Deep Dive Into Fisheries Subsidies, Part 2: Cheap gas and free nets causing problems for shrimp

Members of the World Trade Organization (WTO) are currently negotiating an agreement on fisheries subsidies that will determine the future of our oceans. The need to reach this multilateral deal is embodied in Sustainable Development Goal 14.6, which calls for the prohibition of harmful subsidies that contribute to overfishing. In this three-part series, IISD looks at the impact of fisheries subsidies on the day-to-day lives of people living in different regions across the globe.

Last month we spoke with Dyhia Belhabib about Senegal and how a small fish can have a big impact on the local population. Today, we look at the Pacific coast of Latin America with Andrés Cisneros-Montemayor, a researcher and author of a new paper on this subject, who tells us how the WTO agreement will impact the everyday lives of shrimp fishers in this region.

How important are shrimp to the economy in Latin America?

Shrimps are fished almost everywhere in this region, including Costa Rica, Chile, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama and Peru and represent some of the most valuable fisheries. In countries such as Nicaragua, Mexico and Honduras, for example, shrimp fisheries can make up over 20 per cent of the value of all fisheries on the Pacific coast.

Are shrimp stocks already facing overfishing in this region?

Almost every country in the region shows an all-too-familiar trend of overfishing of  shrimp stocks: It starts with a rapidly expanding catch of one species, then new species start appearing in the catch as the original species declines, and finally the catch declines altogether. Out of 27 shrimp stocks assessed in the six countries of focus of our recent study (Mexico, Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica, Panama and Ecuador), 15 are officially determined to be overexploited and seven maximally exploited.

But this problem does not only affect shrimp fisheries themselves. Shrimp are most often caught using bottom trawls, which are nets that rake across the ocean floor. Roughly 80 per cent of all catch on shrimp vessels are species other than shrimp; about 70 per cent of this bycatch is discarded at sea. This is obviously wasteful and worrying for marine species and ecosystems, but it also impacts artisanal fisheries that could have caught some of these fish for local consumption and to supply seafood markets.

Are fisheries subsidies the reason this happens?

Subsidies can be big contributors to overcapacity because they generate more fishing power than is actually needed to run a sustainable fishery—and subsidies that increase capacity, such as those to help cover fuel costs, are the most common in Latin America. For industrial vessels in Mexico and Nicaragua, subsidies can represent up to 50 per cent of their income.

Removing subsidies will transform the fishing industry. should coastal communities be worried about their jobs?

It’s important to understand that the way the funding is being granted now isn’t supportive for fishing communities. It’s harmful. About 78 per cent of total fisheries subsidies in Latin America are granted to industrial fleets. This contributes to power imbalances and disadvantages artisanal fisheries, which generate the vast majority of employment across the region.

Stories of success in Latin American fishing communities have nothing to do with the price of gas or getting cheap equipment. Instead, there must be a system that protects their business from illegal fishing and integrates their local expertise into management plans.

Local fishermen know perfectly well that cheaper gasoline and free nets won’t solve their problems in the long term. In fact, stories of success in Latin American fishing communities have nothing to do with the price of gas or getting cheap equipment. Instead, there must be a system that protects their business from illegal fishing and integrates their local expertise into management plans.

Are there signs of the region’s fisheries moving in a more sustainable direction?

There are clear precedents of Latin American countries taking measures to address the effects of harmful fisheries subsidies and better manage shrimp fishing. But much remains to be done.

Every country in Latin America has existing regulations in their national legislation that, if implemented, would allow them to improve the management of their fisheries and see greater benefits to local economies and fishing communities. The system is already in place—it just needs funding. But right now the money is often being directed to subsidies that not only don’t work but are actively harmful. This is why effective subsidy disciplines at the WTO could be so useful.

Is the WTO currently on the right track to reach an agreement on fisheries subsidies?

This topic has been on the agenda for the last two decades. We have more than enough information to reach a meaningful decision. WTO negotiators have been empowered by a strong mandate and tasked to reach a solution to a clear global problem. None of the Sustainable Development Goals’ targets are as within reach as this one. The new extended deadline is June 2020; hopefully, this will mark the date when this target is achieved.