Fisheries subsidies: ‘We have let history down’

“Now and again, we are called upon; history calls upon us to actually stand up and rise to the occasion. I’m afraid that today we have let history down.”

Those were the words of Fiji’s minister for trade, Manoa Kamikamica, to the World Trade Organization’s ministerial conference in Abu Dhabi, United Arab Emirates earlier this month. There, despite hopes expressed by environmentalists and developing nations beforehand, delegates couldn’t finalise an agreement to rein in fishing subsidies.

While governments pay tens of billions of dollars annually to subsidise their fishing fleets, 35% of fish stocks worldwide are exploited beyond sustainable levels, according to the UN Food and Agriculture Organization (FAO).

The subsidies primarily lower fuel and vessel construction costs for industrial fishing, enabling boats to catch more by going further out to sea for longer periods of time. According to one estimate, US$22 billion was spent in 2018 on such “capacity enhancing” subsidies, which critics say endanger fish populations and harm marine ecosystems.

WTO members had agreed a deal at a 2022 ministerial conference to limit some of the subsidies most directly linked to long-term damage of fish populations. But in order to reach a consensus, as required by WTO rules, they put off dealing with eliminating subsidies that contribute to overfishing and overcapacity – a fleet’s ability to harvest more fish than is sustainable. 

While observers believed an agreement on that vital second element of the deal was possible after two years of negotiations, it ultimately proved elusive.

International waters, international disputes

At the Abu Dhabi meeting, a group of Pacific Island states argued that a draft text of additional rules on overcapacity and overfishing did not go far enough. They called for further changes, including an outright cap on fisheries subsidies, rather than the mooted option of allowing large fishing nations to continue providing subsidies in some circumstances, such as for stocks considered well managed. Daniel Skerritt, a senior analyst at conservation NGO Oceana, said finding compromises on this took most of the week and “delayed the negotiations”. 

China and the United States worked together to find solutions, noted Ernesto Fernández Monge, a senior officer at the NGO Pew Charitable Trusts. “China was ready to give up on its differential treatment as a developing country at the WTO for the purpose of this agreement, and had also accepted [including] a mention of distant-water fishing subsidies in the text,” he told China Dialogue Ocean. Imposing limits on countries subsidising fishing beyond their own jurisdictions would make much current “distant-water fishing” no longer profitable, says Milko Schvartzman, a marine conservation specialist from Argentina. He cites the example of the fishing vessels that arrive from Asia every year in the South Atlantic – journeys that involve substantial amounts of fuel. “They wouldn’t be able to keep up with the costs,” he told China Dialogue Ocean.  

‘Blocked by a few’

Towards the end of the meeting, there appeared to be a compromise text of the additional rules that the majority of WTO members could have agreed to. It included a new clause committing members to reviewing the effectiveness of the agreement in the future. But India and Brazil refused to accept the text due to the lack of agreement on agriculture reforms that were being negotiated at the same time, observers say.

“There was a lack of political will, and obstruction from just a few countries,” says Steve Trent, CEO of the Environmental Justice Foundation. “Everybody needs and deserve a voice, but countries can block progress.”

European Trade Commissioner Valdis Dombrovskis also singled out India. “Agreements were within reach, supported by an overwhelming majority of members, but ultimately blocked by a handful of countries – sometimes just one,” he said in a statement.

Choppy waters ahead

The 2022 WTO agreement deals with phasing out the most egregious subsidies. These are payments that support: illegal, unreported and unregulated fishing; catching of overfished stocks when no fisheries management measures are in place; and fishing on the high seas outside the jurisdiction of fisheries management bodies. It will only enter into force once 110 WTO members have ratified it – the number currently stands at 71.

The additional rules that many hoped WTO members could conclude in Abu Dhabi would have gone further and prevented subsidies that contribute to overfishing in the first place, says Tristan Irschlinger, a policy advisor at the International Institute for Sustainable Development (IISD). “They focus more on the root cause of the problem and not only on the most acute manifestations of that problem,” he notes. 

Negotiations on the additional rules will continue at the WTO’s headquarters in Geneva. Observers hope a decision might not have to wait until the next ministerial conference taking place in 2026. Some have suggested that countries could instead vote on the new rules at a meeting of the General Council, the WTO’s highest decision-making body, or even call for an ad-hoc ministerial meeting focused specifically on fishing subsidies. 

In the meantime, WTO director general Ngozi Okonjo-Iweala said she expects the first part of the agreement to enter into force by mid-year, something many observers also believe is feasible. If this happens, a “sunset clause” provision will come into effect that mandates the termination of the agreement if a comprehensive set of rules is not established within four years. This gives a clear deadline to approve the additional rules.

“We came so close, but at the end of the day, there were one or two matters that we couldn’t reach,” Okonjo-Iweala told the media after the Abu Dhabi meeting. Nonetheless, she said, “with ministers here, it was helpful for members to understand the reservations of each other. It brought us closer to almost getting the package.”