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August 1999 No. 13
 The European Association of Fisheries Economists


Conference Reports

Management of Straddling and Highly Migratory Fish Stocks

The Centre for Fisheries Economics in Bergen arranged a conference on the management of straddling and highly migratory fish stocks May 19-21.

The United Nations Conference on Straddling and Highly Migratory Fish Stocks held its concluding session in December 1995. The United Nations agreement arising from the Conference is now up for ratification. It is only a matter of time before it will be ratified by the required number of states and becomes part of international treaty law.

The process of implementing the law is now underway. It remains to be seen whether the Agreement will offer an effective instrument for managing transboundary fishery resources that are found both within coastal state EEZ and the adjacent high seas. If the Agreement proves ineffective, the consequences could be severe, both for resource conservation and for the future of the United Nations Convention of the Law of the Sea.
The Bergen Conference focussed on the management of straddling and highly migratory fish stocks, with case studies from different parts of the world. Recognition was also given to the experiences from managing transboundary fishery resources shared by two or more coastal states.

About 60 people from many different countries attended the conference. Keynote lecturers included Andre Tahindro, Senior Ocean Affairs/Law of the Sea Officer, the United Nations, Gordon Munro, University of British Columbia/Centre for Fisheries Economics, Veijo Kaitala, Helsinki Technical University, Robert McKelvey, University of Montana, Johannes Nakken, Deputy Minister of Fisheries, Norway and Eidur Gudnason, Ambassador, Iceland.

The Centre for Fisheries Economics will publish proceedings from the conference.

Trond Bjørndal
Centre for Fisheries Economics

Overcapacity, Overcapitalisation and Subsidies in European Fisheries

The existence of overcapacity in fisheries is now widely recognised. The severe biological and socio-economic impacts it has had on fisheries have been recognised and have hence been given much needed attention in recent years. Important work has been carried out on a global scale by FAO, OECD, WWF and the World Bank, tackling the issues of defining fishing capacity, overcapacity and investigating the role of subsidies made available to the industry. It is clear that the linkage between these concepts will largely determine the effectiveness of fisheries policy decisions and fleet restructuring programmes, influencing the long-term sustainability of fish stocks and the fishing industry.

An EU funded Concerted Action (CA) has been set up to discuss the important issues facing the development of the Common Fisheries Policy. The CA is co-ordinated by Aaron Hatcher and Kate Robinson at CEMARE in the UK, with partners from France, Norway, Spain and Denmark. The first in a set of four workshops was held in Portsmouth in October 1998 and dealt with the issue of "Overcapacity, Overcapitalisation and Subsidies in European Fisheries". In total, 25 people (including myself) were invited to attend and present papers at the workshop. European research institutions were represented as well as international organisations such as the OECD and WWF. Keynote presentations were made by Gordon Munro from the University of British Columbia and Ragnar Arnason from the University of Iceland, leading to three days of very informative presentations and constructive discussions.
The objective of the workshop was to analyse the extent of subsidies in European fisheries and assess their impact on fishing capacity and effort, and ultimately assess the role that subsidies play in attaining the goals set out by the Common Fisheries Policy. There was broad agreement by participants on a number of issues. These included:

  • Any subsidy that increases revenues or lowers the cost of variable or fixed inputs will tend to lead to increased fishing effort, which in the longer term means increased capacity. Capital grants for vessel construction and modernisation will have the most immediate impact on fleet capacity. Subsidies would not be translated into increased fishing effort only where effort can be effectively and completely constrained by regulation or where property rights are perfectly assigned.
  • Subsidies are often made available to improve the efficiency of fleets or to protect employment in fishery-dependent regions. As in most other industries, it should be expected that a profitable fishing industry should be able to finance its own reinvestments and it should therefore be a priority to implement a management strategy that will ensure such profitability. Although protecting employment is understandable, increased fishing effort may have an adverse impact on the long-term sustainability of the resource. It may therefore be more advisable for such spending to be directed towards alternative employment.
  • Vessel decommissioning can play an important role when managers are faced with overcapacity in the fishery. However, there are strong arguments for making fleet reductions over a short period of time and then adjusting the management strategy to avoid a similar build-up in capacity. Gradual programmes, such as MAGPs of the European Union, may be ineffective in the long term, especially if the incentive structure of management is not altered. It is also predominantly voluntary and cash-limited programmes that are used, more often than not assisting to remove the least efficient vessels. Although this may improve overall fleet performance it is unlikely to curb fishing effort in the fisheries. Long-term decommissioning may also reduce the perceived risk of investment, which may lead to the introduction of more capital into the industry, exacerbating the overcapacity problem.

The issue of structural assistance in the EU has now been given increased attention. In his presentation at the EAFE Conference in April this year, John Farnell (Director of DG XIV) said that there would be increased pressure for a reduction in subsidies. It is doubtful, however, that there will be any rapid changes to the structure of MAGP funding and decommissioning.

At the end of the German presidency in June, EU fisheries ministers failed to reach a deal on structural assistance for the 2000-2006 period. The controversy largely concerned access to vessel modernisation and construction funds and required construction:decommissioning ratios. It is clear that whatever the outcome, subsidies will continue to play an extensive role in European fisheries. The negative impacts that subsidies may have on fisheries in the longer term are apparent and concerns regarding their use therefore need to be continually voiced in an attempt to influence decision makers in Europe.

The proceedings of the first CA workshop are currently available (see Publications).

Erik Lindebo

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