INDONESIA ALLOWS ONE-YEAR TRANSITION TO REFLAG

UNCLAS MANILA 005929

SIPDIS

STATE FOR EAP/EP, EB/TPP/ABT, EB/TPP/BTA/ANA, OES/OMC
STATE PASS USTR FOR BWEISEL, DKATZ, RVARGO
STATE PASS USAID
USDA FOR MANIS, AUTRY, SHEIKH
TREASURY FOR OASIA FOR AJEWELL
USDOC FOR 4430/ITA/MAC/DBISBEE

E.O. 12958: N/A
TAGS: EAGR EAID PREL PGOV ECON RP WTRO
SUBJECT: INDONESIA ALLOWS ONE-YEAR TRANSITION TO REFLAG
PHILIPPINE TUNA VESSELS

REF: MANILA 5344

During November 24-25 negotiations in Jakarta, the
Government of Indonesia declined to renew its bilateral
fishing agreement with the Philippines but agreed to allow
Philippine vessels to use Indonesian waters during a one-
year transition period ending on December 2, 2006.
According to USAID Fisheries Advisor Stanley Swerdloff, who
attended the negotiations, Indonesia maintained its
requirement (reported in reftel) that Philippine vessels
reflag under Indonesia in order to continue fishing in
Indonesian waters. Philippine tuna industry representatives
remain deeply concerned that this requirement could severely
damage the Philippine tuna industry by forcing Philippine
vessels to land most of their tuna catch in Indonesia. The
$400 million-per-year Philippine tuna industry is vital to
the economy of Southern and Western Mindanao.

Swerdloff reported that representatives of the Philippine
tuna industry and the Bureau of Fisheries and Aquatic
Resources (BFAR) briefed President Arroyo after the talks
and asked her to press President Yudhoyono to exempt
Philippine vessels from Indonesia's reflagging requirement.
Arroyo later enlisted former Philippine Army Chief General
Efren Abu, a personal friend of President Yudhoyono, to help
lobby for a new tuna pact. Arroyo appointed General Abu as
Special Representative to the Brunei Darussalam, Indonesia,
Malaysia, Philippines - East ASEAN Growth Area (BIMP-EAGA),
in part to promote Philippine fishing interests under the
BIMP-EAGA framework.

JONES