MINISTRY OF MARINE AFFAIRS AND FISHERIES REPUBLIC OF

MINISTRY OF MARINE AFFAIRS AND FISHERIES REPUBLIC OF INDONESIA Dr. Reza Shah Pahlevi Delivered in Indonesia – ACIAR Consultation Jakarta, 21 February 2007

THE ROLE OF AQUACULTURE IN DEVELOPMENT • EXPANSION OF EMPLOYMENT OPPORTUNITIES (PRO-JOB) • POVERTY REDUCTION (PRO-POOR) • ECONOMIC GROWTH (PRO-GROWTH) 5 -year Revitalization Aquaculture Strategy

Item 2001 2005 Growth rate (per year) Production (tonnes) 1, 076, 750 2, 163, 674 20. 14 % Value (trillion) IDR 12. 36 IDR 21. 45 14. 85 % Export volume (tonnes) 519, 415 (2000) 902, 358 (2004) 16. 69 % Export value (trillion) IDR 1. 67 (2000) IDR 1. 78 (2004) 1. 67 % Fish farmers (million) 2. 19 2. 51 3. 43 % 22. 67 0. 54 % Per Capita consumption 22. 47 of fish (kg/capita/year)

AVERAGE OF FISH FARMER INCOME IN FRESHWATER SECTOR, 2004 No Type of Aquaculture Fish Farmer income (IDR million per year) 1 Ponds 17. 85 2 Cages 15. 36 3 Floating Net Cages 20. 70 4 Paddy Field 7. 45 5 Other freshwater sector 16. 28

AQUACULTURE PRODUCTION AND VALUE 2001 - 2006 Ye a r Produc Value tion (tri (tonn llio es) n) 20 0 1, 076, 7 1 50 IDR 12. 36 20 0 1, 137, 1 2 53 IDR 14. 37 20 0 1, 224, 1 3 92 IDR 16. 02 20 0 1, 468, 6 IDR 19. *) Temporary data

YEAR ACHIVEMENT 2005 86 % 2006* 98 % *) Temporary data HIGH POSSIBILITY THAT THE PRODUCTION TARGET ON 2011 WILL BE ACHIEVED

Note: 2001 – 2006: Production 2007 – 2011: Target

AREA POTENTIAL AREA ( MILLION HA) IN USE (%) FRESHWATER 2, 23 10, 1 BRACKISHWATER 1, 22 40 MARICULTURE 12, 14 0, 01 TOTAL 15, 59 50, 11

STRENGTHS OF INDONESIAN AQUACULTURE Q HIGH BIODIVERSITY Q EXTENSIVE AREA Q GEOGRAPHY AND CLIMATE Q HUMAN RESOURCES HAS POTENTIAL TO BECOME MAJOR WORLD PLAYER

1. 2. 3. 4. 5. 6. ENVIRONMENTAL DEGRADATION SUSTAINABLE DEVELOPMENT FOOD SAFETY (antibiotic residue) GMO ECO LABELING TRACEABILITY AQUACULTURE DEVELOPMENT SHOULD APPLIED CCRF

VISION : AQUACULTURE which is COMPETITIVE and SUSTAINABLE as a MAJOR CONTRIBUTOR TO ECONOMIC GROWTH MISSION : 1. Create bussiness opportunities and provide employment 2. Produce high quality fish in an efficient manner 3. Develop an aquaculture sector which is responsible and environmentally friendly

1. Increase foreign exchange earning, fish farmers income, and create employment and business opportunities; 2. Improve nutritional quality of the people diet through the fish consumption; Tilapia culture in Freshwater Aquaculture Development Centre in Sukabumi 3. Protect and rehabilitate fisheries resources. Seaweed Culture

1. Increase aquaculture production for export, with special focus on increasing competitive advantages through the development and application of efficient and environmentally friendly technology; 2. Development of aquaculture production for in-country consumption, with special focus on increasing and strengthening the farming of area-specific (local) commodities and improving communitybuilt ponds; 3. Establishing mechanisms for controlling the use (exploitation) of aquaculture resources, with especial focus on increasing the attention paid towards the conservation of fish and other aquaculture resources. Koi crap farm in West Java Province

1. Mariculture zone 2. Brackishwater zone 3. Freshwater zone Shrimp culture in Banggai – Central Sulawesi Province

• Well-developed technology spreading to the grass-roots • High export market potential • High uptake from overseas markets • High employment prospects • Low fuel requirement • Relatively low capital investment SHRIMP/PRAWN (vaname and tiger prawn) SEAWEED (Euchema and Gracilaria)

• Well-developed technology spreading to the grass-roots • High export market potential • High uptake in the domestic market • Relatively low capital investment • High employment prospects • Low fuel requirement GROUPER GOURAMY ABALONE CATFISH ORNAMENTAL FISH TILAPIA MILKFISH PANGASIUS CATFISH

Government Investment Rp 3. 06 trillion RPB up to 2009 Rp 13. 41 trillion (1) Rehabilitation of tambak irrigation systems, (2) hatchery improvement, (3) optimisation of fish health & environment laboratories, (4) development of mariculture sites, (5) development of brackish-water sites, (6) development of fresh-water sites, (7) TASK FORCE operations, (8) Service Development Unit (UPP) development, (9) extension by technical staff, (10) stimulation of working capital for hatcheries. Investment Cost Rp. 2. 92 trillion Working Capital Rp 10. 35 trillion as follows : Rp 9. 70 trillion for small and medium enterprises Rp 656 billion for large enterprises Working Capital Rp. 7. 43 trillion Site development and long-lived machinery (aeration paddles, pumps, feed pelleting machines, etc) Seed, feed and chemical inputs

Budget Requirements (billion Rp. ) No Target/Activity A Government Investment B Working Capital Requirements (1 -5) 2006 2007 2008 2009 Total 360. 44 438. 83 785. 61 1, 479. 17 3, 064. 05 1, 777. 41 2, 278. 12 2, 623. 80 3, 676. 55 10, 355. 88 1 APBN National Budget 53. 32 68. 34 78. 71 110. 30 310. 68 2 APBD Local Budgets 35. 55 45. 56 52. 48 73. 53 207. 12 3 Private Sector 177. 74 227. 81 262. 38 367. 65 1, 035. 59 4 Banking Sector 1, 475. 25 1, 890. 84 2, 177. 75 3, 051. 54 8, 595. 38 5 Other Sources of Finance 35. 55 45. 56 52. 48 73. 53 207. 12 2, 137. 85 2, 716. 95 3, 409. 41 5, 155. 72 13, 419. 93 Total (A+B)

CAPITAL STREGTHENING

Financing Requirements (billion Rp. )

q Promoting micro, small & medium enterprises, for: (a) providing increased employment; (b) strengthening family business; © reducing poverty q Promoting the involvement larger / big enterprises in processing sector and marketing, specially for export; q Creating conducive condition

1. Development of demonstration units 2. Development of partnership between nucleus and plasm 3. Use National budget as a cash collateral in bank 4. Cooperate with banks to reduce the interest rate for aquaculture business 5. Increase number of training fish farmers 6. Develop for Aquaculture zones 7. Increase promotion and investment opportunities, either for local and international investment 8. Apply national standards 9. Increase the work effectiveness of UPT 10. Increase the role of Local Government in providing financial assistance to farmers from Local Budget Allocations (APBD) 11. Provide incentives for investors 12. Strengthen UPP

1. Developing working partenership with bank institutions 2. Improving budget structure from province to districts / municipalities 3. Promote fish farmers friendly banking rule & regulation

1. Increase in aquaculture production for export (PROPEKAN); 2. Increase in aquaculture production for in-country consumption (PROKSIMAS); 3. Protection and rehabilitation of aquaculture resources (PROLINDA)

(1) Infrastructure for Aquaculture Development; (2) Seed Production Systems Development; (3) Production Systems Development ; (4) Fish and Environmental Health Management Systems Development; (5) Aquaculture Business Systems Development; and (6) Administrative and Organizational Systems Development.

1. Aquaculture zone development: (i) Mariculture: seaweed, grouper, abalone, and others; (ii) brackishwater: shrimp, brine shrimp, milkfish, and others; (iii) freshwater: tilapia, pangasius catfish, clarias catfish, gouramy, and others. 2. Improve hatchery quality: (i) strengthening Broodstock Centre capability, (ii) improving broodstock quality, (iii) increasing capacity building of human resources on hatchery management. 3. Guiding and Controlling : Implementing on aquaculture quality through Indonesian National Standard and certification on hatchery and grow-out. 4. Strengthening Infrastructure and Physical Equipment on aquaculture area through manage special budget allocation (DAK).

q FIS/2002/111: Culture, capture conflicts: sustaining fish production and livelihoods in Indonesian Reservoirs q FIS/2000/061: Development and delivery of practical disease control programs for small-scale shrimp farmers in Indonesia, Thailand Australia q FIS/2002/075: Application of PCR for improved shrimp health management in India, Thailand Indonesia q FIS/2003/027: Planning tools for environmentally sustainable tropical finfish cage culture in Indonesia and northern Australia q FIS/2002/076: Land capability assessment and classification for sustainable pond-based aquaculture systems q FIS/2002/077: Improved hatchery and grow-out technology for marine finfish aquaculture in the Asia-Pacific region q FIS/2005/028: Technical training and capacity building program for the restoration of Tsunami-impacted brackishwater aquaculture ponds in Aceh

q ADB PROJECT: SUSTAINABLE AQUACULTURE DEVELOPMENT FOR FOOD SECURITY AND POVERTY REDUCTION (LOAN NEGOTIATION, SIGNED, LOAN AGREEMENT, UNDER PROCESS) q WORLD BANK: FISHERIES REVITALIZATION PROGRAM (UNDER NEGOTIATION PROCESS)