Indonesia depends on marine resources both to feed its population and for its economy. Presently, about 20 percent of Indonesia’s GDP is derived from marine and fishery industries, while 60 percent of the Indonesian population lives within 50 km of the coast and it is estimated that 70 percent of the country’s protein source comes from fish. That figure hits upwards of 90 percent in some rural coastal villages.
Conservation of marine resources was introduced a long time ago as a means to maintain, restore and increase fish production. By 2020 Indonesia aims to increase the area of its hectares of Marine Protected Areas (MPAs) from 16.5 million to 20 million hectares.
The Maritime Affairs and Fisheries Ministry and local governments could declare and manage the MPAs depending on their category.
Declaring a marine area an MPA should be followed by the establishment of a collaborative management body and the development of a management plan. The most important thing is to ensure the plan is implemented to make sure the MPA is effectively managed.
The management body needs enough funding to cover its recurring costs and monitoring. In its early stage, it needs investment costs such as purchasing boats and other equipment.
Adequate and sustainable financial resources could be understood as efforts to generate essential income to cover monitoring and operating costs (Donier 2002) for short- and long-term period.
Moreover, if sustainable financing is properly adopted it could provide alternative livelihoods for communities in the surrounding areas that could later reduce pressure on the marine resources.
It could generate income from users and if this income could be jointly managed by the community then there are business opportunities that could be started and will result in new economic activity.
Thus sustainable financing mechanisms could provide incentives for communities to protect the area as their zone plan to provide as mutual benefits.
A collaborative management body is needed to formulate this financing strategy and identify and implement revenue generation. It is a complex and difficult task. Capacity development for people involved in this management body is needed in advance.
Looking at the 2004 Fiscal Decentralization Law and a 2007 government regulation that regulates the authority of the central and local governments in various sectors, it is now urgent to establish a segregation of duties between the Maritime Affairs and Fisheries Ministry and local governments, keeping in mind their different capacities and human resources.
Clarifying the tasks and functions between these two main players will ensure synergy and the acceleration of efforts toward effectively managed MPAs.
He ministry in this context should provide guidance and issue practical guidelines for local governments. Those could be on how to draw up costings for MPAs or how to make a simple project feasibility study to determine how much money is needed in the years ahead to ensure all components are ready and working at the various MPAs.
To ensure those declared MPAs move forward, a division of labor between the ministry and local governments should be clarified to effectively execute some of the following steps.
First, conduct a study on determining what kind of recurring and monitoring costs as well as investment costs for each MPA. Cost components should then be then multiplied by the local price of commodities to arrive at a total cost needed to run an MPA on an annual basis. The result will be a generic cost structure of MPAs that could be shared among local governments and practitioners.
Second, identify what financial resources are able to tap the needs. There are some areas that may be able to generate income from user fees such as from divers and tour operators. But not all MPAs can be treated that way. Technical assistance could be provided by the ministry or international NGOs.
From series of financial resources, the ministry should take the lead on international and national funding. At the international level for example, debt swaps could be negotiated with some lenders.
Instead of paying interest and principal, the government could offer to use the money for managing MPAs.
“If sustainable financing is properly adopted it could provide alternative livelihoods for communities in the surrounding areas.”
Foreign donors both private and bilateral should be approached to provide grants. The establishment of a multi-donor trust fund and fixing government fund channels for this financing scheme could be made by involving the Finance Ministry.
At the national level, the transfer of funds to local governments such as deconcentration funds, which are provided to provincial governments to execute tasks delegated by the central government, and special allocation funds, which are given to all districts based on their fiscal capacity.
The latter is a sectoral fund, given only for specific purpose in many sectors. Revenue sharing funds could be used as an instrument to ensure that the management body of the MPAs have enough funds to implement their management plans.
Technical guidance on how to spend these funds can be issued to guarantee its proper budget allocation for MPAs.
At the site level, local governments should identify, along with other stakeholders, what type of income could be generated from their MPA site and how to distribute the income among stakeholders.
Properly distributed income will go to the communities and provide the incentive to stakeholders of MPAs to protect the areas.
If the MPA has the appeal to attract visitors, local people can again make money from that opportunity, it will reduce pressure on marine resource exploitation.
Third, the development of human resources to manage the areas needs to begin soon. So far, we have no school for MPA managers. These are essential as the areas need to be administered and led by managers with adequate technical expertise.
Fourth, the legal structure of collaborative management body must be decided. If it is part of government bureaucracy, then it could easily access government funding. But this type of organization could not receive and directly use user-fee type of revenue unless they are under the Public Works Agency.
If the body is an NGO, resources from government funding could not be channeled on regular basis making it ad-hoc and endangering its sustainability. Raja Ampat regency in West Papua province employs the Public Works Agency for conservation.
This kind of organization could operate in a more flexible manner in receiving and using its financial resources. Other legal forms are available and can be chosen based on its MPA revenue characteristic.
International and national funding resources should be identified and approached by the Maritime Affairs and Fisheries Ministry.
We could not focus only to achieve a certain area of MPAs. To ensure the effective management of each MPA, a series of resources including financial resources are needed.
The ministry should play an active role in this and work together with local governments and NGOs to avoid letting those protected areas become nothing more than numbers on a map.
The writer is a lecturer at Perbanas Graduate School of Management Jakarta.
