658 150,489,170,246 $16,553,809
Appendix Table 4 — Provincial & District Budgets, by Program & Year

2004  2005 2006
2007
Local Authorities / Programs (Rp) (Rp) (Rp) (Rp)
(USD) (USD) (USD) (USD)
Bali     6,797,908,333 $747,770 2,532,611,420 $278,587    

Development of fishery agribusiness   1,582,169,095 $174,039      
Increase in the prosperity of
government staffs.     39,900,000 $4,389    
Management and Development of
Coastal area   487,199,400 $53,592 151,171,000 $16,629    
Management and Development of
use of fishery and marine resources   3,948,555,518 $434,341 2,115,310,920 $232,684    
Surveillance, control and
conservation on marine and fishery
resources   779,984,320 $85,798 226,229,500 $24,885    
Banyuwangi 193,520,000 $21,287            
38
Development of aquabusiness 100,000,000 $11,000        
Development of fishermen and fish
farmers 43,520,000 $4,787        
Management and protection on
fishery and marine resources 50,000,000 $5,500        
Batang 1,711,022,000 $188,212 450,000,000 $49,500        
Capacity building for fisheries
communities 40,000,000 $4,400 75,000,000 $8,250      
Development of marine affairs and
fisheries 109,900,000 $12,089        
Improve technical facilities for
marine affairs and fisheries 1,561,122,000 $171,723 335,000,000 $36,850      
(blank)   40,000,000 $4,400      
Central Java Province (Fishery &
Marine Service)         13,942,014,600 $1,533,622    
Development and Empowerment of
Capture fishery     3,347,436,000 $368,218    
2004  2005 2006

2007
Program of empowerment of coastal

community     149,089,000 $16,400    
Program of empowerment of small
islands     97,916,500 $10,771    
Program of fishery business
development     7,371,961,600 $810,916    
Program of increase in instrument
and infrastructure of the government     557,623,000 $61,339    
Program of increase in the quality
of district government human
resources Daerah     124,550,000 $13,701    
Program of supervision on marine
39
resources exploitation and
exploration     2,293,438,500 $252,278    
East Java Province     29,848,319,004 $3,283,315        
Agribusiness development   991,260,000 $109,039      
marine resources   10,863,120,306 $1,194,943      
Food security   411,683,800 $45,285      
Integrated fisheries development   437,337,500 $48,107      
Office operations   17,144,917,398 $1,885,941      
East Lombok Province (Marine &
Fishery Service)     548,192,357 $60,301 5,557,683,390 $611,345    
Empowerment of economy of the
coastal community (sea and freshwater
fishermen & fish farmers)   156,265,950 $17,189 98,955,000 $10,885    
Implementation of environmentally
friendly science & technology (IPTEK)   120,085,000 $13,209 195,765,500 $21,534    
Increase in marine and fishery
infrastructure.   94,763,307 $10,424 3,484,159,090 $383,257    
2004  2005 2006

2007
Increase in the management of

marine and fishery environment   55,926,700 $6,152      
Increase in the participatory marine
environment management     219,041,250 $24,095    
Increase in the quality and quantity
of fishery and marine human
resources   121,151,400 $13,327 289,480,050 $31,843    
Rehabilitation and Restoration of
natural resources reserve (Cadangan
Sumberdaya Alam)     1,270,282,500 $139,731    
Kota Kupang             2,450,750,000 $269,583
Increase fish production       2,450,750,000 $269,583
West Nusa Tenggara Province         10,818,619,281 $1,190,048    
40
marine resources     1,167,390,109 $128,413    
Development of fishery resources     9,651,229,172 $1,061,635    
East Nusa Tenggara Province         7,285,670,000 $801,424    
marine resources     839,000,000 $92,290    
Development of fisheries resources     6,446,670,000 $709,134    
Pati Marine and Fisheries Dept     2,410,271,000 $265,130 3,447,225,000 $379,195    
Catching Facility and Infrastructure
Development   700,000,000 $77,000 1,000,000 $110    
Catching production improvement   283,000,000 $31,130 291,500,000 $32,065    
Control of Exploitation Marine
and Fisheries Nature Resources
Improvement   5,000,000 $550      
Culture production and other
commodity improvement   3,400,000 $374      
2004  2005 2006

2007
Efficiency & Effectiveness of

Administration and technique
services improvement   30,000,000 $3,300      
Facility and Infrastructure
fish culture improvement and
development   1,339,421,000 $147,336      
Fisheries product processing and
marketing improvement   15,000,000 $1,650      
Marine and Fisheries Human Resources

Quality Improvement and Development   9,000,000 $990 68,700,000 $7,557    
Marine and Fisheries institution
41
Development   5,000,000 $550      
Marine and Fisheries Institutional
Development and Community
Empowerment     55,000,000 $6,050    
Marine and Fisheries Nature
Resources Environment Quality
Development   5,000,000 $550 135,000,000 $14,850    
Marketing Facility and Infrastructure
Renovation and Development     2,896,025,000 $318,563    
Planning, Monitoring, Evaluation &
Report Improvement of Marine and
Fisheries Department District Pati   15,450,000 $1,700      
Pekalongan     1,776,429,500 $195,407        
Agribusiness development   64,950,000 $7,145      
Biodiversity protection   15,000,000 $1,650      
Coastal community development   74,700,000 $8,217      
Development of Economic
development zone   993,559,500 $109,292      
2004  2005 2006

2007
Management of natural
environmentPengelolaan Lingkungan
alam   498,220,000 $54,804      
Skills and knowledge improvement
for agriculture HR   55,000,000 $6,050      
Support program for food production   75,000,000 $8,250      
Grand Total 1,904,542,000 $209,500 41,831,120,194 $4,601,423 43,583,823,691 $4,794,221 2,450,750,000 $269,583
42
Appendix Table 5 — Activities by Risk (MMAF DG-Capture Fisheries)

Risk Rating Program Activity
Very High development of capture business meeting for capture fishery
fisheries control of overseas employees working at national fishing vessels
develop management information system for the development of capture fisheries business
development of integrated capture fishery
evaluation on the development of small scale capture fisheries (< 30 GT)
Evaluation on the development of small-scale fishery (fishing power < 30 GT)
feasibility and allocation for capture fisheries
feasibility and fishery allocation for capture fishery
formulate salary system and profit sharing in capture fishery business
formulation of master plan and renstra (strategic planning) on the development of small-scale capture fisheries
(PUPTSK)
international cooperation for the development of capture fisheries business
international cooperation on the development of capture fisheries
43
mapping performance of artisanal fisheries
mapping performance of small-scale fisheries
mentoring on revitalization of capture fisheries
mentoring the operational of revitalization package for capture fisheries
policy formulation on open ocean capture fishery
Promote investment on capture fishery
socio-economic analysis of fisher’s business
technical meeting and develop partnerships for capture fishery
training TOT on institutional structure of capture fishery

development of fishing Development of fishing boats and gears
vessels and gears development of fishing vessels and gears
FAD’s mapping
improve facility for capture fishery, direct aid to community and other supporting activities
improvement of fishing facilities, direct aid and other supporting activities
mapping on FAD (Fish Aggregating Device)
Monitoring-Evaluation (MonEv) of implementation of OPTILANPI
planning and supervision on the design and seaworthiness of fishing boats and gears
Pre-consensus and consensus on standardized fishing vessels and gears
pre-consensus & consensus on standardized fishing vessels and gears
improve service on arrangement for capture fishery allocation
fishing licensing arrangement on fishing allocation
evaluation on fishing allocation
evaluation, allocation and implementation of capture fishery business
field extension and acceleration to the implementation of integrated capture fishery system
field extension on business service on capture fishery of fishing power < 30 GT
44
OPTIKAPI Evaluation of SPDN/SPBN development
Field consultation to support the development of capture fisheries
fishing vessel development
Procurement of fishing vessels
OPTISARKAN development of small scale fisheries
High development of capture facilitate certification of land owning for fishermen
fisheries improve access on capital investment of fishers to bank
increase access to capital investment for small scale fishermen
increase access to capital of fishermen to bank
increased access to capital investment for fisher through pawning service and land certificate at fishing port/fish
landings (PP/TPI)
mentoring to increase access to capital for small-scale fisher
strengthening capital for fishermen
Strengthening capital investment for fishermen

Moderate CCRF follow up action to solve fishermen conflict
development of capture capacity building for competency improvement of the fishermen
fisheries De-regulation on fishery business: public policy analyses on fishery business
development of livelihood diversification for small scale fishermen
improve fishermen competency in basic safety procedure (BSTF)
improve fisher’s competence in machinery (Atkapin III)
improve fisher’s competence on basic safety procedures (BST-F)
improve fisher’s competence on deck skills (Ankapin III)
improve fishermen competency in engine (Atkapin III)
livelihood diversification for small-scale fishermen
Socio-economics analyses of fishermen
development of fishing development of information system for fishing port
vessels and gears
development of outer ring fishing port in Indonesia
45
fishing vessel mapping at fishing port
guideline to measure vessel dimensions
harbor master of fishing port
improve fish landing facilities in West Java Province
improved facilities of Cilacap fishing port (PPS)
improved status of PPP Sungailiat into PPN
Infrastructure development of Jakarta Fishing Port
Monitoring-Evaluation (MonEv) and mentoring of the operational of fishing port
Fishing port operational maintenance & reporting
Planning and supervision on design of safety procedure for fishing vessels and gears
review and evaluation on integrated fishing port management in relation to local autonomy
review on remediation of sedimentation pond at fishing port
study the impact of operational PERUM to performance of fishing port
technical and implementation guideline on the operational of fishing port
technical training on the development of fishing gears
training for boat-master

training for officials on physical and document checking of fishing vessels
training for operator of UPMB
training for operator UPMB
training on development of fishing gears
training on fishing boat master
training on identification and measuring fishing boat dimensions
training on maintenance and reparation of fishing machine
training on maintenance and reparation of machinery for fishing
training on physical and document checking for fishing boats/ship
training on safety procedure of fishing boat
training on seaworthy of fishing boats/ships
development of small training on small-scale fisheries
scale fisheries
fishing license training on fishing
fishing port development of information system for fishing port
development of outer-ring fishing ports in Indonesia
46
facility improvement of fishing port (PPS) in Cilacap
harbor master of fishing port
implementation and technical guideline of the operation of fishing port
improvement of fishing landing sites (TPI) East Java Province
increased status of PPP Sungailiat into PPN
infrastructure improvement of Jakarta Fishing Port
Monitoring-Evaluation (MonEv) of the implementation of OPTILANPI
Monitoring-Evaluation (MonEv) of the operational of fishing port
review and evaluation of integrated fishing port management in relation to local autonomy
review on remediation of sedimentation pond at fishing port
Study on impact of PERUM operation on the performance of fishing port

improve service on coaching on non-taxed government income (PNBK)
fishing licensing establishment of KUB (cooperative)
field extension on business service on capture fishery of fishing power < 30 GT
HR development in relation to capture fishery licensing
mentoring on PNBK (non-taxed government income)
optimizing of non-taxed government income (PNBP)
optimizing no-taxed government income (PNBP)
OPTIKAPI Development of fisheries landing and auction places
improve facility of fishing port
improved service of fishing port
Operational improvement of fishery harbor
Standardization of capture fishery facilities
training on control & construction of fishing harbor
training on fishing facility
47
Low (Positive?) CCRF empowerment of artisanal fisheries (fish box)
development of capture develop concept on the revitalization fishery business
fisheries
OPTIHANDIS fish handling and processing
Improved facility of LPPMHP (fish quality control)
Optimize fish processing facilities
quality improvement of fishery product
Value added and quality improvement of fishery products
Positive CCRF an opportunity for trawl operation in cross boundary between Malaysia - Indonesia
CpUE’s monitoring & evaluation for fishing vessels < 30 GT in WPP (fishery management areas)
Deep sea FAD’s monitoring and evaluation Sulawesi and Papua, FAD’s identification in South China Sea
Development of draft management plan for spotfin flying fish in Makassar Strait and Flores Sea
evaluation and mentoring the trans-boundary fishermen
evaluation and verification on the use of FADs in North Sulawesi and Pacific ocean
evaluation of fishery regulation at cross boundary of EastKal, WestKal with Malaysia
extension of CCRF

Extension of NPOA for shark management
field extension on the implementation of CCRF
Fisheries management of endangered species
Fisheries monitoring in Arafuru Sea
Fishery management of EEZ and open ocean
formulation of National Plan of Action on Fishing Capacity
formulation of technical guideline on fishing gear, FAD’s placement and NPOA fishing capacity
implementation of NPOA for shark management
initial development of fishery management plan (RPP) for Arafura Sea
Inventory of fishery resources in the Province of Bangka Belitung
management of red snapper fishery in Arafuru and Timor Sea
management plan for Banggai Cardinal fish
Mentoring on Code of Conduct for Responsible Fisheries (CCRF)
Monitoring-Evaluation (MonEv) of fishery regulation in archipelagic areas
Monitoring-Evaluation (MonEv) of longtail shad, Tenulosa macrura
Monitoring follow up actions of fishery management plan (RPP) of Teluk Tomini
48
Monitoring follow up actions of fishery management plan in Java Sea
multi-lateral cooperation (CCSBT, IOTC, BOBLME) and prepare the membership of Indonesia in CCSBT and WCPFC
National FKPPS (fishery management forum) meeting
onboard observer on fishing vessels (SIPO)
onboard observer program
policy formulation on capture fishery management and urgency of membership of Indonesia in CCSBT and WCPFC
Study on by-catch utilization and management of trawl fishery in Arafura Sea
Workshop on fishery management plan (RPP) of Malacca Strait
development of capture control of overseas employees working at national fishing vessels
fisheries formulation of master plan and strategic plan (Renstra) for the development of small scale fisheries (PUPTSK)
management information system for the development of capture fisheries
policy formulation on open ocean capture fishery

Development of fishery analyses of the world fishery
statistics Appreciation of data collection system for tuna fishery
appreciation and improvement of statistical system for capture fishery (SISPT)
data analyses and presentation on fishing boats/ships > 30 GT
data analyses and presentation on statistics for capture fishery
data analyses and presentation on statistics of capture fishery
data analyses on world fishery
data analysis and presentation on fishing boats fishing power > 30 GT
data collection system for tuna fishery
data collection system for tuna fishery in Indian Ocean
data collection system for tuna fishery in Pacific area
data collection system for tuna fishery in Pacific
data validation on statistics for capture fishery
statistics for capture fisheries
49
validating statistics of capture fishery
development of fishing decision on the design of national standard index (SNI) for fishing vessels and gears
vessels and gears design of SNI (National Standard Index) for fishing vessels and gear
guideline to measure fishing vessel dimensions
identification and mapping of fishing vessels in fishing ports
Implementation of TED (training)
Implementation of TED
training on identification and measurement of fishing vessel dimensions
fishing license fishing license control

improve service on field extension on allocation and fishing licensing
fishing licensing field extension on allocation and license for capture fishery
HR development in relation to capture fishery licensing
Operational and maintenance of information system
review on small pelagic fishery in Makassar Strait and Flores Sea
review on small-pelagic fishery in Makassar Strait and Flores Sea
up date licensing system for capture fishery
up dating fishing licensing system for capture fishery
investment and job improve service on fishing license
creation
OPTIKAPI Revitalizing FKPPS (Fishery management forum) and Fisheries Manajemen Plan
service and control of license for fishing vessels
fishing license
50
Appendix Table 6 — Activities by Risk (MMAF DG-Marine Coasts & Small Islands)
Very High Development of Facilitating SPDN (fuel station for fishers) development
fisheries resources Industri teknologi tepat guna (intermediate technology industry)
Empowerment of traditional fishing boat builders
Local technology development
Fishermen Regeneration to improve the quality of human resources in coastal communities
Management and capital aid (water carrier ship and fishing boats)
utilization of small Inventory the recipients of smart ships
islands
High Development of Development of fishermen insurance system
fisheries resources Realization of enterprise capital
LKM Syariah (Syariah MicroFinance establishment)
Management and Livelihood capital aid or coastal communities at trans boundary areas
utilization of small Promote investment for small islands
51
islands
Moderate Conservation of Marine Database development and management for marine conservation areas (KKL)
National Park
Development and Conflict resolutions for problems in and around fishing port at 9 different sites
management of coastal Coordination and facilitation in the development of strategic mitigation of coastal areas
small-island resources
Coordination, facilitation and coaching to support revitalization of Losari Beach
Field extension on general guideline of RPKP at 5 provinces
Formulate policy on mitigation to tsunami in West Sumatera
Material production and dissemination of coastal mitigation
Provide support to revitalization of Losari, Makassar
Publication on marine, coastal and small island activities (programs)
Review design of the revitalization of Kupang Bay

Development of fisheries Development of empowerment and service center for coastal communities
resources Development of profit sharing mechanism for fisheries (Bali and Java)
Development of TPD network
Extension and documentation of PEMP Program
Corporatization of fishermen and fish farmers
Maritime cultural development through Wallacea’s institution
Development of new cooperatives/microfinance agencies
Development of coastal shops (Kedai Pesisir)
Empowerment of coastal community economy (PEMP), sending materials
Empowerment of coastal communities through small scale marine tourism
Empowerment of coastal communities through intermediate technology Implementation
Empowerment of coastal women through development of fisheries product wastes
Development of LEPP M3/fisheries cooperatives networks.
Development of coastal community credit-banking (BPR Pesisir).
Improvement of the role of LEPP-M3 through development of super-markets (Waserda).
Improvement of women role for household economy development
52
Distribution of bank-credit to LEPPM3/ Fisheries cooperatives
Publication of coastal and PPK activities on coastal community empowerment
Management and Data management on PPK
utilization of small islands Development of integrated marine tourism in Sulsel, Saunek, Batam, Lembongan, Moyo, Sangihe
Dissemination of Ministerial Decree, Kepmen Pedum Investasi at 5 Districts/Cities
Field visits (coordination) to coastal and small islands areas
Monitoring-Evaluation (MonEv) ofthe implementation of PPK
Monitoring on the implementation of facility aids
Promote the development of marine tourism
Workshop and road show on tourism development in coastal and small island areas

marine resources coastal construction in support of revitalization of Losari Beach (phase III)
management coastal development in support of revitalization of Kupang Bay
Development of Warehouse BMKT
field extension, technical assistant & monitoring of the implementation of coastal village development
Formulate draft of government regulation on mitigating from disaster for coastal communities
Formulate strategic plan to mitigate tsunami in Indonesia
identification on the potential use of unused (exs) Oil Rig
Inventory and distribution of BMKT to local museums
Mitigation to Tsunami with Soft Structure
Operationalization of national secretariat of BMKT
Revisiting Presidential Decree 107/2000, 25/1992 and Ministerial Decree KP 39/2000
Training on BMKT handling and management
MCRMP - marine and Accomplishment of reports on the implementation of activities in Aceh to ADB
coastal resources Admin activities
53
management program
Coordination meeting on BLN
Development of financial reports (central and local governments)
Development of yearly plan with provincial and district level institutions
Discussion on the implementation of SNRM
Meeting on project evaluation
Meeting on project monitoring
Meeting to evaluate the implementation of rehabilitation and reconstruction of NAD
Meeting to review ADB mission
organizational structure of working group on rehabilitation and reconstruction of NAD
Regular meeting of PMO
Spatial plan for coastal Software management (satellite imageries) - GIS
and small-islands
Low (Positive?) Development and Development of coastal village in District Gianyar
management of coastal Implementation of the development of coastal villages at 7 sites
Implementation of the development of coastal villages in district Pontianak
Monitoring the implementation of the development of coastal villages

Positive Conservation of Marine Technical guidance on methods for monitoring of coral reefs evaluation
National Park Demonstration plot of coral transplantation and technical training in 4 locations
Develop draft Ministerial Decree on protection of fish species
Develop guideline book for coral identification (3rd edition)
Develop guideline on sustainable use of marine biota inside MPAs
Develop information materials and promotion to MPAs
Development and management of Wakatobi.
Development of draft government regulation on conservation of fishery resources
Development of management plan for local MPAs (KKLD)
Development of MPAs in Batek Island, Sawu and the surrounding areas
Dissemination of MPA gazettement
Documentation and publication of MPAs in coastal and small island areas
Facilitate action plan for SSME and national committee on marine conservation
Institutional establishment for new MPAs and facilitate the development of action plan
Inventory and selection of candidate MPAs at 4 sites (Sabang-NAD, Simeuleu-NAD, Paloh-Kalbar, P. Enggano-
Bengkulu)
54
Inventory of MPAs
Monitoring and facilitation of coral transplantation
Facilitation and monitoring of buffer zones for marine conservation
Strengthening the community around buffer zones of marine national parks
Giant clam restocking in district Lombok Timur, West Nusa Tenggara
Coral Rehabilitation in Kawasan Loka Budidaya Laut Lombok.
Synchronize the MPAs management

Development and Coordination, facilitate the development of plan for coast line management
management of coastal Coral reef transplantations
Develop mitigation strategy for coastal ecosystem
Development of comprehensive regulations (central-province-districts) that used as guideline for governments
and stakeholders
Development of computerized data system for mangrove
Development of general guideline on management of bays
Development of general guideline on management of coast line
Development of general guideline on management of estuarine areas
Development of general guideline on the development of coastal villages
Extension and implementation of Beach Cleaning (GBPL).
Extension, coordination and monitoring the activity on mitigation to coastal ecosystem
Extension, supervision and facilitation on monitoring of marine pollution
Formulation of national strategy and action plan to control marine pollution
55
Implementation of clean coastal villages in Semarang
Implementation of GBPL at 5 different sites
Mitigation to coral reef destructions in Biak Papua.
Mitigation to degradation of coastal environment at District Demak
monitoring on the implementation to the development of coastal areas and mangrove rehabilitation
National workshop on the development of strategic planning of West Sumatera
Pilot Project on control of marine pollution caused by fishermen boats
Prepare government regulations on the management of coastal and marine areas
Public consultation for the development of strategic plan of management of coastal area in West Sumatera
Workshop to develop general guideline on rehabilitation and optimal use of coastal areas
Development of fisheries Revitalization of social infrastructure in marine and coastal resources utilization and management
resources

Management and Data management on small island using GIS base date
utilization of small islands Develop profile of small island in Indonesia
Development Index of small islands, economic valuation of small islands
Ecosystem improvement of coastal and small islands areas
Ecosystem rehabilitation and optimal use of coastal and small islands
Facility and capital aid and ecosystem rehabilitation of coastal and small islands
Inventory of islands in Indonesia
Monitoring on coral reef transplantation
Survey on small islands in Indonesia
marine resources Coastal and marine clean up (GBPL) at two locations
management Community awareness on mitigation from disaster and pollution
coordination, technical assistant & extension of the marine policies
data management on potential resources of coastal villages
develop concept on mangrove conversion mechanism
Develop guideline to measure Indicator Performance of Integrated Coastal Management (ICM)
56
develop technical guideline on planning document of coastal village management
Extension, technical assistant & monitoring on the implementation of mitigation of coastal environment
field extension on national strategy of mangrove management
field extension, technical assistant & monitoring of the implementation of mangrove rehabilitation
Formulate draft Ministerial Decree on standardized integrated management of coastal areas
formulate draft of Presidential regulation on coastal ecosystem management
Formulate draft of Presidential Regulation on reclamation
Formulate draft on zoning plan for coastal area in Lampung Bay
Formulate draft on zoning plan for coastal areas (three sites)
formulation of strategic plan on mitigation of pollution in the Jakarta Bay
House Aid (resistant to disaster and pollution) in 5 locations
Identification and inventory of marine resources
improve performance of national committee of mangrove in Indonesia
Information system on mitigation from Tsunami in fishery facility areas

integrated planning and development of Palu Bay, Central Sulawesi
integrated planning and management of coastal village at 4 locations (Lakudo, Banyuasin, Tojo Una-Una, Lombok
Tengah)
Lampung, Jepara, Sidoarjo, Bali, Nunukan)
Mitigating pollution through vegetation
Mitigation to beach erosion in Tegal
Mitigation to coral reef degradations
Mitigation to pollution in DemaK
Optimal use of Delta Mahakam
Project monitoring and evaluation
Strategic planning on integrated management of coastal areas
Technical coaching on integrated management of coastal areas
training on Scientific Diving
Updating Data on mangrove ecosystem (8 location)
57
Workshop and TOT on mitigation to disaster and pollution

MCRMP - marine and accomplishment of quarterly MCRMP
coastal resources accomplishment of yearly reports
management program
Appreciation on unit work management (Pengelola Satuan Kerja)
Consultant service on prolonged MCRM
Discussion on local regulations (provincial and district level) regarding coastal area management (PWP)
Exhibition and dissemination of MCRMP results
HR development on advance GIS and remote sensing
HR development on coastal planning and development
HR development on project planning and management
HR development on spatial data up date and management
International Practical on Attachment ICZPM
Meeting discussion on the development of provincial level spatial information center
Meeting to discuss reports and results of MCRM projects
National workshop on consultation of coastal and marine regulations
Project Management Office (PMO)
Regional meeting - Kalimantan & Nusa Tenggara
58
Regional meeting - Sulawesi
Regional meeting - Sumatera
Short Course on ICZPM and Marine Policy
Workshop on dissemination of MCRMP results
Workshop on extension of the operationalization of spatial information center at provincial level
Workshop to socialize ICM at provincial levels of non MCRMP recipient

Spatial plan for coastal and Conduct coordination, Monitoring-Evaluation (MonEv) of the implementation of LP3K spatial planning
small-islands Conduct evaluation and formulate policy recommendations on spatial plan of LP3K.
Conduct identification, analyses and formulate spatial plan for some strategic/priority areas
Conduct identification, analyses and formulate spatial planning for strategic or priority areas
Database Management System on marine spatial plan
Develop documentary films and publication on the implementation of spatial plan of marine, coastal and small
islands (LP3K)
Develop guideline data identification for spatial planning of marine, coastal and small island
Develop guideline for the utilization of small-island areas (cluster)
Develop guideline in Monitoring-Evaluation (MonEv) of spatial planning for marine, coastal and small island
Develop spatial planning for Balikpapan Bay
Development of spatial planning of 12 Districts/Cities
Field extension and institutional strengthening in spatial planning for marine, coastal and small islands
Formulate guideline for spatial planning of coastal city
59
Formulate guideline to estimate carrying capacity of small islands
Formulate implementation guideline for Kepmen KP No. 34/ 2002 on spatial planning
Management of TRLP3K network system
Provincial coordination meeting for arrangement of between province MPA
Spatial analyses on coastal and marine resources
Spatial planning for Riau and Sulsel
Appendix Table 7 — Activities by Risk (MMAF DG-Product Processing & Marketing)

Very High Business development on processing and Follow up actions to the fishery revitalization plan
marketing of fishery products Development planning
Improvement of public service, HR
development and good governance
High Business development on processing and Develop information system on Business and investment
marketing of fishery products Develop pattern for domestic and foreign capital and investment
Engagement of financial consultant to empower UMKM partnership with
bank
Socialization and facilitating bank SKIM credit for fishery products
Moderate Business development on processing and Develop business partnership
marketing of fishery products Develop format data statistics on processing and marketing of fishery
products
Develop Entrepreneurship
Facilitate partnership in processing and marketing
Improve service on regional business and investment cooperation in fisheries
Institutional empowerment to sea weed industries
60
Inventory of labors employed in fish processing and marketing industries
partnership pattern in processing and marketing
Promotion for national, regional and international investments
Promotion on marketing, industries and investments
Improve quality and development of Harmonization and cooperation in standardizing
processing for fishery product Improve national program on monitoring of fishery products
Operational of technical committee
Pre-consensus and consensus
prepare materials and produce book on SNI and SNI revision
Problem identification for fish processing industries
Socialization of national standard index (SNI) for fishery products
Stakeholder coordination forum on fishery industries

Improvement of public service, HR Develop data-base on processing of fishery products
development and good governance Develop information system on processing and marketing of fishery products
Development of external affairs
Development of program and technical work plan
Development of statistics on fishery processing and marketing
Facilitate commissions, associations and other institutions on processing and
marketing of fishery product
HR development
Identification of national tuna industries and socialization of the establishment of
Indonesian Committee on Tuna (KTI)
Improvement of working ethics
Institutional development and public relation
Monitoring and evaluation
Operational for general administration service
Organization development
61
Outreaching the fishery products
Procurement of furniture
Procurement of official uniform
Procurement of tool and data processors
Public relation and protocol
Research and Development on Legal Aspects

Marketing development and improvement of Arrange profile of market for export
fishery products Audit the need for imports
Campaign on eating fish
Develop mission and diplomacy for overseas marketing
Develop pattern and distribution of marketing system for fishery products
Develop promotion and export market for non traditional fishery products
Development of import management for fishery products
Development of information analysis on overseas marketing
Development of market information system
Development of marketing institutions
Development of non-traditional market
Empowerment of domestic marketing information system
Empowerment of exporters and distribution network
Exhibition of IMFS 2005
Facilitate establishment and development of domestic marketing facilities
Impact analyses for import
62
Improve domestic marketing distribution and network
Improve export of fishery products
Increase fish consumption through national program of GEMARIKAN and
promotion of fishery products
Institutional strengthening of domestic marketing system
market analyses for export
Operational of fish raiser
Overseas marketing diplomacies
Promotion and mission of overseas marketing
Promotion to fishery products
Simulation on Bilateral-Regional-Multilateral fish trading
Technical consultation on constraints for export

Low (Positive?) Improve quality and development of Accompanying the EU inspection visit
processing for fishery product Appreciation on fish handling in fish landing sites (TPI/PPI) for
government officials
Appreciation on handling technique for small and medium scale fish
processing units
Appreciation on onboard fish handling techniques for traditional
fishermen
Appreciation on value added processing technologies
Business meeting in relation to the development of value added products
Coaching for the development of value added fish products
Develop mechanism to harmonize between stock of salts and salt harvest
season at field level
Develop quality standard
Develop standard policy on empowerment of salt industries
develop standard policy on the development of fish processing industries
63
Development of Cool-Chain System (CCS)
Development of high-added value products
Evaluation to laboratory facilities
Evaluation to LPPMHP as agency to provide certification
Evaluation to sanitation monitoring program
field review on opportunities to develop salt processing industry for
small-scale fishermen
Harmonize with international standard on quality
Identification of fish processing unit based on business-scale
Identification of fishery products to hamonize quality standard
Identification on fish processing facilities
Identify facilities needed for the laboratory quality-control on fishery
products (LPPMHP) and fish processing units (UPI)
Improve competence of certification agencies
Improve competency of quality-control laboratories
improve quality of reference laboratories

Inspection and control to the use of chemical substances in small- and
medium scale fish processing units (UPI/UKM)
Monitoring-Evaluation (MonEv) of losses of fishery products and types
and volume of value added products
Development of fisheries product processing centers
Pre-accreditation
prepare materials for government regulation on safety and quality
guarantee of fishery products
quality and safety control of fishery products
Restructuring and revitalization of fish processing industries
Socialization of CODEX and SPS
Socialization on policy regarding the empowerment of slat processing
industries
socialization on the development of value added products
Surveillance to Laboratory of quality testing for fishery products
(LPPMHP)
technical coaching on onboard fish handling
Technical meeting for quality inspector in Indonesia
64
Technical meeting of LPPMHP in Indonesia
technology manipulation in processing and quality control of fishery
products
training entrepreneurship for small and medium scale processing units
Training on internal verification and audit
Training on quality control of fishery products
Training PPC and quality system
Verification on the use of PMMT in UPI, case handling and evaluation to
‘Approval Number’
Marketing development and Empowerment of hygienic fish market and ornamental fish market
improvement of fishery products
Positive Improvement of public service, HR Development of management of information system
development and good governance Formulation, improvement and socialization of fishery regulations
Appendix Table 8 — Survey Results (Bali Strait Fishers)
 
Bali Strait
  Banyuwangi Jembrana
(300 Recipients) (300 Recipients)
Number Number %
Subsidy Type Perceived Impact Getting % Getting “Yes” Getting Getting “Yes”
Subsidy Subsidy Replies % “Yes” Subsidy Subsidy Replies % “Yes”
Increased catch had increased income 186 62.0% 186 100.0%
BBM Increasing Trip duration/fishing intensity had increased catch 186 62.0% 186 100.0%
Reduced fuel price had increased trip duration/fishing intensity   186 62.0% 186 100.0%
Boat aid had increased numbers of crew 26 8.7% 6 23.1% 82 27.3% 80 97.6%
Boat/Gear Fishing gear aid had increased fishing activity 26 8.7% 6 23.1% 82 27.3% 82 100.0%
Increased in crew numbers had increased catch 26 8.7% 6 23.1% 82 27.3% 80 97.6%
Fish box aid had improved the quality of catch 14 4.7% 13 92.9%
65
Fish Box Increase in fish price had increased income 14 4.7% 14 100.0%
Increase in fish quality had increased fish price   14 4.7% 14 100.0%
Increased capability in fish handling had decrease catch damage
Handling Training Increased catch quality (Fresh fish be better)
Training in fish handling skill had increased capability in fish
handling    
Add age of ship and fishing equipment
Machine Care Add knowledge and skill about machine care and fishing
& Equipment equipment
Training Share information about ship, machine and fishing equipment
care    
Auction activities had increased fish price 300 100.0% 207 69.0% 300 100.0% 271 90.3%
Improved fishing activities had increased fishing intensity 300 100.0% 300 100.0% 300 100.0% 299 99.7%
Port infrastructure Increase in fish price had increased income 300 100.0% 245 81.7% 300 100.0% 300 100.0%
Improved harbor/landing place improved fish marketing (auction) 300 100.0% 298 99.3% 300 100.0% 297 99.0%
Improved harbor/landing place improved fishing activities and
processing 300 100.0% 300 100.0% 300 100.0% 299 99.7%
 
Bali Strait
  Banyuwangi Jembrana
(300 Recipients) (300 Recipients)
Number Number %
Subsidy Type Perceived Impact Getting % Getting “Yes” Getting Getting “Yes”
Subsidy Subsidy Replies % “Yes” Subsidy Subsidy Replies % “Yes”
Increased capability in fish quality and processing had decrease
Quality & catch damage 89 29.7% 89 100.0%
Processing Increased catch quality (Fresh fish be better) 89 29.7% 89 100.0%
Training Training in improvement of fish quality skill and processing had
increased capability in fish quality and processing 89 29.7% 84 94.4%  
Capital support (revolving fund) had increased trip duration/
fishing intensity 44 14.7% 44 100.0%
Revolving Fund Increased catch had increased income 44 14.7% 44 100.0%
Increasing Trip duration/fishing intensity had increased catch   44 14.7% 44 100.0%
Improvement in sanitation and socialization of fish handling 84 28.0% 71 84.5%
Sanitation &
Increased capability in fish handling had decrease catch damage 84 28.0% 84 100.0%
Socialization
Increased catch quality (Fresh fish be better)
66
84 28.0% 84 100.0%  
Skilled fishing operation had increased catch 4 1.3% 3 75.0%
Technology Skilled fishing operation had increased catch quality 4 1.3% 4 100.0%
Training
Training in fishing technology skill had increased capability in
fishing operation 4 1.3% 3 75.0%  
Appendix Table 9 — Survey Result (Java Sea Fishers)

Java Sea
  Batang Pati Pekalongan
 
(300 Recipients) (300 Recipients) (300 Recipients)
Number Number Number
% Getting “Yes” % Getting “Yes” % Getting “Yes”
Subsidy Type Perceived Impact Getting % “Yes” Getting % “Yes” Getting % “Yes”
Subsidy Replies Subsidy Replies Subsidy Replies
Subsidy Subsidy Subsidy
Increased catch had

216 72.0% 216 100.0% 300 100.0% 300 100.0% 264 88.0% 263 99.6%
increased income
Increasing Trip duration/
BBM fishing intensity had 216 72.0% 214 99.1% 300 100.0% 300 100.0% 264 88.0% 246 93.2%
increased catch
Reduced fuel price had
increased trip duration/ 216 72.0% 216 100.0% 300 100.0% 300 100.0% 264 88.0% 261 98.9%
fishing intensity
Boat aid had increased
94 31.3% 63 67.0% 46 15.3% 40 87.0% 2 0.7% 1 50.0%
numbers of crew
67
Fishing gear aid had
Boat/Gear 94 31.3% 85 90.4% 46 15.3% 46 100.0% 2 0.7% 2 100.0%
increased fishing activity
Increased in crew numbers
94 31.3% 60 63.8% 46 15.3% 42 91.3% 2 0.7% 1 50.0%
had increased catch
Fish box aid had improved
       
the quality of catch
Increase in fish price had
Fish Box            
increased income
Increase in fish quality had
       
increased fish price
Java Sea
 
Increased capability in fish
handling had decrease catch 67 22.3% 67 100.0% 141 47.0% 36 25.5%
damage
Increased catch quality
Handling 67 22.3% 67 100.0% 141 47.0% 19 13.5%
(Fresh fish be better)  
Training
Training in improvement
of fish handling skill had
67 22.3% 67 100.0% 141 47.0% 141 100.0%
increased capability in fish
handling
Add age of ship and fishing
46 15.3% 39 84.8%
equipment
Machine Care Add knowledge and skill
& Equipment about machine care and 46 15.3% 46 100.0%    
68
Training fishing equipment
Share information about
ship, machine and fishing 46 15.3% 46 100.0%
equipment care
Java Sea
 
Auction activities had

300 100.0% 300 100.0% 300 100.0% 250 83.3% 300 100.0% 300 100.0%
Improved fishing activities
had increased fishing 300 100.0% 298 99.3% 300 100.0% 300 100.0% 300 100.0% 292 97.3%
intensity
Increase in fish price had
300 100.0% 300 100.0% 300 100.0% 300 100.0% 300 100.0% 300 100.0%
Port increased income
infrastructure The existence of fishing
harbor/landing place had
300 100.0% 300 100.0% 300 100.0% 297 99.0% 300 100.0% 300 100.0%
improved fish marketing
69
(auction)
The existence of fishing
harbor/landing place had
300 100.0% 298 99.3% 300 100.0% 299 99.7% 300 100.0% 300 100.0%
improved fishing activities
(logistic service, processing)
Increased capability in fish
quality and processing had 43 14.3% 43 100.0% 25 8.3% 25 100.0%
decrease catch damage
Increased catch quality  
Quality & 43 14.3% 30 69.8% 25 8.3% 23 92.0%
(Fresh fish be better)
Processing
 
Training Training in improvement  
of fish quality skill and
processing had increased 43 14.3% 38 88.4% 25 8.3% 25 100.0%
capability in fish quality and
processing
Java Sea
 
Capital support (provision
of revolving fund) had
increased trip duration/
fishing intensity
Revolving
Increased catch had      
Fund
increased income
Increasing Trip duration/
fishing intensity had
increased catch
Improvement in sanitation
and socialization of fish
handling
Sanitation & Increased capability in fish
   
70
Socialization handling had decrease catch  
damage
Increased catch quality
(Fresh fish be better)
Skilled fishing operation had
29 9.7% 29 100.0% 73 24.3% 66 90.4% 27 9.0% 23 85.2%
increased catch
Technology 29 9.7% 23 79.3% 73 24.3% 61 83.6% 27 9.0% 19 70.4%
increased catch quality
Training
Training in improvement
of fishing technology skill
29 9.7% 21 72.4% 73 24.3% 52 71.2% 27 9.0% 20 74.1%
had increased capability in
fishing operation
Appendix Table 10 — Survey Results (Nusa Tenggara Fishers)

  East Nusa Tenggara West Nusa Tenggara
*
Kupang Lombok Timur
  (268 Recipients) (300 Recipients)
Number
Number Getting % Getting “Yes” % Getting “Yes”
Subsidy Type Perceived Impact % “Yes” Getting % “Yes”
Subsidy Subsidy Replies Subsidy Replies
Subsidy
Increased catch had increased

211 78.7% 211 100.0% 132 44.0% 132 100.0%
income
Increasing Trip duration/fishing
BBM 211 78.7% 211 100.0% 132 44.0% 132 100.0%
intensity had increased catch
Reduced fuel price had increased
211 78.7% 211 100.0% 132 44.0% 102 77.3%
trip duration/fishing intensity
71
Boat aid had increased numbers
36 13.4% 6 16.7% 148 49.3% 146 98.6%
of crew
Fishing gear aid had increased
Boat/Gear 36 13.4% 36 100.0% 148 49.3% 148 100.0%
fishing activity
Increased in crew numbers had
36 13.4% 4 11.1% 148 49.3% 148 100.0%
increased catch
Fish box aid had improved the  
90 33.6% 83 92.2%
quality of catch  
 
Increase in fish price had increased
Fish Box 90 33.6% 90 100.0%  
income
 
Increase in fish quality had  
90 33.6% 90 100.0%  
* Includes interviews conducted in the neighboring localities of Oebaba, Oesapa, and Kabupaten Kupang. See Table 5 and Endnote 21.

Kupang* Lombok Timur
Number
Subsidy
Increased capability in fish handling  

had decrease catch damage  
 
 
 
Increased catch quality (Fresh fish    
Handling Training be better)  
 
 
Training in improvement of fish   
 
handling skill had increased  
  
capability in fish handling  
Add age of ship and fishing
               
equipment
72
Add knowledge and skill about
Machine Care & machine care and fishing                
Equipment Training equipment
Share information about ship,
machine and fishing equipment                
care

*
Kupang Lombok Timur
Number
Subsidy
Auction activities had increased

253 94.4% 210 83.0% 300 100.0% 296 98.7%
fish price
Improved fishing activities had
253 94.4% 253 100.0% 300 100.0% 292 97.3%
increased fishing intensity
Increase in fish price had increased
253 94.4% 253 100.0% 300 100.0% 286 95.3%
income
Port infrastructure
The existence of fishing harbor/
73
landing place had improved fish 253 94.4% 252 99.6% 300 100.0% 300 100.0%
marketing (auction)
The existence of fishing harbor/
landing place had improved
253 94.4% 253 100.0% 300 100.0% 300 100.0%
fishing activities (logistic service,
processing)
Increased capability in fish quality
and processing had decrease catch                
damage
Increased catch quality (Fresh fish
Quality &                
be better)
Processing Training
Training in improvement of fish
quality skill and processing had
               
increased capability in fish quality
and processing

Kupang* Lombok Timur
Number
Subsidy
Capital support (provision of

revolving fund) had increased trip         22 7.3% 22 100.0%
duration/fishing intensity
Revolving Fund Increased catch had increased
        22 7.3% 22 100.0%
income
Increasing Trip duration/fishing
        22 7.3% 22 100.0%
intensity had increased catch
Improvement in sanitation and
               
socialization of fish handling
74
Sanitation & Increased capability in fish handling
               
Socialization had decrease catch damage
Increased catch quality (Fresh fish
               
be better)
        3 1.0% 3 100.0%
increased catch
Technology Training increased catch quality         3 1.0% 3 100.0%
Training in improvement of fishing
technology skill had increased         3 1.0% 3 100.0%
capability in fishing operation
Literature Cited
Antara News (2006a). “Govt provides subsidized fuel supply for fishermen”, Antara News
(Jakarta), 20 April 2006. (http://www.antara.co.id)
Antara News, (2006b) “Marine and Fishery Ministry to build 300 ships in 2006”, Antara
News (Jakarata), 24 May 2006. (http://www.antara.co.id).
Antara News (2007). “Govt may use cards system to distribution of subsidized oils:
observer” Antara News (Jakarta), 8 January 2007), (http://www.antara.co.id)
Asian Development Bank (2004). Technical Assistance to the Republic of Indonesia for
the Marine and Fisheries Sector Strategy Study, ADB Doc. No. TAR:INO 37762 (December
2004)
FAO (2002). State of World Fisheries and Aquaculture (SOFIA) 2002 (Rome, FAO 2002)
(http://www.fao.org/docrep/005/y7300e/y7300e00.htm)
FAO (2003). Report of the Expert Consultation on Identifying, Assessing and Reporting on
Subsidies in the Fishing Industry. Rome, 3-6 December 2002. FAO Fisheries Report. No.
698. Rome, FAO. 2003.
FAO (2008). Fishery and Aquaculture Country Profile: Indonesia / Fishery Production
Statistics (online publication, accessed 19 November 2008). (http://www.fao.org/fishery/
countrysector/FI-CP_ID/3/en)
FAO FishStat Database. (Note: FAO continually updates FishStat, including retrospectively,
so that data results can vary over time. FishStat is available at http://www.fao.org/fishery/
statistics/software/fishstat).
Komnas Kajiskan (2007). Komisi Nasional Pengkajian Sumberdaya Ikan, Rekomendasi
No: 012/Komnaskajiskan/X/2007, 21 Oktober 2007 kepada Menteri Kelautan dan
Perikanan Republik Indonesia. (“The National Commission for Fish Resources Assessment
Recommendation No. 012/Komnaskajiskan/X/2007, 21 October 2007 to the Minister of
Marine Affairs and Fisheries”) 9pp. (original available only in Bahasa Indonesia; translated
here by A. Ghofar)
Komnas Kajiskan (2007a). “Exploitation levels of major fish resources in each Indonesian
fisheries management zone” (original available only in Bahasa Indonesia; translated here
by A. Ghofar)
Mercapesca (2008). “Indonesian Govt urged to subsidize fishermen`s fuel oil” (editorial
and news article), Mercapesca (an international online service for the fishing industry) 28
April 2008. (www.mercapesca.net)
Milazzo (1998). Subsidies in world fisheries: A reexamination. World Bank Technical Paper
No. 406 (World Bank 1998)
75
MMAF (2005), Management Plan of the Java Sea Small Pelagic Fishery, (Government of
Indonesia, Ministry of Marine Affairs and Fisheries, DG-Capture Fisheries, 2005) (available
only in Bahasa Indonesia)
MMAF (2006). Strategi pembangunan kelautan dan perikanan tahun 2007 (Government of
Indonesia, Ministry of Marine Affairs and Fisheries, DG-Capture Fisheries, 2006) (available
only in Bahasa Indonesia)
MMAF (2006a). Estimasi kebutuhan BBM per ukuran kapal secara nasional, (Government
of Indonesia, Ministry of Marine Affairs and Fisheries, DG-Capture Fisheries, 2006)
(available only in Bahasa Indonesia)
MMAF (2008). Pembangunan Kelautan dan Perikanan – refleksi capaian tahun 2007 dan
sasaran sampai dengan tahun 2009 (“Marine and Fisheries Development – a reflection
of 2007 achievement and direction/targets towards 2009”), paper presented at MMAF
National Coordination Meeting (“Rakornas”) 26-28 March 2008.19pp.
MMAF (2008a). Pencapaian kinerja 2007, perkiraan pencapaian 2008 dan prioritas
kegiatan tahun 2009 (“Performance achievement 2007, achievement estimate 2008, and
forecast of priority activities 2009”), paper presented by MMAF Directorate General of
Capture Fisheries (DJPT) at MMAF National Coordination Meeting (“Rakornas”) 26-28
March 2008. 21pp.
MMAF (2008b). Rangkuman hasil rapat koordinasi nasional tahun 2008 (“Summary of
the 2008 National Coordination Meeting”). 7pp.
Porter (2002). Fisheries subsidies and overfishing: Towards a structured discussion. (UNEP
2002) (http://www.unep.ch/etu/etp/acts/capbld/rdtwo/FE_vol_1.pdf)
PricewaterhouseCoopers (2000), Study Into the Nature and Extent of Subsidies in the
Fisheries Sector of APEC Members Economies (report prepared for the Fisheries Working
Group of the Asia Pacific Economic Co-operation) (APEC 2000). (http://www.apec.org/
apec/publications/all_publications/fisheries_working.html)
Purwanto (2003), “Status and Management of the Java Sea Fisheries”, in G. Silvestre, et al.,
Assessment, Management and Future Directions for Coastal Fisheries in Asian Countries.
WorldFish Center Conference Proceeding 67 (WorldFish Center 2003)
Reuters (2008). “Indonesia to cut fuel subsidies”, Reuters (Jakarta), 23 May 2008. (http://
www.iht.com/articles/2008/05/23/business/23indofuel.php)
Schorr (2004), Healthy Fisheries, Sustainable Trade, (WWF 2004) (http://assets.panda.
org/downloads/healthyfisheriessustainabletradefinal.pdf)
Schorr & Caddy (2007). Sustainability Criteria for Fisheries Subsidies: Options for the WTO
and Beyond (UNEP & WWF, 2007)
(http://www.unep.ch/etb/publications/fishierSubsidiesEnvironment/UNEPWWF_
FinalRevi09102007.pdf)
Squires, et al, (2003). “Excess capacity and sustainable development in Java Sea fisheries”,
in Environment and Development Economics Vol. 8, pp. 105–127 (Cambridge Univ. Press,
2003).
76
Sutijastoto (2006). “Energy Efficiency Policy of Indonesia”, slides of presentation at

International Center for Environmental Technology Transfer Training Course for Asian
Countries on Energy Efficiency (Japan, 31 July – 4 August 2006) (http://www.resourcesaver.
com/file/toolmanager/O105UF1947.pdf)
Sumaila & Pauly (2006). Catching More Bait: a bottom-up re-estimation of global fisheries
subsidies, Fisheries Centre Research Reports 14(6) (Univ. British Columbia Fisheries Centre,
2006)
UNEP (2008). Fisheries Subsidies: A Critical Issue for Trade and Sustainable Development
at the WTO — An Introductory Guide (UNEP, 2008) ( http://www.unep.ch/etb/areas/pdf/
UNEP-ETB%20Brochure%20on%20Fisheries%20Subsidies_May2008.pdf)
WWF (2001). Fishing in the dark: A symposium on access to environmental information
and government accountability in fishing subsidy programs (WWF 2001) (http://assets.
panda.org/downloads/fishinginthedarkproceedings.pdf)
77
Endnotes
1 Komnas Kajiskan (2007).

2 See especially Law No. 31/2004, Arts. 2 & 6; The text of Law No. 31/2004 in English is available on the FAO website at
http://faolex.fao.org/docs/pdf/ins51065.pdf.
3 Komnas Kajiskan (2007). The use of FMPs is also explicitly required by Law 31/2004 Art. 7(1)(a).
4 MMAF (2006). In oral statements, MMAF officials have subsequently indicated that production increases should be in
value rather than quantity of landings. Such a focus on value and quality is clearly consistent with policies to increase
fisheries revenues without further depleting resources.
5 MMAF (2008).
6 MMAF (2008a).
7 For a good overview of the fisheries subsidies negotiations at the WTO, see UNEP (2008).
8 See, e.g.,Law 31/2004, Art. 3.
9 Asian Development Bank (2004), ¶ 6.
10 The field work was conducted from July to November, 2007. At each site, the field teams spent several days conducting
interviews with between 250 and 350 local fishermen, fish processors, and fish traders. Each interview required an
average of 180 minutes to administer. In all, the field teams conducted more than 1800 interviews, spending a total of
more than 220 person-days in the field.
11 This figure was calculated by assuming that the data made available to us was representative of an average year or
set of years for each locality. Thus, where we had data for one year, this was assumed to be the amount for the other
two years in the 2005-07 period. Where we had data for two out of three years, the third year was filled in using their
average.
12 PricewaterhouseCoopers (2000).
13 Sumaila & Pauly (2006).
14 The three methods used were:
1. Looking only at all available data for all years combined;
2. Looking at available data, interpolating missing years of MMAF data by adding a third year of data for
each of DG-P2HP and DG-K3PK, using the average for each activity type of the two years for which
data was available from those two DGs; and
3. Adding to the last method data for years missing from provincial and district level budgets, which was
done by adding one or two years of data (as needed), using the average for each activity type of the
years for which data was available from those sub-national authorities.
15 MMAF (2006a). MMAF estimated total fuel consumption by the Indonesian fishery sector in 2005 and 2006 to be
2,092,680 kilolitres and 2,131,605 kilolitres, respectively. It also estimated a subsidy level of Rp1,700 per liter, based
on the difference in price between fuel generally available on the Indonesian market and the more heavily subsidized
price made available to fishers. Note that if the baseline for calculating the subsidy had been the world price for similar
fuel, the subsidy would likely have been much higher, since fuel consumption is subsidized in Indonesia generally.
16 Antara News (2006a).
17 Antara News (2007).
18 Reuters (2008).
19 See Sutijastoto (2006). Mr. Sutijastoto apparently was at the time an official in the Data and Information Centre of the
Indonesian Ministry of Energy and Mineral Resources. His 22nd slide, titled “POLICY ON PETROLEUM PRODUCT PRICE
SUBSIDY” set out a table that appears to set out the phases by which various sectors of the Indonesian economy will
lose fuel subsidies. “Traditional fish catching boats” fell into one of the last categories to be liberalized (along private
cars, public transport, and maritime transport). Only subsidies for poor households were to be phased out later.
78
20 See, e.g., Mercapesca (2008).

21 See, e.g., Schorr (2004); Porter (2002); Milazzo (1998) .
22 Porter (2002).
23 See generally, Schorr & Caddy (2007).
24 The four sites visited in East Nusa Tenggara were all quite small, and included one (Oebaba) which is more properly
a landing site than a village. A total of approximately 300 interviews were conducted in these four localities, and are
reported together in Appendix Table 10 under the heading “Kupang”.
25 Antara News (2006b).
26 Purwanto (2003).
27 Squires, et al,(2003).
28 See, e.g., MMAF (2005) (reporting that almost all of the major Java Sea fish stocks are overexploited, in some cases
exceeding sustainable utilization levels by as much as 37%)
29 MMAF (2008b).
30 Regarding declines in CPUE in the Java Sea fisheries, see Squires et al., (2003)
31 See, e.g., WWF (2001).
32 Asian Development Bank (2004), ¶ 3, (citing MMAF’s annual report for 2002).
33 See Id. (reporting without citation USD $1.75 billion in exports in 2002); see also FAO FishStat database, which reports
total annual fisheries exports from Indonesia as ranging from USD $1.5-2.0 billion from 2002 to 2006.
34 See Schorr (2004), § I.D & fn. 54 (citing 1992 FAO State of World Agriculture and Fisheries Special Chapter).
35 The only reference to fisheries subsidies in an international instrument approved by FAO members appears to be in
¶¶ 25-26 of the FAO International Plan of Action for the Management of Fishing Capacity, which calls on FAO members
to eliminate subsidies and other incentives that contribute to overcapacity. The term “subsidy” is not defined in that
text.
36 See generally, FAO (2003) (hereafter, “FAO Expert Consultation Report”).
37 FAO (2002), p. 92.
38 FAO (2003), at pp. 27-28.
39 NB—The FAO presents these categories as a nested set, such that each category includes the subsidies of preceding
categories. Thus, read literally, FAO Category 4 includes all of the subsidies covered by Categories 1-3, as well as
“regulatory benefits” etc. For purposes of clarity, the categories are presented here as containing only those subsidies
unique to each of them, so that speaking of “Category 4” subsidies means only the “regulatory benefits” etc. added by
Category 4.
40 For an “overview and gap analysis” of how current WTO rules cover fisheries subsidies, see Schorr (2004), Part IV.
41 Ministerial Declaration Adopted on 14 November 2001 (“Doha Declaration”), WTO Doc. No. WT/MIN(01)/DEC/1 (20
November 2001), ¶ 28.
42 Doha Work Programme — Ministerial Declaration Adopted on 18 December 2005, (“Hong Kong Declaration”), WTO
Doc. No. WT/MIN(05)/DEC (22 December 2005), Annex D, ¶ I.9.
43 Draft Consolidated Chair Texts Of The AD and SCM Agreements, WTO Doc. No. TN/RL/W/213 (30 November 2007),
Annex VII (pp. 87 ff.).
44 Id., Art. I.1(g).
45 Sumaila & Pauly, (2006)
46 Id. at pp. 11 ff.
79

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Selected Indonesian Fisheries Subsidies:

Quantitative and Qualitative Assessment of

By A. Ghofar, D.K. Schorr, and A. Halim

The Nature Conservancy - Coral Triangle Center

(Note: Institutional affiliations are given for

Abdul Ghofar is a senior member of the Faculty

The Nature Conservancy – Coral Triangle Center,

All photos copyright of The Nature Conservancy,

Appendix Table 6 — Activities by Risk (MMAF DG-Marine Coasts &

Abbreviation English Meaning Equivalent in Bahasa Indonesia

BBM Fuel Oil Program Bahan Bakar Minyak

Table 1 – Indonesia’s Fishing Fleet and Fisheries Production

Based on FAO 2002, Fig. 15 Source: FAO 2008

production, while Law No. 27/2007 calls for improved management

B. The goal: healthy ecosystems, sustainable livelihoods

Status of Fisheries Resources

Figure 2 -- The Critical Problem: Policy Coherence

Table 2 — Budget Data Obtained for this Study

DG-Capture Fisheries (DJPT) 2005-07

National (MMAF) DG-Fisheries Product Processing & Marketing (DJ-P2HP) 2005-06

DG-Marine Coasts & Small Islands (DJ-KP3K) 2005, 2007

Bali Province (Fishery & Marine Service) 2005-06

Central Java Province (Fishery & Marine Service) 2006

East Java Province (Fishery & Marine Service) 2005

East Nusa Tenggara Province (Fishery & Marine Service) 2006

West Nusa Tenggara Province (Fishery & Marine Service) 2006

Banyuwangi District (Fishery & Marine Service) 2004

Batang District (Fishery & Marine Service) 2004-05

Pati District (Fishery & Marine Service) 2005-06

Pekalongan District (Fishery & Marine Service) 2005

A. The definition of “fisheries subsidy”

B. The scale of Indonesia’s fisheries subsidies

by the international accounting firm PricewaterhouseCoopers.11 We

management, and rehabilitation;

Table 3 — Distribution of Subsidies by Activity Type (excluding fuel)

Activity Type Object of Subsidy % of Total

Infrastructure Port facilities (not otherwise categorized as “Value 20.1%

Conservation & Management Fisheries management activities & programs 17.5%

Fisheries Development A program category used by MMAF to describe various 11.5%

Directly Capacity-enhancing Gear or vessel acquisition, repair, modernization, etc. 10.4%

Skills (fishing) Training in fishing techniques 1.3%

Social Safety Net Income supports, unemployment relief, etc. 1.0%

Skills (value-added) Training in handling/processing techniques 0.4%

Other Subsidy type not clear or not included in other 13.9%

Figure 3 — Distribution of Subsidies by Activity Type (excluding fuel)

D. Indonesian fuel subsidies

E. The “risk profile” of Indonesia’s fisheries subsidies

Table 4 — Subsidized Activities and Risk Ratings

Subsidy Types Risk Rating

Figure 4 — Overall Risk Profile (available data 2005-07)

Figure 5 — MMAF Risk Profile (available data 2005-07)

Figure 6 — MMAF Risk Profiles (available data, by year)

Province Locality Fisheries

Figure 7 — Field Study Locations (Map)

A. The first issue—sustainability

While some of Indonesia’s fisheries subsidies are doubtless

B. Other issues — effectiveness, equity, and transparency

information. Moreover, as decentralization proceeds in Indonesia’s government structure

Conclusion 4 — Significant levels of policy incoherence and ineffectiveness are detracting

Recommendation 1 — MMAF should take immediate steps to eliminate subsidies

Recommendation 2 — Special attention should be given to the use of fuel subsidies

Recommendation 3 — MMAF should make increased use of positive subsidies. In

Recommendation 4 — MMAF should give increased emphasis to developing and

2005   2006   2007  

Bali     6,797,908,333 $747,770 2,532,611,420 $278,587    

2004  2005 2006

2004  2005 2006

2004  2005 2006

2004  2005 2006

  East Nusa Tenggara West Nusa Tenggara

Increased capability in fish handling  

  East Nusa Tenggara West Nusa Tenggara

  East Nusa Tenggara West Nusa Tenggara