Indicators of ineffective fisheries management

Rashid SumailaFisheries Economics Research Unit

UBC Fisheries Centre

r.sumaila@fisheries.ubc.ca

Coastal Zone 2007, Portland, Oregon July 25, 2007

Three indicators

• Poverty index;

• Policy sensitivity index;

• Subsidy indices.

Fisheries subsidies: A definition

Fisheries subsidies are financial payments

from public entities to the fishing sector,

which makes the sector make profitable than

otherwise.

Why the concern about subsidies?

• Subsidies are substantial and have to be paid by someone;

• Subsidies have socio-economic, distributional and trade impacts on fishing communities, regions and countries;

• Fisheries subsidies recognized worldwide as contributing to over-fishing.

Why the concern about subsidies?

• Overcapacity and overfishing• overcapitalization and subsidies

Fishing Intensity

19001900

19991999

Biomass Biomass

Courtesy V. Christensen

1.8-2.51.5-1.81.2-1.50.9-1.20.7-0.90.6-0.70.4-0.60.3-0.40.2-0.30.1-0.20-0.10-0

Biomass t·km-2

How subsidies induce overfishing

MEY

MSY Bionomic equilibrium (BE)

Total cost of fishing effort (TC)

Total Revenue (TR)

Fishing effort (E)

TR & TC ( $)

E1 E2 E3

Max. rent

TC1

TC2BE2

BE1

TR

TR& TC ($)

E3 E4 Fishing effort (E)

Cost-reducing subsidies

Gordon Schaefer bioeconomic model

Identifying & categorizing subsidies

• ‘Good’ subsidies:

• Fisheries management and services;

• Fisheries research and development.

Identifying & categorizing subsidies

• ‘Bad’ subsidies:• Tax exemption programs; • Foreign fishing access payments; • Boat construction renewal and modernization

programs;• Fishing port construction and renovation programs; • Fishery development projects and support services;• Marketing support, processing and storage

infrastructure programs;

• Fuel subsidies.

Identifying & categorizing subsidies

• ‘Ugly’ subsidies:

• Fisher assistance packages;

• Vessel buyback programs;

• Rural fishers’ community development programs.

Computing subsidy indices

• Created a database of the 12 types of subsidies identified for 144 maritime countries for 1995 to 2005;

• Use the database to re-estimate the magnitude of subsidies;

• Use the re-estimated subsidies to calculate a number of indices.

Total global subsidies

0 3 6 9 12 15 18 21 24 27 30 33 36

Fuel subsidies

Fisheries mngt & services

Fishing port construct. & renovation

Fish. develop. projects & services

Market., process., & storage infrast.

Fisher assistance

Boat construct., renewal & modern.

Tax exemption

Fisheries R & D

Fishing access agreements

Rural fisher community develop.

Vessel buyback

Global total

Subsidy amounts (USD billion)

Developing countries

Developed countries

Comparing estimates

All except fuel

Fuel

0

10

20

30

40

50

60

FAO (1992) This study Milazzo (1998)

Subs

idy

amou

nts

(USD

billi

on)

Subsidies by category

0

5

10

15

20

25

The Good The Bad The Ugly

Subs

idy a

mou

nts

(USD

billi

ons

) Developed countries

Developing countries

Subsidies by geographical region

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

Asia (All)

Europe

Lat. America & Caribbean

North America

Sub Saharan Africa

North Africa & Mediterranean

Oceania

Subsidy amount (billion USD)

Good subsidies Bad subsidies Ugly subsidies

Subsidies by major fishing nations

0

1

2

3

4

5

6

Japan EU China Russia USA Peru

Subs

idy a

mou

nt (U

SD b

illion)

.

Good subsidies Bad subsidies Ugly subsidies

Subsidy indices

• Percentage of ‘Bad’ subsidy to the sum of ‘Bad + Good’ subsidy;

• Ratio of landed value/‘Bad’ subsidy;

• Amount of ‘Bad’ subsidy per fisher;

• Percentage of fuel subsidy to landed value of bottom trawlers active in the high seas.

Indices: Top 10 performers

Countries

Good/(Good+B

ad) Country

LV/BadSubsid

y Country

Bad ($)/ Fisher

New Z. 1.0 Nigeria 487 New Z. 0

Nigeria0.94 Peru 132 Nigeria 1.25

Peru 0.84 UK 18 China 178

USA 0.77 Netherlands 18 Peru 204

Ireland 0.76 Australia 17 Indonesia 220

Sweden 0.68 USA 16 Eqypt 245

Japan 0.63 Sweden 16 Vietnam 268

Poland 0.54 Ireland 15 Ghana 317

UK 0.50 Chile 14 Myanmar 346

Canada 0.44 Canada 11 UK 370

Indices: Bottom 10 performers

Country

Good/(Good+Ba

d) CountryLV/TotalSubsidy Country Bad ($)/ Fisher

Korea 0.08 Spain 3 France 11565

Yemen 0.07 Bangladesh 3 Yemen 14845

Taiwan 0.07 Russia 3 Canada 19393

Spain 0.06 Philippines 3 Portugal 26962

India 0.06 Yemen 3 Argentina 31027

Thailand 0.05 Namibia 2 Japan 42192

Brazil 0.04 Ghana 2 Australia 73994

Turkey 0.02 Denmark 1 Namibia 101859

China 0.01 Brazil 1 Iceland 122005

Malaysia 0.00 India 1 Denmark 342717

Fuel subsidy estimates to high sea bottom trawl fleet

CountryFuel used(m liters)

Fuelsubsidy(US$m)

Landedvalue

(US$m)

Subsidy perLanded value

(%)

Japan 0.25 25.44 125 20

Australia 0.20 17.38 9 11

South Korea 0.18 16.37 92 19

Russia 0.18 6.97 126 13

Iceland 0.18 1.03 33 5

Ukraine 0.15 3.66 20 18

Faeroe Isl. 0.15 2.85 45 6

Estoniaj 0.15 1.26 27 5

Lithuania 0.15 1.78 10 5

Latvia 0.15 0.46 7 4

France 0.14 0.29 5 7

Spain 0.10 0.37 103 7

Total 78 601 13

Concluding remarks

• ‘Bad’ subsidies constitute the bulk of subsidies paid by governments to their fishing sectors – big barrier to effective fisheries management and governance;

• Countries perform differently under different subsidy indices, revealing different areas for improvement in fisheries management and governance.

Thanks for your attention

EC Contract No. 003739