FISHERIES SECTOR Investing in Indonesia's - EU-Indonesia Business Network

 
FISHERIES SECTOR Investing in Indonesia's - EU-Indonesia Business Network
Investing in Indonesia’s
   FISHERIES SECTOR
   An overview of opportunities, capabilities and provisions

Published in December 2018                                     With the support of:
FISHERIES SECTOR Investing in Indonesia's - EU-Indonesia Business Network
Contents
Opportunities: Tuna, Shrimp, Crab, Seaweed, Cold Storage, and Shipyard/Ship-building

     • Introduction to the sector                                                                      3

     • Why Indonesia?                                                                                  5

     • Market opportunities                                                                            6

     • Existing and future capabilities                                                                15

     • Government provisions and support                                                               27

     • Six good reasons to invest in Indonesia’s Fisheries sector 38

                                      The Investment Coordinating Board of the Republic of Indonesia
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FISHERIES SECTOR Investing in Indonesia's - EU-Indonesia Business Network
Introduction to Indonesian fisheries
  Indonesia is currently the…                               World’s 2th Longest
  • World’s 2th Largest Fisheries Producer                      Coastline
  • World’s Largest Source of Seaweed
  • World’s 7th Largest Exporter of Processed and Canned Tuna
  • Largest Shrimp Producer in South East Asia

                                                                                                              Challenges in the sector remain:
  The fisheries sector provides vital      In 2014 , almost  5,000 foreign
  support to coastal economic              fishing boats were operating illegally                             • Addressing illegal, unreported and
  development, creating employment in      in Indonesian waters. In 2016, the                                   unregulated (IUU) fishing.
  fish catching and in onshore             number has been successfully
  processing, as well several thousand     reduced to 163.                                                    • Prohibited the issuance of new
  indirect jobs.                                                                                                licenses to vessels over 150 GT.
                                           New regulations and reformations on
  Indonesia lands approximately 1.1        licenses have been introduced to                                   • New regulation limits traditional
  million tonnes of pole and line caught   sustainably manage the sector’s                                      fishing methods in order to remove
  tuna a year, though it is estimated      supply chain, as well as to maintain                                 doubts around destructive and
  that only 10-20% reaches market          the welfare of as many as 2 million                                  overly exploitative fishing gears.
  labeled as pole and line caught.         local fishermen.
  Hence it has been one of the least
  regulated subsectors.

                                             The Investment Coordinating Board of the Republic of Indonesia
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Indonesia’s geography and location
      Indonesia lies at the intersection of the Pacific Ocean and the Indian Ocean. Over
      half of all international shipping goes through Indonesia waters.
      Indonesia is one of the most populated countries in the world (currently 265 million
      people*). Indonesia accounts 40% of total ASEAN population.

                                                                                          As the largest archipelagic country in the
                                                ASEAN
                                                                                          world, Indonesia comprises more than 16,056
                                                                                          islands spread over nearly 6,500km from east
                                                                                          to west. At 95,181km, it has the world’s 2nd
                                                                                          longest coastline. Indonesia’s Java island
                                                                                          alone is as big as England and home to 125
                                                                                          million inhabitants, including its capital
                                                                                          Jakarta, which can be reached via direct
                                                                                          flights from numerous locations worldwide,
                                                                                          including:

                                                                                          Singapore: 1h40min                   Kuala Lumpur: 2h50min
                                  INDONESIA
                                                                                          Bangkok: 3h30min                     Hong-Kong: 5hrs
                                                                                          Sydney: 6h50min                      Tokyo: 7hrs

      Sumatra Java          Kalimantan    Sulawesi   Nusa Tenggara     Papua
                                                                                          Seoul: 7hrs                          Dubai: 7h50min
                                                                                          Beijing: 7h20min                     Amsterdam: 14h20min
Source: Minsitry of Home Affairs (2016)
        http://www.bakosurtanal.go.id                         The Investment Coordinating Board of the Republic of Indonesia
                                                                                                                                                       4
FISHERIES SECTOR Investing in Indonesia's - EU-Indonesia Business Network
Why Indonesia
        MARKET                              EXISTING & FUTURE                                                    GOVERNMENT
     OPPORTUNITIES                             CAPABILITIES                                                  PROVISIONS & SUPPORT

    Indonesia is the world largest          60,584 Fish Processing Units                                      Continuously enforcing and
     source and fisheries producer,           are available throughout                                           promoting sustainable fisheries
     including tuna, seaweed and              Indonesia                                                          programme
     shrimp.
                                             Lowest operating costs in                                         Revitalising existing land for
    it is expected that the industry         ASEAN-5 (Thailand,                                                 aquaculture of seaweed,
     can produce various type of              Philippines, Malaysia, Vietnam                                     shrimp and crabs.
     250,000DWT vessels by 2025               and Indonesia) for a food and
                                              beverage manufacturing plant.                                     Open FDI investments include:
    Indonesia maritime economic                                                                                 aquaculture, seaweed
     potential is US$ 1,33 trillion          Host to leading centres of                                         processing industry and
     per year.                                excellence, including a                                            shipbuilding/shipyards and cold
                                              prestigious government-funded                                      storage facilities.
                                              specialist fisheries college

                                            The Investment Coordinating Board of the Republic of Indonesia
                                                                                                                                                   5
FISHERIES SECTOR Investing in Indonesia's - EU-Indonesia Business Network
MARKET OPPORTUNITIES

                                                                The Investment Coordinating Board of the Republic of Indonesia
Image source: http://www.flickr.com/photos/arditpg/3590772699
                                                                                                                                 6
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Indonesian Marine Resources
             Potential of Maritime Economy                                                         Contribution of Fisheries to National GDP
                                   Capture                                                                                                                        2.56                2.57
                                   fisheries                                                                                                    2.51
          Non-conventional            1%
             resources                             Aquaculture                                                                2.32
                15%                                   16%                                                                                2.27              2.27                2.28
                                                                                                          2.21         2.21
                                                                                                   2.16
    Mangrove
     forest
       1%
                                                                 Fish processing
 Resources of small                                                  industry
      islands                                                           7%                            2013               2014              2015              2016                 2017
         9%
                                                                                                                   Share of fisheries to the national GDP at constant prices
                                                                                                                   Share of fisheries to the national GDP at current prices
                                                                 Biotechnology
 Maritime services
     industry
                                                                    industry
                                                                      14%
                                                                                                     Target of Marine and Fisheries Ministry
       15%                                                                                                    Information                       2016       2017          2018            2019

                                                                                              GDP Growth of Fisheries (%)                       8,00       9,50          11,00         12,00
              Sea
         transportation                        Mining and                                     Fishery Production (million tonnes)               22,63     27,24          34,19         43,09
               2% Marine tourism                energy
                                                                                              Export (USD billion)                              6,82       7,62           8,53           9,54
                                                  16%
                        4%
                                                    Source: Statistics Indonesia, 2015        Fish Consumption (kg/capita/year)                 43,88     47,12          50,65         55,78

                                                                                              Processed Product Volume (ton)                    5,90       6,20           6,50           6,80
Indonesia maritime economic potential:                                                        Investment Need for Marine and
                                                                                                                                             139,31       165,23         209,95        260,22
                                                                                              Fisheries Sector (IDR Trillion)*
       US$ 1.33 trillion per year                                                            *) Government, Private, and Community

                                                      The Investment Coordinating Board of the Republic of Indonesia
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FISHERIES SECTOR Investing in Indonesia's - EU-Indonesia Business Network
Abundant wealth in Indonesian territorial waters
Global future demand is on the rise and will be dependent on these sources
   World’s                                                                Fisheries sector                                                    +60,000 Fish Processing
   2nd                                                                    Growth was                                                          Units are available
                                                                                                                                              throughout Indonesia:
   longest coastline                                                      5.95% in 2017
                                                                                           GDP Growth of
   5.500 rivers and lakes                                                         Year       Fisheries                                        Sumatra
                                                                                                                                              Java
                                                                                                                                                                      : 13.947
                                                                                                                                                                      : 26.840
                                                                                  2013          7.24
                                                                                                                                              Kalimantan              : 8.880
                                                                                  2014          7.35
   5,8 million km2 sea                                                            2015          8.96
                                                                                                                                              Bali & Nusa Tenggara : 5.231
                                                                                                                                              Sulawesi                : 5.137
   area (including 2,55 million                                                   2016          5.14                                          Maluku & Papua          : 1.767
   km2 of Exclusive Economic                                                      2017          5.95                                                     Total (2016) : 61.802
   Zone)                                                                       Target 2019       12
                                                                            Indonesia GDP is USD $ 1 Trillion (2017)*

    Tremendous biodiversity                                                                         Value Export of Fisheries Commodities in USD

    16,500 aquatic species
    65 million        tons/year
    potential fisheries
    production (7,4 million ton
    capture and 47,6 million ton
    aqua/marine culture)
Source: BIG (2016), BPS (2018), KKP DirGen Fisheries Processing and                          shrimp         Tuna                             Other Fish   Crab       Cephalopods
Marketing (2016), Ministry of Marine Affairs and Fisheries (MMAF) 2016.
                                                                            The Investment Coordinating Board of the Republic of Indonesia
                                                                                                                                                                                   8
FISHERIES SECTOR Investing in Indonesia's - EU-Indonesia Business Network
Investment Realization
  Fishery Investment in Indonesia, 2010-2017 (FDI)
   FDI Realization by Sector (USD Million)                                              Fishery Investment by Location (USD Million)

                                                                                       Fishery Investment by Countries (USD Million)

                                        The Investment Coordinating Board of the Republic of Indonesia
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FISHERIES SECTOR Investing in Indonesia's - EU-Indonesia Business Network
Increased production capacity spurring from
increased domestic consumption
    The Indonesian fisheries sector contributed almost 2.57                                 The Government through its Midterm Plan* has
    % or USD 16,8 Billion to the country’s economy in                                       indicated its targeted volume to reach 19.5 million
    2017.                                                                                   tons of fish by 2019. Through the plan, the
                                                                                            Indonesian Government states three targets for
    Domestic fish consumption** grew to 47.34 kilograms                                     increasing fisheries products and fish processing
    (kg)/capita in 2017 from 43.94 kg/capita in 2016. The                                   industry:
    average monthly expenditure per capita for fish was
    IDR28,356 in 2013, by 2017 it became IDR 40,478                                         1.       Achieve GDP growth of 7.2% annually in the
    (USD 3). The consumption per capita target by 2019 is                                            fisheries sector
    54,4kg.                                                                                 2.       Reach fish production volume of 19.5 million,
                                                                                                     and USD 9.5 billion in export value by 2019
                Fish Consumption per Capita (in Kg)                                         3.       Increase the volume of processed fisheries
                                                                                                     products by 6.8 million tons by 2019
                        2014                        2015    2016          2017
                                                                                                                                                    19.5
   Fish Consumption/Capita
                       38.14                       41.11   43.94         47.34                 Targeted Total Volume and Fish Production
                                                                                                        (million ton) 2014 – 2015
                                                                                                      Source: RPMJN 2015 - 2019              16.2
    In order to meet its 2019 production target of 50 million
    ton, Indonesia will require approximately 141,1 billion                                                                           13.4

    seeds of fresh water, brackish & sea fish.                                                                                 11.1
                                                                                                   10.2            10.6

                                                                                                  2014            2015         2016   2017   2018   2019

Source: Statistik KKP (2017), RPJMN (2015 -2019)              The Investment Coordinating Board of the Republic of Indonesia
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Indonesian shrimp exports are expected to rise to meet with
global demand
                 Shrimp Aquaculture in Asia: 2010 – 2018                                                                         Total Indonesia Shrimp Production (Ton)

                            Major Producer                                                                                                                                    800000
                                                                                    MT=Metric tones                                                         698138
                                                                                                                                     645955 639369 615871
                                                                                                                                                                     555138
                                                                                                                         415703

                                                                                                                           2012      2013    2014   2015     2016     2017     2018
                                                                                                                                                                              (Target)

                                                                                                                           Global demand for Indonesian shrimps is
                                                                                                                           estimated to be around 560,000 – 570,000
                                                                                                                           tons yearly with main destination USA,
                                                                                                                           getting about 57% of Indonesian exported
                                                                                                                           shrimp.
    Shrimp is the most important fisheries export commodity,                                                               In 2016, more than 60% of total fisheries
    representing 45% of the total value of Indonesian export of                                                            exported to the US was shrimp, valued at
    fishery products.                                                                                                      above USD 1 billion, and is expected to
                                                                                                                           increase in 2017. Most Indonesian shrimp
    Shrimp production in 2016 was estimated to range between 11.2                                                          are either exported in frozen form or with
    and 17.6 million metric tones. Farmed shrimp is a key driver of                                                        heads and shells removed.
    global aquaculture supply, which exceeded wild caught supply for                                                       In 2017 due to bad weather the shrimp
    the first time in 2014.                                                                                                production declined.

                                                                                                                           Exports are expected to rise in order to
Source: http://www.aqtinfo.com/2016/11/global-shrimp-survey-goal-                                                          meet global demand.
2016.html/, KKP Book (Analisis Data Pokok, 2017),
http://www.trobos.com/detail-berita/2017/12/15/12/9648/menatap-
peluang-perudangan-2018                                             The Investment Coordinating Board of the Republic of Indonesia
                                                                                                                                                                                         11
Indonesia is the world’s Top 5* global exporter of
canned and processed tuna
                                                                                                                Indonesia Tuna Production by Type (2012-2016)
                                                                                                                                   in tons
 The second most important fishery commodity is

                                                                                                                                            450608
 tuna. In 2016 tuna contributed 22% of the

                                                                                                                                                                                                                                              413152
                                                                                                                                                                                 401619
 national fisheries production.

                                                                                                              362143

                                                                                                                                                                                                                340016
 Indonesia produces mainly skipjack and                                                                                                                                                                                                                         Frigate Tuna
 yellowfin tuna and to date still producing below

                                                                                                                                                                                                                                                       197207
                                                                                                                                                     193385
                                                                                                                       185966

                                                                                                                                                                                                                         182809
                                                                                                                                                                                          172543
                                                                                                                                                                                                                                                                Longtail Tuna

                                                                                                                                                                157801
 the RFMO assigned quotas.

                                                                                                                                                                                                       134346
                                                                                                                                   119899
                                                                                                                                                                                                                                                                skipjack Tuna

                                                                                                                                                                                                                                     107380
                                                                                                      86883
                                                                                                      82634

                                                                                                                                                                                                   76240
                                                                                                                                75581
                                                                                                                                                                                                                                                                yellowfin Tuna

                                                                                                                                                                                                                                  67714
                                                                                                                                                                         58819
 Indonesia’s tuna mainly goes to the UK,
 Germany, the US, and Japan. Japan remains
 Indonesia biggest importer.
                                                                                                         2012                       2013                                 2014                           2015                          2016

 Since 2015 Indonesian government’s policy in
 combating illegal, unreported and unregulated
                                                                                                                                Indonesian Tuna Export in Thousand USD
 fishing (IUUF) has resulted in increase of fish
 stock. Based on the study by University of                                                                                                                   Non Processed                                                  Processed
 California Santa Barbara and Ministry of Marine
 Affairs and Fisheries (MoMAF) it is expected by
 2050 the fish biomass will increase by 224% and
 can be translated to USD 3,7 billion economic
 gain.

 *, Thailand, Ecuador, Spain, China, Indonesia and Mauritius in the first half of
 2016 according to Globefish.
 Source:: KKP Book (Analisis Data Pokok, 2015), BPS (2015)

                                                                           The Investment Coordinating Board of the Republic of Indonesia
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Enforcement on sustainable crab aquaculture

Volume of Crab Export in Thousand Ton                   Traditionally, Indonesia had relied on nature
                                                        and wild-catch for its crab production, which
                                                        might caused shortages of current crab family
                                                        population.

                                                        In 2015 the MoMAF enacted a new regulation
                                                        enforcing more sustainable aquaculture in this
                                                        area. It prohibited the catchment of crab
                                                        (Portunus spp., Scylla spp.) and lobster
                                                        (Panulirus spp.) when they are breeding and
                                                        when they are smaller than a certain size. The
                                                        policy is to provide for a healthier and more
                                                        abundance stock.

                                                        Of all fishery products exported, which was
                                                        mainly to China and the US, crab has the
                                                        highest added value because the end product
                                                        was ready-packed for retail. The value of
                                                        exports continued increasing steadily between
                                                        2015-17.

                                                        In 2016, the value of crab exports stood at
                                                        USD 322 while in 2017 was USD 411 million.
                                                                                        Source: KKP Processing Crab Products (2017), FAO (2014)

                               The Investment Coordinating Board of the Republic of Indonesia
                                                                                                                                                  13
80% of the world’s Carrageenan Seaweeds originate
from Indonesian waters
                                               Seaweed Export Value and Volume                                                                            The Potential of Seaweed
                                        220                                                             250                                              Farming Land in Indonesia
             Volume in Thousands Tons

                                        210                                                             200                                       Region                 Potential Size

                                                                                                              Value in million USD
                                        200                                                             150                                                              (Hectare)
                                        190                                                             100                                       Aceh                         104,000
                                        180                                                             50                                        North Sumatra                  20,000
                                        170                                                             0
                                                                                                                                                  Riau islands                   37,635
                                               2015               2016               2017
                                                       Volume Export      Value Export                                                            East Java                      16,420
                                                     Seaweed Production in Million tons                                                           Bali                               1,151
                                   Seaweed               2015     2016      2017        2018                2019
                                                                                                                                                  West Nusa Tenggara             22,270
                                   Production            11.3     11.6       10.8
                                   Target Production     10.6     11.1       13.4       16.2                19.5                                  East Nusa Tenggara             10,086

   Indonesian seaweeds have been exported all over the world, 85% of                                                                              South Sulawesi               250,000
   them as raw materials. While Indonesia has 555 species of seaweeds, it                                                                         North Sulawesi                 50,600
   produces mostly Cotonii sp. and some Glacilaria sp.
                                                                                                                                                  Central Sulawesi             106,000

   Blessed with an ideal climate and geography for seaweed cultivation,                                                                           Southeast Sulawesi             83,000
   the majority of seaweed cultivation is in the Eastern parts of Indonesia                                                                       East Kalimantan                15,520
   including Bali, Nusa Tenggara, Sulawesi and Maluku.
                                                                                                                                                  Gorontalo                          2,850

   The government is committed to support seaweed industry, not only by                                                                           Maluku                       206,000
   increasing seaweed target production to 19.5 million tons in 2019 but                                                                          Papua                        501,000
   also giving various incentives and setting up industrial clusters across
                                                                                                                                                  Total land available       925,523 ha
   the archipelago                                                                                                                                for farming
Source: Ministry of Fisheries and Maritime Affairs
                                                                                 The Investment Coordinating Board of the Republic of Indonesia
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Potential of Indonesian shipbuilding industry
Currently, there are 250 shipyards companies with ship repair capacity of 12
million DWT and new ship building capacity of 1 million DWT per annum
    Indonesia’s shipyards have the                     Vessel Age                     Percentage                             There are around 60 companies
    capacity and capability to build                   0-5                                     25                            make up the Indonesia ship
    various type of ships up to 50,000                                                                                       components industry.
                                                       6-10                                    15
    DWT and repairing up to 300,000
    DWT (graving dock)                                 11-15                                   15                            They are capable in producing
                                                       16-20                                   13                            rubber and plastic product,
    Indonesian shipbuilding industry is                21-25                                    9                            capstans and windlass, casting
    also capable in producing                          >25                                     21                            product, crane, fire extinguisher,
    Submarine, Strategic Sealift Vessel                                                                                      IMO fluorescent signs, marine
    and Guided Missile Destroyer.                                                                                            and protective coating, anchor
                                                                                                                             and chain, steering gear,
    In 2016 the Indonesian Government                                                                                        propeller.
    ordered 193 units which was almost
    quadrupled the previous years.                                                                                           According to the roadmap, by
                                                                                                                             2025 it is expected that the
    In 2017 83% of 218,300 GT worth of                                                                                       industry can produce various
    the ship orders are for domestic                                                                                         type of 250,000DWT vessels
    market. As most of Indonesian ships   '89: Ships, boats and floating structures                      2012                 2013           2014            2015            2016
    are aging there is increasing demand
    in the near future for new ships.    Indonesia's exports to the World                              818,577,342          942,474,406    714,460,834     375,307,498     492,294,853

    Most of shipyards are concentrated                 Indonesia's imports from the World            1,807,631,000     1,131,030,000      1,212,744,000   1,107,534,000    990,342,000
    on Batam and Java islands.
Source: Iperindo (2017)                                Total trade                                   2,626,208,342     2,073,504,406      1,927,204,834   1,482,841,498   1,482,636,853
                                                           The Investment Coordinating Board of the Republic of Indonesia
                                                                                                                                                                                          15
Cold Storage Distribution is Still Concentrated in the Western Region
     The construction of cold storage is plagued by electricity supply, clean water network and other
                                         supporting infrastructure
                Cold Storage Location, supported by MoMAF and                                                                                MoMAF has prioritized to have 8 units of cold
                                 Private Sector                                                                                              storage between 30-100 tons, 300 packages of
                                                                                                                                             chest freezer & thermal ice gel and 30 units of
                                                                                                                                             1,5 ton ice flake machines in 2018 to
                                                                                                                                             accommodate fisheries industry.

                                                                                                                                             According to Indonesian Cold Storage
                                                                                                                                             Association Indonesia’s seafood industry alone
                                                                                                                                             requires some 14 million tons of cold storage
                                                                                                                                             facility capacity per year. Back in 2016 the
                                                                                                                                             supplied cold storage capacity was 7.5 million.

                          MoMAF cold storage (2009-2015)          MoMAF single cold storage
                                                                  (2009-2016)
                                                                                                           Private cold storage              Other sectors such as processed meat industry,
                                                                                                                                             fruit and vegetable industry also experience lack
                             Cold Storage Availability and Demand                                                                            of cold storage facilities.
                       835
     in Thousand Ton

                                      349                                                                                                                                 Required Storage           Available Cold Storage Facility
                                                       251                                                                                       Product
                                                                                                                                                                        Facility (in million tons)       Supply (in million tons)
                         118                                            118                   99              97
                                            23               31               11                   4                14                (Processed) Fish                   14.0                                 7.5
                                                                                                                                      (Processed) Chicken Meat           5.0                                  1.5
                        Java        Sumatera          Sulawesi       Bali & Nusa Kalimantan                  Papua &
                                                                                                                                      Fruits & Vegetables                30.0                                 1.5
                                                                      Tenggara                               Maluku

                                 Demand of Cold Storage                  Available Cold Storage
                                                                                                       The Investment Coordinating Board of the Republic of Indonesia
Source: Marine and Fishery Ministry, 2016
                                                                                                                                                                                                                                       16
EXISTING AND FUTURE CAPABILITIES

Image Source: Tribune News
                             The Investment Coordinating Board of the Republic of Indonesia
                                                                                              17
Project opportunities

                       PORTS:                                           VESSELS:                                                 COLD STORAGE

        Modernizing 5 Existing                            Fishing Vessel 512 units:
           Fishing Ports:                                    300 vessels 120 GT                                                   60 units ice flake machines
     Zachman, Jakarta                                                                                                               of 1.5 tonnage
   • PPS Bitung,                                                                                                             10 units ice flake machines
     North Sulawesi                                                                                                                  of 5 tonnage
   • PPN Pengambengan,                                                                                                       14 Units cold storage of 30-
     Bali                                                                                                                            100 tonnage
                                                           20 Integrated Marine and
   • PPP Sendang Biru,                                                                                                       1 Unit cold storage of 1000
                                                           Fisheries Centers all over
     East Java                                                                                                                          tonnage
                                                          Indonesia, especially in the
                                                                                                                               40 Units of refrigerated
   • Jayanti, West Java                                        Eastern Indonesia
                                                                                                                                       vehicles

For further Information and more inquires please visit:
http://www.bkpm.go.id/en
                                                            The Investment Coordinating Board of the Republic of Indonesia
                                                                                                                                                            18
Investment Opportunity

 Fishery Opportunity
                                                 Annual Potential                                                                                                                                            Market
                              Competitive
        Location                                      Catch                        Opportunities                                               Infrastructures
                              Commodities                                                                                                                                                           Local              Export
                                                   (kilo tons)

Simeuleu Regency, Aceh    Tuna, Lobster,               36           Fisheries, Aquaculture, Processing,            Airport (Medan 1 hour, Jakarta 3 hours – transit), Ferry wharf and      Medan, Jakarta                Singapore,
                          Grouper                                   Marketing and Cold Chain                       cargo, Road network                                                                            Hongkong, Taiwan,
                                                                                                                                                                                                                           Shanghai

Mentawai Regency, West Grouper, Seaweed,               270          Fisheries, Aquaculture, Tourism                Port in 4 major islands (Padang 3 hours), Electricity, Fisherman gas    Padang
Sumatera               Pearl                                                                                       station, Fresh water

Natuna Regency,           Snapper, Mackerel,           542          Fisheries, Aquaculture, Processing,            Airport (Batam 1 hour, Jakarta 2 hours – transit), Cargo port, 6 ice    Bintan, Batam,                 Hongkong,
Riau Islands              Grouper                                   Marketing and Cold Chain                       factories, Cold storage                                                 Pontianak, Jakarta    Malaysia, Singapore

Nunukan Regency,          Tuna, Grouper,               338          Fisheries, Aquaculture, Processing,            Airport (Balikpapan 1 hour – transit), Ferry wharf (Malaysia 1 hour),   Tarakan,                          Serawak
North Kalimantan          Mackerel, Seaweed                         Marketing and Cold Chain                       Cold storage, Ice factory, Cannery, Freezing plant, Filleting           Balikpapan,
                                                                                                                                                                                           Pontianak

Sangihe Regency,          Mackerel, Grouper,           30           Fisheries, Aquaculture, Processing,            Airport (Manado 1 hour), Fish port, Pertamina storehouse, Fish          Bitung, Manado,              Asia, Europe,
North Sulawesi            Pompano, Sea                              Marketing and Cold Chain                       processing unit, Solar packed dealer for fisherman                      Minahasa                          America
                          cucumber

Morotai Island Regency,   Tuna, Mackerel,             1,228         Fisheries, Aquaculture, Processing,            Part of SEZ which has completed infrastructure, Airport (Manado 1       Manado, Makassar           Manila, Darwin
North Maluku              Grouper, Yellow fin,                      Marketing and Cold Chain                       hour, Manila 3 hours, Makassar 2 hours, Darwin 3 hours), Fish port
                          Lolosi, Trevally                                                                         equipped with ice factory, cold storages and sufficient electricity

Kisar, South West         Tuna, Grouper,               200          Fisheries, Aquaculture, Processing,            Airport (Kupang 90 minutes), Ferry wharf, Electricity, Fresh water      Ambon                 Timor Leste, Darwin
Maluku                    Napoleon, Seaweed                         Marketing and Cold Chain

Rote Ndao, East Nusa      Tuna, Grouper,               17           Fisheries, Aquaculture, Processing,            Airport (Kupang 30 minutes), Port, Fish market, Electricity
Tenggara                  Mackerel, Seaweed                         Marketing and Cold Chain

Saumlaki, Western         Grouper, Lobster,            36           Fisheries, Aquaculture, Processing,            Airport (Ambon 90 minutes), Fish market, Electricity, Fresh water,      Ambon, Surabaya,           Australia, Cina,
Southwest Maluku          Seaweed                                   marketing and cold chain, Warehousing,         Seaweed processing plant                                                Bali                           Hongkong,
                                                                    Tourism (cruise)                                                                                                                              Singapore, Taiwan,
                                                                                                                                                                                                                                Japan

Tual, Maluku              Tuna, Mackerel,             1,729         Fisheries, Aquaculture, Processing,            Airport (Ambon 90 minutes), Ferry wharf, Fish port, Pertamina port,     Ambon
                          Grouper, Shrimp,                          Marketing and Cold Chain                       Electricity, Fish processing plant
                          Seaweed

Biak Numfor, West         Tuna, Grouper, Sea          1,997         Fisheries, Aquaculture                         Airport (Jayapura 1 hour, Makassar 2 hours), Pertamina storage,         Manokwari
Papua                     cucumber                                                                                 Electricity, Fresh water

Sarmi, Papua              Grouper, Snapper,            229          Fisheries, Aquaculture                         Airport (Jayapura 30 minutes), Ferry wharf                              Jayapura
                          Yellow fin, Lobster

Merauke, Papua            Snapper, Shrimp,             125                         The Investment
                                                                    Fisheries, Aquaculture,       Coordinating Board
                                                                                            Processing,              of the(Jayapura
                                                                                                                  Airport    Republic of Indonesia
                                                                                                                                      1 hour), Port                                        Surabaya, Makassar,                  China
                          Crab, Mullet fish                         marketing and cold chain                                                                                               Jayapura, Jakarta                     19
Success Story : Sea Delight, LLC
        Sea Delight, LLC was founded in 2006 by Eugenio and Margarita
        Sanchez, the owners of ADS Seafood, LLC dba Atlantic Fisheries, as
        an initiative that sought to target the market of high quality frozen
        and fresh seafood products.

        Sea Delight is committed to supporting sustainable fisheries by
        participating in sustainability workshops and partnering with our
        suppliers to cooperate with appropriate NGO's (non-government
        organizations) and join the Trace Register web-based traceability
        program. This company support fisheries stakeholders in working
        towards the goal of Marine Stewardship Council (MSC)
        certification.

        Sea Delight became the first company to receive official
        membership in the WWF-Indonesia's corporate engagement
        program, SEAFOOD SAVERS, their inter-business cooperation plan
        for sustainable fisheries in support of Sea Delight's current Fishery
        Improvement Projects (FIP) in Indonesia.

Source: http://www.sea-delight.com
                                                        The Investment Coordinating Board of the Republic of Indonesia
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Success Story : PT. Mustika Minanusa Aurora (PT. MMA)
        PT. Mustika Minanusa Aurora (PT. MMA) is one of the leading
        shrimp processing company in Indonesia. It was established in 1995
        and managed by Dachan Greatwall group since 1998. The two
        companies became partner in 2008 through Joint Venture.

        Today, they have around 2500 skilled workers that is ready to
        process wider range of product followed by the two extended new
        plants which are PT. Misaja Mitra – Pati, which specialized in
        producing finest breaded shrimp, and PT. Misaja Mitra – Kota Baru
        which offer various of sea-caught shrimp freshly caught from
        Sulawesi sea. PT. Misaja Mitra – Pati is located at Pati, Central Java,
        Indonesia, and PT. Misaja Mitra – Kota Baru is located at Pulau Laut,
        South Kalimantan, Indonesia.

        PT. MMA is the pioneer organization that establishes the Mangrove
        conservation program supported by World Wildlife Foundation
        (WWF) and funds from our clients. They have successfully increased
        the awareness of environmental protection among community.

Source: https://www.shrimp.co.id/
                                                          The Investment Coordinating Board of the Republic of Indonesia
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The corporate landscape
What are the investors saying?

    The ocean is just one of                                                                                             “Indonesia offers big
    many areas that                                                                                                      opportunities through
    sustainability can focus on,                   Our mission is to achieve ongoing                                     its access to natural
    and it is an area that is also                 commitment to build sustainable                                       resources, a large
    hard-hit by climate                            community through our Corporate                                       work force and a
    change. The Sea Delight                        Social Responsibility. We offer                                       market of huge
    2013 Annual report shows                       knowledge and skills to our                                           potential. It is our
    a strong effort to improve                     employees to support individual’s                                     vision to become the
    sustainability in Indonesia                    talents, as well as motivate them to                                  market leader in the
                                                   achieve target through rewarding                                      frozen food industry
                                                   system. Our organization believes                                     renowned for high
                                                   that every member is an essential                                     quality products, and
                                                   keystone to our success.                                              we are open to
                                                                                                                         collaboration with
                                    “As the largest shrimp                                                               partners with a similar
                                    farms in Indonesia,                                                                  goal”.
                                    we guarantee the best
                                    quality of shrimp for
                                    export and have the
                                    most advanced
                                    techniques shrimp
                                    farming in Indonesia”.
Source: http://fisheriesimprovementindonesia.org
                                                        The Investment Coordinating Board of the Republic of Indonesia
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Food Manufacturing:
Indonesia leads the way with operating costs

    Data from the Financial Times has                                                   Total annual operating costs:
    found that Indonesia has the lowest                                            Food & Beverages Manufacturing Plant*
    operating costs for a typical Food &
    Beverages Manufacturing plant* of all
    the 5 key ASEAN markets, at just over
    US$1.51m per annum.

    Indonesia is therefore 39% lower than
    the average of US$2.47m per annum
    across the 5 ASEAN countries.

    Out of these markets, Indonesia has
    the 2nd lowest labour costs and the
    3rd lowest utility costs – it the only
    market with relatively low costs on both
    the labour and utility fronts.

   Source: fDi Benchmark (Financial Times)
   * Based on a food and beverage manufacturing plant with a headcount of 200, comprised as follows: 186 production
   operatives (16 highly skilled, 70 skilled and 100 unskilled); 6 quality control specialists, 3 secretaries; 2 office service
   specialists; 1 head of manufacturing; 1 production manager and 1 quality control manager.

                                                   The Investment Coordinating Board of the Republic of Indonesia
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Boat Building:
Indonesia’s labour costs lowest of the ASEAN-5
 Data from the Financial Times has                                                               Total annual labour costs:
 found that Indonesia is the most cost-                                                                Boat Building*
 competitive country among the 5 major
 ASEAN markets when it comes to
 labour costs for a typical boat-building
 operation.

 Indonesia has the lowest operating
 costs of all the 5 locations at $668,856
 per annum.

 Indonesia is therefore 20% lower than
 the study average of $833,419 per
 annum.

Source: fDi Benchmark (Financial Times)

* Based on a boat building operation with 150 employees, comprised as follows: 40 Unskilled Production Operatives; 16 Skilled
and Highly-Skilled Production Operatives; 40 Semi-Skilled Craftspeople; 20 Skilled Craftspeople; 9 Engineers; 8 Warehouse &
Distribution Operatives; 4 Secretaries; 3 Supervisors; 3 Quality Control Specialists; 3 Technical Drawers and 1 of each of the
following: Facilities Specialist; Head of Manufacturing; Production Manager and a Quality Control Manager

                                                The Investment Coordinating Board of the Republic of Indonesia
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Private sector engagement in sustainable fisheries:

Eight companies have joined WWF’s Seafood Savers program.
This entails a commitment to operational safety, sustainable and
responsible use of Indonesia marine resources, and a
commitment to more towards MSC/ASC certification.

                                                      Corporate members of the Seafood Savers program will engage
                                                      in Fisheries Improvement Program (FIP) for capture fisheries
                                                      companies, an Aquaculture Improvement Program (AIP) for
                                                      aquaculture companies, and a Chain of Custody Improvement
                                                      Program (CoCIP) for restaurant, hotel, and supermarket
                                                      companies.

                                          The Investment Coordinating Board of the Republic of Indonesia
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Commitment toward certification

1. Indian ocean long line     2. Indonesian pole, line, and                                       3. Blue Swimming Crab
   tuna FIP.                     handline FIP                                                        FIP program
   Contributes to the            Development of the FIP                                              Blue Swimming Crab

   development,                  action Plan was                                                     (BSC) Processors and

   improvement, and              facilitated by IPNLF                                                Exporters Association

   sustainability of the         (International Pole and                                             (APRI), together with

                                 Line Foundation).                                                   SFP and the Crab
   tuna fishery industry by
                                                                                                     Council, have worked to
   promoting traceability,
                                                                                                     improve the BSC fishery
   improving the
                                                                                                     through FIP since 2007.
   availability and
   accuracy of data on
   total catch.

                                 The Investment Coordinating Board of the Republic of Indonesia
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Indonesia Fair Trade Program

   Indonesia Fair Trade program was initially based only in Maluku,
   and now expanding the program to Sulawesi. At first, there were
   only four groups of fishermen, and now increased rapidly up to
   33 fishers association with a total of 712 fishers involved in this
   program in August 2016.

                                                        Indonesia’s Fair Trade Achievement

                                                        In 2015, consumers in North Carolina, Portland, and Seattle
                                                        US can find Indonesian tuna products sourced by the certified
                                                        Fair Trade Fisherman from Maluku Ambon. As the number of
                                                        registered and participating fishers increases and hence the
                                                        volume available product increases the in-store product
                                                        range will also be expanded to more branches of Safeway
                                                        across the United States of America.
                                                                                                                  Source: http://mdpi.or.id/fair-trade-program/
http://mdpi.or.id/fair-trade-program/            The Investment Coordinating Board of the Republic of Indonesia
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Indonesia Fair Trade Communities

http:// mdpi.or.id/fair-trade-program /#
                                           The Investment Coordinating Board of the Republic of Indonesia
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GOVERNMENT PROVISIONS AND SUPPORT

Image source: http://worldcocoafoundation.org/wp-
content/files_mf/aboutcocoatextpagesweb.jpg
                                                    The Investment Coordinating Board of the Republic of Indonesia
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Overview of Fisheries Minister Susi Pudjiastuti’s Policy:

      a.Combating illegal fishing                                 d. Provinces               oversee              near                f. Launched       a     plan     for
         by        foreign-owned              and                   shore waters out to 12                                              modernizing the country’s
         operated vessels is top                                    nautical miles (nm); and the                                        fishing fleet. Through its
         priority.                                                  national                        government                          2016 budget, Ministry of
                                                                    oversees from 12-200 nm.                                            Marine        Affairs        and
      b.The                 administration’s                                                                                            Fisheries       (MMAF)        will
         sinking of more than 160                                 d. MMAF will deregulate and                                           spend     IDR       3.72   trillion
         illegal            foreign-flagged                         simplify certain aspects of                                         (roughly $286 million USD)
         vessels.                                                   the fisheries sector in order                                       on    fish      transportation,
                                                                    to encourage foreign and                                            fishing      vessels,        cold
      c. Reform the capture fishing                                 domestic                companies                  to               storage, and surveillance.
         licensing system.                                          submit tenders.

For further Information and more inquires please visit: http://
http://www.kkp.go.id/
                                                                     The Investment Coordinating Board of the Republic of Indonesia
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Policy Reforms

                  Pro Investment Policies


Predictable
                   
                   
                  Tax incentive for
                   labor intensive
                                                             
                                                    Dwelling time                                New Negative List of
                                                                                                  Investment that is
                                                                                                                             Relaxation of entry
                                                                                                                                 visa policy
Wage System           industries                    optimization                                     more open


Tax incentive
                      
                   Acceleration of
                                                                                              Lower energy
                                                                                                                                   
for transport     infrastructure &               3 Hour Licensing                                   costs for                 Tax incentive
  industries           power                     Service in BKPM                                   industries                  on property
                    development

                   EODB                                                                                e-
                  Ease of Doing
                                                   %
                                                      Affordable
                                                                                                 commerce
                                                                                                   Incentive for
Acceleration of      Business                         housing for                                investment in e-
 land licensing    Improvement                        the people                                  commerce area
                                The Investment Coordinating Board of the Republic of Indonesia
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                                                                                                                        Source: Bank Indonesia, May 2016
Investment Opportunities in Indonesia 2015-2019
Investment Priority Sectors
  BKPM’s PRIORITY SECTORS 2015-2019

                                   35 GW power                                       Multimode
            Infrastructure                                24 Sea ports
                                    generation                                     Transportation

             Agriculture            Food estate         Corn Plantation                   Cattle                       Salt

            Labor-intensive                                  Food &
                                       Textile                                          Furniture                   Footware        Lifestyle
            industry                                        Beverages

            Import-subtitution      Chemical &
                                                           Iron & Steel               Component              Defend Industry
            industry               Pharmaceutical
 Industry
                                                             CPO &
            Export-oriented                                                        Wood Products,
                                     Electronics            Derivative                                              Automotive
            industry                                                                Pulp & Paper
                                                            Products

            Downstream industry
                                       Cacao                   Sugar                     Smelter
            of natural resources

                                                                                        Marine
              Maritime              Ship building         Cold Storage
                                                                                      Technology
                                    10 Tourism
                                                                                                                                    14 Priority
 Tourism, SEZ,& Industrial Park       Priority         10 Tourism SEZ 8 Existing SEZ                                7 New SEZ
                                                                                                                                 Industrial Parks
                                    Destination
                                                                                        IT Based
                                                            Finacial
        Digital Economy             e-Commerce                                           Creative
                                                           Technology
                                                                                        Economy
                                                   The Investment Coordinating Board of the Republic of Indonesia
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Improving

   INDONESIA
     One-stop service for investment
     Direct construction
     Simplification of licensing
     Pro-investment policy reforms
                                                                                      WHERE
                                                                                      ON EARTH
     Bonded logistics centers

                                                                                     34 provinces &
                                                                                      514 regions,
                                                                                      decentralized
                    The Investment Coordinating Board of the Republic of Indonesia
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Indonesia has created some breakthrough to improve business climates

                         The Investment Coordinating Board of the Republic of Indonesia
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The Investment Coordinating Board of the Republic of Indonesia
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The Investment Coordinating Board of the Republic of Indonesia
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The Investment Coordinating Board of the Republic of Indonesia
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Green Lane Acceleration Facility
  Four Customs Checking Status:
  • RED line is for the new
    companies.
  • Physical & document checks
    before transported from ports
  • YELLOW line
  • Document       check    before
    goods transported from ports
  • GREEN line
  • Document check after goods
    transported from ports
  • Main Partner Priority for
    companies with proven track
    record. No checking required

  New Facility: Status upgrade
  from RED to GREEN line for new
  companies under construction

                                     The Investment Coordinating Board of the Republic of Indonesia
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Key Industry Ministries and Associations
Fisheries
  Ministry of Marine Affairs           Fishery Harbours                            Fish Quarantine and               Indonesia Fisheries Public
 and Fisheries / Kementerian         Information Centre /                       Inspection Agency / Badan              Company / Perusahaan
   Kelautan Dan Perikanan         Pusat Informasi Pelabuhan                    Karantina ikan, Pengendalian          Umum Perikanan Indonesia
            (KKP)                      Perikanan (PIPP)                          Mutu dan Keamanan Hasil
                                                                                    Perikanan (BKIPM)

                                                                                                                   A state-owned company
                                                                                                                   specialising in the sea
KKP is the main authority       PIPP informs the dynamics of                                                       transportation of fisheries
mandated to organise marine     fishing ports throughout                     Controls the safety of fishery        products. The company
affairs and fisheries affairs   Indonesia to fisheries and                   products for exporting                partners with fishermen and
within the Indonesian           marine stakeholders through                  purpose. The body issues              small and micro businesses in
government.                     the following website:                       Approval for Loading letter (or       the country.
                                                                             Surat Persetujuan Muat).               //http://bumn.go.id/perikananin
        http://kkp.go.id            www.pipp.djpt.kkp.go.id/                     www.bkipm.kkp.go.id/bkipm/                     donesia
                                                                                                                       Fisheries Businessman
   The Bureau of Logistics          Indonesia Aquaculture                        Yayasan Masyarakat dan
                                                                                                                      Association or Gabungan
  or Badan Urusan Logistik           Society or Kumpulan                        Perikanan Indonesia (MPDI)
                                                                                                                        Asosiasi Pengusaha
         (BULOG)                     Akuakultur Indonesia
                                                                                                                        Perikanan Indonesia
                                                                                                                             (Gappindo)

                                                                                                                   A complete list of Fisheries
                                                                             MPDI is a non-profit                  sector Association is available
                                                                             organisation supporting the           through the following Ministry
A state-owned company in        Protecting the domestic                      sustainability of Indonesian          of Marine Affairs and Fisheries
Indonesia which deals with      manufacturing industry, KADI                 fisheries in order to achieve         link:
food distribution and price     deals with importation of                    the standards by WWF and the            http://kkp.go.id/index.php/200
control.                        dumping goods and subsidies                  Marine Stewardship Council                       8/02/02/daftar-
                                issues.                                      certification.                                himpunanasosiasi-
        www.bulog.co.id            www.aquaculture-mai.org                            http://www.mdpi.or.id               perikanan/?print=pdf
                                                  The Investment Coordinating Board of the Republic of Indonesia
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Key Industry Ministries and Associations
Fisheries
                                               National Agency of Drugs                             The Centre of Brackish
                                              and Food Control or Badan                               Water Aquaculture or
                                                 Pengawas Obat dan                                 Balai Perikanan Budidaya Air
            Batam Shipyard Offshore and            Makanan (BPOM)                                         Payau (BPBAP)
            Offshore Association (BSOA),
            was established on 7 August                                                            The Centre of Fresh Water
            1997 as a non-profit                                                                          Aquaculture or
            organization by shipyard                                                               Balai Benih Air Tawar (BBAT)
            companies which became a
            pioneer of the growth in          Communicates health and                            Technical Implementation
            shipbuilding and offshore         safety aspects including the                       Units under the Directorate
            industries on Batam island.       danger of chemical substances                      General of Aquaculture
                                              on fisheries products.                             responsible for sustainable
               http://www.bsoa-btm.org                                                           aquaculture and production.
                                                  http://www.pom.go.id

             Indonesia Chambers of             Association of Processing
            Commerce / Kamar Dagang           and Marketing of Fisheries
               Indonesia (KADIN)                  products / Asosiasi
                                               Pengusaha Pengolahan dan
            KADIN is focused on all           Pemasaran Produk Perikanan
            matters relating to trade,                   (AP5I)
            industry and services, offering
            a strategic forum for             The association promotes
            Indonesian entrepreneurs. It is   fisheries products
            privately financed, hence an      manufacturing and marketing
            independent spokesperson of       and is based at the Indonesia
            private sector interests.         Chambers of Commerce /
                                              Kamar Dagang Indonesia
                   http://www.kadin-          (KADIN)
                    indonesia.or.id/
                                                  The Investment Coordinating Board of the Republic of Indonesia
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Centres of Excellence
Fisheries

     National College of             Universitas Padjajaran                         Universitas Diponegoro              Sidoarjo Fisheries
  Fisheries and Technology                                                                                             Academy Politechnic

The school is under the           The University’s fisheries                   The Faculty of Fisheries and         Sidoarjo Fisheries Academy
auspices of the Ministry of       department was established in                Marine Sciences at the               was established in 2002 after
Maritime Affairs and Fisheries.   1965, under the Agriculture                  Universitas Diponegoro was           the formation of the Ministry
                                  Faculty                                      established in 1968                  of Sea Exploration and
                                                                                                                    Fisheries in 1983.
   http://www.stp.kkp.go.id/          http://fpik.unpad.ac.id/                    http://www.fpik.undip.ac.id/           http://apsidoarjo.ac.id

                                                   The Investment Coordinating Board of the Republic of Indonesia
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Indonesia’s Special Economic Zones                                                                                               Open for Fisheries
(Indonesian: ‘KawasanEkonomiKhususor KEK’)

                                                                                      Central Sulawesi:
            North Sumatra:                      East Kalimantan:                      • Automotive industry, heavy
            • Processing of CPO, rubber)        • Processing of CPO, coal               movers equipment
            • Textile products (garment            and minerals                       • Electronic components
              and apparels), fertilizers and                                          • Agribusiness
              chemicals.                                                              • Mining                                              North Maluku:
            • Logistics                                                               • Logistics                                           • Tourism
            • Tourism                                                                                                                       • Processing of
                                                                                                                                              fisheries products
                                                                                                                                            • Logistics

                                                                                                                                North Sulawesi:
                                                                                                                                • Processing of fisheries
         South Sumatra:                                                                                                           products, agrobusiness
         • Processing of CPO and                                                                                                • Textile products (garment and
           rubber                                                                                                                 apparels), fertilizers and
                                                                                      West Nusa Tenggara:
                                               West Java:                                                                         chemicals.
                                                                                      • Tourism
                                               • Tourism                                                                        • Logistics

Source: National Mid-Term Plan (2015-2019)
                                                               The Investment Coordinating Board of the Republic of Indonesia
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Key Regulations
BKPM together with the Ministry of Marine Affairs and Fisheries can provide you with
further details on specific pieces of regulation.
 Law or Regulation Number:                                              Concerning:

 Presidential Regulation No. 81/2005 on the                             Establishment of the Coordinating Board for Security in the Sea
 Coordinating Board for Security in the Sea                             (BAKORKAMLA) in order to enforce the security of Indonesian waters.
 Law No. 45 Year 2009 (an amendment of                                  All fisheries and marine related affairs
 previous law No. 31 Year 2004)
 Decree of the Minister of Marine Affairs and                           Quality and safety control of fishery products that enter the Indonesia territory.
 Fisheries No. 74/PERMEN-KP/2016

 Decree of the Minister of Marine Affairs and                           Monitors the water quality standards for Indonesian Shellfish Sanitation
 Fisheries No.Kep.17/MEN/2015                                           System
 Decree of the Minister of Marine Affairs and                           Protection on Lobster (Panulirus spp.) , Crab (Scylla spp.) and swimming crab
 Fisheries No. 01/PERMEN-KP/2015                                        (Portunus pelagicus spp.)
 Decree of the Minister of Marine Affairs and                           Ban on the use of fishing gear such as trawler (trawls) and seine nets in the
 Fisheries No. 02/PERMEN-KP/2015                                        fishery management area of Indonesia
 Decree of the Minister of Marine Affairs and                           Delegation of authority to the Indonesia Investment Coordinating Board
 Fisheries No. 03/PERMEN-KP/2015                                        (BKPM) One Stop Shop on granting of Aquaculture Business Licenses
 Decree of the Minister of Marine Affairs and                           Any 2015 Marine and Fisheries related affairs are: (a) handed down to the
 Fisheries No. 14/PERMEN-KP/2015                                        provincial governors in the framework of de-concentration, and (b) assigned to
                                                                        the Provincial or District / Town in the Framework of Assistance.
 Decree of the Minister of Marine Affairs and                           Criteria and/or conditions of income tax facilities for investment in certain
 Fisheries No. 17/PERMEN-KP/2015                                        business fields and / or in certain regions on the marine and fishery sector

Source: jdih.kkp.go.id,
http://www.fao.org/fishery/legalframework/nalo_indonesia/en#tcNB012F                                                 Further updates are available at http://jdih.kkp.go.id
                                                                       The Investment Coordinating Board of the Republic of Indonesia
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Criteria and/or conditions of income tax
facilities for investment
        As per Decree of the Minister of Marine Affairs and Fisheries No. 17/PERMEN-KP/2015
No      Business Field                                                       Minimum value of                            Minimum        Minimum absorption
                                                                             Investment                                  output to be   of workforce
                                                                             (in Indonesian                              exported
                                                                             Rupiah - IDR)                               (volume)
1       Aquaculture of marine fish                                                                                            80%       100 people, 90% of
                                                                                     IDR 25 billion                                     which must be
                                                                                                                                        Indonesian workforce
2       Floating net aquaculture of freshwater fish                                  IDR 10 billion                           n.a.

3       Cold storage facility for fish products                                      IDR 25 billion

4       Processing of fish products into floss, paste or surimi                      IDR 25 billion

5       Processing and preservation of fish and aquatic fish                                                                              50 people, 90% of
                                                                                     IDR 30 billion                           50%          which must be
        (except Shrimp or Prawns) and packaged into cans
                                                                                                                                        Indonesian workforce
6       Processing and preservation of Shrimp or Prawns and                          IDR 30 billion
        packaged into cans
7       Cold storage facilities for other types of fish products                     IDR 20 billion

8       Processing and preservation of other types of fish                           IDR 15 billion                           30%

                         Tax holiday will apply if a minimum amount of investment is IDR 1 Trillion*

*Please consult with BKPM for further information.
                                                        The Investment Coordinating Board of the Republic of Indonesia
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A range of incentives available including:
BKPM will provide advice on which incentive is applicable for fisheries sectors

                      TAX                                   TAX                                                      IMPORT DUTY
                   ALLOWANCE                              HOLIDAY                                                      FACILITY
           Government Regulation         Ministry of Finance Regulation                                       Ministry of Finance Regulation
                 No. 9/2016                       No. 150/2018                                                    No.176/PMK.011/2009
                                        A variety of sectors are covered in
                                        this Regulation including                                            On machines and materials used
    30% of investment value
                                        fisheries. (18 eligible pioneer                                      for production purpose
                                        industries)
                                        Period of tax holiday: 5-20years
                                        based on investment value and                                        2 years import duty exemption or 4
    Reduction of corporate net income
                                        eligible for projects that                                           years for companies using locally-
    tax for 6 years, at 5% each year.
                                        considered strategic for                                             produced machines (min. 30%).
                                        Indonesian economy.

    145 business segments
                                                                                                             Industry, producing goods and / or
    Specific requirements incl.:        Minimum amount of investment is:                                     Services, including: tourism and
    • minimum amount of                 IDR 1 Trillion                                                       culture; public transportation;
       investment value and                                                                                  public health services; mining;
       workforce, and certain project   Reduction of tax up to 100%*                                         construction; telecommunication;
       location (especially outside                                                                          and port.
       Java island).
Source: BKPM (2015)
*Terms and conditions apply                 The Investment Coordinating Board of the Republic of Indonesia
                                                                                                                                                  45
Areas restricted or closed for FDI
Certain types of activities are fully or partially restricted when it comes to FDI. Key areas
relevant to the fisheries sector are detailed below.

                                                                                                                  Subject to a
                     RESTRICTED FDI                                                                         recommendation from the
                                                                                                               Minister of Forestry
     AQUACULTURE* (or fish farming) is open to FDI providing
     hatcheries and fish rearing area is located beyond 12 nautical                                        Gathering (taking) of and
      miles from the coastline to the open sea and/or towards the                                           trade in (wholesale of)
                  direction of the archipelagic waters.                                                     ornamental coral from
                                                                                                             nature for aquariums
      *Require Partnership with Local
               Businesses:
                                                      Subject to Special                                     CLOSED to FDI:
                                                      License or Permits
 •    Rearing of Fish*
 •    Hatchery of Fish*
                                                     from the Minister of                                  (1) Capture Fisheries
                                                        Manpower and                                       (2) Fishing of species
 •    Processing of Fishery Products
                                                        Transmigration:                                    of fish listed by Convention
 •    Manufacture of wooden ships
 •    Manufacture of devices and                                                                           on International Trade in
                                                 Fisheries business in                                     Endangered Species of Wild
      fittings of wooden ships for
                                                 transmigration areas                                      Fauna and Flora
      marine tourism and fishing
                                                                                                           (3) Sea Sand Quarrying

                                          The Investment Coordinating Board of the Republic of Indonesia
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6 good reasons to invest in Indonesia’s fishery
sectors

  Rising domestic and                                                                             Increasing FDI in
 global consumption of         Abundant wealth in                                              Fisheries industry from
  fisheries products         Indonesian territorial                                             USD 30 million in 2012
                            waters offer various key                                             to USD 59 million in
 From 112 million tons in    fisheries products and                                                     2017.
 2003 to 150 million tons            sources
  by 2030 (FAO, 2014)                                                                                  (BKPM)

 Some of the 60,000 fish       Most competitive                                                     Government
  processing units and        operating costs for                                                  commitment to
 200 shipyards could be       food and beverage                                                   supporting FDI in
     benefitted from            manufacturing                                                     aquaculture, fish
 advanced technologies.          in ASEAN-5                                                     feeds, seaweed and
                                                                                                    shipbuilding
                                     (Financial Times)

                              The Investment Coordinating Board of the Republic of Indonesia
                                                                                                                         47
Investment Opportunity

Shrimp Investment Policy
                            •   Fishery Products Processing Enterprises (UPI):
                            •   salting / drying fish and other aquatic biota industry
  Negative Investment       •   fish smoking and other aquatic biota industry
List for Shrimp Industry    •   fermentation / fermented fish and other cooking products industry
                            •   pulverized meat-based and surimi industry

                            • Marketing, Distribution, Wholesale and Export of Fishery Products

                            • Shrimp processing and preserving industry in cans. (All the products
                              included in the scope of this)
   Tax Allowance for        • Freezing industry of other aquatic biota. (Frozen shrimp and / or
    Shrimp Industry           breaded shrimp)
                            • Shrimp processing and preserving industry of other aquatic biota.
                              (Frozen shrimp and / or breaded shrimp)

Terms of Tax Allowance      • Shrimp processing and preserving industry in cans. (Minimum 30
  for Shrimp Industry           billion IDR Investment value)

                           The Investment Coordinating Board of the Republic of Indonesia
                                                                                                     48
BKPM international representative offices
(Investment Promotion Centre):

 Invest in...

For further information, contact us at:

  BKPM - Indonesia Investment Coordinating Board
                                                   This document, initially developed by the EU-Indonesia Trade
  Jln. Jend. Gatot Subroto No. 44
  Jakarta 12190 - Indonesia                        Cooperation Facility project, has been updated in 2017 for
  t. +62 21 525 2008                               BKPM with the support of:
  f. +62 21 525 4945
  e. info@bkpm.go.id
  www.bkpm.go.id

  EU Desk at BKPM
  t. +62 21 527 4802
  e. eu.desk@bkpm.go.id
                                                     © 2016 by Indonesia Investment Coordinating Board (‘BKPM’). All rights reserved
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