11 October 2019 (closed)
USD/IDR (14,187) +47.00 +0.33%
EUR/IDR (15,643) +51.83 +0.33%
Jakarta Composite Index (6,105.80) +82.16 +1.36%
As is widely known, especially to those who have visited certain beaches in Bali, Indonesia needs to combat water pollution, and specifically plastic waste. While local authorities on Bali announced earlier this week to enact a ban on single-use plastics, such as shopping bags, styrofoam food packets and straws (while Jakarta may follow suit), Indonesia's Industry Ministry expressed it opposes an earlier plan to impose an excise tax on plastic bags.
For the environment and tourists it is good news that Bali Governor Wayan Koster decided to ban single-use plastics. The policy was signed (and took effect) on 21 December 2018 (carrying a six-month grace period). However, for producers, distributors, suppliers and business actors the policy is a problem as they need to shift to different packaging materials, which are likely to be more expensive than plastic materials. In case retail prices are raised in order to offset the impact of higher packaging costs, then the local population would also be negatively affected as inflation is bound to rise.
Bali Governor Koster said the new policy aims at a 70 percent reduction in Bali's marine plastics within one year. He added that sanctions would be taken if the policy is disobeyed, for example local authorities could decide not to extend business permits.
It is assumed that most of the plastic waste that is found on Bali's beaches comes from the popular tourist island itself where hotels and villages often dump their waste in rivers (usually this is done by informal workers). The trash is then carried out to sea but tends to finds its way back to Bali's beaches during coastal tides and currents. Currently, plastic waste is a major issue in Bali, littering the island's beaches and surrounding waters, including snorkeling and diving sites. This is bad publicity, also in terms of word-of-mouth advertising. We frequently hear foreign tourists complaining about littered beaches. This makes it less attractive for other foreigners to plan a trip to Bali.
Indonesia's capital city of Jakarta may follow the example that has been set by Bali. The Jakarta administration is currently drafting a gubernatorial regulation that will ban single-use plastic bags (including a fine up to IDR 25 million if the regulation is disobeyed). If approved by Jakarta Governor Anies Baswedan, then the regulation will take effect per January 2019 (possibly also with a six-month grace period).
According to the Jakarta Environment Agency, out of the 7,250 tons of waste that is produced each day in Jakarta, 14 percent involves plastics, while 1 percent of the plastics are non-degradable, single-use plastic bags. According to a survey that was conducted by the Indonesia Plastic Bags Diet Movement, more than 90 percent of the residents of Jakarta agree to reduce their use of plastics.
Meanwhile, Indonesia's Industry Ministry opposes an earlier plan of the Indonesian government to impose an excise tax on plastic bags as this policy would impact negatively on the country's small and medium-sized enterprises (SMEs). It is estimated that around 80 percent of manufacturers in Indonesia's plastics industry are SMEs. Achmad Sigit Dwiwahjono, Director General for Textile, Chemical and Miscellaneous Industries at Indonesia's Industry Ministry, said the problem is not plastic products but plastic waste management. Therefore, government policies should focus on enhancing plastic waste treatment, while encouraging more public awareness of (the risks of) plastic waste pollution.
Indonesia - an archipelago with more than 17,000 islands that is home to about 265 million people - is believed to be the world's second-largest contributor of plastic pollutants in the oceans after China. Last year, Indonesia launched a national action plan, pledging up to USD $1 billion to reduce the waste in its waters by 70 percent by 2025. Fajar Budiyono, Secretary-General of the Indonesian Olefin, Aromatic and Plastic Industry Association (Inaplas), says average plastic consumption in Indonesia is around 21-22 kilogram per individual per year.