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Securing economic benefits from Pacific Fisheries Licensing, Industry Development and Certification Mike Batty Director Fisheries Development UNCTAD Consultation on Trade in Sustainable Fisheries Products Port Vila 5 th August 2015

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Page 1: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Securing economic benefits from

Pacific Fisheries

Licensing, Industry Development and

Certification

Mike Batty

Director – Fisheries Development

UNCTAD Consultation on Trade in Sustainable Fisheries Products Port Vila 5th August 2015

Page 2: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Overview of presentation

Nature of Pacific Island

Fisheries

Current status of tuna

fisheries

Prospects for economic

development

Markets, trade and

market access EU, US

Ecolabelling

Conclusions/outlook

Page 3: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

The FFA region

Page 4: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Oceanic and coastal fisheries

Industrial tuna fisheries Inshore (coastal) fisheries

Page 5: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Relative economic importance

(2007 data)

Measure Coastal Fisheries Offshore Fisheries

Catch in EEZ $ 295 million $ 1,632 million

Catch by nationals $ 295 million $ 546 million

Contribution to GDP $ 224 million $ 188 million

Employment 50-90% of coastal

rural households

12,300

Licence fees negligible $77 million

Values in US$ for Pacific

Island countries combined

Page 6: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Aquaculture development

Only accounts for around

0.2% of value of fisheries

production from P.I.

Countries

Significant production and

exports from French

Territories

Mariculture products mainly

for export; freshwater (tilapia)

for domestic consumption;

Considerable potential.

Page 7: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Coastal fisheries products traded

Sea cucumber – 2nd

largest export after

tuna; also MoP shell;

Aquarium fish and coral

– significant in several

countries;

Snapper – mainly from

Tonga;

Crayfish, reef fish;

Resource limited

Page 8: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Tuna Fisheries

Consultation on Trade in Sustainable Fisheries Products Port Vila 5th August 2015

Page 9: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Key facts about WCPO

Fishery

2014 WCPO total tuna catch 2.6 million mt (worth USD5.5

bn) representing about 60% of global tuna catch

Around 60% of WCPO catch from FFA waters worth $3 bn. In

2014 (1/3 global catch by volume).

4 key target species are Skipjack, Yellowfin, Bigeye, Albacore

Main fishing methods Purse seine, Longline

Page 10: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Catch by gear

0

400,000

800,000

1,200,000

1,600,000

2,000,000

2,400,000

2,800,000

19

60

19

62

19

64

19

66

19

68

19

70

19

72

19

74

19

76

19

78

19

80

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82

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84

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86

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88

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90

19

92

19

94

19

96

19

98

20

00

20

02

20

04

20

06

20

08

20

10

20

12

Ca

tch

(m

t)

PURSE SEINE

OTHER

POLE-AND-LINE

LONGLINE

Page 11: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Catch by Species

0

400,000

800,000

1,200,000

1,600,000

2,000,000

2,400,000

2,800,000

19

60

19

62

19

64

19

66

19

68

19

70

19

72

19

74

19

76

19

78

19

80

19

82

19

84

19

86

19

88

19

90

19

92

19

94

19

96

19

98

20

00

20

02

20

04

20

06

20

08

20

10

20

12

Ca

tch

(m

t)

SKIPJACK

YELLOWFIN

BIGEYE

ALBACORE

Page 12: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Who catches the fish? Total Purse Seine and LL tuna

catch

Thousand metric tons, 2012

SOURCE: WCPFC, World Bank, UN Commtrade; FFA

Catch

value1

$m, 2012

980

691

624

1083

886

461

277

184

167

988

Longliners Purse Seiners

HARVESTERS

Others 331 26

Kiribati 62 2

Marshall

Islands 72 1

Philippines 110 0

Indonesia 131 19

PNG 236 5

US 260 6

Korea 262 33

Taiwan 201 68

Japan 232 72

Fleet size Top 3 export markets

▪ 35 Purse

seiners

▪ 198 Longliners

▪ Japan

▪ Thailand

▪ Spain

▪ 40 Purse

seiners

▪ 138 Longliners

▪ Canada

▪ Japan

▪ Spain

▪ 18 Purse

seiners

▪ 17 Longliners

▪ Germany

▪ Philippine

s

▪ Japan

▪ 34 Purse

seiners

▪ 1,529 Longliners

▪ Japan

▪ US

▪ Thailand

▪ 104 Purse

seiners

▪ 159 Longliners

▪ US

▪ Japan

▪ Thailand

▪ 103 Purse

seiners

▪ 16 Longliners

▪ Japan

▪ Thailand

▪ China

▪ 5 Purse seiners ▪ China

▪ Thailand

▪ Mexico

▪ 12 Purse

seiners

▪ 3 Longliners

▪ Japan

▪ Thailand

▪ US

▪ 42 Purse

seiners

▪ 546 Longliners

▪ Thailand

▪ Guam

▪ US

4

Page 13: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

And who processes it?

PNG1 100

18 Fiji1

Marshall Islands1 10

Solomon Islands1 15

China 20

Indonesia 20

Vietnam 45

Japan 78

Korea 110

American Samoa 132

Phillipines 225

Thailand 736

Total 1,453

SOURCE: FFA; McGowan & McCain 2010

No. of processors

15

5

1

3

55

14

3

3

6

2

1

1

1

Processing capacity thousand metric tons; 2008

Market share by traders %

70

30Tri Marine

Others

100

PROCESSORS

2

1 2013 data

Page 14: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Stock Status Overview:

“Kobe Plot”

• 3 main stocks accounting

for 95% of the catch are

‘biologically healthy’

• Rate of stock reduction

generally accelerating

• May be at or below

preferred target levels

• BET the main focus of

management action, but

some by-catch - species of

sharks - are severely

overfished

• Albacore longline fisheries

becoming uneconomic due

to depletion of large adults

Page 15: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Opportunities

Economic

opportunities for

members:

Contribution to GDP

Access fees

Domestication of

fleets

Onshore processing

and employment

Exports

Page 16: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Measuring economic contribution

Access Fees Success of the PNA VDS

Zone based ‘rights’

Generally profitable

fishery with competition

for access

Sets ‘common currency’

in vessel days

Countries agree

benchmark price

Some threats – abuses,

over-supply, alternative

fishing areas.

Page 17: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Employment Growth in processing

Mainly driven by PNG

policy of onshore

development;

Access to resource linked

to processing facilities;

Some concerns that cost

of preferential access

exceeding benefits;

Processing plants

operating below capacity.

-

2 000

4 000

6 000

8 000

10 000

12 000

14 000

16 000

18 000

20 000

2008 2009 2010 2011 2012 2013

No

. o

f em

plo

yees

Offshore (foreign vessels) crew

Observers (Nat'l & regional prog)

Local crew

Govt Administration

Processing

Page 18: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Development challenges competitiveness for processing

0.8

5

1.0

9

0.9

0

2.3

2

1.0

2

1.0

6

3.8

3

0.5

6

-

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

Mu

ltip

le o

f T

hai o

r G

en

San

co

sts

/ e

ffic

ien

cy

Minimum cost in FFA Maximum cost in FFA

Page 19: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Trade in Tuna Products

Consultation on Trade in Sustainable Fisheries Products Port Vila 5th August 2015

Page 20: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Exports from FFA members

By product By destination

-

50.0

100.0

150.0

200.0

250.0

300.0

350.0

400.0

450.0

US

$ (

millio

ns)

Japan EU US

Page 21: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Tariff preferences A key driver of EU exports

EU MFN rate of duty on canned tuna and tuna loins

is 24%;

5 (now 6) of the top 7 exporters of canned tuna to

EU benefit from duty free access;

In the Pacific, the iEPA is credited with attracting

new investment in tuna processing in PNG –

particularly due to flexible rule of origin;

Recent grant of GSP+ status for Philippines is a

challenge;

Possible erosion of preferences – Thailand

processors are highly competitive.

Page 22: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

EU Market Access-

Competent authority (sanitary)

Clear system based on official

guarantees by a competent

authority (fisheries or health

departments).

Only Fiji, Solomons, PNG meet

requirements and all face

challenges (resources,

independence).

FFA developing system of

delegation to a regional body.

Participating countries will still

need basic CA function with

adequate staff and resources.

Page 23: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

IUU Regulation

Implementation of IUU regulation

raises some concerns.

4 main requirements: Competent

Authority (IUU); NPOA; Port

State Controls; Catch

Documentation.

Countries reliant on market

access have little choice.

On the positive – many of the

required actions make sense for

P.I. fisheries

Page 24: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

EPA Negotiation

Leaders’ direction is to conclude an

agreement;

11 red-line issues on fisheries

conservation and management –

fisheries access provisions not yet

discussed;

No clear commitment on global

sourcing; PNG concerns;

EU recommending signature of the

iEPA and suspension of talks for 3

years.

Page 25: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

US Exports Mainly low tariff products

Product FAS Other PICs Pref., FTAs

Frozen tuna fillets 0% 0% 0-2.4%

Canned tuna in oil 35% 35% 0-29%

Canned tuna not “ “ 0% 6-12% 0-4.9%

Tuna in pouches 0% 12% 0-10.4%

Cooked loins 0% 1.1c /kg 0- 4.2%

For the products most likely to be exported, duty is 6% rising to

12% for canned tuna when the quota is exceeded (every year).

Compact countries: duty free for everything except tuna in oil.

Other preferential agreements (e.g. Caribbean) provide duty

free for everything; but this is not true of FTAs – Korea receives

very minor reductions in duty at present.

Page 26: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Other market access issues

Food Safety:

Based on importer/ exporter

guarantees rather than Govt.

CA (EU, China) – but not

‘easy’.

HACCP – process control system

to US standards;

Bio-terrorism act – registration

of all overseas food

processors;

Food safety modernisation act

– mandates inspection of

overseas plants by FDA,

capacity building for

government systems (not yet

fully implemented)

Page 27: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Other market access issues

Dolphin safe - All tuna

products except fresh

require a certificate of origin

and Captain’s statement –

now applies to WCPO.

IUU and Seafood Fraud –

US is developing systems

to prevent import of IUU

caught fish and fraudulently

sold seafood products.

Page 28: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Other markets

China – following EU model of Govt issued

sanitary guarantees, but limited enforcement;

Japan – based on importer inspection: special

documentation required for Bigeye (ICCAT);

Australia – testing at point of importation;

expensive and delays fresh imports

New Zealand – similar but with ‘approved

importer’ status for local companies.

Page 29: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Ecolabelling

Consultation on Trade in Sustainable Fisheries Products Port Vila 5th August 2015

Page 30: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Eco-labelling in general

Provides opportunity to increase returns,

penetrate new markets and/or meet customer

demands;

Fisheries schemes mainly focus on

sustainability of fisheries resource;

Pressure for adoption mainly from NGOs on

large retailers;

2 elements: certification of the fishery and

chain of custody.

Page 31: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Marine Stewardship Council

3rd party certification scheme for

sustainability of fisheries resource;

Regarded as the ‘gold standard’ of

fisheries ecolabels;

Relatively few tuna fisheries

certified : in the Pacific Islands -

PNA skipjack free-school fishery;

Fiji albacore longline fishery; and

Cook Is. albacore LL fishery.

Recent certifications have raised

queries.

Page 32: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Others

Fisheries Improvement

Programmes

Friend of the Sea

Dolphin Friendly (Earth Island

Institute)

FAD – free tuna

Fair-trade certification

Some importers considering eco-

label standards or government

approval.

Page 33: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Conclusions/Outlook

Consultation on Trade in Sustainable Fisheries Products Port Vila 5th August 2015

Page 34: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Tuna Fishery Outlook

Purse seine

Catch rates remain high

Fish prices, particularly

Skipjack are very low

Lower fuel prices

Many vessels would seem to

be operating at a loss

Various plans to curtail over-

supply

Longline - albacore

Some improvement in prices

for cannery albacore;

Lower fuel prices;

Increasing use of alternative

markets by domestic fleets;

Key problem is low catch rates

due to increasing capacity.

Page 35: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Development of processing

Continuing

development of

canning/loining in PNG

Opportunities in

Solomon Islands

Fiji developing as

regional ‘hub’ for

processing longline

caught tuna

Vanuatu – good

albacore fishery

Page 36: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

Other employment opportunities

Crewing – estimated

that up to 19,000 jobs

could be taken by

Pacific Islanders;

Observers – around

700 employed now -

potential to increase

coverage;

Fisheries management

positions.

Page 37: Securing economic benefits from Pacific Fisheries...2014 WCPO total tuna catch 2.6 million mt (worth USD5.5 bn) representing about 60% of global tuna catch Around 60% of WCPO catch

The Future

The tuna fishery is a major resource for all Pacific

Island nations – for some it represents almost the

only chance for economic development.

Despite more than 30 years of sovereignty over 200

mile EEZs, 70% of the tuna is caught by foreign

fleets and around 90% is processed outside the

region.

While there are many challenges – this creates a

considerable potential to secure increased

development benefits.

Terms of trade and market access are crucial.