Towards Quota-based Fishery: Current Status and Future Needs of The Quota-Based Fisheries Management in Indonesia

1.              Introduction

The sustainability of the ocean should be a priority for each party involved. This is related to Sustainable Development Goals (SDG) 14: Live Below Water, which aims to achieve conserve and sustainably use of the oceans, seas, and marine resources (United Nations, 2021a). Though the ocean has many benefits to humans, it is known that several issues change this ecosystem due to industry-scale fishing, offshore energy, the development of coastal, invasive species, and climate change (United Nations, 2021b). Fisheries are one of the activities that have a major impact on the sea ecosystem and are directly related to food security, so this sector needs to be well planned.

In recent years, as fish stocks have dwindled and the industry has been plagued by economic and social challenges, capture fisheries management has received general attention from the international community and governments (Huang & Tang, 2019). One of the efforts that can be made to achieve marine and fisheries sustainability is to implement quota-based fisheries with an output approach. This regulation has become a trend due to several countries that are trying to develop and implement it, such as China, New Zealand, Iceland, Australia, and Indonesia (Sanchirico et al., 2005; Shen & Heino, 2014). China started to implement output control in 2017, which includes individual fishing quotas (IFQs), vessel catch limits, and total allowable catch (Yang, 2018). New Zealand started to implement QMS (Quality Management System) in 1906 that was regulating quotas for 17 inshore species and 9 offshore species (Bess, 2005). Meanwhile, for Indonesia, this type of regulation was implemented in January 2023.

In its implementation, quota-based fisheries management can cover many aspects, ranging from fishing areas (Morzaria-Luna et al., 2020), community groups (Rout et al., 2024), business entity groups (Hara et al., 2014), vessel and port management, and catch distribution (Aguión et al., 2022). In Indonesia, this regulation includes the division of areas based on zoning and quota types. The implementation of quota-based in several countries has shown an increase in sustainability, prevented IUU, and ensured a fairer distribution of fishery products (Arton et al., 2024; Jacobsen & Delaney, 2014; Nilsson et al., 2019). This is in line with the blue economy policy agenda. Despite the implementation, Indonesia’s transition to QBFM faces several challenges. Many aspects of policy implementation, stakeholder adaptation, and technological readiness remain unclear. This study aims to analyze the current status of Indonesia’s fisheries governance under QBFM, identify challenges, and propose policy recommendations for improving its effectiveness. By addressing these gaps, this research contributes to the sustainable transformation of Indonesia’s fisheries sector.

2.              Methods

2.1.           Data collection

This research uses a qualitative method by conducting interviews with stakeholders related to the implementation of the Quota-Based Fisheries Management (QBFM) regulation. It is conducted to gather information from the representatives of the central government, local government, port authorities, fishermen, boat owners, and fishmongers. Key informants were selected using the purposive sampling method because by using this method, authors can select appropriate respondents who are directly involved with the case to provide insightful information and express their experiences thoughtfully and persuasively (Palinkas et al., 2013). Interviews were conducted using a semi-structured method that includes open-ended questions and follow-up inquiries that glean data from recent, pertinent literature on the subject (Jamshed, 2014). The interview lasted 45–60 minutes on average and was conducted both offline and online. Before the interview was recorded, important participants were informed about the subject and requested their permission.

2.2.           Data analysis

The interview records were transcribed as references in data processing using NVivo.  To find themes that surfaced from the qualitative data, the information was examined using thematic content analysis approaches. Because thematic content analysis is an independent qualitative descriptive approach that allows flexibility and simplicity of adjustment based on the study strategy, it was selected to analyze, produce, describe, and report rich and thorough data and themes inside a study (Nowell et al., 2017). We gave a thorough explanation of the current situation's background based on the themes that were chosen. The data triangulation method will be used to validate this study. This approach was chosen because it can lessen bias and increase the study's validity and credibility (Bans-Akutey & Tiimub, 2021). The interview data were used in this study, with additional information from news articles, statistical reports, and administrative guidelines. This approach will enable cross-validation and make it easier to investigate how quota-based fisheries policy might be implemented.

3.              Result and Discussion

3.1.           Current Status of Fisheries Management in Indonesia

The quota-based fishery is regulated in The Government Regulation of Indonesia Republic No. 11/2023 on Measurable Capture Fisheries. Measurable capture fisheries mean controllable and proportional fish harvesting executed in certain zones based on the predetermined capture quota to preserve fish resources, ensure sustainability, and realize equitable national economic growth. Fish quota signifies the fish resource allocations that can be utilized based on the resource’s potential (President of The Republic of Indonesia, 2023). This regulation covers several scopes, including: (1) defining fishery area-based fishing zones (WPPNRI); (2) regulating quota sharing between industry, local fishers, and non-commercial sectors; (3) requiring fisheries business licenses and installation of vessel monitoring systems; (4) controlling the distribution of catches through authorized ports and fish transport rules; and (5) Set sanctions for violations of the quota-based fisheries system.

Quota-based control implemented for capturing fisheries in Indonesia is considered one of the efforts in realizing the blue-economy strategy. The establishment of this policy is based on the increase of fish catch production in 2022, which reached the amount of 1.5 million tonnes and contributed around 3.875 trillion rupiahs in Non-Tax State Revenues (PNBP). It is also predicted that in 2024, the fish harvest will reach 5 million tonnes, with the PNBP value reaching 14.554 trillion rupiahs. Based on this opportunity, followed by a comprehensive calculation of the sustainability of fish stocks and the ecosystem, the government initiated a quota-based fishing policy. It is designed to string together end-to-end business processes of capture fisheries by accurately quantifying potential stocks, allowable catch allocation, and catch quota (Ministry of Marine Affairs and Fisheries, 2022).

Before the implementation of this policy, The Ministry of Marine and Fisheries used an input control to regulate marine capture fisheries by limiting the number of ships, size of the ships, and fishing gear. By using this system, the barrier to entry is low so it is possible for a number of ships to get the required license. However, it causes a negative externality due to unlimited fish catch, overfishing, underreporting for ships, ship productivity manipulation, and low PNBP value.  PNBP billing is requested before the catching operation begins based on the stock prediction, resulting in no control for the number of fish one boat can carry. This system can damage the marine ecosystem and loss of PNBP revenue. Meanwhile, using the new output control policy, the PNBP will be charged based on the mass of fish landed in the port according to the quota given previously for each boat. The bill will be adjusted based on the auction price, average price, or price set by the head of the port (Ministry of Marine Affairs and Fisheries, 2022).

3.2.           Challenges in Implementing QBMF

The analysis presented in this section presents a comprehensive analysis of the themes identified from the coding process of the interviews with key informants. This analysis aims to find the main challenges in implementing QBFM in Indonesia.

3.2.1.       Governance and Policy

QBFM is developed as one of the Blue Economy strategies in Indonesia namely expanding 30% of the conservation area, measurable capture fishery based on Fishery Management Area, developing sustainable aquaculture, sustainable management for coastal and small islands, and marine litter handling and management through The Ocean Love Month Program. This policy implementation in Indonesia is mainly regulated in The Government Regulation of Indonesia Republic No. 11/2023 on Measurable Capture Fisheries. However, there are also another five regulations related in order to support the implementation of this regulation. The related policy regulates resource (mainly fish) prices, logistics, production value, non-tax state revenue, and fishery organization.

Though all the regulation is established and acknowledged through different policies under different instances under the central and local government, there is barely any connectedness between the regulations. This condition creates overlapping or missing responsibilities in certain areas of work. For example, under the Directorate General of Capture Fisheries, the Directorate of Logistics manages the logistics and transportation along the chain. This distribution depends on fuel, contributing to 60-65% of the total logistic cost. However, the fuel regulation for fishery activities is not under the same ministry. To overcome this issue, The Logistic Directorate manages the route with the shortest distance and places several distribution centers along the route with high-capacity cold storage. Another example is tackling Illegal, Unreported, and Unregulated (IUU) Fishing, where the taken resources are under the Ministry of Marine and Fishery. However, these illegal activities are handled under a different ministry, namely The Indonesian Sea and Cost Guard under The Ministry of Transportation.

Permit management is divided into two types of licensing: one is for the vessels under 30 GT using the local government permit, meanwhile for the vessels above 30 GT using the central government permit. This license also regulates the fishing zone, whereas the vessels with a capacity under 30 GT are only allowed to fish under 12 miles, and those above 30 GT have to fish above 12 miles. The challenge for this regulation is that several local fishers are using vessels with a capacity below 30 GT and harvesting the marine resources located above 12 miles. One of the actions taken by the central government to tackle this issue is by providing a “permit migration” where fishers who do activities above 12 miles but only have local permits can change to a central government permit. In any other condition where the fishermen refuse to migrate their permit, every catching activity above 12 miles is considered illegal.

3.2.2.       Technical and operational challenges

The implementation of this policy is supported by an online application called e-PIT (electronic Perikanan Tangkap Terukur). Previously, several applications were used either to monitor or request permits. These application works on their own under different ministries, causing overlapping and no data center that collects and analyzes the data gained from the fishing activity.  A fast network is required for the digital system and must be a priority to provide a real-time data report. The delay in the system can cause an error in the PNBP billing.

The implementation of e-PIT integrates upstream and downstream services of the capture fisheries sector into a unified system. This encompasses the entire process from the submission of Operational Standard Compliance, Sailing Approval Letters, e-logbooks, Arrival Reporting Certificates, and Self-Assessment Reports to the calculation of Non-Tax State Revenue from Fisheries Levies post-production.

Digital platforms are necessary to increase transparency and compliance (Rowan, 2023; Zeller et al., 2016). The implementation of this system necessitates robust infrastructural support, with high-speed internet connectivity being a priority. However, in reality, the digital infrastructure in certain regions remains inadequate. For example, digital scales, which are already internet-based and connected to the licensing system, sailing approvals, and even PNBP payment billing connected to finance. Therefore, ports are indeed required to have a ready internet network as it would greatly disrupt operations if not supported by this. Because everything is no longer manual (application-based), providing a fast internet network is a fundamental and mandatory requirement.

The aforementioned infrastructure needs can potentially create numerous investment opportunities, such as the construction of cold storage facilities, processing plants, procurement of high-technology vessels, shipyards, and fish-based industries. The government can focus on developing a particular location in stages before moving on to another area in order to create an environment that is conducive to investment. Furthermore, the banking industry can take part by making funds more easily accessible. For example, in Aceh Province, one of the most critical investments required is the downstream processing of fisheries, including the transformation of fish into value-added products such as frozen fish fillets, canned tuna, fish floss, and fish crackers. With proper planning, Indonesia can predict the business trends for the next 10-20 years based on the carrying capacity of available resources, fleet resources, issued permits, and investments that will be made toward the port, as all of these factors will have an impact.

3.2.3.       Economic challenges

Economically, fisheries in Indonesia show a gap in the export sector. For fish export in 2023, Indonesia is still less competitive with the Netherlands, India, and Denmark (Trend Economy, 2023). This also happened to other commodities. For example, comparing shrimp export to Indonesia, the basic price of shrimp production in Ecuador is cheaper at $0.7 per kilogram, India is cheaper at $0.5 US dollars per kg, and Vietnam is cheaper at $0.3 US dollars per kg. The disparity in the competitiveness of Indonesian shrimp commodities against Ecuador, India, and Vietnam was triggered by the average productivity of shrimp ponds in Indonesia, which is still low (Shrimp Insights, 2023). Indonesia is also an exporter of tuna, skipjack, and mackerel. However, on the other hand, Indonesia is also one of the largest importers of fishmeal.

In addition, there is also a national fish distribution gap. Areas that have large amounts of fish, namely the central and eastern regions of Indonesia, actually have low fish consumption values as well. This gap is because many of the fish that are caught in these areas are distributed directly to western Indonesia, which is the center of industry. It is also the basis for the implementation of the QFBM regulation where vessels must land fish in designated WPP areas. However, in practice, monitoring and control at sea is important because there is the potential for fishing vessels to transfer the catches to other vessels in the middle of the ocean.

For small-scale and local fishermen, one of the main obstacles to fishing is high operating costs, particularly gasoline expenditures. The well-being of the fishermen is also impacted by price fluctuation and market uncertainty. In order to incentivize fishermen to continue fishing, the government's role in maintaining market availability and price stability is crucial while adopting QBFM. With the regulation that fish must be landed at the designated port in the same area, fishers also have the opportunity to sell to the industry and open up opportunities for fish processing industries in the area.

3.2.4.       Environmental concerns

One of the main reasons for environmental issues in Indonesian fisheries is IUU (illegal, unreported, and unregulated) fishing. This action not only harms marine biodiversity but also depletes fish stocks. To ensure that fish stocks are restored while balancing ecological and economic demands, quota systems that are both legally binding and supported by science must be established (Pascoe et al., 2020). This requires a reform in fisheries management. The implementation of QBFM is made more difficult by issues with the climate and regulations. Because traditional fishing patterns and habitats are disrupted by changing marine ecosystems and rising sea temperatures, Indonesia's fisheries are extremely sensitive to climate change. This climate vulnerability highlights the necessity for adaptable methods in fisheries governance. Consistent enforcement and high stakeholder compliance are much needed to ensure that the regulatory framework is matched and aligned with the reality on the ground, making it easier to achieve the fisheries management objectives.

4.              Conclusion

Based on the analysis that shows the challenges in implementing Quota-Based Fishery Management (QBMF) in Indonesia, the most important thing that can be done is to strengthen governance and regulatory coordination with clear boundaries for each role and responsibility. This is supported by several studies that discuss how governance is important to encourage collective action based on sustainability goals to control all the activities in the fisheries value chain (Perez-Quesada & Hendricks, 2021; Zaga-Mendez et al., 2021). Harmonizing between central and local governments with clear roles will prevent overlapping authority. This can be done with a digital transformation that stakeholders can access. For fishermen and business actors, this platform can be a solution to ensure their rights and obligations. Meanwhile, for the central and local governments, this platform can be a way to improve enforcement and real-time monitoring to ensure that the entire fishing process takes place in accordance with applicable regulations.

Author Contributions: All authors contributed to this research.

Funding: Not applicable.

Conflict of Interest: The authors declare no conflict of interest.

Informed Consent Statement/Ethics Approval: Not applicable.

Declaration of Generative AI and AI-assisted Technologies: This study has not used any generative AI tools or technologies in the preparation of this manuscript.