Fisheries subsidies

Fisheries subsidies: The WTO’s New Year’s Resolution for 2019?

If your New Year’s resolution was to eat healthy and lose weight, you may have signed on to one of the popular diet trends like Keto or Whole30. Both trendy diets are low in carbs and high in fat — meaning more trips to the protein aisle in the grocery store.

While the word “protein” usually brings to mind a juicy steak or roasted chicken, the world’s largest source of protein isn’t found on the ranch or farm, but in the ocean. Over three billion people depend on the ocean as their primary source of protein, according to the United Nations, and over 200 million people making their living directly or indirectly from marine fisheries.

The UN and WTO are both “resolved” to reduce fisheries subsidies

In 2015, the United Nations made its own list of resolutions through the Sustainable Development Goals (SDGs), a collection of 17 far-reaching goals aimed to reduce poverty, eradicate hunger, improve sustainability, and more. Some of these goals have a 2020 deadline, including one that pledges to eliminate harmful fisheries subsidies.

Although not bound in any formal way to meet the SDGs, members of the World Trade Organization (WTO) share many of the same objectives, including a mandate to negotiate commitments to prohibit certain forms of fisheries subsidies that contribute to overcapacity and overfishing. WTO members have been debating the topic for nearly two decades.

With time running out before the UN’s 2020 deadline, 2019 is a “make or break” year for the WTO to address the question of how best to address harmful fisheries subsidies within the international trade framework.

What are fisheries subsidies?

In general terms, a subsidy is a benefit given by a government to an individual, business or institution, usually in the form of cash payments or tax reductions. For fisheries, subsidies can include government grants to buy new fishing vessels, tax exemptions on boat fuel, or other forms of subsidization. Governments around the world spend an estimated $35 billion on fisheries subsidies each year, $20 billion of which are considered capacity-enhancing subsidies that directly contribute to overfishing.

Government subsidies to their respective fishing industries may be accelerating the depletion of fish stocks. Nearly 90 percent of the world’s fish stocks are at risk. 58 percent of global marine fish stocks are fully exploited. 31 percent are overfished.

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This means we’re fishing beyond sustainable limits, which not only affects our seafood supply, but also impairs the functioning of ocean ecosystems. Some of the world’s most popular commercial fish — like the prized Atlantic bluefin tuna on the menu at a nice sushi joint — have been overfished to the point where the species is threatened, the World Wildlife Fund says.

SDG 14 aims to conserve and sustainably use the oceans, seas and marine resources for sustainable development, including tackling harmful fisheries subsidies. But subsidies and the rules that govern them are complex.

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Subsidies are not all bad. If properly managed, they can help developing countries and the small-scale fishers who truly need support. But developing countries often can’t afford to provide as much in subsidies as developed countries. Small-scale fishers complain that subsidies tend to get sucked up by larger fishing companies at their expense. This creates unfair advantages and distortions in the marketplace. The “big fish” are the subsidies that aid illegal, unreported and unregulated fishing, which reportedly cause global losses of up to $23 billion a year.

These trade issues, plus increased environmental fears of overcapacity and overfishing, led the WTO to take up the mantle of fisheries subsidies reform in 2001.

What is the WTO’s role?

WTO members first started negotiating on fisheries subsidies at the Doha Ministerial Conference in 2001. The negotiating mandate was further clarified at the 2005 meeting of WTO ministers in Hong Kong to focus on prohibiting certain forms of fisheries subsidies that contribute to overcapacity and overfishing. Negotiations continued from 2005 to 2011, and then largely stalled before hope reignited prior to the 2017 meeting of trade ministers in Buenos Aires, thanks in part to the adoption of the UN’s SDGs a couple of years earlier.

Before the Buenos Aires conference, seven different proposals from members spanning from the EU to Africa to South America were circulated. China, Japan, India, and the United States also jumped in to suggest further amendments to the compilation text. But despite the renewed push for action, members ultimately failed to reach an agreement in Argentina.

WTO members have since vowed to intensify negotiations and reach an agreement on comprehensive and effective disciplines by the end of 2019. Next steps include hosting working groups from January to July 2019 on four main topics: subsidies to illegal, unreported and unregulated (IUU) fishing; subsidies to fishing where stocks are overfished; subsidies contributing to fleet overcapacity and overfishing; and the cross-cutting issues of special and differential treatment for developing and least-developed members, dispute settlement, institutional issues, and notification and transparency.

“We all know the mandate is to reach an agreement by end-2019 and we all know getting there is not easy,” said Negotiating Group Chair, Ambassador Roberto Zapata Barradas of Mexico, at December 2018 talks. “If we are serious about getting this done, we have to move into the uncomfortable zone of compromise and accommodation.”

Running out of time

The WTO is under more scrutiny than ever to deliver concrete results. Reaching an agreement on harmful fisheries subsidies may give the organization an opportunity to demonstrate its effectiveness and defend its relevance in 2019.

Some WTO members sense this urgency, expressing that success of fisheries negotiations is vital for the credibility of the organization at recent talks. The UN Secretary General’s Special Envoy for the Ocean, Peter Thomson, recently echoed those sentiments, calling 2019 “the year in which we will win or lose our long struggle to rid global fisheries of harmful subsidies.”

It’s no secret that New Year’s resolutions are notoriously hard to keep. While we may start the year vowing to stick to Keto or Whole30, we’re well aware that the protein aisle is dangerously close to the snack food aisle. For the WTO, the resolution to eliminate harmful fisheries subsidies has fallen short year after year since 2001.

Is 2019 finally the year for the WTO to stick to its resolution on fisheries subsidies? The tuna sure hope so.