If the World Trade Organization is to prohibit subsidies for unsustainable fishing practices, it will need to take into account the needs of millions of fishermen in the world’s less developed countries, Pallavi Arora writes.
The depletion of global fish stocks has reached a tipping point. A study by the United Nations Food and Agriculture Organization has revealed that approximately 60 per cent of the assessed fish stocks are fully exploited and 31 per cent are over-fished. Further, the World Wildlife Fund has reported that illegal, unreported and unregulated (IUU) fishing constitutes 13-31 per cent of the global catch, valued between $10 billion and $23.5 billion annually.
For centuries, states have subsidised their fisheries sectors. Wide-ranging studies show that capacity-enhancing fisheries subsidies, for example for fuel and vessel construction, lead to unsustainable levels of fishing. Globally, $20 billion worth of fisheries subsidies have been assessed to have a negative environmental effect.
In view of this, 11 countries within the World Trade Organization (WTO) have together formed the ‘friends of fish’ group. Led by the United States, Iceland, Australia, New Zealand and Norway, they demand the prohibition of environmentally harmful fisheries subsidies under the auspices of the WTO. Their position has been on the WTO agenda since the Doha Round of 2001, yet for years negotiations on the issue have ended in a stalemate.
However, the adoption of the United Nations Sustainable Development Goals (SDGs) in 2015 provided a fresh impetus to the negotiations. SDG target 14.6 has set 2020 as the deadline to prohibit environmentally harmful fisheries subsidies.
Following suit, the WTO Buenos Aires Ministerial Decision of December 2017 has urged member countries to adopt comprehensive rules to prohibit subsidies contributing to over-fishing and IUU fishing. The deadline for this goal is the next Ministerial Conference scheduled in 2019.
The fisheries sector is of particular importance to Least Developed Countries (LDCs), Small Island Developing States, and developing countries. A World Bank study reveals that 90 per cent of the world’s fishermen are employed in small-scale fishing activities, and of these 97 per cent live in developing countries. The impoverished fishermen of the LDCs and developing countries rely heavily on government subsidies for their sustenance. Thus, a carte blanche prohibition on fisheries subsidies would be harmful to the livelihood of artisanal and small-scale fishermen.
Consequently, a number of WTO groups have demanded special and differential treatment for any prohibition on fisheries subsidies. These groups include the LDCs; the African, Caribbean and Pacific States group; as well as developing countries like India, China and Indonesia. Such countries claim that ending subsidies would threaten the sustenance of artisanal fishermen, and that their governments face severe capacity constraints to report on and regulate fisheries.
It is important to note that SDG target 14.6 explicitly supports special and differential treatment on fisheries subsidies: “…appropriate and effective special and differential treatment for developing and least developed countries should be an integral part of the WTO fisheries subsidies negotiation.” Successive WTO Ministerial Conferences since 2001 have also reiterated the same.
However, the United States has vehemently opposed the granting of special and differential treatment, and Iceland, New Zealand, Pakistan, and Norway have joined the US position. They argue that the prohibition of subsidies contributing to overfishing and IUU fishing should apply equally to all countries. As far as special and differential treatment goes, they propose only that some countries may have an extended timeframe to implement the new rules.
If the next WTO Ministerial Conference in 2019 is to reach a pragmatic outcome on fisheries subsidies, it is imperative to find a way to address fish stocks depletion without compromising the livelihoods of impoverished fishermen. Despite the opposition of the United States and other developed countries, the incorporation of effective special and differential treatment is an essential precondition for the prohibition of fisheries subsidies.
So what would special and differential treatment actually involve?
The primary demand of the developing countries is that the prohibition on fisheries subsidies should not apply to artisanal and small-scale fishermen. Developing countries have stressed that the terms ‘artisanal’ and ‘small-scale’ should be defined comprehensively. Further, special and differential treatment for these categories should not be made contingent upon an effective fisheries management system, which is a highly onerous obligation for capacity-constrained developing countries.
A second plea relates to maritime zone classification. Under the UN Law of the Sea Convention, states have a sovereign right over the living resources in their Exclusive Economic Zones. On this basis, developing countries contend that the prohibition on fisheries subsidies should not apply in these areas.
One of the central demands of the ‘friends of fish’ coalition is the prohibition of subsidies that contribute to IUU fishing. However, this would require an overarching regulatory and enforcement framework that many developing countries presently lack.
For instance, developing countries are yet to effectively implement monitoring, control, and surveillance (MCS) operations, which would be necessary to stamp out IUU fishing. Close coordination between national and regional authorities to regulate fisheries is hard to forge in most jurisdictions. This is why developing countries seek special and differential treatment in the context of prohibiting unreported and unregulated fishing. They want a transition period that would enable them to enhance their regulatory and enforcement capacity first.
There is no denying that the depletion of global fish stocks is a cause of imminent concern. But of at least equal concern are the livelihoods of millions of small-scale fishermen in the world’s poorer countries.
Yes, subsidies to environmentally harmful fishing practices should be prohibited, but only after taking into account the precarious position of the LDCs and developing countries. If negotiating countries can strike this balance, we just might see some progress on fisheries subsidies in 2019.