Thursday, 26 March 2015


The government continues to accelerate human resource development (HRD) through a series of educational and training programs in order to welcome the ASEAN Economic Community (AEC). After that, through formal channels, they seek international-standard certification, so that the existence of human resources will be formally recognized by the global community.

Report of the Ministry of Maritime Affairs and Fisheries (MMAF) stated that the Marine & Fisheries Human Resource Development Agency (BPSDM KP) had conducted a series of educations that prioritize practice rather than theory in a number of regions, among others, Medan, north Sumatra; Tegal, Central Java; Banyuwangi, east Java; Aertembaga, Bitung, North Sulawesi; Ambon, Maluku; and one Administrative training Center (Balai Diklat Aparatus) in Sukamandi, Subang, West Java. To facilitate access to training for the community, BPSDM KP also established 417 Centers for Independent Marine and Fisheries training (P2MKP) in various regions in Indonesia, including Maluku.

Head of BPSDM KP, Suseno Sukoyono, on Tuesday (March 3) said that before the implementation of AEC 2015, MMAF was aware of the strategic role of marine & fisheries human resources as an agent of change. Therefore, in AEC, the community was facing global competition. To that end, MAAF through KP BPSDM has organized various activities in education, training and counseling. This is to increase the capacity of the community so that their productivity and income will increase.

Consequently, the lives of the people in this sector become more prosperous. This is because MMAF realize that education, training, and education are keys to the success of winning the competition in AEC 2015. According to him, the development of marine & fisheries human resources is very important, because managing marine & fisheries natural resources is essentially managing its human resources. Furthermore, Suseno said that the performance achievement in 2014 is that the competence of marine & fisheries human resources is in accordance with demand, which is as many as 73,279 people. This figure is the result of marine & fisheries human resource development through education, training, and counseling.

In education, BPSDM KP produces 1,665 graduates in 2014. 80% of the graduates work as professionals in corporations/industries and some of them become entrepreneurs, while the rest work in government administration and continue their education. BPSDM KP graduates have been spreading not United States, Uruguay, Spain, France, Netherlands, Belgium, Russia, Mozambique, United Arab Emirates, China, South Korea, Japan, Malaysia, the Philippines, Australia, Fiji, Solomon Islands, and other countries.

Suseno asked the private sector to be involved in the development of marine & fisheries human resources in the country. He said that MMAF planned that in the future, Indonesia will no longer hire foreign crews. From the result of study of Bogor Agricultural University (IPB), number of foreign crews in Bali alone has reached 40,000 people. While every year, MMAF’s marine & fisheries academy produces 1,600-1,700 graduates.

Therefore, efforts to replace foreign crew with local crews should be strengthened by local human resources through the role of private sector. He revealed that today, demand for reliable human resources in the marine & fisheries sector is still lacking. According to him, the necessary standard are to establish an academy that can directly implement practice, and can immediately enter the workforce. Currently, there are only 17 academies like this.

Meanwhile, Yugi Prayanto, Vice Chairman of the Indonesian Chamber of Commerce & Industry (KADIN Indonesia) for Marine and Fisheries, said that his party supports the government’s efforts to develop marine & fisheries human resources. According to him, this effort will support the marine & fisheries business. In this case, it was difficult to finalize KADIN’s education & training in Seram Island, Maluku. Investment for the development of education & training, his party hopes that marine & fisheries human resources can do a lot of practice in the economic management of fisheries, from upstream to downstream. (E)

Business News - March 6, 2015


The total area of mangrove forest in Indonesia was posted at 3.74 million ha or 25% of world’s total mangrove expanse, of which only 2.85 million ha were in the state of favorable, the rest were being damaged.

Hilman Nugroho, the Dir. Gen. of River Management and Social Forestry, Ministry of environmental Affairs and Forestry, made the Statement. Damaged mangrove forest came to 1.08 million ha or 29% of total mangrove forest.

The main cause of damage was refunctioning of land for embankments, settlements, infra structure building and home wastage and yet mangroves had its important role economically and ecologically for shrimp and crabs cultivation and other sea bio life.

Therefore the eco system must be safe guarded. The unaffected virgin mangroves must be protected from damage while damaged Mangroves must be rehabilited. The process of mangrove rehabilitation takes time and patience because the fruits would not be visible in 5 – 6 years.

The Government had issued various regulation to enhance rehabilitation of mangroves. The Ministry of Environmental Affairs had helped formation of Regional Task Forces in 25 provinces and 21 regencies cities. Mangrove rehabilitation and 21 regencies cities. Mangrove rehabilitation by the Government had covered 31,000 ha of mangroves.

Mangroves must be safeguarded because of its high carbon content. To change mangroves into embankments means to cause sizable glass house effect.

The carbon content of mangroves was 5 times that of tropical forest. Therefore to protect mangroves means to maintain climate cycle in Indonesia and Indonesia could apply for carbon trading trough mangrove cultivation.

On of the ways to protect mangroves was by exercising proper space planning in coastal areas and to step up permit procedures for the communities. For information, mangrove could also serve as medium to mitigate the effect of Tsunami in some locations where the condition of mangrove was not too severely damaged. (SS)

Business News - March 6, 2015


Huge fisheries potential of Indonesia has not been balanced with high quality of human resources needed in the development of this sector. On the other hand, government policies have led to efforts to optimize to marine & fisheries sector by fishermen in order to achieve the ideals of Indonesia to become world maritime axis.

“The competitiveness of marine & fisheries human resources needs to be improved. Foreign vessels are no longer free to take our marine products, so that our nation should be the main actor in fisheries management, “said Deputy Chairman of Marine and Fisheries Department of the Indonesian Chamber of Commerce and Industry (KADIN Indonesia), Yugi Prayanto, in Jakarta, on Monday (March 2).

According to him, marine & fisheries human resource development must touch all aspects ranging from upstream to downstream. In other words, it is not limited to capability and traditional fishing activities, but also aquaculture ability and other management techniques. “We want the fishermen to not only be good at catching fish, but also to have skills. It would be better of these people become competent ship crews, ship captains or chief engineers. We also except that the aquaculture ability of our fishermen will develop, “he explained.

Yugi added that fisheries and marine education should be synergized with business or entrepreneurship through the implementation of special education & training and adequate training activities. “In the future, aquaculture should be a trend that can stimulate the development of innovations to be able to generate added value for this sector. The processing industry sector will require many workers who have specific skill. This is our challenge in the future for marine & fisheries human resources to be more competitive, “he said.

In relation to this, he admitted that his party has completed KADIN’s fisheries industry training in Seram Island, Maluku, where the development has been initiated since two years ago with an investment of IDR 7 billion. In the near future, his party will construct 7 fishing vessels for training weighing 300 gross tons. The objective of KADIN Indonesia in building these schools is an effort to improve skills at the young age the economic management of fisheries.

Through this education, he hoped that the younger generation will be interested in working in fisheries profession as skilled workers and entrepreneurs. Therefore, in the future, there will be a lot of competent young people engage in fisheries business. The enforcement of competency certification for extension workers and graduates should be given and appreciated. We hope that it will become the attention of the government, and hopefully the program can be accelerated so that our human resources will be better prepared in facing global competition, “he concluded.

Based on data from the Ministry of Industry, the national fish processing industry consist of 37 large-scale business units that absorb 62,000 workers, with an investment of IDR 1.5 trillion. National fish processing industry has an installed capacity of 339 thousand tons with 197 thousand tons of production capacity/year, resulting in a utilization of 58%. The problem faced by the fish processing industry, among others, the seafood industry, especially processed fish, which is in shortage of raw materials due to transshipment of fish in the sea. In addition, there is no Mutual Recognition Agreement (MRA) concerning standard mutual recognition with seafood export destination countries, so that many processed fish products are rejected by export destination countries.

To that end, the Ministry of Industry has arranged a fish processing industry development program that ensures the availability of raw materials; prepared skilled and competent human resources in the field of fish processing industry; improved technological mastery and innovation of fish processing technology; improved the efficiency of processing and quality assurance; coordinate the development of logistics system; and facilitated access to competitive financing for small and medium-scale fish processing industry. (E)

Business News - March 6, 2015


Through 2014, not only the condition of Indonesia’s macro economy weakened but also the banking sector was in trouble. The condition was signified by tight liquidity, slow credit extention and net margin interest going down.

In mid 2014, bank’s liquidity was calculated by Loan-to-Deposit Ratio and had reached 92.19% by directives of BI and OJK.

However liquidity eased to become 89.42% by end of 2014 when credit also only grew by 11.6% this growth was by far lower than 2013 which was only 21.6%. Betterment of fundamental economy was believed to propel growth of economy and the banking sector.

Economic growth in 2013 was notably high, i.e. 5.78% and credit growth was above 20%. On the other hand, deficit in current transaction in 2013 was posted at USD 29.115 billion or around 3.13% of GDP.

Growth of credit and reduced deficit to USD 26.23 billion by end of 2014 were positive signals of betterment.

In the banking industry, Net Interest Margin was down to 4.23$ by end of December 2014; and yet at that time NIM of the banking industry was still 4.89%. In 2012 NIM was still 5.49% Downturn of NIM was not merely due to slowdown of credit growth.

Increased Cost of Fund as result of “interest war” specially fixed deposit interest was more prevalent as the cause. This was reflected in BOPO ratio which increased to 76.29% by end of 2014 while in fact by end of 2013 BOPO was still 74.08%.

Growth of economy and the banking sector as main propeller of economy was expected to be sustainable. Import of consumptive goods which was the cause of deficit would diminish. The reason was that import would be dominated by auxiliary goods and capital goods.

The government sets target of economic growth at 5.7% by 2015 which means big opportunity for banks to grow credit. However with fund resources mostly in short term fund credit growth was predicted to be only at around 15% - 17%.

Liquidity was predictably easier as the Government had greater spending potentials compared to previous years; moreover with Third Party Fund growing better. To banks liquidity and Financial System Stability (SSK) was most important. Therefore when LDR had exceeded ceiling last year, anxiety grew.

Monetary crisis that happened 15 years ago was due to failure of banks in maintaining liquidity. With most of consumer’s fund already extend as credit, some banks were not ready to comply to customer’s rush.

With better liquidity, banks had enough room to grow credit so intermediary role could be maximized. Banks also had enough room to serve customer’s cash withdrawal. Still social and economical stability was needed to maintain consumer’s trust in banks.

Well balanced macro economy variables must be prioritized for the short term to ensure sustainable economy in the long run. Economic growth must not be spurred on too high in the short run so inflation and deficit could be managed.

BI wished that economic growth in 2015 and 2016 would be set at moderate level. In fact this year economic growth could be stepped up to 7%. But if such was done inflation would be high and deficit would widen which was certainly not good for fundamental economy.

Well balanced economic variables of the short term must be prioritized as Indonesia was still highly dependent on import. Indonesia’s Trade Balance showed that import of auxiliary goods was USD 9.61 billion or around 76.28% of total import in 2015. Import of capital goods totaled USD 2.2 billion or 17.48% of total import of the same period.

To jack up economic growth, Indonesia needed raw a materials and capital goods for the industry. If the need for import soared up, deficit would widen and such would depreciate Rupiah. Growing demand would push inflation higher up.

In the near future, deficit ratio would probably still increase as long as domestic supply was short. The effort to develop raw material industry at home was urgent to ensure supply.

In this case BI always prioritized on monetary policy mix designed to secure Indonesia’s fundamental economy. Stability of Monetary System was needed to keep long term investment flow in. Amidst export slowdown direct investment was expected to play its greater role.

Although credit growth 2015 was predictably better than 2014, BI was optimistic that inflation would be controlled at 3% - 5%. While lowering BI Rate from 7.75% to 7.50% on February 15 last, BI also lowered Deposit Facility Interest from 5.75% to 5.5% which signaled that BI was quite permissive to easing of liquidity.

BI’s decision to lower BI Rate on February last was different from most of the economist estimate that BI rate would remain at 7.75%; this indicated that BI Rate of 7.5% was believed to be in line with the effort to reduce deficit.

Deficit ratio by end of 2015 was estimated to be 3.1% of GDP which was worse than GDP by end of 2014 at 2.95% of GDP. However, as long as deficit was due to import for productive purpose like infra structure building, deficit which was slightly above 2.5% was notably healthy an well accepted by the market.

Therefore the Government and BI needed not to hesitate to jack up growth as long as the momentum was condusive. Deficit upturn slightly above 3% of GDP should not be too alarming as long as expenditures were for productive purposes.

The most important thing was that the Government must be able to communate the message honestly, objectively and constructively. Marketplayers would trust more if they could see infra structure building in broad daylight. Now the advice for all stakeholders was to stop all the discourse and start working. (SS)

Business News - March 6, 2015