The Impact of Government Policies on Profitability and Competitiveness of Seaweed at Tanakeke Islands, South Sulawesi Province

Abstract

Seaweed is one of the leading commodities in the Fisheries Revitalization Program in South Sulawesi. Production and export growth of seaweed over the last five years experienced a significant increase but will not be offset by the value of export receipts caused by the quality of seaweed produced in Tanakeke islands so low that the price of seaweed in the international market is low. Therefore, This study aims to analyze: (1) the level of financial and economic benefits, (2) the competitiveness of commodities seaweed the through competitive and comparative advantage, (3) the impact of government’s input-output policy on the competitiveness and benefits of commodities seaweed. Policy Analysis Matrix (PAM) was employed in this study in order to calculate the private and social prices of revenue and cost of the seaweed in which the social price was calculate from the shadow price of output is based on FOB prices in the port of export (Makassar) and private prices from seaweed adjusted real actual price received by farmers Tanakeke Islands. The results showed that: (1) the seaweed in Tanakeke islands was profitable (both privately and socially profitable), (2) it had competitive advantage (PCR < 1) and comparative advantage (DRC < 1), (3) the impact of government policy on output indicates negative result means that government intervention has not been effective so that the prices received by farmers is lower than international prices.