Subsidies weaken the sustainability of global fisheries ... · Subsidies weaken the sustainability...
Transcript of Subsidies weaken the sustainability of global fisheries ... · Subsidies weaken the sustainability...
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Subsidies weaken the sustainability
of global fisheries while increasing
inequality among fishers
U. Rashid Sumaila
Fisheries Economics Research Unit
Sea Around Us project
The University of British Columbia
Vancouver, Canada
UNCTAD and ComSec AHEM on Trade in Sustainable Fisheries, Sep 29 – Oct 1, 2015
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Outline of talk
• How important are fisheries to us?
• Opportunities and challenges facing ocean
fisheries worldwide;
• Fisheries subsidies;
• Suggestions for subsidies reform.
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How important are fisheries to us?
• Food and nutritional security;
• Economic security;
• Social security;
• Recreational values;
• Cultural and spiritual values;
• Ecosystem function and service.
L.Teh
D. Varkey
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Food and nutritional security
• Annual ocean fish catch is ~80 million t;
• Fish is a good source of protein, micro-
nutrients, minerals and essential fatty acids;
• Provides 3 billion people up to 15% of
dietary animal protein;
• For low-income food-deficit countries, the
contribution of fish to total animal intake is
nearly 20%.
FAO, State of World Fisheries and Aquaculture (2014)
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Gross revenues from marine
capture fisheries worldwide
are estimated at between US$
80 and 85 billion annually
(World Bank, 2009, Sumaila et
al. 2012);
Total impact throughout the
global economy is between
US$ 220 and 235 billion in
2003 (Dyck & Sumaila, 2010).
Economic security
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Social security through jobs
0
10
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India
Chin
a
Indonesia
Bangla
desh
Vie
tnam
Phili
ppin
es
Pakis
tan
Myanm
ar
Nig
eria
Thaila
nd
Em
plo
ym
en
t (m
illio
n jo
bs)
TotalIndirect
Direct
260 million people worldwide
involved in marine fisheries, including
direct and indirect sector
Top 10 countries providing marine employment
Teh and Sumaila (2011)
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Opportunities and challenges to
global fisheries?
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Climate change impacts
↑ Sea temperature;
↑ acidification;
Δ ocean current
pattern;
Δ salinity;
retreat of sea ice;
↑ coastal hypoxic
& oxygen min.
zone;
↑ sea level.
Physical/Chemical
changes in the
ocean
• Physiology;
• Growth; &
• Body size. INDIVIDUAL
• Distribution;
• Abundance; &
• Recruitment.
POPULATION
• Species composition;
• Invasion/extinction. COMMUNITY
• Productivity; &
• Species interaction. ECOSYSTEM
Biological / ecological
changes in the ocean
Cheung, Watson & Pauly (2012): Nature
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What are fisheries subsidies
• A subsidy is a “financial contribution [direct
or indirect] from the public sector that grants
private benefits to the fishery sector (World
Bank 2009).
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Economic justification
for subsidies
• Externalities:
– occurs when producing or consuming a
good causes an impact on third parties
not directly related to the transaction
• Positive externality → provide subsidies;
• Negative externality → impose taxes.
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30/09/2015 Global fisheries subsidies 11
Categorizing subsidies
• Beneficial subsidies (‘investment’
programs in fish stocks);
• Capacity-enhancing (harmful) subsidies
(‘disinvestment’ programs in fish stocks);
• Ambiguous subsidies (programs may
benefit or harm fish stocks).
Khan et al. (2006); Sumaila et al. (2013)
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30/09/2015 12
Subsidies are substantial
Capacity-enhancing subsidies 83% of total USD 35 billion
Subsidies to developed country fisheries at 65%.
Sumaila et al. (2013)
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30/09/2015 Global fisheries subsidies 13
Subsidies by type → fuel
subsidies = more than 20%.
Sumaila et al. (2013)
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30/09/2015 Global fisheries subsidies 14
Subsidies are made for
inequality
Teh & Sumaila, 2011; Sumaila et al. (2013)
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Beneficial Capacity enhancing Ambiguous
Developing countries
Developed
Su
bs
idy p
er
fish
ery
wo
rke
r (U
SD
00
0)
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Approximately 12% of all fishing subsidies go to the small-scale sector
Fisheries mangt.
MPAs Fishery R&D Fuel subsidies
Fisher assistance
0
10
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30
40
50
60
70
80
90
Sub
sid
ies
(20
14
US
$ m
illio
n)
Small-scale fisheries total = US$ 22 million
Industrial fisheries total = US$ 191 million
Mexican fisheries subsidies
Schuhbauer & Sumaila (in prep.)
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Subsidies and overfishing
*Effective effort indexed on 2000 based on average 2.42% increase annually
Effo
rt (
GW
or
wat
ts x
10
9)
Cat
ch (
mill
ion
to
nn
es)
Year
5
10
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1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005
Catch
FAO Fisheries Statistics
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Subsidies and overfishing
*Effective effort indexed on 2000 based on average 2.42% increase annually
Effo
rt (
GW
or
wat
ts x
10
9)
Cat
ch (
mill
ion
to
nn
es)
Year
5
10
15
20
25
10
20
30
40
50
60
70
80
90
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005
Catch
Effective effort*
Watson et al. (2013)
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Impact on food & nutritional security
Srinivasan, Sumaila et al. (2010)
Potential catch loss by region of the world
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Impact on economic security
Sumaila et al. (2012): PLoS One
Pe
rce
nt
80
60
40
20
0 0.02 0 -0.02 -0.01 0.01
Pre-tax profit share of sales for 1000 fishing companies
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30/09/2015 Global fisheries subsidies 20
Push reform at several levels
• National level;
• Regional level;
• Global level.
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National effort: Indonesia
15%
3%
100%
0
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100
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Beneficial Capacityenhancing
AmbiguousSubsid
ies (
US
$
mill
ion) Small-scale
Large-scale
Schuhbauer & Sumaila (in prep.)
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Core group of countries adopts
fisheries subsidies disciplines
• Examples:
– TPP may include disciplines on subsidies to over-
fished stocks and IUU vessels;
– The ACP group of countries;
– The TTIP countries (EU and USA).
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Establish multilateral disciplines
built step-wise and ‘bottom up’ to fill
remaining ambition gap
• A group of countries, perhaps in
partnership with Intergovernmental
Organisations and NGOs, could stimulate
collective action with bottom-up voluntary
commitments to subsidy reform.
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Establish multilateral disciplines
built on areas of agreement in WTO
negotiations
• Chair report 2011, areas of more
agreement = subsidies to IUU vessels,
transfer of vessels, access agreements;
• Key gap: Subsidies to over-fished stocks
arguably should have been listed.
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Align incentives by focusing
international subsidy negotiations
on international stocks
• WTO negotiations cover subsidies to both EEZ
and High Seas; shared and not-shared stocks;
• Re-start the WTO negotiations giving a higher
priority to subsidies that affect international stocks;
• Build evidence around impact of domestic
subsidies on domestic fish stocks in key countries;
• Lobby domestically and provide incentives
internationally for domestic reform.
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Conclusions
• Build political will by tackling short-term
socioeconomic & political considerations
– ‘switching’ of ‘bad’ to ‘good’ subsidies
• Develop a cadre of local opinion leaders
within countries who really see the
benefits of eliminating harmful subsidies;
• Encourage national and regional efforts
that can develop into a multilateral
agreement.
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Thanks for your attention
Thanks to UNCTAD & COMSEC
for the invitation