The KPK on Nov. 26 named Edhy as a suspect in the case along with six other individuals, in connection with its investigation into alleged bribery in exchange for export permits. Edhy is the architect of the export policy, which he issued in May to effectively reverse the ban his predecessor Susi Pudjiastuti had imposed on exporting lobster larvae.

The Gerindra Party politician is the first minister in President Joko “Jokowi” Widodo’s second-term Cabinet to be nabbed by the antigraft body. The KPK had named two ministers in the President’s first-term Cabinet, then-social affairs minister Idrus Marham and youth and sports minister Imam Nahrawi as suspects of separate graft cases in 2018 and 2019, respectively.

Coordinating Maritime Affairs and Investment Minister Luhut Panjaitan, who stepped in as interim fisheries minister on Nov. 25 after Edhy’s arrest, ordered an immediate review of the lobster larvae export policy. The following day, the ministry issued a circular imposing an indefinite moratorium on the issuance of any documents related to exports of lobster larvae.

Policy flip-flop on lobster larvae

In January 2015, shortly after Jokowi appointed her to his first-term Cabinet as the fisheries minister, Susi issued Ministerial Regulation No. 1/2015 that placed a size restriction on several species of lobster and crab and a ban on harvesting egg-bearing females and baby lobsters during the spawning period.

Additional details were stipulated in Ministry Regulation No. 56/2016, which permits exports of only lobsters without eggs that weigh more than 200 grams or measure more than 8 centimeters long. Article 7 of the regulation also bans the sale of lobster larvae for farming.

The regulations were issued following concerns that exporting lobster larvae would eventually deplete Indonesia’s wild lobster population. On the one hand, the general public lauded the policy as an effort to protect the marine animals from overfishing to extinction, while on the other, its critics argued that the stringent policy could increase the prevalence of smuggling baby lobsters.

The policy met with opposition from fishers, especially breeders who relied on wild-caught lobster larvae to seed their lobster farms. Secretary-general Susan Herawati of the People’s Coalition for Fisheries Justice (KIARA) said that fishers in Lombok, West Nusa Tenggara, particularly opposed the 2016 regulation, saying that the minimum threshold on the size and weight of lobsters for export was too high.

“They said [at the time] that it would take too long for [the lobsters] to develop to reach 200 grams,” she said, adding that the lack of a grace period following the regulation’s enactment made it harder for stakeholders to comply.

After succeeding Susi, Edhy sought to reverse the export ban on lobster larvae, citing the high demand for the commodity in Vietnam. He argued that resuming exports would boost state revenues and stressed that tight provisions would be put in place to assuage any lingering environmental concerns.

In May, Edhy signed Ministry Regulation No. 12/2020 to resume exports of lobster larvae in accordance with the quota set by the National Commission on Fish Resources Assessment (Komnas KAJISKAN). The commission also determined the locations where fishers were allowed to catch lobster larvae.

The 2020 regulation also stipulates that businesses are permitted to export only the larvae of farm-bred lobster species and only after two successful harvests. Lobster aquaculture businesses are also required to partner with local fishers and release 2 percent of their harvest into the wild.

Why are lobsters such a hot commodity?

Demand for lobsters had been growing over the years in lockstep with China, the world’s top importer of the commodity, while its value also grew consistently, said deputy chairman Muhibbuddin Koto of the Indonesian Aquaculture Society (MAI).

“Lobster is among the major consumer items in China and Hong Kong. China has been the biggest consumer of Indonesia’s lobsters since around 2000 as their economy grew [significantly],” he said.

Worldwide lobster imports reached US$1.64 billion in 2019 with $1.02 billion, or 61.78 percent of all imports, going to China, according to the data of the International Trade Centre.

According to Statistics Indonesia (BPS), Indonesia’s lobster exports between January and October 2020 stood at $24.25 million, with Taiwan, Hong Kong and China among the top destinations.

The BPS data also revealed that, following Edhy’s reversal of the export ban in May, lobster larvae exports spiked from $112,990.23 to $15.1 million in September. Total lobster larvae exports in the first 10 months of the year amounted to $33.97 million, with the majority of the larvae shipped to Vietnam.

MAI’s Muhibbuddin said that Vietnam had a competitive advantage in its geographical proximity to China and as such, it was well-positioned to profit from the boon in the lobster market in their neighboring country. Meanwhile, Indonesian fishers lost out because of the high shipping costs as well as the high costs associated with lobster farming.

“We send [lobster larvae] on airplanes, while Vietnam can send [them] on trucks. The logistical costs of shipping to China has affected our spirit in jumpstarting lobster aquaculture, because if we cultivate lobsters, the profit margins are clearly smaller when compared to Vietnam’s,” he said.

What’s next for the industry?

Susan of KIARA called on the government to formulate a comprehensive policy road map for key maritime resources, including the widely coveted lobster.

“For lobsters, a supply chain should be established in which fishers can catch lobster larvae to sell to breeders. The government can facilitate them,” she suggested.

Meanwhile, Muhibbuddin suggested that the government scrap the regulation altogether to level the playing field between lobsters and other marine commodities, pointing out that fishers would catch larger lobsters once they realized that Chinese consumers would not buy small lobsters.

“Let the market mechanism run. Why does [the state] regulate the size [of lobsters for exports]?” he said.