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The Performance and Strategy of Indonesian's Fisheries: A Descriptive Review

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 International Journal of Economics and Financial
Issues
ISSN: 2146-4138

available at http: www.econjournals.com

International Journal of Economics and Financial Issues, 2019, 9(1), 31-36.

The Performance and Strategy of Indonesian’s Fisheries: A

Descriptive Review

Abdul Bashir*, Zulkarnain Ishak, Imam Asngari, Mukhlis, Dirta Pratama Atiyatna, Ichsan Hamidi

Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, South Sumatera, Indonesia.
*Email: [email protected]

Received: 02 October 2018 Accepted: 17 December 2018 DOI: https://doi.org/10.32479/ijefi.7188

ABSTRACT
This study to analyze the performance and strategy of fisheries in Indonesia. The data used in this study is secondary data during 2011-2016. Source of
data from the Ministry of Maritime Affairs and Fisheries (KKP) and Central Bureau of Statistics (BPS). The analytical method used with a qualitative
descriptive approach, in addition also, for strategy mapping through the SWOT analysis approach by evaluation of strengths, weaknesses, opportunities,
and threats in the fisheries sector. The findings of this study indicate that during 2011-2016, the growth performance of production, consumption,
investment, export value, trade balance, and potential fish resources based on Maximum Sustainable Yield has increased significantly. However, in
our observation, there are still many weaknesses and threats that must be resolved. For this reason, we formulated a strategy in an effort to overcome
weaknesses and minimize these threats in conclusions.
Keywords: Fisheries, Production, Consumption, Trade, SWOT Analysis
JEL Classifications: Q20, Q22, K24

1. INTRODUCTION (Andersen, 2015; Anriquez and Stamoulis, 2007). Fisheries is one

of the agricultural sub-sectors after food crops, plantation crops,
The fisheries product market at the domestic and global level livestock, and forestry are one of the livelihood options of the
currently demands quality standards, size uniformity, and product Indonesian population. Type of fishery business in Indonesia has
innovation. On the other side, most of the current producers of high economic value, proven by average value gross domestic
fish are small-scale and also have a variety of products. Even product growth of 6.79% during 2011-2017 (Figure 1).
though the industrialization market is currently demanding
order uniformity for the product processing fishery. Maritime Fish has always been an important source of protein in human
and fishery development is one of the sectors that receive high food and on a global scale, fish and fish products are the most
attention and priority for the Indonesian government, especially important protein source and it is estimated that more than 30% of
with the establishment of the Ministry of Maritime Affairs and fish for human consumption comes from aquaculture and marine
Fisheries (KKP). It is expected that in the future the intensity and (Håstein et al., 2006). Over the past three decades, fish farming
penetration of fisheries development will be better in terms of has developed into the largest fish producing sector in Indonesia.
quality and quantity. Most fish products come from small-scale producers in developing
countries. More than 80% of global fish processing products are
In addition, equitable development in the context of realizing produced in freshwater (Marschke and Wilkings, 2014; Tidwell
more stable and dynamic economic conditions cannot be separated and Allan, 2001). From early developments in Asia, fish farming
from the role of the main non-food sub-sectors such as fisheries has experienced very large development and is currently very

This Journal is licensed under a Creative Commons Attribution 4.0 International License

International Journal of Economics and Financial Issues | Vol 9 • Issue 1 • 2019 31

 Bashir, et al.: The Performance and Strategy of Indonesian’s Fisheries: A Descriptive Review

diverse (Thornton, 2010). According to Abowei and Tawari not included in the top five exporters of world fishery products
(2011) Njai (2000), the fisheries sub-sector functions as a source because it has not optimized the existing fisheries potential. On
of income and facilitate the development of home industries and the other side, Indonesia’s fisheries production export performance
provides employment opportunities for many people involved in under China and Vietnam, because the ability to increase fisheries
fisheries production, processing, and marketing. In addition, fish value-added is still not optimal. However, Indonesia still has a
meat also functions as an important protein supplement for meat great opportunity to improve the export performance of fishery
protein, even more currently of meat price has the continuous products due to a shift in healthy lifestyles that encourage increased
increase (Daniel et al., 2011; Weinert, 2009). consumption of fishery products globally. On the other side,
demands for global trade with high levels of competition. For this
The development of Indonesia’s fisheries subsector is an effort to reason, there needs to be an effort to increase the competitiveness
develop fisheries business in all potential areas (Halim and Juanri, of fishery products by producing a variety of competitive products
2016). Potential fisheries resources consist of freshwater fisheries with good quality and in accordance with food safety standards
and seawater fisheries. The potential of freshwater fisheries is still (Frohberg et al., 2006; Vieira, 2006).
wide open both in wetland, ponds, floating nets, and cages. On
the other hand, Indonesia is a country that benefits from having Based on the problems background has described, the objective
a huge potential of fishery resources both in terms of quantity of this study is to analyze productivity and strategy of fisheries
and diversity. The potential of catch fisheries resources based in Indonesia. In the next session, we will explain the analytical
on maximum sustainable yield (MSY) in Indonesia in 2017 is methods and SWOT analysis. The third session explained the
estimated at 12.54 million tons per year, while the potential that results and discussion, and the final session will present the
can be utilized (allowable catch) is 80% of MSY which is 10.03 conclusions of our study.
million tons per year. Meanwhile, there has been an imbalance in
the level of utilization of fisheries resources between regions and
between types of resources (Adisanjaya, 2009). In some regions 2. RESEARCH METHOD
there have been more catching symptoms (overfishing) such as
in the Java sea area and the Malacca Strait, while in most eastern The scope of this study was the descriptive study that performance
regions the utilization rate is still below the sustainable potential, analyzes such as the productivity of fisheries from side production,
in other words, it is still not optimal. Java Island and Sumatra are consumption, export, import, investment, trade balance, and
the largest regions producing aquaculture fish in Indonesia. potential of fish resources (MSY). In addition, this study also to
formulation strategy in facing the sustainable development of the
On the other side, one of the fisheries problems faced by Indonesia, fisheries sector in the future through SWOT analysis by mapping
i.e., the rampant illegal, unreported and unregulated (IUU) fishing strengths, weaknesses, opportunities, and threats in the fisheries
activities in Indonesia, has caused significant losses, both in terms sector. The data used in this study is secondary data during
of economic, social and environmental, so this activity can be 2011-2016. Source of data from the Ministry of Maritime Affairs and
stated as a major obstacle for Indonesia in realizing sustainable Fisheries (KKP) and Central Bureau Statistics (BPS). Meanwhile,
catch fisheries (Ahmad, 2011). IUU fishing activities are not only other information in this study also obtained from literature reviews
carried out by foreign-flagged fishing vessels, but also by national such as article and study report. In addition, was also held Focus
fishing vessels. This is reflected by the low level of compliance of Group Discussion to obtain opinions from the experts.
national fishing vessels on the rules of the game in the management
of fish resources, such as the non-compliance of national fishing 3. RESULTS AND DISCUSSION
vessels in using vessel monitoring system and reporting of the
catch logbook. Based on production and consumption performance, fisheries
production in Indonesia currently has a positive trend; in 2016 the
Meanwhile, Indonesia is one of the largest fishery producer total national fishery production amounted to 23.5 million tons
countries in the world, besides China. However, Indonesia is also consisting of catch fisheries of 6.8 million tons and aquaculture
of 16.7 million tons. The total production increased from the
Figure 1: The trend of gross domestic product fisheries growth in previous year by 5.35%. The increased of catches production and
Indonesia aquaculture is highly dependent on weather climate, technology,
seeds, fish feed, and the quality of water used by fishermen and
fish farmers. The trend of fish production and consumption can
be seen in Figure 2.

Meanwhile, annual per capita fish consumption in 2016 reached

46.46 kg per capita per year, the fish consumption increased from
the previous year of 6.88%. The increase in fish consumption is
inseparable from an increase in the population and an increase
in the nutritional needs of the population because fish are a very
relevant source of protein to improve the quality of life of the
Source: BPS, Indonesia Statistics, processed population in Indonesia.

32 International Journal of Economics and Financial Issues | Vol 9 • Issue 1 • 2019

 Bashir, et al.: The Performance and Strategy of Indonesian’s Fisheries: A Descriptive Review

Figure 3 shows a positive production trend for aquaculture and aquaculture. Whereas for the investment credit value in catch
catch fisheries, which during 2011-2016 aquaculture production fisheries and aquaculture in 2017 of IDR. 1.007 billion, this value
grew by an average of 16.6%. While capture fisheries production increased from the previous year which only reached IDR.588
grows by 3.74% during the same period. Generally, the increase in billion or increased by 71.26%. Overall investment in catch
aquaculture production can be influenced by the fish seeds quality, fisheries and aquaculture grew by 96.81%.
the fish feed quality, and the water quality. Meanwhile, an increase
in catch fisheries production can be influenced by weather and In Table 1, shows the trade balance performance of China,
technology used by fishermen. Indonesia, Thailand, Viet Nam, Philippines, Malaysia and
Singapore in the fisheries sector. Nominally, Indonesia is under
In terms of trade performance, Indonesian fisheries production China and Viet Nam, but from the growth of the trade balance,
exports are still below China and Vietnam. Indonesia is also during 2012-2016, the growth of Indonesia’s trade balance
not included in the top five exporters of world fishery products. averaged grew of 2.67% (Table 1).
Looking ahead, Indonesia still has a great opportunity to increase
fisheries product exports due to a shift in healthy lifestyles which Figure 2: The trend of fisheries production and consumption total in
encourages increased consumption of fishery products globally. Indonesia, 2011-2016
However, given the demands of global trade with high levels of
competition, Indonesia needs to improve the competitiveness of
its fishery products by producing a variety of competitive products
with good quality and in accordance with food safety standards.

Figure  4 shows a fluctuating trend in the value of exports and

imports of fishery products, the value of fishery exports on average
grew by 3.95% during 2011-2016. While the import value on
average grew negatively by −2.96% during the same period.
Export performance of fisheries in Indonesia not separated from
export growth to destination countries such as the United States
averaged grew of 10.94% per year during 2011-2016, Japan Source: KKP and BPS, Indonesia Statistics, processed
average negative grew of 4.19%, ASEAN grew average of 0.47%,
China averaged grew 10.25%, and the EU grew by 3.74% during
the same period. Meanwhile, Indonesia’s import value during the Figure 3: The trend of fisheries production total in Indonesia,
2011-2016 period, dominated by processed fish products such as 2011‑2016
Fish-Pellet Flour which average grew negatively of 4.24% per
year during 2011-2016, Fish oil fat which average grew negatively
of 2.94%, Mackerel which average grew by 10.58% per year,
Crab averaged grew negatively of 4.58%, Salmon-Trout grew
by average of 46.43%, Sardines grew by average of 15.61%, and
other products on average grew by 1.21% during the same period.

International trade investment in fishery products currently

is not only affected by factors of demand and supply but also
determined by the results of fisheries international conventions and
agreements. The agreement regulates the mechanism of trading
Source: KKP and BPS, Indonesia Statistics, processed
fisheries commodities in the international market. To enter the
export market several strategic things that need to be considered
are: Product commodities, competitiveness, quality and quality Figure 4: The trend of fisheries export and import value total in
of products, tastes and purchasing power of consumers, delivery Indonesia, 2011-2016
time, and analysis of the conditions of export destination countries,
including population, tradition, socio-political conditions and
export-import regulations.

In terms of investment performance, based on data from the

Ministry of Maritime Affairs and Fisheries, in 2017, foreign
investment of IDR.193 billion, the investment value that increased
from the previous year which only reached IDR. 34 billion or
grew by 468% in 2017. Meanwhile, for domestic investment in
2017 reached IDR.30 billion, an increase from the previous year
which only reached IDR.3 billion or grew by 900% in 2017.
The investment is the total investment in catch fisheries and Source: KKP and BPS, Indonesia Statistics, processed

International Journal of Economics and Financial Issues | Vol 9 • Issue 1 • 2019 33

 Bashir, et al.: The Performance and Strategy of Indonesian’s Fisheries: A Descriptive Review

Table 1: The trend of Indonesia’s trade balance growth with several competing countries (Thousand USD), 2012‑2016
Countries 2012 2013 2014 2015 2016 Average growth (%)
China 11,270,507 11,761,796 12,649,812 11,504,690 11,452,509 0.60
Indonesia 3,408,381 3,642,666 4,158,516 3,499,954 3,691,279 2.67
Thailand 4,823,527 3,704,161 3,644,042 2,840,139 2,452,222 −15.14
Viet Nam 5,246,212 5,712,248 6,489,084 5,196,691 617,888 −21.39
Philippines 665,971 1,011,938 881,294 503,533 386,788 −6.75
Malaysia −246,153 −298,796 −288,646 −288,554 −262,528 −2.23
Singapore −702,110 −686,932 −742,566 −674,051 −779,759 −3.10
Source: KKP and BPS, Indonesia Statistics (Processed)

Figure 5: The potential of fish resources (MSY) in Indonesia aquaculture production need to pay attention to the environmental
(million tons/year) carrying capacity, including related to water quality and pollution
that may occur due to excessive feeding, as well as new land
clearing for fish ponds or ponds (Diana, 2009).

Implications and results of internal and external evaluation of the

fisheries sector in Indonesia, we made a strategy analysis through
mapping strengths, weaknesses, opportunities and threats, from
the results of the mapping, we formulated four strategy quadrants,
i.e., (1) strategies to encourage strengths and take advantage of
opportunities (SO strategy); (2) strategies to overcome weaknesses
and take advantage of opportunities (W-O strategy); (3) strategies
to encourage strength and minimize threats (S-T strategy); and
Source: KKP, KEPMEN No. 50/KEPMEN-KP/2017, processed (4) strategies to overcome weaknesses and minimize threats (W-T
strategy). The strategy will be presented in the form of a matrix
Meanwhile, China’s trade balance grew only by 0.60%, while Viet such as Table 2.
Nam has negative growth with an average of −21.39%. Likewise,
the trade balance of other countries such as Thailand, Philippines, 4. CONCLUSIONS
Malaysia, and Singapore which grew negatively, i.e., by −15.14%,
−6.75%, −2.23% and −3.10%. There are many factors that drive Conclusions from the results of this study indicate that the
an increase in trade balance such as the fish caught quality, quality performance of fisheries in Indonesia has improved, this
assurance, services, and technology used. In free trade, the most performance is shown from (1) the average growth of fisheries
important is the level of confidence of importing countries whose production and consumption of 5.35% and 6.88% during the period
role is to strengthen the competitiveness of companies. For 2011-2016; (2) the average growth of export value of 3.95%, and a
industries that market nearly 90% of the products they produce to decrease in import value of -2.96% during the period 2011-2016;
export markets, meeting customer satisfaction is indispensable to (3) investment growth in the fisheries sector by 96.81% in 2017;
maintain their market share from competitors from overseas and (4) average trade balance growth of 2.67% during 2012-2016; and
domestic companies. Product suitability with customer demand, (5) the average growth of the quantity of catch that has approached
availability of product supply for consumers, and the delivery of sustainable catch production (MSY) of 9.1 million tons per year
products are timely and quantity because it’s the major factor in or grew by 24.75% during 2011-2017.
increasing fishery exports in Indonesia.
The formulated of strategies for encourage strengths and take
Based on data from FAO, in 2012, Indonesia was ranked second advantage of opportunities i.e. (1) Increasing the competitiveness
for the world’s marine capture fisheries production, ranked fourth of capture fisheries products; (2) providing certainty in the
for aquaculture production in the world, and ranked second for business spatial planning of catch fisheries and aquaculture;
seaweed production in the world. Since the last few years, capture (3) improve the efficiency of small-scale catch fisheries business
fisheries have experienced a slowdown in production growth and meet an economy of scale; (4) providing access to financial
and the trend has stagnated. This is because the quantity of catch and banking institutions for small-scale fishermen; (5) eradication
that has approached sustainable catch production (maximum of IUU fishing activities; (6) improve the quality and welfare of
sustainable yield) of 6.5 million tons per year, with the total fishermen and fisheries workers; (7) Improvement of facilities
allowable catch is 80% of MSY. and infrastructure for the management of catch fisheries data and
information; and (8) optimization of national capture fisheries
During 2011-2017, the MSY average grew of 9.1 million tons production through rationalization of capture fisheries fleets.
per year. In 2017 the estimated reach of 12.5 million tons per
year (Figure 5). Currently, efforts to manage fishing in the sea are The formulated of strategies for overcome weaknesses and take
more directed at controlling and structuring production factors advantage of opportunities i.e.: (1) Improve the quality and welfare
to produce sustainable use. Furthermore, efforts to increase of fishermen and fisheries workers; (2) providing certainty in the

34 International Journal of Economics and Financial Issues | Vol 9 • Issue 1 • 2019

 Bashir, et al.: The Performance and Strategy of Indonesian’s Fisheries: A Descriptive Review

Table 2: SWOT analysis

SWOT evaluation result Internal evaluation
Strength (S) Weakness (W)
Indonesia is the largest archipelago in the world with Low of fish farmer business scale, the high
17,504 islands production cost and the high price of feed
Sea area of 5.8 million km2 Hard access to the domestic market for
The territorial sea area of 0.3 million km2, the total catch fisheries and aquaculture products,
area of the archipelago 2.95 million km2 and low of fish quality
The area of the ZEEI 2.55 million km2 The weak institutional capacity of
Potential marine flora and fauna diversity supervisors and law enforcement
Potential marine and aquaculture fisheries resources Access to capital for the development of
International trade potential limited capture fisheries business
Competitiveness of capture fisheries and aquaculture The quality of fishermen is still relatively
products low, both from technology and production
systems
The certainty of the spatial business of
aquaculture
External evaluation
Opportunities (O) Strategy S‑O Strategy W‑O
Encourage investment in the fisheries Increasing the competitiveness of capture fisheries Improve the quality and welfare of
sector products fishermen and fisheries workers
Increasing production and consumption Providing certainty in the business spatial planning of Providing certainty in the business spatial
fisheries catch fisheries and aquaculture of capture fisheries and cultivation
Increasing the welfare of fishermen and Improve the efficiency of small‑scale catch fisheries Creating a system of marketing and
aquaculture farmers business and meet an economy of scale distribution of catch fisheries products that
Increased economic value of the Providing access to financial and banking institutions are efficient, safe and quality.
environment for small‑scale fishermen Increased empowerment of small‑scale
Enforce the law against IUU fisheries Eradication of IUU fishing activities fishermen businesses
Increased access to domestic and Improve the quality and welfare of fishermen and Improving the quality of human resources
international markets fisheries workers for capture and aquaculture fisheries data
Increased export of catch fisheries and Improvement of facilities and infrastructure for the management
cultivation management of catch fisheries data and information Development of small‑scale fishing
Development of fishing business with a Optimization of national capture fisheries production businesses through STP programs to
fleet or group system through strict and through rationalization of capture fisheries fleets improve access of technology and
clear regulations related to transshipment information
of catches Increased capture fisheries business
Development of branding of aquaculture partnerships through business incubator
and catch fisheries products through the programs and mutually beneficial
promotion and packaging of healthy and cooperation patterns of both parties
attractive products
Threats (T) Strategy S‑T Strategy W‑T
The rise of IUU fishing, both by foreign Increase the effectiveness of the implementation of Increasing the effectiveness of law
fishing vessels and Indonesian fishing catch fisheries management based on the carrying enforcement through strict and effective
vessels capacity of aquatic ecosystems sanctions against violators of catch fisheries
Overfishing in coastal waters Eradication of IUU fishing activities regulations
Data collection systems for capture and Improve the institutional capacity of fish resource Determination of the optimal allocation of
cultivation fisheries that are not yet reliable, supervisors and the effectiveness of law enforcement fishing boats in each of Indonesia's marine
not efficient and still partial Providing certainty in spatial planning for waters
Decreased water qualityw aquaculture business Institutional capacity building for fisheries
Climate change Improved quality and quantity of capture and supervisors
cultivation fisheries data and information Maintain and restore the abundance of fish
Improving the quality of human resources for capture resource availability (SDI)
and cultivation fisheries data management Reliable and integrated capture fisheries
Maintain and restore biodiversity in Indonesia's data collection and information system
marine waters Providing certainty in spatial planning for
The use of balanced and sustainable fish resources aquaculture business
Protection, preservation and sustainable use
of fish resources and the environment
ZEEI: Indonesian exclusive economic zone, IUU: Illegal, unregulated, and unreported, STP: Science and techno‑park, Source: Authors

International Journal of Economics and Financial Issues | Vol 9 • Issue 1 • 2019 35

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