Casting the net

Trade measures for sustainable fish stocks
Round Table on Sustainable Development at the OECD

Overfishing remains a major problem on our high seas. Stopping illegal and unrecorded fishing should help. The question is, how?

Remember the Johannesburg World Summit on Sustainable Development in 2002? A distant memory for many, but there, governments committed themselves to restoring depleted fish stocks to levels that can produce the maximum sustainable yield by 2015. Notwithstanding this commitment, as well as a flurry of diplomatic and legal activity throughout the 1990s including major intergovernmental agreements, the evidence suggests that global fish stocks are in serious decline. Illegal unregulated and unrecorded (IUU) fishing, particularly on the high seas, contributes to this problem.

How significant is illegal fishing? The truth is, we do not really know its dimensions. There is anecdotal evidence, but no official statistics, precisely because the fishing is illegal and unreported. What is clear though is that the sharp rise in high seas fishing over the past two decades, both legal and illegal, has placed considerable pressure on the overall state of global fish stocks. According to the UN Food and Agriculture Organization (FAO), only 1% of the global fishery resource is on the road to recovery.

Tellingly, production levels from 12 of the FAO’s 16 world “fishing regions”, including areas of known IUU activity such as the Antarctic, Southeast Pacific and Northwest Atlantic, have fallen below their historical maximums, which lends support to the declining stocks thesis. That said, it is worth noting that the FAO, in its latest report on the state of the world's fisheries, estimated that the catch of oceanic species (the closest that we can get to defining high seas catches) amounted to 8.5 million tonnes in 2000. This was equal to 10% of the total marine catch in that year.

So, what can we do to curb this illegal fishing activity which, year after year, is helping to strip the high seas of its fish stock? Over-capacity in the world fishing fleet remains the fundamental problem. This has forced some trawlers to turn their attention to high seas fishing, placing further strain on the resource. Countries must address the drivers of this activity in the first instance.

One modest set of policies, which may complement other approaches, is to make it more difficult for these illegal catches to reach the marketplace. After all, fish and seafood products are among the most widely traded commodities in the world.

Trade-related measures to stop the supply of illegal fish are a broad category which incorporates, among other things, catch documentation schemes (CDS). These aim to identify the origin of all fish entering member countries of regional fisheries management organisations (RFMOs). The CDS, introduced by the 24 country-strong Commission for the Conservation of Antarctic Marine Living Resources (CCAMLR) in May 2000, is arguably one of the more effective schemes. CCAMLR covers the Southern Ocean region which surrounds the continent of Antarctica.

Under the terms of the CDS, all Patagonian and Antarctic Toothfish traded by members must be accompanied by a valid catch document confirming that the fish was caught in a manner consistent with CCAMLR's Conservation Measures. Without this document, participating countries have the authority to seize, confiscate or dispose of the consignment. Implementation is inevitably complex, and depends on members’ goodwill in enforcement and oversight.

Influencing demand can reinforce the effect of these supply-side measures. Many consumers, for instance, claim to prefer ecolabels as a way of identifying the “right” foods to eat. The appeal of this market-oriented mechanism for sustainable development is clear: it simultaneously informs consumers about the environmental impact of their consumption, while providing producers with a price incentive by accurately translating the mood of consumers into environmentally friendly product development. It is a model that fits the economist’s beloved win-win principle. That’s the good news.

The bad news is that whereas eco-labelling may work with some foods, it has had limited impact on fish. The penetration of environment-friendly fish products in the high value markets of the US and Japan, for instance, has been partial at best. And labelling’s impact on illegal fishing in the high seas has been dulled by its emphasis on specific country-level fishery certification.

WTO friendly?

Another thorny issue is whether fisheries-related trade measures are consistent with WTO rules about non-discrimination and transparency, and whether they can be justified as contributing to “conserving an exhaustible natural resource”, as the GATT 1994 Agreement puts it.

On the face of it, the measures applied by regional fisheries management organisations (RFMOs) fulfil their WTO-related obligations, though there is a grey area. In particular, fears have been raised by some developing countries that trade measures applied through multilateral environmental agreements (MEAs), under which the CCAMLR scheme could fall, may be used against non-signatories who are members of the WTO. In other words, possible incompatibility with the nondiscrimination provisions of the WTO agreements could give rise to a dispute.

That said, the WTO secretariat’s own assessment is that the measures used by CCAMLR and the International Commission for the Conservation of Atlantic Tunas (ICCAT) members may be “considered to provide examples of appropriate and WTOconsistent (i.e., non-discriminatory) use of trade measures in MEAs”. And most significantly perhaps, despite the sensitivities, no case has yet been brought against any fisheries-related trade measure at the WTO (though there have been some close calls).

Private voluntary eco-labelling should also be safe from WTO challenges since the schemes are developed independently from governments. Complications arise, however, when a government supports or appears to endorse labelling schemes. According to the WTO principle that “like” products should be treated alike for the purpose of trade, all fish should be treated the same, regardless of whether they were captured in a sustainable manner. Eco-labelling assesses not only the product itself, but also how it was produced. This offers the potential for a complaint since explaining how the fish was captured means making judgements about responsible fishers, management, impacts on the environment, and so on.

The jury is still out then on how best to fight against the illegal fishing trade which is contributing to the decline in global fish stocks. Trade measures may be of some limited assistance, but are an insufficient mechanism on their own. Moreover, in the absence of a dispute settlement case on a specific trade measure with regards to fisheries, it will be difficult even to be categorical about whether such fishery mechanisms are really WTOfriendly or not. In the meantime, a “learning by doing” approach may be the most practical way forward.

* The views presented in this paper are those of the author alone and do not necessarily represent the views of the OECD or its member countries.

While illegal, unreported and unregulated fisheries are creating headaches for governments and environmentalists, in truth, very little work has been done on examining the economics and social drivers behind this activity. Most measures taken by the international community have been legal and jurisdictional, but economic measures have been overlooked. The OECD Committee for Fisheries, currently working on IUU, will host a workshop on 19-20 April to address these issues and seek to find multidisciplinary solutions to the problem. For more, visit the web site at www.oecd.org/agr/fish or email observer@oecd.org

References

FAO (2002), The State of the World Fisheries and Aquaculture, Rome, FAO, 2002.

Schmidt, C.C. (2002), “Inconvenient flags”, in OECD Observer No 233, August, also available at www.oecdobserver.org.

Upton, S. and Vitalis, V. (2003), Stopping the High Seas Robbers: Coming to Grips with Illegal, Unreported and Unregulated Fishing, Round Table on Sustainable Development, OECD. www.oecd.org/dataoecd/15/16/16801381.pdf

WTO (2000), The Environmental Benefits of Removing Trade Restrictions and Distortions: The Fisheries Sector, Note by the Secretariat, WTO, Geneva, WT/CTE/W/167, 16 October.

©OECD Observer No 240/241, December 2003




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