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Last Tango in Buenos Aires: WTO Faces Deadline to Ban Fishing Subsidies

With a 2020 mandate to prohibit harmful fisheries subsidies that have led to the overexploitation of fish that feed billions of people, the World Trade Organization may finally take action at its biennial meeting this week in Argentina.

Written by Todd Woody Published on Read time Approx. 6 minutes
Boats set sail to fish in the East China Sea on September 17, 2017, in Zhoushan, Zhejiang province of China.VCG/VCG via Getty Images

Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime, goes the old proverb. Here’s a 21st-century update: Give a person an unsustainable subsidy and they’ll fish until all the fish in the sea are gone.

Nearly 90 percent of all commercial fish stocks are fully exploited or overexploited, according to a 2016 United Nations report. Today, one-third of aquatic stocks are being fished at unsustainable levels, up from 10 percent in 1974. That threatens a vital source of food for billions of people – the U.N. Food and Agriculture Organization estimates that fish account for 20 percent of animal protein consumed globally while in small island nations and regions of Asia and Africa, fish supply half of all protein.

What’s fueling this fish free-for-all? As much as $8 billion a year in government fuel subsidies, for one thing. Such largesse – part of $27 billion to $35 billion in annual global fisheries subsidies – extends the reach of fishing fleets and encourages exploitation that would otherwise be a money-loser.

Which is why you should be paying attention to what happens in Argentina this week. After nearly 20 years of protracted negotiations to eliminate subsidies that promote overfishing and illegal fishing, the 164 member nations of the World Trade Organization (WTO) are at last poised to take action during its biennial meeting. Negotiations open on Monday, December 11, in Buenos Aires.

“I think that they just took things too easy for a long time, but now the ocean crisis is much more evident,” Remi Parmentier, director of Madrid-based consultancy the Varda Group and a longtime observer of the WTO, said from Buenos Aires. “The same way we talk about climate change, we now talk of ocean change – ocean acidification, coastal sea-level rise, overfishing.”

“We’re getting to a place where ocean change is top of the agenda,” added Parmentier, who serves as a political adviser to BLOOM, a Paris-based ocean conservancy nonprofit, whose representatives are also in Buenos Aires this week. “It’s more difficult to get off the hook. And until now, the WTO was largely off the hook.”

(United Nations Food and Agriculture Organization)

Researchers led by Rashid Sumaila, a professor and director of the Fisheries Economic Research Unit at the University of British Columbia, calculated that global fishing subsidies amount to $27 billion annually. Their 2010 study estimated that $8 billion of those subsidies could be considered beneficial as they support programs that promote management of sustainable fisheries. However, $16 billion in subsidies underwrite the expansion of fishing fleets. That includes between $4.1 and $8.3 billion in government fuel subsides that make it economically viable to send ships to the far reaches of high seas. The researchers labeled another $3 billion in annual subsidies as “ambiguous” as their impact on fish stocks could not be determined. (The U.N. in 2014 pegged global fisheries subsidies at $35 billion.)

“Subsidies that help build bigger vessels, and vessels with bigger engines, as well as, in some cases, port infrastructure development have resulted in a global fishing fleet that is two and a half times larger than the number of vessels needed to fish sustainably,” Karen Sack, managing director of environmental nonprofit Ocean Unite, said in an email.

“The result is that we have way too many boats catching too few fish – the subsidies prop up fishing practices that may not be economically viable without them,” added Sack, who closely follows international fisheries issues. “They skew investment in larger more destructive fleets, undermining more progressive investments in the development of more sustainable fisheries that provide food and livelihoods for more people.”

New research by Sumaila and his colleagues published in June in the journal Marine Policy found that industrial fishing fleets are the most heavily subsidized. Small-scale fisheries, which provide employment and food to local communities in developing countries, receive only 16 percent of total global subsidies.

“Almost 90 percent of capacity-enhancing subsidies, which are known to exacerbate overfishing, go to large-scale fisheries, thus increasing the unfair competitive advantage that large-scale fisheries already have,” the scientists wrote. “The developmental, economic and social consequences of this inequity are huge and impair the economic viability of the already vulnerable small-scale fishing sector.”

U.N. member states in 2015 agreed to eliminate fisheries subsides that contribute to overfishing and illegal, unreported and unregulated fishing by 2020 as part of a “Sustainable Development Goal” to promote ocean health.

Members of the Indonesian navy holding the crew of the Chinese trawler Hua Li-8, which was allegedly operating illegally in Indonesian waters, in April 2016. (Abimata Hasibuan/AFP/Getty Images)

That apparently lit a fire under WTO negotiators, who have been debating fisheries subsidies since 1999. In negotiations in Geneva last month to prepare for the Buenos Aires talks, discussion focused on eight proposals presented by individual nations and groups of countries. Differences emerged on how, among other things, to determine if a species is overfished; whether prohibitions on subsidies should be limited to fishing in nations’ Exclusive Economic Zones or apply to the entire ocean; whether to exempt developing nations; and if subsidies should be phased out over time.

Decisions on fisheries subsidies must be unanimous, but there’s reason to be cautiously optimistic about the outcome of this week’s WTO negotiations, Parmentier says.

For one thing, the WTO ministry last Wednesday released a draft of a proposed decision on fisheries subsidies to be considered by trade representatives in Buenos Aires. The draft indicated an emerging consensus on at least some issues, such as subsidies for illegal, unreported and unregulated (IUU) fishing and subsidies that encourage overfishing.

To eliminate subsidies for vessels that engage in IUU fishing, the draft decision offers five alternatives. The strongest states that, “until a negotiated agreement is adopted, members agree not to grant or maintain subsidies that contribute illegal, unreported and unregulated fishing.” A weaker alternative only requires nations to “endeavor” to eliminate such subsidies, while other proposed alternatives provide various loopholes from a subsidy ban, according to an analysis BLOOM issued Saturday.

(United Nations Food and Agriculture Organization)

A section of the draft on banning subsidies that promote overfishing showed that no consensus had been reached. But last Thursday, Canada, the European Union, Iceland, New Zealand and Norway offered proposed language that would require nations to either agree or endeavor not to grant or maintain subsidies that lead to overfishing.

No consensus has been reached on the crucial issue of barring “capacity” subsidies – including fuel subsidies – that expand the size and reach of fishing fleets. “We’re talking about a big, big elephant in the room – a mammoth in the room,” said Parmentier of fuel subsidies. “If we don’t solve that, we won’t resolve fisheries subsidies.”

One wild card is China, which maintains the world’s largest long-distance fishing fleet and which has proposed exempting developing nations from subsidy prohibitions and applying a ban to areas of the ocean under territorial dispute, such as the South China Sea.

Still, observers expect consensus to be reached this week on some issues – most likely IUU fishing – with the rest punted to the 2019 WTO meeting for final resolution. (Then again, the delegates so far have yet to agree to what the 2020 deadline means – some say it’s January 1, 2020 while others insist it is December 31, 2020.)

“My expectation is that I hope we get something with a sufficiently high ambition that will lead to implementation of the fisheries subsidies target by 2020,” Parmentier said.

For Sack of Ocean Unite, the WTO negotiations could influence U.N. negotiations expected to begin in 2018 to draft an international treaty to protect the biodiversity of the high seas beyond national jurisdiction.

“Success at the WTO would be a positive signal to negotiators at the U.N. that the world is taking the importance of protecting ocean resources seriously and that their negotiations are key to plugging the holes in the global ocean governance system,” she said.


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