INDONESIA POTENTIAL TO BECOME WORLD’S NUMBER-ONE PULP AND PAPER PRODUCER

        National pulp and paper business operators were optimistic that Indonesia is potential to become world’s largest pulp and paper producer following Indonesia’s wood which is still abundant all over Indonesia. Indonesian Pulp and Paper Association (APKI), sets target of volume of pulp production to reach 20.4 million tons and paper production to reach 19.8 million tons by 2020. Executive Director of APKI, Liana Brataside, was optimistic that pulp and paper industry will be growing rapidly, empowered by condition of land and season in Indonesia which is conducive in the development of industrial forests (HTI).

       According to Liana, Indonesia’s pulp and paper production is potential to surpass productive forest producing countries such as Brazil, United States and China. Up to this day, Indonesia’s pulp production has reached 6.9 million tons a year and paper production 11.5 million tons a year. Indonesia now sits on the 9^th position as world’s pulp producer. And, productivity of Indonesia’s paper industry has occupied the 6^th position or surpasses Scandinavian countries which currently tend to accelerate import due to scarcity of raw material. “I am confident that Indonesia could become world’s number-one pulp and paper producer”, she said.

       Liana believed that paper demand will increase continuously with average growth of 2.1% a year. She explained that in the previous year, national paper consumption reaches 7.8 million tons, and world’s demand is currently at 394 million tons. Growth in paper demand in advanced countries will increase around 0.5% a year so it could reach 394 million tons by 2020. Projection of growth in paper demand in advanced in export volume. She said that the government has set target of capacity of pulp and paper export to increase by 10% this year. Pulp and paper export last year is able to contribute up to USD 6.2 billion or around 5% of Indonesia’s total export.

          But, she reminded that even though its potency is very substantial, pulp and paper industry operators must pay attention to environmental aspect. According to her, besides it being based on economic aspect, pulp and paper industry must pay attention to environmental and social aspects to create sustainable environmental preservation. There three aspects must become an integrated unit. The government should make a guide on sustainable procurement based on legality, social and economic aspects. This is important to make Indonesia’s pulp and paper products acceptable in international market.

          Liana said that pulp and paper export mechanism in the future must be in accordance with Timber Legality Verification System (SVLK). Every industry unit must have SVLK if they want their products to be acceptable in export destination countries. The Indonesian government has signed MoU with several European Union countries, United States, Japan and China for the implementation of SVLK so that illegal logging can be traced right back to the source who has the license.

         The government has appointed five verification institutions which will provide certification for some forestry industry units. These institutions will inspect timber legality in accordance with good forest management principles ad stipulated by the Forestry Ministry. Forestry products certified as legal will be given a mark and a special document by an independent appraisal and verification institution. “By having the certificate, we are confident that Indonesia’s pulp and paper products will be more competitive in international market”, she said.

 Business News - April 20, 2012

PRODUCTS NOT MEETING THE REQUIRED STANDARDS ARE STILL CIRCULATING MARKET

          The Directorate General for Standardization and Consumer Protection (SPK) of the Trade Ministry has committed to reduce products which are not in accordance with Indonesian National Standard (inspeksi mendadak/sidak) to markets and shopping centers all over Indonesia. report of the inspection in January-February 2012 found 29 products which are violating SNI rules, 13 products violating manual and Guarantee card (MKG), and 59 products violating the regulations on Indonesian language labeling.

            The Director General of SPK, Nus Nuzulia Ishak, admitted that there were still some products circulating in the market which are not in accordance with SNI. Therefore, his party committed to continuously intensify inspection. Nuzulia explained that surprise inspection is conducted to crate a fair business competition. “This is also to increase consumer protection”, he said.

         But, he promised that surprise inspection is conducted to intensify supervision of circulating products without creating a negative effect. This activity is also conducted to acquire direct and real information regarding circulation of certain products in the domestic market. According to him, the program on surprise inspection is also an active manifestation of government’s role in protecting consumers from circulation of products which are not in accordance with standards.

            He confirmed that inspection is conducted to ensure rights of consumers. Therefore, the government uses the SNI instrument. Sustainable inspection is expected to be able to encourage the businesses to increase competitiveness in producing or trading qualified products in accordance with the prevailing legislation in order to create a healthy and conducive business climate.

            He said that the government will perform development of the businesses concerned and law enforcement if they are proven to have violated the legislation. Nuzulia explained that inspection of circulating products will be done synergically based on the prevailing legislation. In addition to conducting supervision on circulating products and services, the government will also perform intensive education and development to businesses and consumers. Consumer will be educated so they will be critical before buying or consuming goods and services.

            By applying SNI, according to Nuzulia, trust on national products will be increasingly high and it will have a strong effect on national competitiveness in local and international market. He expected that consumers should not only consider the price, but also the quality of a product. He considered that a standard is very important for competitiveness of a product in connection to price, quality, and supply. “When we talk about quality, it is not free from standardization. A standard could reduce cost and provide economic benefit”, he said. 

 Business News - April 18, 2012

MINISTRY OF MARINE AND FISHERIES PLANNED TO REALIZE MARINE AND FISHERY INDUSTRIALIATION

           Indonesia has a very big marine potency, especially fishery. But, the big potency is not yet utilized optimally for social welfare. Therefore, the Ministry of Marine and Fisheries (MMAF) planned to increase volume of fishery production. Minister of Marine and Fisheries, Cicip Sutardjo, promised to accelerate marine and fishery industrialization process as one of the foundations for improvement of Indonesia’s economy.

             According to Sharif, marine and fishery industrialization will bring progress to the society. And, it can also create an expansive work opportunity for the society, increase, and becoming stronger in economic development. He expected that the industrialization program can increase national fish production. At present, target of fihery production for 2012 is at 13.8 million tons. This amount consists of 5.4 million tons of capture fisheries and 8.4 million tons of culture fisheries.

          According to him, MMAF will increase culture fishery production. This is because capture fishery production cannot be predicted. He calculated that fish population in Indonesian water is around 6.4 million tons, but those who can be captures is only around 80%. In addition to promoting marine and fishery industrialization, his party also reminded of the importance of protecting Indonesia’s fishery potency and illegal fishing.

              Sharif demanded so that culture fishery production can be multiplied considering that its potency is very big. Culture fishery potency reached more than 15 million hectares consisting of brackish-water fish culture potency of 2.9 million hectares and sea culture potency of 12.5 million hectares. Culture fishery potency consists of sea culture, brackish water fish culture, pond culture, and floating net fish culture. He explained that currently, for new brackish-water pond, only 682,858 hectares that have been realized. A majority of them are traditional brackish water ponds, while realization of sea culture only reaches 117,649 hectares.

            But, he reminded that fishery industrialization requires a strong synergistic between central government and regional government to guarantee achievement of increase of competitiveness and sustainability of production from the upstream to the downstream. According to him, it is difficult for fishery industrialization to run smoothly if there is no strong relationship between the upstream that produces raw materials and attractiveness of the downstream related to processing and marketing. Attempt to increase competitiveness must cover improvement on both sides.

            He explained that synergistic among central government, regional government, private sector and other business communities is the key to the success business communities is the key to the success of the attempt to increase competitiveness. He explained that marine and fishery sector is highly potential to become a motor of regional and national development if it is managed properly. One of the strategic attempts is by accelerating fishery industrialization though empowerment to increase production and revenue of the business operators.

            The Minister said that industrialization policy is a priority strategy and program taken by MMAF, and it is also intended to increase added value of fishery business operators. In the future, small and medium businesses (SMB) in fishery sector will be able to produce value-added fishery products and to expand national and international markets. For that purpose, MMAF provide assistance in the form of ice production machinery, cold storage, machinery to produce processed value-added products, cold chain system, mobile marking facility in the form of cars for elucidation on processing technology and “I like to consume fish” campaign.

 Business News - April 18, 2012