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Latest delay casts pall over WTO bid to end harmful fishing subsidies

  • International negotiators were set to discuss ending government subsidies that lead to overfishing at the Twelfth WTO Ministerial Conference, scheduled to run Nov. 30 through Dec. 3 in Geneva, Switzerland.
  • Days before it was due to start, however, organizers postponed the event indefinitely, due to concerns over the newly announced COVID-19 variant, Omicron.
  • Negotiators have been struggling to close the remaining gaps in an agreement that has been 20 years in the works.
  • Observers say the ongoing failure to reach agreement on fishing subsidies calls into question the WTO’s ability to adapt to a changing world and meet the U.N.’s Sustainable Development Goals.

Twenty years is a long time to talk about fish. But hopes that World Trade Organization (WTO) members would finally reach a meaningful agreement to ban subsidies that enable overfishing at the Ministerial Conference (MC12) this year were dashed Friday when organizers postponed the event indefinitely, due to concerns over the novel Omicron COVID-19 variant.

“This does not mean that negotiations should stop,” Ngozi Okonjo-Iweala, the WTO’s director-general, said in a press release about the postponement. “On the contrary, delegations in Geneva should be fully empowered to close as many gaps as possible. This new variant reminds us once again of the urgency of the work we are charged with.”

The global trade regulator is grappling with how to keep itself relevant amid rising calls for reform of trade rules made last century that observers say no longer fit present-day economic conditions. Many observers saw MC12, formally the Twelfth WTO Ministerial Conference and scheduled to run Nov. 30 through Dec. 3 in Geneva, Switzerland, as a chance for the WTO to prove its ability to conclude major trade deals and to reform its dispute settlement and negotiation pillars. Other major agenda items for the meeting were the waiver of trade-related intellectual property rights for COVID-19 vaccines and reform of the WTO’s organizational process.

Okonjo-Iweala had emphasized the importance of the fisheries subsidies negotiation at an April meeting of delegation heads: “[C]oncluding these negotiations is a top priority for this organization, not only for the fisheries, but also for the WTO system. We simply cannot afford to fail here,” she said. “if there is anything that would demonstrate that the WTO is back and capable of having positive results, it is a good outcome early enough this year to these fisheries subsidies negotiations.”

Santiago Wills, Colombia’s ambassador to the WTO and the chair of the negotiation, described the latest holdup as “deflating” in a Tweet.

Globally overexploited fish stocks have risen from 18% to 34% over the 20 years that WTO members have been talking about banning “harmful” fisheries subsidies, according to U.N. Food and Agriculture Organization ()FAO) reports published in 2000 and 2020. The targeted subsidies are deemed harmful because they enable overfishing, environmental degradation and destruction of food security and livelihoods. Governments collectively dole out an estimated $22 billion in such subsidies each year, according to a 2019 paper.

“The best and only way for the WTO to save face is to truly save fish,” Rémi Parmentier, director of the environment, health and social welfare consultancy Varda Group and an adviser to the NGO Friends of Ocean Action, told Mongabay. Parmentier has been participating in the talks since the beginning.

A view of the most recent fisheries subsidies ministerial meeting, on July 15, 2021. Image courtesy of WTO.

How close were they?

The WTO’s Negotiating Group on Rules was charged in 2001 with agreeing what exactly a ban on harmful fisheries subsidies should look like. After almost two decades with little to show, the group made good progress with Wills’s election to the chair in November 2019.

Wills’s revisions of the draft agreement and his efforts to galvanize the group toward meeting the 2020 deadline for the U.N.’s Sustainable Development Goal 14.6 broke several deadlocks, despite having to be done remotely because of the COVID-19 pandemic. But the group failed to finalize an agreement in 2020, or at a post-deadline meeting in July 2021.

Wills’s latest draft agreement, submitted to the WTO’s highest-level decision-makers last week, contains square brackets around items where consensus has yet to be reached. Negotiators have reduced these from more than 70 at the end of 2020 to fewer than 20.

The trickiest of these remaining bracketed items include how to address fuel subsidies, allocate exemptions from the rules to developing and least-developed countries, and apply a subsidies ban in disputed territories, according to Wills’s addendum to the latest draft agreement.

“Solutions exist to the major remaining sticking points  the overarching question is whether there’s the political will to solve them,” Isabel Jarrett, who manages a campaign to reduce harmful fisheries subsidies at PEW Charitable Trusts, told Mongabay via email.

“Support offsetting the cost of fuel must remain on the list of prohibited subsidies,” Jarrett said. She also emphasized the importance of prohibitions on so-called distant-water fishing, far from a country’s home shores: “[W]ithout harmful subsidies, 54% of fishing on the high seas and in other countries’ waters would be unprofitable.”

WTO Director-General Ngozi Okonjo-Iweala, second from right, and Colombian Ambassador Santiago Wills, center, met with representatives of the Stop Funding Overfishing Coalition on March 1, 2021. Image courtesy of WTO.

The trouble with subsidies

Not all fisheries subsidies are bad. But capacity-enhancing subsidies lead to overfishing because they artificially enhance profits, either by reducing how much it costs to fish or by increasing how much revenue fishers receive.

These subsidies can take the form of tax exemptions and infrastructure development loans or grants. In practice they can result in scenarios like fishing boats getting cut-price fuel to access distant fishing grounds that would otherwise be too expensive for them to reach. Or companies getting grants to buy otherwise unaffordable fish-finding technology, gear and vessel upgrades.

Even good subsidies can be bad in the wrong hands. So the WTO negotiations also aim to curtail subsidies for fishers who engage in illegal, unreported and unregulated (IUU) fishing.

China tops the list of harmful subsidizers, followed in order of contribution size by Japan, the EU, South Korea, Russia, the U.S. and Thailand, according to a report released in July by researchers at the University of British Columbia and supported by the NGO Oceana. The top 10 biggest subsidizers contribute more than two-thirds of harmful fisheries subsidies.

The rest of the WTO’s 164 member states contribute far less to harmful fisheries subsidies. Ironically those who contribute least often suffer most from the effects of depleted fish stocks.

“Harmful fisheries subsidies enable developed nations to engage in distant-water fishing at an industrial scale in the waters of developing countries,” Wisdom Akpalu, director of the Ghana-based Environment for Development Initiative, said in press materials from Pew Charitable Trusts after adding his signature in October to an open letter from 300 international scientists urging the WTO to reach an agreement.

If a meaningful WTO deal were struck, “depleted fish populations could rebound, boosting coastal communities and stemming international migration across the [African] continent,” Akpalu said, highlighting an extreme consequence of overfishing, which can undermine people’s livelihoods to such a degree that they migrate.

A modeling tool funded by PEW Charitable Trusts indicates global fish biomass could increase by 12.5% by 2050 if countries agree to end harmful fisheries subsidies.

Fishermen in Ghana. “Harmful fisheries subsidies enable developed nations to engage in distant-water fishing at an industrial scale in the waters of developing countries,” says Wisdom Akpalu, director of the Ghana-based Environment for Development Initiative. Image by hbieser via Pixabay.
Germany brought a fish to the fisheries subsidies ministerial meeting on July 15, 2021. Image courtesy of WTO.

What now?

Parmentier said he was “cautiously optimistic” for a positive outcome when he read the draft agreement prior to hearing MC12 had been put on hold. “Now, regardless of when the WTO Ministerial Conference is reconvened, governments should start and implement urgently what is envisaged in that draft,” he said. “They should not wait forever for the WTO to put in place the measures called for in the Sustainable Development Goals’ Target 14.6.”

People need “credible and effective action,” Parmentier said. “Especially young people who were not even born when the fisheries negotiations started in 2001.”

If the negotiations over fisheries subsidies are a touchstone for the WTO, Parmentier said they are also one for humanity’s ability to achieve the U.N.’s Sustainable Development Goals. ”The WTO says that among their ambitions are climate change mitigation and addressing plastic trade. Fine. But if they want to be taken seriously, they need to finalize now the 20-year-old fisheries negotiations,” he said.

Jarrett agreed that people need to see some results: “Eliminating fuel subsidies through a WTO fisheries agreement is the perfect first rung on the ladder for governments to prove that they are serious about their commitment to ending fossil fuel subsidies and fighting climate change.”

Banner image: Fisherman on board a Chinese fishing boat hauling the net in Guinea. Image ©Pierre Gleizes/Greenpeace.

Citations:

Sumaila, U. R., Ebrahim, N., Schuhbauer, A., Skerritt, D., Li, Y., Kim, H. S., … Pauly, D. (2019). Updated estimates and analysis of global fisheries subsidies. Marine Policy109, 103695. doi:10.1016/j.marpol.2019.103695

Skerritt, D. J., & Sumaila, U. R. (2021). Assessing the spatial burden of harmful fisheries subsidies. Retrieved from Oceana website: https://oceana.org/sites/default/files/OceanaDWF_FinalReport.pdf

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