USA: subsidies for fishermen in the Gulf of Mexico

"Commerce Secretary Gary Locke Announces Fishery Failure Determination in Gulf of Mexico". This is the title of the announcement by the Department of Commerce for financial help (or subsidies) to fishermen affected by the oil disaster in the Gulf of Mexico.

Here are the figures (at least the preliminary ones):

"The administration has requested $15 million of supplemental funding as a backstop to address this disaster, as well as $5 million of economic development assistance through the Economic Development Administration. In addition, the administration is requesting unemployment coverage for this disaster, and the Small Business Administration is offering economic injury disaster loans, which can help fishermen and other affected businesses."

When reading the text of the release I was thinking of the latest submission by the US to the WTO on fisheries subsidy rules. Readers of this blog may remember that in my post of 26/04/2010 I was quoting a paragraph of the US document where the US indicated the following:

"We note that exceptions for 'disaster relief' are now placed in Article I.1 ("Except . . . in the exceptional case of natural disaster relief, the following subsidies . . . shall be prohibited"). While we have not come to a firm view, disaster relief may be covered more appropriately in Article II. We have not addressed the disaster relief exception in this submission, but may have further thoughts as to its scope and placement as technical discussions of the text continue."

My guess is that the US has made up its mind on this issue, i.e. that man made fisheries "failures" or "disasters" (such as an oil spill) is a good reason to provide subsidies to fishermen.

Here is the press release announcing the good news for US fishermen affected by the "fisheries failure":

http://www.commerce.gov/news/press-releases/2010/05/24/commerce-secretary-gary-locke-announces-fishery-failure-determination

BLOG: blog on fisheries and aquculture (in French)

For those who understand this beatiful language: here is a very comprehensive and informative blog on fisheries and aquaculture with emphasis on French and EU issues.

I am adding it to my list of favorites blogs.

http://aquaculture-aquablog.blogspot.com/

WTO: reporting on informal negotiating meeting on fisheries subsidies (6)

It seems that the WTO negotiating group on Rules discussed from 3 to 7 May the submission on Special and Differential Treatment by Brazil, India, China and Mexico and the paper by the US toughening the conditions to get an exemption from a wide ranging prohibition.

Here is the link to the ICTSD web site with the report on the negotiating session

http://ictsd.org/i/news/bridgesweekly/75726/

WTO: Natural (fishery) Resource Subsidies, the next battle at the WTO on fisheries subsidies?

Browsing the WTO website I found a very interesting article titled “Natural Resource Subsidies” by Matthew S. Yeo, Partner, Steptoe & Johnson LLP. This article is published under the section “Discussion forum: World Trade Report 2010 Trade in Natural Resources: Challenges in Global Governance”

In this article the author make numerous references to the a dispute between Canada and the US regarding the pricing of natural resources, the so called Softwood Lumber case.

Interesting to note is that in this dispute Canada maintained that the way fishing rights are allocated (for free, through auctioning, etc) is a matter for the WTO Member and referred to the fact that the US was not asking fishermen to acquire fishing rights through an auction.

In the “softwood lumber” case the following issues, which could be relevant for fisheries, were raised:

1. First, whether the way a government grants harvesting rights constitutes a subsidy. or not.
2. Underlying the first issue emerges the question as whether comparisons can be made between different countries, in other words, whether “cross-border” benchmarks to find and measure “benefit” can be used.
3. And third whether this benefit can be passed on downwards to other parts of the industry.

As I said before this dispute has raised a number of issues that could resurface in the future, either in the context of WTO’s Dispute Settlement or… in the next WTO negotiating round (not this one).

Here under are some of the issues that could be subject to discussion in a re-negotiation (in a perhaps not so distant future) of WTO fisheries subsidies disciplines:

• The right obtained from the government to harvest a natural resource is tantamount to a government financial transfer in the meaning of Article 1 of the Subsidies Agreement… thus “free access” to fisheries resources could be a subsidy to fishermen.
• Pricing a natural resource and benefit: for the determination of a “benefit” the SCM Agreement does not require markets to work perfectly, neither to work equally in all member countries… so, we need to change the SCM Agreement (and its future annex on Fisheries Subsidies) to require the allocation of fishing rights based on a market mechanism.
• Some types of regulatory interventions by the government, even if they have significant trade effects, are shielded from the disciplines of the SCM Agreement... thus regulatory actions such as compulsory domestic landings, export prohibitions, no user-charging or cost recovery in fisheries would not be actionable under the current SCM Agreement.

In sum, will be the future debate on fisheries subsidies target regulatory actions instead of direct financial transfers?

Watch this spot!

Here is the link to the article:

http://www.wto.org/english/res_e/publications_e/wtr10_yeo_e.htm

NGOs: increased competition on fisheries subsidies among NGOs. "Mission blue" joins the pack

Fisheries subsidies has become, overtime, one of those subjects on which a number of environmental NGO are "competing" when it comes to drawing the attention of the general public.

Over the last few days “Mission Blue” (Sylvia Earle Foundation) has teamed up with OCEANA to send a letter to G-20 leaders asking them to “halt overfishing subsidies”.

The key paragraph in the letter reads as follows:

"We urge G-20 leaders to pledge to not further expand fishing subsidy programs and give their highest priority to a strong outcome in the WTO fisheries subsidies negotiations."

Personally I was struck by this very candid, and I would add, audacious request by these NGOs to countries such as Brazil, India or China (all members if the G-20) which are in the process of expanding their fishing fleets, including by the provision of subsidies.

As regards WTO negotiations on fisheries subsidies these countries have also been very clear in rejecting strict rules that would limit their ability to provide subsidies to vast segments of their fishing fleets (small-scale or artisanal fisheries). If any doubt; please refer to my previous posts on the negotiating submissions tabled by these countries.

On the other I would expect that fishermen in some developed countries would be tempted to (immediately) underwrite such statement. Keeping the "status quo" in the level of subsidies, in times of budget cuts, could be seen a rather satisfactory situation, at least from the point of view of teh beneficiaries of the subsidies.

Here is the link to letter:

http://na.oceana.org/sites/default/files/G-20_Ad_for_Hill_Times_FINAL.pdf

And here the links to Oceana and to Mission Blue pages where reference is made to this letter:

http://na.oceana.org/en/blog/2010/05/letter-to-the-g-20-stop-fishing-subsidies

http://www.mission-blue.org/

WTO: Pascal Lamy on fisheries subsidies, again.

The Director General of the WTO has, once again, referred to fisheries subsidies as a prominent negotiating subject in the WTO Doha Round.

He did that recently, during a speech he delivered at the Round Table Centre for Public Studies in Santiago on 15 April 2010.

This time he framed his reference to fisheries subsidies by underscoring how important "trade rules" are for WTO Members. Here is the paragraph of Mr Lamy's speech where he speaks about fisheries subsidies:

We all know that governments could do things to restrict trade without infringing their WTO obligations, but the rules draw a line beyond which it is not possible to go without breaking the system, and more importantly in my view, the WTO has created a culture of cooperation. The trade rules have stood to the protectionist pressures but we now need to ensure that this culture of cooperation brings the Doha Round to its completion. We need to ensure that the rules of the WTO, which are a public good, are improved and updated. Failure may be costly on a global scale. Take the example of fishery subsidies. We have a mandate to negotiate the prohibition of certain subsidies which contribute to over-capacity and over-fishing. Present disciplines are inadequate. Scientific studies tell us that over 80 per cent of fish stocks are over-exploited. We need action and for that, we need leadership from our membership. The coastal population in Chile which has been severely affected by the earthquake and which is dependent on fishing activities knows this only too well.

So, according to Mr Lamy trade rules are a "public good" to be improved and updated and are critical to fight problems such as over-capacity and over-fishing.

What I miss in this paragraph, and in the speech, is a reference to the fact that these rules relate to the use of anti-dumping and anti-subsidy measures. Nowhere in the speech could I find these (ugly?) words. And yet, Chilean fish products, i.e. farmed salmon, have been subject to anti-dumping measures imposed by the U.S.

Rules on anti-dumping and anti-subsidy are also discussed under the so called “Rules” chapter and it seems that, unless progress is made in these “nasty” area of what the EU has called “trade defence instruments” (and in all other areas of the WTO Doha Round), no new rules on fisheries subsidies will be agreed. This holds true, provided WTO Members will continue to stick to principle of the “single undertaking”.

Here is the link to Mr Lamy’s speech:

http://www.wto.org/english/news_e/sppl_e/sppl153_e.htm