Investing in Indonesia's fisheries - BKPM

© 2015 by Indonesia Investment Coordinating Board (‘BKPM’). All rights reserved
Investing in Indonesia’s
Fisheries sector
An overview of opportunities,
capabilities and provisions
Version: December 2015

The Investment Coordinating Board of the Republic of Indonesia
2
Contents
Opportunities:Tuna,Shrimp,Crab, Seaweed,ColdStorage,andShipyard/Ship-building
• Introduction to the sector 3
• Why Indonesia? 4
• Market opportunities 5 - 13
• Existing and future capabilities 14 –
19
• Government provisions and support 20 - 25
• Six good reasons to invest in Indonesia’s Fisheries sector 26

3
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 235 million
people). Indonesia accounts 40% of total ASEAN population.
As the largest archipelagic country in the
world, Indonesia comprises more than 17,500
islands spread over nearly 6,500km from east
to west. Its has the world’s 4th 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:
JavaSumatra Sulawesi PapuaNusa TenggaraKalimantan
Singapore: 1h40min Kuala Lumpur: 2h50min
Bangkok: 3h30min Hong-Kong: 5hrs
Sydney: 6h50min Tokyo: 7hrs
Seoul: 7hrs Dubai: 7h50min
Beijing: 7h20min Amsterdam: 14h20min
INDONESIA
Indonesia’sgeographyandlocation
ASEAN

4
The fisheries sector provides vital
support to coastal economic
development, creating employment
in fish catching and in onshore
processing, as well several thousand
indirect jobs.
Indonesia lands approximately
106,000 tonnes of pole and line
caught tuna a year, though it is
estimated that only 10-20% reaches
market labeled as pole and line
caught. Hence it has been one of
the least regulated subsectors.
Up until early 2014, almost
5,000 foreign fishing boats
were operating illegally in
Indonesian waters.
New regulations and
reformations on licenses have
been introduced to sustainably
manage the sector’s supply
chain, as well as to maintain
the welfare of as many as 2
million local fishermen.
Challenges in the sector
remain:
• Addressing illegal, unreported
and unregulated (IUU) fishing.
• Revolutionizing fisheries
management in the long term.
• International Standards
include: World Wildlife Fund
(WWF), International Pole and
Line Foundation (IPNLF) and
the Marine Stewardship
Council.
Introduction toIndonesian fisheries
Indonesiaiscurrentlythe…
• World’sLargestFisheriesProducer
• World’sLargestSourceofSeaweed
• World’s7thLargestExporterofProcessedandCannedTuna
• LargestShrimpProducerinSouthEastAsia
World’s 4th Longest
Coastline

5
MARKET
OPPORTUNITIES
EXISTING & FUTURE
CAPABILITIES
GOVERNMENT
PROVISIONS & SUPPORT
 Indonesia is the world largest
source and fisheries producer,
including tuna, seaweed and
shrimp.
 Shipyard/Ship-building realised
investment to date is worth
USD 214 million (170 projects)
 Indonesia’s fisheries sector is
potentially worth USD 32 billion
 60,000 Fish Processing Units
are available throughout
Indonesia
 Lowest operating costs in
ASEAN-5 (Thailand,
Philippines, Malaysia, Vietnam
and Indonesia) for a food and
beverage manufacturing plant.
 Host to leading centres of
excellence, including a
prestigious government-funded
specialist fisheries college
 Continuously enforcing and
promoting sustainable fisheries
programme
 Revitalising existing land for
aquaculture of seaweed,
shrimp and crabs.
 Open FDI investments include:
aquaculture, seaweed
processing industry and
shipbuilding/shipyards and cold
storage facilities.
WhyIndonesia

6
MARKETOPPORTUNITIES
Image source: http://www.flickr.com/photos/arditpg/3590772699

7
World’s
4th
longest coastline
5,500
rivers and lakes
17,508 islands
(a land mass spanning
1,919,440km2 between the Indian
and the Pacific Oceans)
Fisheries sector
contributed
7%
or USD 7.84 billion to the
Indonesian economy in
2014
GDP (2014) USD 888.5billion
As the largest archipelago country
in the world, Indonesia has huge
potential and abundant wealth in its
territorial waters. 25% of global
fisheries demand rely on this
country’s and the region’s
production.
AbundantwealthinIndonesian territorialwaters
Globalfuturedemandisontheriseandwill bedependentonthesesources
Source: CEIC Data (2014), BPS (2014), KKP DirGen Fisheries
Processing and Marketing (2014)
Year % of GDP
2010 6.00
2011 7.00
2012 6.50
2013 6.90
2014 6.97
2015 – 2019
Target
7.2%
annually
Source: KKP KPDA (2014)
11
40
0
10
20
30
40
50
2009 2010 2011 2012 2013
Number of Fisheries
Establishments by Investment
Facility Status, 2009-2013
Foreign Direct Investment
Domestic Direct Investment
Other Fisheries Establishments
Current fisheries establishments
and investments in Indonesia are
mostly run by domestic seafood
processing companies including
small and micro businesses.
+60,000 Fish Processing
Units are available
throughout Indonesia:
Sumatra : 13,602
Java : 26,805
Kalimantan : 8,611
Bali & Nusa Tenggara : 4,947
Sulawesi : 4,674
Maluku & Papua : 1,524
Total (2014) : 60,163

8
29.08
30.48
32.52
33.89
35.14
Annual Domestic Fish Consumption per capita (Kg)
The Government through its Midterm Plan* has
indicated its targeted volume to reach 19.5
million tons of fish by 2019. Through the plan,
the Indonesian Government states three targets
for increasing fisheries products and fish
processing industry:
1. Achieve GDP growth of 7.2% annually in the
fisheries sector
2. Reach fish production volume of 19.5
million, and USD 9.5 billion in export value
by 2019
3. Increase the volume of processed fisheries
products by 6.8 million tons by 2019
10.2 10.6 11.1
13.4
16.2
19.5
2014 2015 2016 2017 2018 2019
Targeted Total Volume and Fish Production
(million ton) 2014 – 2015
Source: RPMJN 2015 - 2019
4.70 4.81 5.04 5.35 5.44 5.71
0.49 0.30 0.34 0.37 0.39 0.40
2008 2009 2010 2011 2012 2013
Production of Fish Capture (million ton) 2008-2013
Open
Water
Marine
Fisheries
Increasedproduction capacityspurringfrom
increaseddomesticconsumption
Source: RPJMN 2015-2019 p.178, **KKP Buku Kelautan dan
Perikanan (2013) and BPS (2014)
The Indonesian fisheries sector contributed almost
7% or USD 7.84 billion to the country’s economy in
2014.
Domestic fish consumption** grew to 38.0
kilograms (kg)/capita in 2014 from 35.2 kg/capita in
2013. The average monthly expenditure per capita
for fish rose to IDR28,356 (or approx. USD 2.83) in
2013. This is the highest level since 2000 and an
increase of 6.6% from 2012.
In order to meet its 2019 production target,
Indonesia will require approximately 90 billion
seeds derived from 15.8 million species.

9
Enoughfishforeveryone!
Source: FAO Fish to 2030 (2013), Seafish.org (2012)
According to the FAO, global seafood
consumption is estimated to increase to 151.8
million tons by 2030, from 122.9 million tons in
2009. Globally, a more sustainable and tight
approach to fishing will also be applied as wild-
caught consumption is set to reduce.
In South East Asia alone, fish consumption is
projected to reach almost 20 million tons.
Seafish.org suggested that aquaculture production is expected to continue to expand on all continents, with
variations across countries and regions in terms of the product range of species and product forms. Asian
countries is set to continue dominating world aquaculture production, with a share of 89% by 2021.

10
Indonesia produces mainly skipjack and
yellowfin tuna. Between 2012 - 2013, skipjack
production increased by 12% reaching almost
500,000 tons, while yellowfin increased by
almost 13.5%, reaching just over 200,000 tons.
Indonesia’s tuna mainly goes to the UK,
Germany, the US, and Japan. Japan remains
Indonesia biggest importer.
In 2012, Indonesia’s canned tuna contributed 6%
to the UK total global imports, followed by 8% to
Germany, 4% to the USA, and 19% to Japan.
The total export volumes from Indonesia to these
countries have been generally stable, which was
130,000 tons in 2008, and it reached 200,000
tons in 2013. Meanwhile, the value of exports
was USD 347 million in 2008 and more than
doubled to reach USD 765 million in 2013*.
There are still plenty of opportunities in the tuna
processing market. 1,088
2,053
5,943
6,655
7,746
5,599
13,251
10,001
9,374
10,494 10,487 10,592
2010 2011 2012
Indonesia's Canned Tuna Exports to UK, Germany,
USA and Japan (2010 - 2012), in tons
UK
Germany
USA
Japan
Indonesia istheworld’s Top7*globalexporter of
cannedandprocessedtuna
*Thailand, Ecuador, Philippines, Spain, China, Mauritius and Indonesia.
Source:: DirGen Processing and Marketing of Fisheries Products, Ministry of
Marine Affairs and Fisheries, Intracen (2012).
348,897
372,211
429,024
481,014
112,803
176,754 190,238
215,706
2010 2011 2012 2013
Indonesia Tuna Fish Production by Type (2010 - 2013) in tons
Skipjack
Yellowfin
Bigeye
Albacore
Bluefin
Other fish

11
Indonesian shrimpexportsareexpectedtoriseto
meetwithglobaldemand
Source: KKP (2014),
https://www.undercurrentnews.com/spotlight/shrimp-ems/
Shrimp is the most important fisheries commodity, representing
15% of the total value of internationally traded fishery products.
The South East Asian region champions shrimp production; that
includes Thailand, Vietnam and Indonesia.
Shrimp production in 2013 was estimated to range between 11.2
and 17.6 million metric tones. Farmed shrimp is a key driver of
global aquaculture supply, which exceeded wild caught supply for
the first time in 2014.
MT=Metric tones
Global demand for Indonesian
shrimps is estimated to be around
560,000 – 570,000 tons yearly.
In 2013, 65% of total fisheries
exported to the US was shrimp,
valued at nearly USD 900 million,
and is expected to increase in 2015.
Most Indonesian shrimp are either
exported in frozen form or with heads
and shells removed.
Exports are expected to rise in order
to meet global demand.
338,060
380,972 400,386 415,703
639,589
699,000
785,900
2009 2010 2011 2012 2013 2014
(Estimated)
2015
(Target)
Total Indonesia Shrimp
Production (ton)
CAGR 13%

12
Enforcement onsustainable crabaquaculture
Source: KKP Processing Crab Products (2014), FAO (2014)
Traditionally, Indonesia had relied on
nature and wild-catch for its crab
production, which caused shortages
of current crab family population.
As a result, in 2014 the ministry
enacted a new regulation enforcing
more sustainable aquaculture in this
area.
Of all fishery products exported, which
was mainly to China and the US, crab
has the highest value because the
end product was ready-packed for
retail. The value of exports continued
increasing steadily between 2012-14.
28.211 34.172 28.09
329.7 359.3
414.3
0
100
200
300
400
500
2012 2013 2014
Estimated
Total Crab and Blue Swing Crab
Export
Volume
(ton)
Export
Value (USD
million)
502,883
6,014,947
-
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
2009 2010 2011 2012 2013
World Crustaceans Production
Marine areas
Inland waters
According to the FAO, aquaculture in Asia is dominated
by fin-fishes (64.6%), followed by molluscs (24.2%),
crustaceans (9.7%) and miscellaneous species (1.5%).
In 2013, 6.5 million crustaceans were cultivated
worldwide, 95% of which came from inland waters.
Within the Indo-Pacific waters, there are more than 234
types of crab. Indonesian waters have approximately
124 species and up to 7.2 million tons per year are
produced, though only 40% are caught for
consumption.

13
Indonesian wet seaweeds have been exported to Denmark, Hong Kong,
US and The Philippines for further processing. By 2013, Indonesia’s annual
production of wet seaweed reached over 9 million tons, the majority of
which originated from the Eastern parts of Indonesia including Bali, Nusa
Tenggara, Sulawesi and Maluku.
Throughout the archipelago, there are 925,000 hectares of land available
for investment in seaweed farming. At the same time the government is
also committed to increasing seaweed production to almost 12 million tons
in 2019.
48%oftheworld’s Carrageenan Seaweedsoriginate
fromIndonesianwaters
Source: Fisheries Directorate General of Business and Investment (2014),
BPS (2014), *Mid Term Plan / RPJMN (2015-2019 p.178).
The Potential of Seaweed
Farming Land in Indonesia
Region Potential Size
(Hectare)
Aceh 104,000
North Sumatra 20,000
Riau islands 37,635
East Java 16,420
Bali 1,151
West Nusa Tenggara 22,270
East Nusa Tenggara 10,086
South Sulawesi 250,000
North Sulawesi 50,600
Central Sulawesi 106,000
Southeast Sulawesi 83,000
East Kalimantan 15,520
Gorontalo 2,850
Maluku 206,000
Papua 501,000
Total land available
for farming
925,523 ha
3,915,018
5,170,831
6,986,311
9,224,706
4,300,000
7,300,000
8,350,000
9,410,000
10,550,000
11,780,000
-
20
40
60
80
100
120
140
160
180
200
-
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
2010 2011 2012 2013 2014* 2015 2016 2017 2018 2019
Millions
Wet Seaweed Production and Mid Term Plan* Targeted Volume
Wet Seaweed Production (ton)
Export Volume (Kg)
Export Value (USD)
*Targeted Seaweed Production
Volumes per Mid Term Plan

14
PotentialofIndonesian shipbuildingindustry
Currently,only200shipyardscompaniesarecapableofproducingnew
vesselsandtorepairandrefitvessels
Source: BKPM (2014)
Realised investments to
date are worth:
USD 214 million
and is expected to reach USD 215
million by end of 2015.
Between 2010 and 2014, realized
investment in the shipbuilding
industry in Indonesia amounted to
USD 212.5 million with a total of
107 projects being implemented.
Top ten FDIs were from:
① Singapore
② Britain
③ Mauritius
④ Malaysia
⑤ South Korea
12 locations currently
awaiting for FDIs are:
• Riau
• Riau islands
• South Sumatera
• Lampung
• West Kalimantan
• Central Java
• East Java
• North Sulawesi
• Papua
• Batam Free Trade Zone
• Wongsorejo Industrial
Estate
• Banyuwangi Industrial
Estate
• Java Integrated Industrial
Port Estate (JIIPE) in
East Java
During 2014/15, BKPM has
received strong interest in
shipbuilding investment worth
USD 9.3 billion, with a potential
for direct employment of 700
thousand people.
Based on BKPM’s analysis,
each investment of
USD 1 million can
potentially absorb 75
direct labor.
⑥ Germany
⑦ Australia
⑧ New Zealand
⑨ Sweden
⑩ Japan

15
EXISTINGANDFUTURECAPABILITIES
Image Source: Tribune News

16
Originating from Switzerland, PT.
Aquafarm Nusantara is a foreign investor
which initially established in 1988 in
Central Java. Ten years into its
investment, the company built a hatchery
of 30 hectares in North Sumatra.
In order to sustain the population of fish in the waters of Lake
Toba, Aquafarm collaborates with the Ministry of Maritime Affairs
and Fisheries, the local Head of Regency, the local Centre of
Aquaculture and the local Protestant Church Community to
stock freshwater Tilapia fish, with as many as 120,000 seeds in
the waters Pangururan Samosir, North Sumatera, annually.
Aquafarm has employed more than 4000 staff, both in Central
Java and North Sumatra, with the majority of workers coming
from the local community in the area where Aquafarm operates.
The end product is a frozen tilapia fillet. The product is packed
with a retail brand ‘Regal Spring Tilapia’. Only 10% of its tilapia
products are consumed domestically. 83% is exported through
the port of Belawan to the US and Europe, and the rest goes to
Singapore, Taiwan and Canada.
Successstory:Tilapiahatcheryandfillets
Asuccessfulpartnershipbetweenlocalcommunity,foreigninvestorandgovernment
Source: http://aquafarmnusantara.com/company-profile/
Domestic
Consumption,
9.83%
US, 53%
Europe,
30%
Taiwan,
4%
Canada,
2%
Singapore
, 1%

17
Source: XXXX
Of the 3000 fishing ports available in Indonesia, some
small ones do not have proper cold storage and ice-
making facilities. This leads to considerable spoilage of
fresh stocks.
The Government of Indonesia has the aim to upgrade
many fishing ports in off-grid and under-serviced areas to
'eco-fishing-port' status, with both financial and energy
self-sufficiency. It is also committed to mobilising
renewable energy to further expand the cold chain in the
regions.
There are also plans to catalyse the financing of solar-
powered fish cold-storage and ice-making installations
for eco-fishing-ports in Indonesia.
Technologically-advanced coldstorageisneededto
stockfreshfish
Source: http://www.pipp.djpt.kkp.go.id/index.php/profil_pelabuhan
Success Story:
PT Contained Energy Indonesia has
developed and successfully deployed stand-
alone, off-grid, 100% solar-powered cold
storage facilities, designed for use in remote
communities.
The project took place between 2013 and 2014,
with a budget of €296,000, including co-funding
from the European Union and Switzerland.

18
Thecorporatelandscape
Whataretheinvestorssaying?
Source: http://fisheriesimprovementindonesia.org
“Indonesia offers big
opportunities through
its access to natural
resources, a large
work force and a
market of huge
potential. It is our
vision to become the
market leader in the
frozen food industry
renowned for high
quality products, and
we are open to
collaboration with
partners with a similar
goal”.
“To produce world-class
premium Tilapia while
building strong
communities wherever we
are… Restocking of fish
seeds is a policy of how we
manage Lake Toba in a
sustainable manner without
damaging the environment
but contribute greatly to
local communities”.
“As the largest shrimp
farms in Indonesia,
we guarantee the best
quality of shrimp for
export and have the
most advanced
techniques shrimp
farming in Indonesia”.
Started in 2015, the company
invested USD 15 million in fish
processing business. The annual
production capacity is targeted at
36,000 tons with Europe as the
focus export market. The
investment is expected to absorb
about 550-650 direct labour and
2200-2600 indirect labour.
PT Sumber
Samudra Indoneisa

19
Data from the Financial Times has
found that Indonesia has the lowest
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.
Total annual operating costs:
Food & Beverages Manufacturing Plant*
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.
FoodManufacturing:
Indonesia leadsthewaywithoperatingcosts

20
Data from the Financial Times has
found that Indonesia is the most cost-
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.
Total annual labour costs:
Boat Building*
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
BoatBuilding:
Indonesia’slabourcostslowestoftheASEAN-5

21
GOVERNMENTPROVISIONS ANDSUPPORT
Image source: http://worldcocoafoundation.org/wp-
content/files_mf/aboutcocoatextpagesweb.jpg

22
KKP is the main authority
mandated to organise marine
affairs and fisheries affairs
within the Indonesian
government.
PIPP informs the dynamics of
fishing ports throughout
Indonesia to fisheries and
marine stakeholders through
the following website:
Controls the safety of fishery
products for exporting
purpose. The body issues
Approval for Loading letter (or
Surat Persetujuan Muat).
A state-owned company
specialising in the sea
transportation of fisheries
products. The company
partners with fishermen and
small and micro businesses in
the country.
A state-owned company in
Indonesia which deals with
food distribution and price
control.
Protecting the domestic
manufacturing industry, KADI
deals with importation of
dumping goods and subsidies
issues.
MPDI is a non-profit
organisation supporting the
sustainability of Indonesian
fisheries in order to achieve
the standards by WWF and the
Marine Stewardship Council
certification.
A complete list of Fisheries
sector Association is available
through the following Ministry
of Marine Affairs and Fisheries
link:
http://kkp.go.id
Ministry of Marine Affairs
and Fisheries / Kementerian
Kelautan Dan Perikanan
(KKP)
www.pipp.djpt.kkp.go.id/
Fishery Harbours
Information Centre /
Pusat Informasi Pelabuhan
Perikanan (PIPP)
www.bkipm.kkp.go.id/bkipm/
Fish Quarantine and
Inspection Agency / Badan
Karantina ikan, Pengendalian
Mutu dan Keamanan Hasil
Perikanan (BKIPM)
//http://bumn.go.id/perikananin
donesia
Indonesia Fisheries Public
Company / Perusahaan
Umum Perikanan Indonesia
Fisheries Businessman
Association or Gabungan
Asosiasi Pengusaha
Perikanan Indonesia
(Gappindo)
Indonesia Aquaculture
Society or Kumpulan
Akuakultur Indonesia
Yayasan Masyarakat dan
Perikanan Indonesia (MPDI)
www.bulog.co.id www.aquaculture-mai.org http://www.mdpi.or.id
http://kkp.go.id/index.php/200
8/02/02/daftar-
himpunanasosiasi-
perikanan/?print=pdf
KeyIndustryMinistriesandAssociations
Fisheries
The Bureau of Logistics
or Badan Urusan Logistik
(BULOG)

23
Batam Shipyard Offshore and
Offshore Association (BSOA),
was established on 7 August
1997 as a non-profit
organization by shipyard
companies which became a
pioneer of the growth in
shipbuilding and offshore
industries on Batam island.
http://www.bsoa-btm.org
Fishing Vessel Crew
Manning Agents
http://www.molajaya-
fishingwork.com
http://www.worldfishing.net/dire
ctory-entries/fishing-worker-
agency
The Centre of Brackish
Water Aquaculture or
Balai Perikanan Budidaya Air
Payau (BPBAP)
The Centre of Fresh Water
Aquaculture or
Balai Benih Air Tawar (BBAT)
Technical Implementation
Units under the Directorate
General of Aquaculture
responsible for sustainable
aquaculture and production.
National Agency of Drugs
and Food Control or Badan
Pengawas Obat dan
Makanan (BPOM)
Communicates health and
safety aspects including the
danger of chemical substances
on fisheries products.
http://www.pom.go.id
Indonesia Chambers of
Commerce / Kamar Dagang
Indonesia (KADIN)
KADIN is focused on all
matters relating to trade,
industry and services, offering
a strategic forum for
Indonesian entrepreneurs. It is
privately financed, hence an
independent spokesperson of
private sector interests.
http://www.kadin-
indonesia.or.id/
Association of Processing
and Marketing of Fisheries
products / Asosiasi
Pengusaha Pengolahan dan
Pemasaran Produk Perikanan
(AP5I)
The association promotes
fisheries products
manufacturing and marketing
and is based at the Indonesia
Chambers of Commerce /
Kamar Dagang Indonesia
(KADIN)
KeyIndustryMinistriesandAssociations
Fisheries

24
National College of
Fisheries and Technology
The school is under the
auspices of the Ministry of
Maritime Affairs and Fisheries.
http://www.stp.kkp.go.id/
Universitas Padjajaran
The University’s fisheries
department was established in
1965, under the Agriculture
Faculty
http://fpik.unpad.ac.id/
Universitas Diponegoro
The Faculty of Fisheries and
Marine Sciences at the
Universitas Diponegoro was
established in 1968
http://www.fpik.undip.ac.id/
Sidoarjo Fisheries
Academy Politechnic
Sidoarjo Fisheries Academy
was established in 2002 after
the formation of the Ministry
of Sea Exploration and
Fisheries in 1983.
http://apsidoarjo.ac.id
CentresofExcellence
Fisheries

25
Company
LPPOM MUI
MUI (Ulama
Council)
1
5
5
4
3
2
1. Company applies for Halal certification to LPPOM MU
2. LPPOM MUI audits the company
3. LPPOM MUI reports to MUI to obtain Fatwa Halal
4. MUI releases the Fatwa Halal
5. LPPOM MUI releases the Halal Certificate
IMPORTANT! The company needs to get permission from
BPOM to put Halal logo on the label
Halalcertification process
Halalcertification isanimportantrequirement tosellfoodanddrinksproductsinthe
Indonesianmarketbecausenearly90%ofthepopulation is Muslim, representing 13%
oftheMuslim population worldwide.

26
Indonesia’s SpecialEconomic Zones
(Indonesian:‘KawasanEkonomiKhususorKEK’)
Source: National Mid-Term Plan (2015-2019)
North Sumatra:
• Processing of CPO, rubber)
• Textile products (garment
and apparels), fertilizers and
chemicals.
• Logistics
• Tourism
East Kalimantan:
• Processing of CPO, coal
and minerals
Central Sulawesi:
• Automotive industry, heavy
movers equipment
• Electronic components
• Agribusiness
• Mining
• Logistics
North Maluku:
• Tourism
• Processing of
fisheries products
• Logistics
South Sumatra:
• Processing of CPO and
rubber
West Java:
• Tourism
West Nusa Tenggara:
• Tourism
North Sulawesi:
• Processing of fisheries
products, agrobusiness
• Textile products (garment and
apparels), fertilizers and
chemicals.
• Logistics
Open for Fisheries

27
KeyRegulations
BKPMtogetherwiththeMinistryofMarineAffairsandFisheries canprovideyouwith
furtherdetailsonspecificpiecesofregulation.
Source: http://infohukum.kkp.go.id,
http://www.fao.org/fishery/legalframework/nalo_indonesia/en#tcNB012F
Law or Regulation Number: Concerning:
Presidential Regulation No. 81/2005 on the
Coordinating Board for Security in the Sea
Establishment of the 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
previous law No. 31 Year 2004)
All fisheries and marine related affairs
Decree of the Minister of Marine Affairs and
Fisheries No. 10/PERMEN-KP/2015
(Amendment of 56/PERMEN-KP/2014)
Temporary Moratorium on Fisheries Licensing Business in the Indonesian
waters. Currently until October 2015, but subject to latest development.
Fisheries No.Kep.17/MEN/2015
Monitors the water quality standards for Indonesian Shellfish Sanitation
System
Protection on Lobster (Panulirus spp.) , Crab (Scylla spp.) and swimming crab
(Portunus pelagicus spp.)
Ban on the use of fishing gear such as trawler (trawls) and seine nets in the
fishery management area of Indonesia
Delegation of authority to the Indonesia Investment Coordinating Board
(BKPM) One Stop Shop on granting of Aquaculture Business Licenses
Any 2015 Marine and Fisheries related affairs are: (a) handed down to the
provincial governors in the framework of de-concentration, and (b) assigned to
the Provincial or District / Town in the Framework of Assistance.
Criteria and/or conditions of income tax facilities for investment in certain
business fields and / or in certain regions on the marine and fishery sector
Further updates are available at http://infohukum.kkp.go.id

28
Criteria and/or conditions of income tax
facilities for investment
AsperDecreeoftheMinisterofMarineAffairsandFisheriesNo.17/PERMEN-KP/2015
*Please consult with BKPM for further information.
No Business Field Minimum value of
Investment
(in Indonesian
Rupiah - IDR)
Minimum
output to be
exported
(volume)
Minimum absorption
of workforce
1 Aquaculture of marine fish
IDR 25 billion
80% 100 people, 90% of
which must be
Indonesian workforce
2 Floating net aquaculture of freshwater fish IDR 10 billion n.a.
50 people, 90% of
which must be
Indonesian workforce
3 Cold storage facility for fish products IDR 25 billion
50%
4 Processing of fish products into floss, paste or surimi IDR 25 billion
5 Processing and preservation of fish and aquatic fish
(except Shrimp or Prawns) and packaged into cans
IDR 30 billion
6 Processing and preservation of Shrimp or Prawns and
packaged into cans
IDR 30 billion
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*

29
Arangeofincentivesavailable including:
BKPMwillprovideadviceonwhichincentiveisapplicableforfisheriessectors
Source: BKPM (2015)
*Terms and conditions apply
TAX
ALLOWANCE
TAX
HOLIDAY
IMPORT DUTY
FACILITY
Government Regulation
No.18/2015
Ministry of Finance Regulation
No. 159/PMK.010/2015
Ministry of Finance Regulation
No.176/PMK.011/2009
30% of investment value
A variety of sectors are covered in
this Regulation including
fisheries.
On machines and materials used
for production purpose
Reduction of corporate net income
tax for 6 years, at 5% each year.
Period of tax holiday: 5-15 years
(Previously it was for 10 years but
it is currently extended for up to 20
years).
2 years import duty exemption or 4
years for companies using locally-
produced machines (min. 30%).
143 business segments
Specific requirements incl.:
• minimum amount of
investment value and
workforce, and certain project
location (especially outside
Java island).
Minimum amount of investment is:
IDR 1 Trillion
Reduction of tax up to 100%*
Industries that produce goods
and/or services, including:
• Tourism and culture
• Public transportation
• Public health services
• Mining
• Construction
• Telecommunication
• Port

30
RESTRICTED FDI
AQUACULTURE* (or fish farming) is open to FDI providing
hatcheries and fish rearing area is located beyond 12 nautical
miles from the coastline to the open sea and/or towards the
direction of the archipelagic waters.
CLOSED to FDI:
(1) Capture Fisheries
(2) Fishing of species
of fish listed by Convention
on International Trade in
Endangered Species of Wild
Fauna and Flora
(3) Sea Sand Quarrying
Areasrestricted orclosed forFDI
CertaintypesofactivitiesarefullyorpartiallyrestrictedwhenitcomestoFDI. Keyareas
relevanttothefisheriessectoraredetailedbelow.
Subject to a
recommendation from the
Minister of Forestry
Gathering (taking) of and
trade in (wholesale of)
ornamental coral from
nature for aquariums
*Require Partnership with Local
Businesses:
• Rearing of Fish*
• Hatchery of Fish*
• Processing of Fishery Products
• Manufacture of wooden ships
• Manufacture of devices and
fittings of wooden ships for
marine tourism and fishing
Subject to Special
License or Permits
from the Minister of
Manpower and
Transmigration:
Fisheries business in
transmigration areas

31
Rising domestic and
global consumption of
fisheries products
From 112 million tons in
2003 to 150 million tons
by 2030 (FAO, 2014)
Abundant wealth in
Indonesian territorial
waters offer various key
fisheries products and
sources
Increasing FDI in
shipbuilding industry
worth USD 214 million
between 2010 - 2014
(BKPM)
Some of the 60,000 fish
processing units and
200 shipyards could be
benefitted from
advanced technologies.
Most competitive
operating costs for
food and beverage
manufacturing
in ASEAN-5
(Financial Times)
Government
commitment to
supporting FDI in
aquaculture, fish
feeds, seaweed and
shipbuilding
6goodreasonstoinvestinIndonesia’s fishery
sectors

Invest in...
For further information, contact us at:
© 2015 by Indonesia Investment Coordinating Board (‘BKPM’). All rights reserved
This presentation has been developed with the
support of:
The European Union (EU) Desk at BKPM, part
of EU-Indonesia Trade Cooperation Facility
(TCF) projects.
Kantor Representatif EU DESK di
BADAN KOORDINASI PENANAMAN MODAL (BKPM)
REPUBLIK INDONESIA
Jl. Jend. Gatot Subroto No. 44, Jakarta 12190, Indonesia
P : +62 21 5274 803
E : eu.tcf@bkpm.go.id
eudesk.bkpm@euind-tcf.com
W : www.bkpm.go.id
www.euind-tcf.com/eudesk/
BKPM international representative offices
(Investment Promotion Centre):

Investing in Indonesia's fisheries - BKPM

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