FARMERS are not the only food producers to get lavish subsidies. The fishing industry gets between $15 and $20 billion a year, at least a fifth of the value of the catch, the World Bank estimates. The result is too many boats chasing too few fish. But now these subsidies too are coming under fire, especially after an initiative by New Zealand.
Much of the $20 billion in subsidies is spent on building and upgrading vessels, and to ensure fishermen continue to profit when prices are low or costs are high. Yet virtually every fisheries agency, including the UN Food and Agriculture Organization, and the International Council for the Exploration of the Seas, which helps manage fisheries for the EU, agrees that these subsidies are the main cause of rampant overfishing worldwide. Even the EU, long among the worst offenders, took an axe last year to some of the subsidies that boost Europe鈥檚 fishing capacity.
鈥淪ubsidies reduce costs, enhance revenues, and mitigate risks,鈥� Alice Mattice, director of environmental policy for the US Trade Representative, told the WTO last year. In overfished fisheries, they allow boats to keep going to the last fish, long after they would normally have given up. And when those fish are gone, she says, subsidised boats turn to other people鈥檚 fish.
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Hence, besides their impact on stocks, these subsidies are also a trade issue. They can drive down prices, give some fleets unfair advantages, and deny countries access to their own fish. For example, subsidised Spanish boats are now fishing off Fiji and selling the fish in Europe as European-caught. Yet a Fijian vessel without an EU subsidy cannot compete with the Spanish if it tries to sell the same fish in Europe, says Aimee Gonzales, a trade expert with the Worldwide Fund for Nature in Geneva.
Efforts to do something about fishing subsidies at the World Trade Organization only got under way after ministers from several countries demanded action at the trade talks in Doha, Qatar in 2001. Even then, there was nervousness among delegates who fear environmental regulation will sneak in the back door at the WTO and impose limits on trade.
But the parlous state of the world鈥檚 fisheries has finally concentrated minds, and the talks have started making progress. 鈥淲e鈥檝e turned a corner,鈥� says Gonzales. At a meeting this week in Geneva, a consensus could start emerging on which subsidies have to go. The 鈥淔riends of Fish鈥�, seven countries led by New Zealand, and including the US, Iceland, Australia, Chile, Peru and the Philippines, want nearly all subsidies declared illegal, while the EU wants to keep subsidies for scrapping vessels and helping fishing people find other work.
Japan, which pays its fleet more than the EU and the US combined, says there is no proof that subsidies hurt fish stocks 鈥� but only South Korea supports this position. If the Friends of Fish succeed, it will be the first time a set of global trade rules has been built on what started out as a conservation issue. The precedent for other industries could be significant.