Fuel, safety at sea and fisheries management

The LinkagesRobert Lee (FAO Fishery Industry Officer)

FAO Regional Office for Asia and the Pacific

How are Fuel, safety and fisheries management linked?

• Fuel subsidies– Justification– Asia Pacific Region

• Different types of fuel subsidies• What kind of policies• How can we make them work in our favor• Some case studies• Conclusions

•Increased fuel prices

•Inflation

•Macro economics

•Stagnation in growth

Fishers complain

•Decrease interest rates

•Subsidies

•Energy efficiency

•Produce more fuels

Reduce costs

Situation Policy Response

Beneficial Subsidies

Effort increasing subsidies

Ambiguous Subsidies

Result

Fuel subsidies study in the Asia Pacific Region Globally Fuel Subsidies (Sumalia, Teh, Watson, Tyedmers, Pauly 2008)

Developed countries = 3 – 7 billion USD Developing countries=1.17 – 1.5 billion USD

In 2000, fuel subsidiesChina Philippines India SamoaS. Korea Samoa Indonesia TongaAustralia Solomon Is. Malaysia JapanSri Lanka Thailand Taiwan VanuatuBangladeshWhat does the picture look like today? How many countries give fuel subsidies?

Beneficial fuel subsidiesEffects Method/Approach

Reduce fishing effort Incentive to move fishers to aquaculture by creating fuel subsidy in aquaculture.

Compliance in safety at sea Vessels safety compliance, registration and operational practices.

Promote culture and aboriginal people Preferential treatment to carry on managed fishing

Improved fisheries management Requirements for reporting, observing management plans, participation in combating IUU, MCS, participatory research, exploratory fishing

Rehabilitation and Recovery after natural disasters

For limited periods and based on past situation. Build Back Better principle

Improved processing Compliance in good corporate responsibility, reduction of GHG emissions, efficiency savings

Reduced GHG from sector Subsidy for alternative and less polluting fuels

Promote new technologies Subsidy for using less destructive fishing

Improved food security and export revenue generation

MSY determined and production < MSY. Management and Monitoring systems in place

Fuel subsidies that increase capacityEffects Cause

Increased fishing effort Unconditional Subsidy based on political pressure

Undermine safety at sea Vessels fish longer and further offshore

Compromise culture and aboriginal people

Subsidy leads to over capacity of the very same people that it was designed to promote.

Undermine fisheries management Subsidy given without analysis of scientific evidence or consideration of management plans and emphasis on economics

Undermine fuel optimization efforts Incoherence of energy policy with actions

Slow uptake of new technologies (LIFE) Impending expectation of fuel subsidy

Over capitalization in processing leading to increasing production

Financial gains invested in more production (boats and gears).

Conflicts with other sub-sectors Industrial fishing mainly trawling and environmental impacts on artisanal fishing

Degraded food security and livelihoods Short term thinking on assistance without impact assessment on resource. Over subsidizing

Anonymous subsidiesIntervention Positive Negative

Provision of safety equipment

Projects that provide safety equipment and training in safety at sea

None – If relatively small one time investment

Provision of free fishing gear

Projects that provide equipment with fisheries management training and plans

Distribution of gear with no management plans implemented

Provision of subsidized ice Preservation of fish and improved incomes and export

Increased income used to increase effort on depleted stocks if fishing above MSY

Provision of credit at lower than market interest rate

Boost to livelihoods earnings and food security in difficult times

Increased effort only if effort is less than MSY – But who knows?

Buy back programme to reduce capacity

Reduce fishing effort No management plan to ensure capacity is maintained

Asia pacific Economic Cooperation -2000Study Into the Nature and Extent of Subsidies in the

Fisheries Sector of APEC Members EconomiesCommittee on Trade and Investment

“The possible negative effects of some kinds of transfers can be reduced or minimized when transfer policies and resource management polices are coherent.” Therefore, there is an issue regarding the efficiency of the subsidy programs”.

Case Studies

Case 1. Grenada • Objective

– Develop the pelagic long line fishery safely• Strategy

– Provide subsidy – fuel and duty free equipment once a year at Xmas

– Subsidy conditional on updated fishing license– Fishing license only issued with valid safety

certificate• Measures

– Yearly inspections, Training, VMS/VSD

Case 2. New Zealand Sanford Ltd. • Objectives

– Sustainable fishing– Profitable, environmentally responsible

• Strategy– Maintain MSC certification and maintain ISO status– Energy efficiency and sustainable development policies – Reduce emissions and GHG

• Measures– Reduce incidental catches of birds and mammals and

impacts on sensitive areas.– Use of fish offal to produce oil to reduce fuel costs– Recycle waste from processing and fishing operations– Corporate – Treatment of workers, good corporate

citizenship – clean up and awareness raising

Case 3. Asia/Pacific Region• Objective

– Ministerial policy increase production of B100 bio fuel.– Large surplus 370 000 tonnes– Replace more costly diesel in fishing vessels with B100– Prevent the price of B100 falling due to large inventory– New stocks expected March – April 2013

• Strategy– Provide cheaper fuel to fleet at subsidized price– No clear if any conditions will be applied

• Measures – Not clear– Improved monitoring, catch declarations, improved safety

compliance, cost of conversion to energy efficient options– Will require monitoring system. Political reality

What can be done?

Policy• Energy policy congruent with Management

Plans• Formulate Fisheries Energy Policies and have

clear objectives– Reduce emissions, consumption, Increase

efficiency (Kw./Kg)• Holistic view link other subsidy policy (Loans,

Guarantees, Price support, tax exemptions, infrastructure, etc).

• Link with Economic and environmental policies

Management• Level of subsidy related to status of stocks• Use subsidies for R and D in new resource

friendly technologies (time bound)• Integrate safety at sea and fisheries

management - Fisheries management should not compromise safety.

• Use subsidies as incentive to comply with Regulations – requires monitoring systems

• Use subsidy for groups to conduct MCS in protected and sensitive zones

Technology• Make sure installations for new alternatives do

not compromise safety – e.g. biogas• Technical and economic studies of fuel and

fishery subsidy viability • Calculate impacts of Ambiguous subsidies• Use Cost of Conversion as subsidy to new

technology, emission reducing fuels, optimization and LIFE

• Monitoring and evaluation of measures

Conclusions• Subsidies can have negative and positive impacts

on fisheries management and safety at sea.• Fuel subsidies should result in environmental

sustainability.• Energy policies and fisheries policies need to be

integrated for maximum benefit and coherence.• Sustainable development is good business.

(Energy, living resources, recycling, efficiency)• Politics should not endanger responsible

resource management

Reference materials• Fuel price increase, subsidies, overcapacity and resource

sustainability - http://icesjms.oxfordjournals.org/content/65/6/832.full.pdf+html

• World Energy Outlook 2012 - http://www.iea.org/publications/freepublications/publication/English.pdf

• Intermediate technology and alternative energy systems for small scale fisheries - http://www.apfic.org/archive/symposia/1980/53.pdf

• Study into the Nature and Extent of Subsidies in the Fisheries Sector of APEC Member Economies, 2000 - http://publications.apec.org/publication-detail.php?pub_id=668

Reference materials

• Safety at sea as an integral part of fisheries management - http://www.fao.org/docrep/003/X9656E/X9656E00.HTM

• Futures contracts of crude oil NYNEX –http://quotes.ino.com/exchanges/contracts.html?r=NYMEX_CL

• International centre for Trade and Sustainable Development - Tackling Perverse Subsidies in Agriculture, Fisheries and Energy http://ictsd.org/downloads/2012/06/tackling-perverse-subsidies-in-agriculture-fisheries-and-energy.pdf

Thanks for your attention