Jan 14, 2012
Why the WTO is unable to deliver trade benefits to small scale fishers
BY BASS UMALI
How can small fishers benefit from global trade? The WTO design offers no space for small producers. Small fishers are not represented, their interests are not articulated and in many cases misrepresented in trade negotiations. In fact, there is no substantial definition of the term “small fisher” in any WTO legal document. And governments do not necessarily represent small sectors’ interests in trade negotiations.
WTO policies and bilateral trade agreements adversely affect the livelihood of small producers. Such policies and agreements have not reached small fishers. They were neither consulted nor informed about these policies and agreements and the implications to their livelihoods .
While binding of tariff at its lowest rate has been temporarily stopped due to collapsed of WTO negotiations in Cancun, neo liberal thinking is still in the upswing and articulated through bilateral agreements.
The Philippine Agriculture sector is near collapse under WTO’s Agreement on Agriculture. Sectors like onion, corn, garlic, rice, vegetables among others have suffered serious losses.
The Philippine fishing industry, along with the agricultural sector, is now substantially liberalized. Executive Order 268 issued by President Gloria Macapagal Arroyo reduced to zero the tariff for essentially all agricultural products including fisheries in accordance to the ASEAN’s Common Effective Preferential Tariff or CEPT. The government issued this crucial policy without consulting basic sectors.
According to United Nations Development Program (UNDP), almost 80% of the total fishers in developing countries in Asia are small-scale. Small scale fishers fish near the shore, employ passive gear and use vessels not more than 5 gross ton.
This figure constitutes a significant portion of the population in the region. Due to lack of access to agricultural land, these marginalised communities turn to fishing as their last resort. These problems, apart from lack of effective management, induce more users and spell disaster.
Livelihood of small fishers is closely associated with natural fishery resources. They catch fish on daily basis and sell to the domestic market. However, huge incentives from the international market resulted in an increase and expansion of fishing capacity. It is reasonable to believe that the degradation of fishery resources will ultimately undermine the coastal communities’ source of income and access to food.
While there are no specific agreements in the fisheries sector, fishery products (shrimp, groundfish, tuna, salmon, cephalopods, fishmeal and fish oil) are widely traded under the WTO rules. Negotiators led by developed nations are serious to conclude agreements using subsidy issue as a façade. Full-scale liberalisation is being advanced through Non-Agriculture Market Access (NAMA) to bind tariffs at low rates.
In 1999, Thailand’s small-scale fishers comprise 88% of their entire fishing population. They commonly use non-motorised boats, which are used daily to sustain household needs.
About 60% of Indian small-scale fishers, on the other use boats that are not more than 20 meters long. Some 65% of the total catch is obtained using highly extractive trawl, which easily beat the passive gears of small-scale operators.
Vietnam has more than 90% of small-scale fishers and their condition is no ifferent from Asian neighbors– living below poverty threshold and rely entirely on fishing. Poor Vietnamese fishers organized themselves into cooperatives and operate shrimp aquaculture for export. Unfortunately, US government slapped them with various legal suits to obviously protect its local industry.
In the Philippines, small-scale fishers should not be mistaken as artisanal or munisipal fishers. Small-scale commercial fishers with vessels weighing between 3.1 to 20 gross tonnes normally operate within municipal waters together with medium scale commercial fishing operators. Commercial fishers in our country predominantly catch pelagic species while groundfish and cephalopods are within the catch domain of municipal fishers.
Offshore fishing remains under utilized among Asian countries except Japan, China, Korea and China. Most of the fishery products being exported are extracted from the same resource basetraditionally utilized by the small-scale fishers.
Asian countries account for more than half of the world’s fish production for food consumption. Around 20% of this is exported to EU, US and Japan. The Food and Agriculture Organization (FAO) reported that in 2001, shrimp contributed 19% of the total value of internationally traded fishery products and the bulk of this were from aquaculture. The USA is now the largest shrimp importer with 88% of its shrimp supply being imported.
Shrimp production for export, which leads to privatization of fishery resources was promoted with government assistance. This has denied small fishers access to traditional fishing grounds. The aquaculture sector, particularly shrimp farming, has a notorious environmental track record characterized by massive conversion of vital coastal ecosystems such as mangrove forest, tidal flat, swamps, lowlands and flood plains (Primavera, 1994). The conversion and use of antibiotics, pesticides and other chemicals resulted in serious negative environmental impact. Aquaculture requires reliable supply of clean water. Water is basic requirement for life and most coastal areas in Asia even lack potable water for household use.
Several studies already proved that intensive shrimp production led to conversion of thousands of hectares of mangrove forests in the Asian region. In the Philippines alone, extensive primary, secondary and cultivated mangrove areas have been reduced to 50,000 hectares from an estimated 400,000 in 1920 (Brown and Fischer, 1920).
Fishery products are being traded within multilateral institution as if these products come from an infinite resource. If the WTO decides to increase fishery production to meet market demand, it simply means more extraction of natural resources, which ideally should be reserved for traditional stakeholders. A common finite resource exploited by one party leads to deprivation of benefits to another party.
Stories of big aquaculture operators, commercial fishing vessels, exporters, importers, and rent seekers from government and the private sector gaining huge profits from the fishery resources at the expense of the vulnerable sectors directly affected by unsustainable and unfair trade practices are all too common.
The FAO’s Committee on Fisheries, Sub-Committee on Fish Trade in its Ninth Session in Bremen, Germany last February; concluded that the concentration of imports are in developed nations. Japan was the biggest single importer of fishery products accounting for 23% of the total. EU as a group cornered 35% and continued to increase dependence on imports. The US was the second biggest single importing country accounting for 17% of total fish imports.
In relation to this, UNDP reported that developed nations substantially lowered their tariff rates to allow the entry of imported fishery products. The US tariff on frozen shrimp for example is zero, it is as low as one percent in Japan and 12 to 18 percent for out-qouta exports to the EU. Japan, US, Canada, Australia, New Zealand, and Norway apply zero tariffs to most primary fisheries products while developing countries maintained high tariff rates on fishery products.
These imply that developing countries are exporting their respective frishing grounds or “carrying capacity” to developed nations. Most developed nations apply effective management programs to protect their fishery resources. For instance, Japan applies multiple management schemes to discourage fishing. Most rich nations provide subsidies to effectively implement conservation programs. While developing countries are encouraged to expand their capacity in order to provide fishery products to countries with purchasing power at the expense of small fishers. This begs the question, in the long run, is trade worthwhile?
Take the case of tuna, which made a 9% contribution to total fish exports in 2001 Massive extraction of tuna for canned industries presents a serious threat. The purse seine nets used in tuna fishing indiscriminately catches schools of fish. Ideally, the extraction of fish stock should be imited only to growth surplus to allow fish stock to replenish and let other species like yellow fin tuna reach their mature and most valuable stage.
Tuna purse seiners are usually operated by the commercial sector. The number of fish workers employed in these commercial fleets is insignificant compared to the number of municipal fishers in the country.
Thailand, the largest importer of frozen tuna as raw materials for canning is also the number one exporter of canned tuna. It is not clear however, who benefits from Thailand’s status as number one importer and exporter since small-scale fishers who primarily catch fish for local consumption are are not really involved in international trade. Almost all freshwater production is for local use and 21% of marine production is consumed fresh. The Philippines has a similar case and it seems that exporters and importers are the winners
Though fishmeal production decreased in 2001 and 2002, 4 million tons annually is still a considerable number and is still reflective of the high level of biodiversity destruction and over fishing. Fishmeal production is a tremendous additional effort that will exacerbate environmental destruction in many parts of coastal areas in Asia. Again, its is not municipal and small scale fishers who benefit from this.
(Published on Focus on the Philippines 2004: http://focusweb.org/philippines/deglobalization/trade-a-finance/55-why-the-wto-is-unable-to-deliver-trade-benefits-to-small-scale-fishers)