(Paragraph 19). “There are moves towards greater ‘market discipline’ in the [small scale] sector as a way of contributing towards a transition to responsible

(Paragraph 19)

“There are moves towards greater ‘market discipline’ in the [small scale] sector as a way of contributing towards a transition to responsible fisheries. This is evidenced by recent focus on issues such a

s withdrawal of subsidies, strengthening of use rights, substitution of grants with loans, and costrecovery programmes . . . .”

Committee on Fisheries Supporting Small Scale FisheriesMarch 2005

“The move to responsible fisheries will in many cases have significant impacts on small-scale fishers. As a result, targeted assistance for small-scale fisheries may be necessary to ease the impacts of this transition.”


“For example, while subsidies . . . which may lead to over-exploitation should be guarded against, incentives and subsidies should be considered where appropriate but their use requires careful justification and specification of the period over which they are to be used.”


“Subsidies might be appropriate if they enhance or diversify livelihoods without leading to increased fishing capacity or trade distortions, or are used to facilitate a structural change to assist with the move towards responsible fishing.”


Promoting Development and Sustainabilityin Fishery Subsidies Disciplines:

An Informal Dialogue on Select Technical IssuesGeneva -- 30 June 2005

Division of Technology, Industry and Economics - Division Technologie, Industrie et Economie - División de tecnologia, industria y economia

Artisanal Fishing:Promoting Poverty Reduction and DevelopmentThrough New WTO Rules on Fisheries Subsidies

Working Draft -- June 2005David K. Schorr






Artisanal Fishing is Important!!


– Human Importance. . . tens of millions of fishers

. . . tens of millions more working on shore

. . . scores of millions dependent for food


– Economic Importance. . . 50% of world catch for human consumption

. . . 90% of all fishing jobs


– Environmental Importance. . . global scale

. . . often dominate near-shore fisheries

. . . sensitive coastal habitats

Sustainable Development



Poverty & underdevelopment . . .



. . . with room to grow



. . . with room to grow??


Bottom line:

Poverty reduction and development are critical . . .

. . . but strategies (including whether to “grow”) are varied and not always clear.



??

The “Sustainability Challenge”

• Competition with industrial fleets (domestic and foreign

. . . Small is not always beautiful . . .


– Exogenous factors. . . competition with industrial fleets (domestic &

foreign)

. . . degradation of coastal zones (land use)


– Endogenous factors. . . population growth

. . . expanding capacity (especially motorization)

. . . in context of inadequate management

. . . shift from subsistence to commerce, including export


→ The challenge is real:. . . Experts refer to it

. . . IGOs are concerned with it

. . . Governments are increasingly acknowledging it. . . Including via increased formal management

The Role of Subsidies


- Many artisanal fisheries are subsidized. . . Extent of subsidization is unclear. . . but experts, IGOs, & gov’ts frequently refer to it

(still, no doubt the scale is a small fraction of subsidies to industrial fleets)


- Subsidies to artisanal fisheries are varied:

• Vessel / gear modernization (including motorization)• Landing and processing infrastructure (port facilities,

refrigeration,roads/transport)• Export• Fuel• Other inputs (e.g., ice)• Training• Capital (cheap money)


- Subsidies are often necessary. . . Positive and important role clear in some cases

. . . Many governments contemplate more subsidies to artisanal fisheries in the future


- BUT can also clearly be harmful. . . case studies & reports document harms

. . . IGOs acknowledge the problem

(e.g., overcapacity, IUU)


Bottom line . . .

. . the need for balance

The discussion in the WTO


– AF a special case from the beginning


– AF a special case from the beginning– Discussion so far has been non-technical


– AF a special case from the beginning– Discussion so far has been non-technical– Basic themes

1) “not the focus”



1) “not the focus”. . . shld be excluded from new rules (some say)

. . . shld be given special treatment (others say)



1) “not the focus”. . . shld be excluded from new rules (some say)

. . . shld be given special treatment (others say)

. . . because:- needed and important

- not harmful


“not harmful” = ??



1. Will not cause overfishing

2. Will not cause trade distortions





(see above)





(see above)

“trade distortion”

“production distortion”


“trade distortion”. . . how the pie is divided

-----

“production distortion”. . . shrinks the pie



1) “not the focus”

2) “what’s the definition?”


“. . . small-scale fisheries that employed labour intensive harvesting, processing and distribution technologies to exploit marine and inland fishery resources. Such fisheries typically targeted local rather than export markets.”

-----

“small-scale fisheries which are local in nature”

-----

“small-scale coastal fisheries”

RECAP

1. Artisanal fisheries are important

2. Sustainability is a problem

3. Careful subsidies policies are needed

4. The issue is heating up in WTO, but with more questions than answers so far

RECAP

1. Artisanal fisheries are important

2. Sustainability is a problem

3. Careful subsidies policies are needed

4. The issue is heating up in WTO, but more questions than answers so far

NOW WHAT?NOW WHAT?

The Definition Debate


– There is no single definition that is both universal and precise



– The term is used alongside “small scale” and “traditional”

. . . Sometimes synonyms, sometimes not




– But there are some frequently recurring elements . . .

Category Definitional Elements Typical Examples

Physical Attributes Vessel type Canoe, dory

Vessel size Short (e.g., < 10m); light

Vessel motor Unmotorized or small engine

Pattern of Fishing Fishing gear/technique Manual or small nets; passive; low tech

Location of land base Rural

Location of fishery In-shore

Target type Multi-species

Social Structure Of fishery Traditional (clan or community)

Of fishing enterprise Family crew, owner on board

Economic Condition

Market orientation Direct consumption or local market

Income level Subsistence or very poor

Table 1 — Elements of a Definition of “Artisanal Fishing”


Physical Attributes Vessel type Canoe, dory . . . or a trawler . . .

Vessel size Short (e.g., < 10m); light . . . or big . . .

Vessel motor Unmotorized or small engine …or powerful …

Pattern of Fishing Fishing gear/technique Manual or small nets; passive; low tech . . . or using GSP, winches, sonor . . .

Location of land base Rural . . . or city-based . . .

Location of fishery In-shore . . . or off-shore . . .

Target type Multi-species . . . or single species . . .

Social Structure Of fishery Traditional (clan or community) . . . or corporate . . .

Of fishing enterprise Family crew, owner on board . . .

Economic Condition

Market orientation Direct consumption or local market . . .

Income level Subsistence or very poor . . .



Physical Attributes Vessel type Canoe, dory . . . or a trawler . . .

Vessel size Short (e.g., < 10m); light . . . or big . . .

Vessel motor Unmotorized or small engine …or powerful …

Pattern of Fishing Fishing gear/technique Manual or small nets; passive; low tech . . . or using GSP, winches, sonor . . .

Location of land base Rural . . . or city-based . . .

Location of fishery In-shore . . . or off-shore . . .

Target type Multi-species . . . or single species . . .

Social Structure Of fishery Traditional (clan or community) . . . or corporate . . .

Of fishing enterprise Family crew, owner on board . . .

Economic Condition

Market orientation Direct consumption or local market . . .

Income level Subsistence or very poor . . .


““Industrial A

rtisanal F

ishing”??

Industrial A

rtisanal F

ishing”??




– But there are some frequently recurring elements . . . applied in contradictory ways




– But there are some frequently recurring elements . . . applied in contradictory ways

– And . . . It’s not clear whether developed country fisheries are included


Bottom line:

WTO needs its own definition

. . . tailored to its needs

. . . while avoiding loopholes


Bottom line:

WTO needs its own definition

. . . tailored to its needs

. . . while avoiding loopholes

BUT HOW?BUT HOW?

Why Subsidize AF?

Why Subsidize AF?

(i.e., for reasons related to artisanal nature per se . . .)

Why Subsidize AF?

– Three basic motives?• Poverty reduction• Development• Cultural preservation

Why Subsidize AF?

– Three basic motives?• Poverty reduction

“the removal or prevention of extreme deprivation, or (in positive terms) the granting of assistance to meet basic human needs”

Why Subsidize AF?

– Three basic motives?• Poverty reduction• Development

“socio-economic transformation of a community or productive sector through technological improvements, increased education, and multiplication of personal and economic options”

Why Subsidize AF?


“socio-economic transformation of a community or productive sector through technological improvements, increased education, and multiplication of personal and economic options”

. . . Difficult to separate from poverty reduction?

Why Subsidize AF?


= changing patterns of fishing . . .

» . . . expanding (?)» . . . increasing efficiency (?)

Why Subsidize AF?


= changing patterns of fishing . . .

» . . . expanding (?)» . . . increasing efficiency (?)

inevitable sustainability concerns

Why Subsidize AF?

– Three basic motives?• Poverty reduction• Development• Cultural preservation

“the maintenance of particular cultures, lifestyles, and communities in the face of market pressures that would otherwise injure or even doom them.

Why Subsidize AF?

Are these correct?

Are they helpful?

– A narrow definition could focus on poverty reduction and development

• Emphasize poverty and/or subsistence economic patterns;• Emphasize very small vessels and/or vessels with small or

no engines;• Emphasize low technology and high labor-intensitivity;• Emphasize fishing very close to shore

– BUT . . .• Export?• Developed countries?

Practical Implications


– A narrow definition could focus on poverty reduction and development

• Emphasize poverty and/or subsistence economic patterns;• Emphasize very small vessels and/or vessels with small or

no engines;• Emphasize low technology and high labor-intensitivity;• Emphasize fishing very close to shore

– BUT . . .• Export?• Developed countries?


Nevertheless . . . the sustainability problem remains real . . .



must go beyond definition

Rules to prevent unsustainable production distortions are needed



must go beyond definition

Rules to prevent unsustainable production distortions are needed

BUT HOW?BUT HOW?

Striking the Balance


– Distinguish classes of subsidies (to allow rules to concentrate on most dangerous)

– Impose substantive conditions (fisheries context)

– Impose procedural conditions(common WTO devices)


Distinguish classes of subsidies

→ Table 2

Poverty alleviation Community/social development

Cultural conservation

Risk of Production Distortion

Risk of Trade

Distortion


Risk of Trade

Distortion


Risk of Trade

Distortion

Vessel / gear modernization

-- -- High Med Med Med

Land-based infrastructure

Low Low Med Med Low Med

Export Med Low High High Med High

Fuel Low Low High Med Med Med

Other inputs Low Low High Med Low Med

Training Low Low Med Low Low Low

Capital Med Low Med Med Low Med

Table 2: Possible Risks of Distortion to Production or Trade


Substantive conditions related to fisheries management context

. . . e.g., “patently at risk”




→ the thin green line




Special problems for AF?Special problems for AF?


“Patently at risk” is about facts:

- fish facts / fleet facts (physical)

- legal facts / institutional facts (juridical)


“Patently at risk” looks to facts:









Data limitsData limits (don’t know “what’s out there”)(don’t know “what’s out there”)






Data limitsData limits (don’t know “what’s out there”)(don’t know “what’s out there”)

Informal managementInformal management(social, not juridical, organization)(social, not juridical, organization)


. . . Basic problem is sequencing . . .

“right” environmental answer is . . . data and effective management

first

but . . . may not be realistic . . .


. . . e.g., for “high risk” subsidies, require:

- parallel investments in management

or

- phase in management context requirements

But beware extremes: should subsidies be allowed in any fishery with zero data or management?

Balanced sequencing?Balanced sequencing?


. . . e.g., for “high risk” subsidies, require:

- parallel investments in management

or

- phase in management context requirements

But beware extremes: should subsidies be allowed in any fishery with zero data or management?

Balanced sequencing?Balanced sequencing?


Procedural conditions: • Notification requirements• Distribution of the burdens of proof• Adjustment of types of remedies available

Bottom Bottom Line

1.Narrowly define “AF”, based on clear goals (poverty & development?)

2.Recognize continuing need for sustainability criteria

3.Limit criteria to “high risk” subsidies

4.Impose substantive conditions, considering sequencing

5.Make good use of standard procedural tools to strike a good balance






Documents

(Paragraph 19). “There are moves towards greater ‘market discipline’ in the [small scale] sector as a way of contributing towards a transition to responsible