Bridges Trade BioRes • Volume 7 • Number 12 • 22nd June 2007
MEMBERS REMAIN UNDECIDED ON KEY FISHERIES DISCIPLINES
MEMBERS REMAIN UNDECIDED ON KEY FISHERIES DISCIPLINES
WTO Members clashed over the shape of future rules on fisheries subsidy spending during a 14 June meeting of the Negotiating Group on Rules.
In particular, a new proposal from Japan, Korea, and Taiwan was criticised by countries that argued that far broader restrictions on subsidy payments would be necessary in order to counteract the rapid depletion of marine fish stocks.
Delegates had a similarly mixed reaction to a new paper from the African, Caribbean, and Pacific (ACP) states focusing on access fees and the industry’s economic impact in the developing world.
Japan, Korea, Taiwan proposal called insufficient
The Japan-led proposal appealed to Members to prohibit specific types of subsidy payments as opposed to the blanket ban with some exceptions supported by countries including the US, New Zealand, and Brazil (see Bridges Weekly, 6 June 2007, http://www.ictsd.org/weekly/07-06-06/wtoinbrief.htm#1).
Japan, Korea, and Taiwan argued that this ‘bottom-up’ or ‘positive list’ framework would be enough to sufficiently lessen overfishing, and would be more workable than sweeping eliminations. Korea contended that delegates’ priority was to reach consensus on fisheries disciplines, and that this proposal represented the strongest compromise. Taiwan echoed this sentiment, praising the paper for striking the right balance.
Countries including Australia, Chile, New Zealand, and the US contested this supposed ‘balance’ and reiterated their calls for more extensive disciplines. New Zealand asserted that the Asian nations’ approach, which would permit some subsidies for building and purchasing fishing vessels, did not go far enough and failed to "follow the momentum of the negotiations." It further argued that Japan’s exemption for payments to small-scale fisheries amounted to a "get out of jail free" card given that 90 percent of the country’s fishing fleet was accounted for by ships of less than five gross tonnes and thus likely to fall under this categorisation. Taking a similar view, the US said the proposal contained too many loopholes enabling circumvention.
Both New Zealand and the US are members of the ‘Friends of Fish’ group, a loose coalition of countries that have long supported a blanket ban with a list of specific negotiated exceptions.
Some delegates fell between the two groups. Notably Norway, which has co-sponsored papers with the ‘Friends of Fish’ before, and the EU, which is not a member of the group, expressed support for the positive list approach but hesitation about other aspects of the proposal. Norway welcomed the proposal but expressed concern that it contained too many exemptions. The EU applauded the proposal, but criticised it for being insufficiently developed.
Defining subsidies divides Members
Fisheries conservation aside, access fees have been another pressing concern for many delegations. These are payments that a government offers another nation - typically a small coastal state - in exchange for the right to fish in that nation’s waters. The access-granting state receiving the payment generally lacks the capacity or resources to capitalise on its fish stocks.
Heeding a call from rules group Chair Ambassador Guillermo Valles Galmes (Uruguay), to increase discussions on this issue, the ACP group earlier this month distributed a communication on the importance of access fees to developing nations (see Bridges Weekly, 13 June 2007, http://www.ictsd.org/weekly/07-06-13/story6.htm).
At the recent meeting, the Solomon Islands presented the proposal on behalf of the group. It reiterated the ACP bloc’s call for government-to-industry access payments to be shielded from new rules, just like government-to-government fees. While the latter are not widely considered to artificially lower the cost of fishing, some countries argue that government-to-industry fees are de facto subsidies, since remote governments often sell access rights to private fishing fleets below cost - i.e., for less than the amount of access fees paid to the coastal nation.
The ACP group wants all access fees to be exempt from WTO challenge, noting that such payments account for 25 percent of total government revenues in several Pacific island countries. Several members of the bloc spoke in favour of the proposal, including coastal countries Mauritius, Barbados, Fiji, Cuba, Egypt, and Cote d’Ivoire. The EU likewise expressed full support for the ACP position.
Raising the issue of balance once again, India said the most important objective would be to optimise revenue protection and marine conservation.
The US and New Zealand opposed the paper, calling attention to sustainability concerns. New Zealand cited an independent study that demonstrated how the transfer of rights from governments to private industry at subsidised rates has led to overfishing; it argued, therefore, that such transfers should be banned. If these fees were permitted, it continued, the coastal nations would have to cope with the subsequent ecological — and economic — effects. Thailand, Chile, Australia, and Costa Rica backed this point of view, and noted their support for disciplines on the transfer of access rights.
Group urges special treatment for developing countries, LDCs, and small, vulnerable economies
While not officially on the agenda at the recent meeting, delegates briefly and informally addressed a paper circulated on 6 June by a group of eleven small, vulnerable economies (SVEs), which included Nicaragua, Barbados, Cuba, Fiji, and the Solomon Islands. The document urges Members to insert flexibilities, technical assistance, and capacity building in any fisheries subsidies rules. They argue that this would boost opportunities for growth in the fisheries sector in developing countries, as well as safeguard the crucial revenue-generating function that the industry currently fulfils.
In the paper, the SVEs outline principles to guide the creation of special and differential treatment (S&DT) provisions. They pointed to the sector’s socio-economic importance to poorer nations, where it aids employment, livelihood security, income, and nutrition, and said that this could be compromised without carefully-crafted disciplines.
The text argues that since developing countries have a limited capacity to implement effective management structures, or initiate research or analysis, making S&DT conditional on management capacity would penalise them, especially SVEs and least-developed countries. Therefore, any such connections in new fisheries subsidies disciplines should provide for developed countries and international organisations to provide them technical and financial assistance to strengthen their capacity and meet such standards.
Another element of future disciplines addressed in the paper, is the definition of artisanal and small scale fisheries. The SVEs proposed that both be well-defined and clearly distinct based on their different economic roles, and recommended that any definitions should be based principally on the sectors’ economic impact.
The SVEs paid heed to the environmental concerns behind recent proposals from the US and Brazil calling for wide-ranging prohibitions on subsidies in order to halt overfishing. However, they argued that "small, vulnerable economies, LDCs, and some other developing countries have had such a minimum impact on over fishing and overcapacity that the proposed restrictions on these countries would be unduly punitive."
Looking ahead
Much of the focus of the next rules meeting, scheduled for the week of 9 July, will be on establishing disciplines for developing countries that will balance conservation and economic concerns. The paper distributed by the group of SVEs will also be formally on the agenda.
Sources report that the Chair will not put down draft agreement text before the upcoming meeting, and it is unclear whether such a text might appear before the WTO’s August holiday. One delegate said that the "one certainty is that [a] rules [text] will not be out" before texts on industrial market access and agriculture.
ICTSD reporting.