Last Friday, the twelfth ministerial conference (MC12) of the World Trade Organization (WTO), which would begin on November 30, was suspended. It's important that this cancellation doesn't delay the agreement that could change the fate of the world's oceans. The trade ministers of the 164 member countries of the WTO are mandated to reach an agreement prohibiting subsidies that are harmful to fishing.
Since the Doha round of negotiations in 2000, the WTO has had a mandate to regulate fishing subsidies and has not succeeded in doing so in 21 years. When the negotiations began, 25% of the world's fisheries resources had development potential, today only 6.2% can be developed. The slowness and the inability to reach agreements is taking a heavy toll on the health of the oceans and the people who live on them.
After 21 years of failed negotiations, this time there are some conditions that may favor an agreement. In 2015, member states of the United Nations approved the Sustainable Development Goals (SDGs), including objective 14.6 for the elimination of harmful subsidies to fishing by 2020.
In follow-up to SDG 14.6, during the eleventh ministerial meeting (MC11) ministers pledged that for SDG 12 they would reach an agreement to ban subsidies that contribute to overfishing. The MC12 was scheduled for 2019, but due to the restrictions generated by the health contingency, the meeting was postponed until it was defined for the week of November 29 to December 3, 2021.
These last few years have not been wasted time, at this point there is already a definite text being negotiated on, the group of negotiators has been meeting regularly and there is political pressure to reach an agreement.
Fishing subsidies in Latin America
Most countries provide subsidies to support the development of their fisheries. According to Sumaila, more than 35.4 billion dollars are awarded annually worldwide in the form of grants. The way in which fishing subsidies are awarded is not equitable, since 58% of all subsidies in the world are given by five participants: China, the European Union, the United States, the Republic of Korea and Japan.
At the regional level, inequity is also evident; the sum of the subsidies granted by all Central and South American countries barely reaches 5.6% of total subsidies, while other regions contribute more significantly: Asia with 55% and Europe with 18%.
Although the objective of the subsidies is to support fishing, many of them have the opposite effect and instead of helping the development of the activity, they favor overfishing, compromising the viability of this activity in the future — these subsidies are called harmful subsidies.
Of the subsidies granted worldwide, it is estimated that 63% are harmful, 30% are beneficial, and there is a 7% classified as ambiguous. In the case of Latin America and the Caribbean (LAC), the composition of subsidies is very similar to global figures: 59% are harmful, 35% are beneficial and 6% are ambiguous.
For Latin American and Caribbean countries, it is difficult to compete in the global fish and seafood market, against countries that provide large amounts of subsidies. Even more serious, that competitiveness in international markets is the case of direct competition for resources; there are Asian and European fleets fishing on the edge of the seas of the countries of the region. This fishing by foreign fleets may be under the regulation of a Regional Fisheries Management Organization (OROP), in an unregulated manner or even illegally.
Direct competition for fishery resources
In accordance with the United Nations Convention on the Law of the Sea, the Exclusive Economic Zone (EEZ) extends up to 200 nautical miles, giving the coastal state special rights for the use of marine resources. Once this strip is over, the sea is open to all states, even those that are landlocked, and will be regulated under the rules of international law. In other words, after 200 miles of the coast, any country can fish.
Using the Atlas of Distant Fleets, it is possible to consult the fishing fleet that exists in the international waters bordering the EEZ of the countries of Latin America and the Caribbean (LAC) and it can be seen that the Latin American fleet represents less than 10%, while the Asian fleet represents almost 70%.
When we look at the figures based on the subsidies granted to the fleet, the data is even more shocking; 82% of the subsidies granted to fish in these areas are provided by countries in Asia, while the fleet of LAC countries represents less than 7% of the subsidies granted to fish just 200 miles off the coast of the region.
Sometimes distant fleets also enter the EEZ of some countries through access agreements or even illegally. As an example, the presence of a foreign fleet in the EEZ of Western Atlantic countries (Argentina, Uruguay and Brazil) was consulted. The subsidies attributable to European and Asian vessels fishing within the EEZ of these countries contribute 98% of all subsidies attributable to foreign fleets within the EEZ of these countries; while only 1% is attributable to vessels from neighboring countries.
Myths about fishing subsidies
Despite the clear advantages that an agreement of this type would have for developing countries with less capacity to provide subsidies, many of these countries have concentrated on defensive positions seeking flexibility to continue granting subsidies to fisheries, or even defending the right to provide subsidies in the future, even if they are currently unable to grant them. These defensive arguments are based on ill-founded assertions, which can be summarized in four myths:
Myth 1 - Subsidies are required to compete against major fishing powers. The five nations that provide the most subsidies spend 20.5 trillion dollars a year on fishing subsidies. There's simply no way that a developing nation with limited budgets can win in this race to support fisheries. The best thing would be to cut global support in order to level the ground.
Myth 2 - So-called fishing subsidies are necessary to combat poverty in coastal areas. Although it is true that in some coastal areas aid can play an important role, subsidies classified as harmful should not be part of the support portfolio for several reasons: (1) this type of subsidy generates overfishing, affecting fish stocks, which are the basis for the development of these communities; (2) fuel subsidies are inefficient as income support, globally for every dollar spent on fuel subsidies, 10 cents of profits are generated for fisheries; and (3) 84% of the subsidies granted globally do not reach coastal communities.
Myth 3 — Subsidies are necessary for the development of fishing potential in developing countries. Only 6.2% of global fisheries resources have development potential; the rest are at their maximum, or even above, the maximum sustainable level. Since the 1980s, wild fish catches have remained constant despite the large sums of subsidies granted. For the development of sustainable fishing activity and the well-being of coastal communities that live from fishing, there are other more efficient public spending options, such as combating illegal fishing, improving fisheries management, or investing in fisheries science.
Myth 4 — Only developed nations are the ones that provide subsidies. There are developing nations that are also major subsidiaries; between Indonesia, Vietnam, India and Pakistan alone they granted 2 billion dollars in fishing subsidies in 2018, this figure exceeds the fishing subsidies granted by all Central and South American countries in a year. In such a way, exempting developing countries from the rules would work against the interests of LAC nations.
Final Recommendations
Considering the strong presence of highly subsidized distant fleets competing for fishing resources 200 nautical miles off the coast of the region, the low percentage of fishing subsidies provided by LAC compared to other regions such as Europe and Asia, and the need to take care of fishing resources for the development and food security of coastal communities, we believe that the region's position should be ambitious and include at least the following points: (1) ensure that all types of harmful subsidies to fishing in international waters, (2) ensure that the definitions of special and differential treatment (SDT) for less developed nations do not end up negatively affecting the region, (3) ensure that the prohibitions include fuel subsidies and fleet modernization —which are the ones that most favor fishing in distant waters—, (4) take advantage of the rules of transition periods to include language that establishes a maximum time for compliance and that serve to redirect resources to the fight against illegal, unreported and unregulated fishing; the analysis of fishing stocks; and improvements in management, and (5) begin to generate cooperation mechanisms within the region to generate a transition that benefits the management of fishing resources and in particular of shared migratory resources.
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