Without a Blue Economy Law, Indonesia's Marine Potential is Threatened with Unexploitation, Academics Recommend
Indonesia, as a maritime nation with two-thirds of its territory covered by ocean, holds enormous potential in the blue economy sector. However, the lack of a strong legal framework is considered a major obstacle to the optimal and sustainable development of this sector.
Recognizing this urgency, Wijaya Putra University (UWP) held a Focus Group Discussion (FGD) entitled "The Urgency of Corporate Blue Bond Regulation as a Financing Instrument for the Blue Economy in Indonesia." The event, held at the Nine Restaurant in Surabaya, brought together dozens of academics, legal practitioners, economists, maritime affairs practitioners, and environmentalists to explore real solutions to encourage the advancement of the ocean-based economy.
The head of the UWP research team, Dr. Budi Endarto, S.H., M.Hum., highlighted that despite Indonesia's rich marine resources, there is no specific law governing the blue economy.
"So far, regulations have been scattered and sectoral. Yet, marine resource exploration requires significant funding that cannot be solely sourced from the state or regional budgets," Budi explained.
In their presentation, Budi and his team recommended three strategic steps to the government and the House of Representatives:
- The establishment of a Blue Economy Bill as a national legal umbrella,
- The establishment of a dedicated blue economy institution, such as the Blue Economy Council,
- The development of an innovative financial instrument, namely the Corporate Blue Bond.
The Blue Bond scheme was a major highlight of the FGD. This instrument is believed to be a sustainable financing solution for the maritime sector without burdening state finances.
As a comparison, Budi cited the Philippines, which already has a Blue Economy Act and has established a dedicated blue economy council. He also suggested that the Indonesian government consider revitalizing the Ministry of Maritime Affairs to ensure more coordinated and integrated maritime management.
Positive responses came from several academics and legal practitioners. Dr. Rihantoro Bayuaji, S.H., M.H., stated that an omnibus law approach to regulation could pave the way for the integration of the capital market sector with the Blue Bond instrument.
Meanwhile, constitutional law expert Dr. Suwarno Abadi, S.H., M.Si., warned that a legal vacuum could actually open up opportunities for abuse of authority and reduce investment interest in the maritime sector.
Interestingly, Prof. Dr. Nugroho Mardi Wibowo, S.E., M.Sc., Head of the UWP Research and Development Institute (LPPM), suggested the development of blockchain-based Blue Bonds to ensure transparency and digital reporting of funds. He also proposed a sharia-compliant financial approach so this instrument could reach a wider range of investors, including those from Islamic countries.
"The digitalization and sharia-compliantization of Blue Bonds will make the blue economy not only inclusive, but also accountable and globally competitive," said Prof. Nugroho.
This FGD is part of UWP's efforts to realize its vision as a Sociopreneur University, which encourages applied research with real impact on society. Research on Blue Bonds is expected to be a pioneer in encouraging the development of innovative regulations and financing systems for the national maritime sector.
With the challenges of the climate crisis, unsustainable exploitation of natural resources, and national fiscal pressures, developing a blue economy through alternative financing schemes such as Corporate Blue Bonds is not only important but urgent.
