Subsidies are making a bit of a comeback in Western economies, but there’s one area where they can be deadly: global fishing. Governments are subsidizing the industry, and the industry is overfishing.
Atlantic bluefin tuna and orange roughy, once commonly on the American restaurant menu, are now making appearances on growing endangered lists. At this rate, the implications extend far beyond your restaurant menu — the ocean ecosystem could change for the worse.
After decades of discussion, the World Trade Organization might just be ready to usher in a solution.
Global fisheries subsidies added up to an estimated $35.4 billion in 2018. China is far and away the largest provider in terms of dollar value and as a share of its landed catch. China is also the largest provider of the most harmful subsidies that are tied to illegal, unreported and unregulated fishing. But China is far from the only offender: Other large subsidizers include the European Union, the United States, South Korea and Japan.
Government subsidies fund bigger boats, bigger gear and fuel, among other things. Rigged-out fishing vessels venture to the high seas and cast their supersized nets and outsized and high-tech destructive trawling gear, pulling up their main catch but also a lot of bycatch, leaving destruction in their wake. According to the United States Geological Survey, “Trawling destroys the natural seafloor habitat by essentially rototilling the seabed. All of the bottom-dwelling plants and animals are affected, if not outright destroyed by tearing up root systems or animal burrows.”
It’s all catching up to us. One United Nations agency categorizes 90 percent of the world’s fisheries as exploited or overexploited. You can overfish for a while before the result becomes noticeable, and by then, it may be too late to reverse. There are laws governing this, but some fishers abide by them and some do not.
The illegal fishing that goes unreported and is unregulated is particularly bad. Illegal, unreported and unregulated (IUU) fishing is responsible for an estimated 26 million tons of fish caught each year, or around 20 percent of global catch (50 percent for some countries). What’s worse, governments don’t just subsidize legal fishing. Some are paying to deplete our oceans.
After more than 20 years of negotiations, WTO members finally seem intent on reeling back the subsidies that fund these destructive practices. Last year, negotiators agreed to significantly curtail some fishing subsidies, including limiting or prohibiting them to “Vessels or operators engaged in illegal, unreported and unregulated fishing or fishing-related activities in support of IUU fishing,” “fishing or fishing-related activities regarding stocks that are overfished” and “fishing or fishing-related activities on the unregulated high seas.”
WTO ministers will have an opportunity to close the deal next year in Abu Dhabi. Many hope for a strong outcome on fisheries subsidies, but it’s still unclear whether enough countries will bite. Two-thirds of the WTO member countries would need to cast a “yes” vote.
It was during the 2001 Doha round of negotiations when ministers agreed to start negotiations on rules for fisheries subsidies, which fall under the WTO antidumping and subsidies rules purview. Those 2001 talks can be traced back to a 1992 FAO report on fisheries subsidies causing overfishing.
But excitement is building, and WTO negotiators are working hard behind the scenes to reach a meaningful deal. Deputy Director General Angela Ellard was recently in Africa discussing the issue. She noted that IUU fishing “currently costs Africa as much as $2.3 billion in economic losses each year, ” that “more than 30 percent of African fish stocks are overexploited, depleted, or recovering from depletion,” and that “the health of African fisheries would improve if foreign fleets were not paid to fish in the unregulated high seas just beyond the exclusive economic zones of African countries.”
If you’re new to this topic, you might think that getting countries to agree to stop subsidizing this destructive behavior should be easy. After all, it’s obvious that if you deplete a prey population beyond its ability to replenish itself, it will dwindle out.
But the incentives for nations to subsidize their own fishing industries are a big part of the problem. Let’s hope WTO members can find common ground to save this common global resource.
Christine McDaniel is a senior research fellow with the Mercatus Center at George Mason University.
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