This event took place in Jakarta, Indonesia at the end of July over one and a half days, and was very well organized as part of The Economist Events’ World Ocean Initiative, bringing together government, industry, the financial sector and scientists for a broad discussion on fisheries reform across South-East Asia and the adjacent Western Pacific.

Typically, the early media suggests a major problem – possibly this is done to attract the interest of people but, to be honest, I am over the ‘shock-horror’ approach to engage. The first words of the media were: “Fisheries in Indonesia are in trouble, as they are in the rest of South-East Asia.” I do not think anyone involved in our industry would say we have solved every issue there is now and into the future, but the statistics that are available indicate that we are not a complete ‘basket case.’ Maybe, by taking a more positive and accurate position, more of the right people can be attracted to such events.

The event was professionally managed by conference chair Charles Goddard from The Economist Intelligence Unit and their moderators, Jon Fasman and Simon Cox.

Unfortunately, but not unusually, when you put an emphasis on engaging government for opening events problems occur. In this case the Indonesian government was having a re-shuffle of internal portfolios, which meant the conference had to make some adjustments.

Indonesian government aside, there was a good array of Asian and Pacific government officials involved in the first session. This included Nao Thuok, secretary of state, ministry of agriculture, forestry and fisheries, Cambodia; Adisorn Promthep, director-general, department of fisheries, Thailand; Ahmad Shabery Cheek, minister of agriculture and agro-based industry, Malaysia; Fleming Umiich Sengebau, minister of natural resources, environment and tourism, Palau and Osea Naiqamu, minister for fisheries and forests, Fiji. Jon Fasman engaged them in discussion on the goals and challenges of regional cooperation on IUU fishing, including progress on the Port State Measures Agreement, deployment of tracking technologies, traceability and how to secure investment in monitoring and enforcement.

3_Roy_1.jpgThe impression I received from this was that there is an increased awareness in the region about the issues and seemed to be a strong spirit in how to resolve them. There was an area meeting of the various governments held just prior to the conference at the event location and that probably explains why they were in Jakarta. There was an emphasis, especially by the smaller countries that control massive amounts of ocean, of a lack of funding and resources. Clearly, technology was going to play an increasing important role in IUU issues and this came more to the fore at the event in later sessions.

Connecting finance to the industry was one of the interesting subjects of this event and it was commenced by Abigail Herron, head of responsible investment engagement for Aviva Investors in London, speaking via live video link. 

Ms. Herron said: “During engagement, the business case for sustainable fisheries should be made from an environmental, social, governance and financial perspective. Bribery, corruption and a rabbit hole of shell companies often go hand in hand with illegal, unreported and unregulated fishing. Given the rapid and continual decline of fish stocks, many current fishery practices and management systems are simply not fit for purpose and need to be urgently addressed through engagement.”

It was not clear from the conversation how much investment Aviva has in seafood, and we were not allowed to ask questions due to the video link issues. We did learn that Aviva has collaboration with Sustainable Fisheries Partnership and together they have recently promoted a report on sustainable seafood investments ( Ms. Herron talked of approximately 20 organizations forming a coalition of investors where they could share information.

I found this to be rather negative as all I was hearing were issues of risk and not the potential of growth, innovation and new technology in the industry. There are few, if any, industries’ growing at the rate aquaculture has achieved, and all I was hearing were danger signs.

The highlight of the day for me followed this negative start to the financial aspects – there was a brief demonstration of the new age of transparency and traceability relating to tracking fishing vessels with Brian Sullivan, program manager for Google Ocean & Earth Outreach and Paul Woods, chief technology officer for SkyTruth. After this presentation, I do not think the fishing industry will ever be the same.

Essentially what is being created is ‘global fishing watch’ and Google says this activity will be ‘free, global and open’ and is expected to be available for anyone to see before the end of the year. Much credit was given to Indonesia for driving the change and highlighted that the country already has the largest Vessel Monitoring Systems (VMS) in operation. 3_Roy_2.jpg

Brian said: “Five years ago, this technology was not possible but within three years will be common place”. It was mentioned that you can currently purchase specific fishing data from one company for about USD 225 per month.
Known large vessels are being locked into the VMS program in Indonesia but what was impressive was that artisanal vessels (under 30 GT) where Indonesia has 500-800,000 vessels are now being targeted. As a start it was noted that Bali Seafood International had recently signed up all of the small vessels that were connected to their program to the new VMS.

Fisheries and the blue economy was the next subject for the day, where new research that brings fisheries’ science and economics together is providing the most compelling case yet for sustainable management, which yields more fish, higher incomes, greater economic benefits and healthier oceans. However, it was stated (and as we know), even if reformed, wild-catch fisheries alone will not satisfy future demand for seafood. Substantial growth in aquaculture will be needed to fill the gap and, this was suggested, poses major sustainability challenges.

This is, in itself, is a full day topic and potentially the most exciting area which could be a catalyst of change enabling aquaculture to be brought from under the ‘fisheries’ control and specifically made its own agenda through the ‘blue economy’ with phenomenal potential of creating new opportunities, but with limited time, the session did not reach its peak and got a little side-tracked on the fisheries management theme.

Moderated by Charles Goddard the session panelists were Christopher Costello, professor of environmental and resource economics, University of California, Santa Barbara; Chris Botsford, chief executive officer, ADM Capital; Michael Arbuckle, independent consultant; Philip Polon, deputy managing director, National Fisheries Authority, Papua New Guinea and Marcos da Cruz, vice-minister of agriculture and fisheries, Timor-Leste.

The final session for the day was moderated by Simon Cox, emerging markets editor for The Economist, and was discussing the transition to sustainable fisheries management.

The panelists were Brett Jenks, president and chief executive officer, Rare; Jerry Knecht, founder and president, North Atlantic and Bali Seafood International; Alan Bollard, executive director, Asia-Pacific Economic Cooperation Secretariat and Thomas Kraft, founder, Norpac Fisheries Export.

3_Roy_3.jpgThere were three areas of great wisdom that came from this. The seafood industry from regulation pre-harvest through to delivery to the consumer is a mighty complex activity and investors need to make certain that they have the right people engaged who understand these issues. There is no book you can buy on this subject so possibly the best risk mitigation is to ensure you can call on the in-depth industry knowledge and be sure you choose those people wisely.
Secondly, at the end of the day you can talk environment, sustainability, animal welfare, labor issues and other ethical matters, but the only thing that will give you the edge in business is quality and consistency, and it will be that which will be rewarded with any price differential.

Thirdly, whilst there are now investors coming forward showing an interest in the fisheries area, there is a lack of ‘product on the shelf’ for them to engage, thus we need a ‘pipeline’ of ideas which are groomed to meet the requirements of the investors.

On the funny side, we heard (from the APEC man himself, I hasten to add) that another definition of APEC was Another Perfect Excuse for a Conversation, suggesting that there was much talk and little action. APEC saw themselves as an incubator for ideas covering the melting pot of complexities relating to the nations engaged.

In this session, we also heard about common elements of different successful strategies for sustainable fisheries management. Sometimes this is top-down enforcement and other times bottom-up transformation, but the fisheries initiatives most likely to succeed are characterized by an integrated approach to reform and the transition to sustainable management through collaboration. New investment is more likely to be attracted and sustained when the right conditions for investible fisheries are in place and understanding the status of stocks is no help without policies that control overfishing. Finance will not flow, nor will infrastructure be built to increase the value of the catch, unless there is an asset to invest in - a sustainable supply of fish.

The day finished with a good networking session over cocktails.

Day Two will be reported in the next blog and covers some insights into Indonesia’s future plans which will indicate that it is, in my estimation, heading down an exciting pathway.