New Zealand: foreing vessels (and foreign subsidies?) and charter agreements

Some of my previous posts on NZ included a one titled "Domcumentary on NZ fishing practices" (15/08/2009).

New Zealand's authorities have taken these allegations very seriously and have launched a "Ministerial Inquiry into Foreign Charter Vessels" on these practices.

When going through some of the documents related to the inquiry and looking at the "nationality" of the vessels involved in the fishing operations (South Korea, Ukraine, Japan and Dominica) I wondered whether NZ companies where benefiting from subsidised fishing capacity, i.e. from vessels that would have been built with subsidies (investment susbsidies) and that would receive subsidies for operating costs (for example lower social security contributions) from the flag countries.

Perhaps readers have comments on this, i.e. the possible use of subsidised vessels, and its relation to WTO issues, such as the export of products that have benefited from subsidies (WTO Agreement on Subsidies and Countervailing measures).

 

Similarly to what the US vs. Canada softwoodlumber case highlighted, could we speak here of the "passing-through" of, say, a South Korean subsidy (for the construction of the vessel), to the NZ company operating the charter arrangement and exporting the product to a third country? Should counter-vailing measures be adopted, against whom should they be directed? Againts NZ or against South Korea?

Comments and views are welcome!

Here is the link to the page of the Fisheries Ministry's website with information on the inquiry:

http://www.fish.govt.nz/en-nz/Consultations/Ministerial+Inquiry+into+Foreign+Charter+Vessels/default.htm


And here the link to the "Nautical Blog" with a post on this issue (chartering in New Zealand):


http://nauticallog.blogspot.com/2011/04/holier-than-thou.html

EU: Commissioner Damanaki on the new EU's fisheries fund

Ms Damanaki European Commissioner, in charge of Fisheries and Maritime Affairs, lifted a corner of the veil on the Commission's proposal for a future EU's fisheries fund. This happened during a hearing at the UK's Parliament House of Commons Select Committee on Envrionment, Food and Rural Affairs.

Here is the link to the UK's Parliament website with the video of the hearing. The discussion on the new fisheries fund takes place at the end of the hearing (from 12h22 on):

http://www.parliamentlive.tv/Main/Player.aspx?meetingId=9264

MALDIVES: governement sued because of non-disbursement of fisheries subsidies

When looking in the Internet for news on fisheries subsidies I stumbled upon an article published in the online edition of the "Minivan News".

The title of the aritcle is "DQP sues Finance Ministry for non-payment of fisheries subsidies". According to the article the "Dhivehi Qaumee Party (DQP) is withholding the budget allocated for fuel subsidies for fishermen".

Here is the link to the article:

http://minivannews.com/politics/dqp-sues-finance-ministry-for-non-payment-of-fisheries-subsidies-26914

NZ: interesting presentation by governement official on WTO negotiations

Here is the link to a presentation by a New Zealand's governement official on the WTO negotiations on fisheries subsidies.

http://www.seafoodindustry.co.nz/f1690,84125/84125_Haike_Manning_WTO_Fisheries_Subsidies.pdf

ALGERIA: minimum salary for fishermen for "biological stops"

Algeria will be paying subsidies for fishermen who have to stop fishing activities to let fish reproduce. The subsidy cosnsists of a minimum guaranteed monthly salary of 18,000 Algerian Dinar (250 USD).

Here is the link to an article (in French) published by AFP - Romandie News

http://www.romandie.com/news/n/_Un_salaire_minimum_aux_pecheurs_algeriens_afin_de_proteger_les_popissons051020111510.asp

USA: subsidies for the shrimp processing industry in Louisiana

According to the press a new shrimp processing facility will open in Baton Rouge, Louisiana.

In some of the articles I found on the Internet it is mentioned that   "the state [Louisiana] is providing a $1.09 million loan guaranty to Baton RougeShrimp, and the company is expected to utilize the state’s Enterprise Zone and Industrial Tax Exemption programs."

Here are the links to the articles:


http://goerie.com/apps/pbcs.dll/article?AID=/20110926/APN/1109260795

http://www.southerngovernors.org/articleview.aspx?articleid=7338

Congressman Faleomavaega mentions "U.S. tax payer subsidising right to fish"

Here is a video posted by Greenpeace USA where Congressman Eni F.H. Faleomavaega of American Samoa welcomes the Greenpeace ship"Esperanza".

In the video he makes a reference the access agreement that the US has with some Pacific nations and to the fact that some fishing companies are benefiting from "U.S. tax payer subsidised right to fish".

INDIA: subsidies for fuel and out of board motors

Public authorities in India, (central government and States)  have an history of supporting the fisheries sector (see my post tagged “India”).  India has also been very adamant at the WTO negotiations on fisheries subsidies in defending the possibility by governments to give subsidies to fisheries, especially in developing countries. This is confirmed by the written proposals that India has submitted to the WTO.

Recently the State of Goa has published an order for the implementation/continuation of the of State Sector Scheme “Financial Assistance towards subsidy for purchase of Kerosene for Out Board Motor Operators”.

I copy here a couple of extracts of the order.

For fuel, fishermen eligible for the aid will receive a: 

“lump sum subsidy of Rs. 30,000/- (Rupees Thirty thousand only) per year on a minimum consumption of 2000 litres of Kerosene.” 

For Out Board Motors: 

“The beneficiary will be entitled for financial assistance to the extent of 50% of the cost limited to Rs. 40,000/- (Rupees Forty thousand only) per O.B.M. of 8-10 HP to be shared by the State and the Central Government from the year 2011-12 of which the Central share shall be 50% of the eligible subsidy limited to Rs. 15,000/- (Rupees Fifteen thousand only) and balance of Rs. 25,000/- shall be borne by the State Government. The bank will finance the loan amount to the extent of the cost of the out board motor hypotheticating the canoe of the applicant and considering the cost of the canoe as margin money and also taking into account of Rs. 40,000/- (Rupees Forty thousand only) as a Government subsidy. Motor purchased with self finance are also eligible for subsidy at the above rate.”

Readers will note that the subsidy for the Out board motors receive financing from the Indian Central Government.

Here is a link to an article by the “Times of India” on this subsidy.

http://articles.timesofindia.indiatimes.com/2011-08-07/goa/29861085_1_kerosene-new-scheme-subsidy

And here a link to the order published by the Government of the Indian State of Goa. 

http://www.goaprintingpress.gov.in/downloads/1112/1112-14-SI-OG.pdf

USA: fisheries subsidies and budget crisis

Readers are certainly aware of the budget crisis that a number of countries, including the U.S.,  are currently experiencing.

Subsidies to fisheries can take the shape of budget hand outs (do not forget that they can also be provided as tax rebates, or forgone government revenue as dubbed in WTO jargon). I found an article in the online edition of the Sun Sentinel  discussing the issue of fisheries subsidies in the context of the U.S. budget crisis.

Here is the link to the article:

http://articles.sun-sentinel.com/2011-08-07/news/fl-nncol-budget-fisheries-nikpour-08020110807_1_catch-shares-fisheries-fishing-industry

USA: Starkist and Tri-marine to benefit from government owned near-shore cold storage facilty?

Some media have reported that Governor Togiola Tulafono of American Samoa is seeking to make available to Tri Marine International and to Starkist a 2,400 tonnes cold storage freeze facility, to be located in the Department of Port Administration in the port area. The local fishing fleet would also benefit from this facility.

Also according to press reports Governor Togiola is seeking federal financial assistance to finance the project.

Here a few links on the subject:

http://samoanews.com/viewstory.php?storyid=24775&edition=1300788000

http://www.samoanewsonline.com/publicviewstory.php?storyid=27119&newspaperid=189

MALDIVES: fisheries subsidies, for fuel, a matter of survival

An opposition party (Dhivehi Qaumee Party or DQP) in the Maldives is pressing the government to quickly provide fishermen with 100 Million Ruffiya (USD 7.8 million) subsidies to the fisheries sector to help them purchase fuel. According to the article, this amount was already allocated by the governement in the 2011 budget.

Also according to the article the DQP argues that:

"...the industry has been going downhill and that the families of the fishermen are now living in hunger and poverty. The party said that the subsidies given to the fishermen to purchase fuel are given with the aim to lift of these burdens from them and to help them out."

This piece of news aroused my curiosity on the Maldives' fisheries industry.

In the 2010 Statistical Yearbook of the Maldives I found information about the number of fishermen active in the Maldives and made a few calculations.

The most recent data  concerned 2007. In that year there were 13,648 fishermen in the Maldives. So this means that a 100 million Ruffiya subsidy allocation to the fisheries industry would translate into a 7,327 Ruffiya (or 571 USD) subsidy per fishermen in the Maldives.

Here is the link to the article:

http://www.miadhu.com/2011/06/local-news/dqp-threatens-court-action-if-fisheries-subsidies-are-not-given-in-21days/

And here the link to the Statistical Yearbook of the Maldives:

http://planning.gov.mv/yearbook2010/yearbook/5_employment/5.9.htm

USA: PETERSON INSTITUTE's recipes for the USA on WTO's Doha illness

There are a lot of ideas circulating on what the WTO Members should do on the current crisis that the WTO's Doha Round is going through.

Here is a link to a webpage from the Peterson Institute for International Economic with a policy brief titled "What Should the United States Do about Doha?"

http://www.bookstore.iie.com/publications/interstitial.cfm?ResearchID=1851

Not a word on fisheries subsidies.

MALAYSIA: more on fuel subsidies

In March 2011 I wrote a post on Malaysia's subsidies to fuel used by fishermen.

In recent articles the Malaysian press has echoed the unhappiness of license holders of so called “C2 trawlers” about the removal of a super-subsidy given by the government.

These trawlers are offshore vessels of 70 GRT and above and operate beyond 30 nautical miles off the coast. Until 31 May 2011 these trawlers could buy diesel at the price Malaysian Ringgit or RM 1.25 (or 0.41USD). After that date they price they pay is RM 1.80 (or 0.59 USD).

According to the government, this is still a subsidised price.

As to how this super-subsidy worked one of the articles (1) mentions that:

“The government subsidises 25,000 to 28,000 litres of diesel equivalent to RM31,250 (10,271 USD) and RM35,000 (11,503 USD) for each vessel every month and all Zone C2 vessels could use up to an average of 14 million litres of diesel every month”

Here are links to press articles on this issue:

(1)    http://www.theborneopost.com/2011/06/08/trawler-operators-still-enjoying-subsidy-for-diesel/
(2)    http://www.freemalaysiatoday.com/2011/05/19/trawler-operators-upset-over-subsidy-move/

WTO: Ideas on helping WTO Doha negotiations forward -> freeze and reduce fish subsidies by 10% the first year

In a previous post I included a quote from a article of a former Indian Ambassador to the WTO, where he set out his views on the possible ingredients (fish not on the plate!) for salvaging the Doha Round.

In the mean time other articles have been published in the voexeu.org website. Some authors writing on the WTO Doha Round have proposed  that "middle trading powers" should 

"Freeze all harmful fisheries subsidies and offer to reduce them by 10% in the first year provided a critical mass of members do the same;"  Richard Baldwin  and Simon J. Evenett © voxEU.org

I wonder which countries the authors have in mind when writing about "middle trading powers"?

This quote can be found here:

http://vox.cepr.org/index.php?q=node/6573

WTO: "US Demands may Kill WTO Agreement" (and so one on fisheries subsidies?)

I found a very interesting video with an interview of Timothy A. Wise, Research Director of the Global Development and Environment Institute (GDAE) at Tufts University.  

 The interview appears under the heading "US Demands may Kill WTO Agreement".

Here is the link to the website with the video:

http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=6831

WTO: "Slim chance of success for "Doha Lite" trade talks" (according to Reuters)

Here is the link to an article by Reuters with an analysis of the situation of the WTO's Doha Development Agenda Round. Not very optimistic I must say.

The article includes good insights on the discussions about the composition of a "Doha-lite" package: abolition, mainly by developed countries, of subsidies to the cotton industry, Duty-Free Quota Free access to markets for the poorest countries. These are important issues for many least developed and developing countries.

Not a word on fish subsidies in the article.

http://www.reuters.com/article/2011/05/31/businesspro-us-trade-wto-doha-idUSTRE74U6ZS20110531

WTO: more of Hollywood in fisheries subsidies negotiations

In my 31 Oct 2009 post titled “WTO: fisheries subsidies and Hollywood under the same roof” I discussed how some celebrities were supporting NGOs in lobbying for strong WTO disciplines on fisheries subsidies.

In another post of 3 Nov 2010 titled “NZ/WTO: Tim Groser on film stars and WTO fisheries subsidies” I discussed Tim Groser’s (NZ Minister responsible for Trade) comments on the role played by celebrities and Hollywood stars in international negotiations, especially in the area of climate change.

On 11 May 2011 the WWF issued a press release announcing that:

“Today, Mission Blue, Oceana and World Wildlife Fund (WWF) delivered a letter to President Obama calling for renewed U.S. leadership at the World Trade Organization (WTO) to end subsidies that contribute to overfishing.

In the letter, 77 prominent environmental leaders and groups, including conservation organizations Oceana and WWF, marine scientists Dr. Sylvia Earle and Dr. Daniel Pauly, and celebrity activists Leonardo DiCaprio, Chevy Chase and Darryl Hannah wrote, “The United States has played a strong role across successive administrations, to achieve new rules for fisheries subsidies at the WTO. Recent developments at the WTO may threaten to derail years of progress towards a successful result. We urge you at this important juncture to send clear and public signals that a genuine ‘win’ on fisheries subsidies remains a critical priority for the United States at the WTO.”

I am sure that Tim Groser, as Trade Minister of a country which is championing the adoption of very strong rules on fisheries subsidies at the WTO, will be very happy that celebrities and Hollywood give their support this time to this cause.

Here is the full link to the full text of the press release.

http://www.worldwildlife.org/who/media/press/2011/WWFPresitem21254.html

OMAN: subsidies for the purchase of fishing vessels, engines, gear, fish processing equipment, etc

A recent press release from Oman's Ministry of Agriculture and Fisheries (17 May 2011) announced a new regulation which provides for a whole array of subsidies for the artisanal fishing sector.

According to the press release the new regulation:

"...includes subsidizing the artisan fishing sector for purchasing fishing boats, engines, instruments and equipment used in the artisan fishing boats, as well as the artisan fishing accessories, in addition to the subsidy allocated for purchasing the long fishing threads, electric cranes used in the artisan fishing boats and GPS and other equipment."

and

"also included the coastal fishing subsidy for purchasing and possessing fishing equipment, quality control devices, subsidizing the fishing industries, such as, the fish drying and preparation equipment whether by salting, smoking or storing."

Here is the link to this press release:

http://www.omannews.gov.om/ona/english/newsDetails_inc.jsp?newsID=51651

 Another press, of 18 May 2011, article of ONA (Oman News Agency) gives a few figures of the Omani fishing sector

"The fisheries sector is one of the major contributors to non-oil/gas generated income, but it is seen as having an even much greater potential with Omani fishing waters being regarded as among the richest in the world. The sector and associated industry plays a vital role in the economy, as well as in the livelihoods of tens-of-thousands of fishermen and employees in the fisheries industry. The sector’s huge growth can be directly related to its importance and the confidence placed in it by public and private sector investors. It generated substantial income with figures for 2009, showing that over 158,000 tonnes of fish with a value of RO104 million were landed, a growth of four per cent compared to 2008. In 2010, local authorities have worked hard to ensure that specified rules and regulations are adhered to by fishermen."

And here is the link to the above press article:

http://www.timesofoman.com/innercat.asp?detail=45062&rand=

WTO: ingredients for salvaging the Doha Round (fisheries subsidies not included!)

Ujal Singh Bhatia, former India’s Ambassador and Permanent Representative to the WTO in Geneva has written on 10 May 2011 an interesting piece in Voxeu.org, a website on research-based policy analysis and commentary from leading economists. There is a link to it in my blog list.

To salvage Doha Mr Bathia suggests:

"Based on this broad understanding of the situation, a three pronged approach needs to be explored:

• Seriously contentious issues like the Market Access issues, Agricultural Subsidies, and Rules may be segregated for continuing consultations under agreed terms of reference.

The segregated package has to be internally balanced to allow for incentives and trade offs for all players.

• Stand alone agreements to be finalised on less contentious issues.

The areas for focus are fairly obvious to those close to the negotiations.¹

• The third component would be a Ministerial decision to initiate a work programme for institutional reform in the WTO."

Ujal Singh Bhatia © voxEU.org


The areas for focus arementioned in footnote 1 and they are the following:

"Specifically, Trade Facilitation, all aspects of Export Competition in Agriculture including Export Subsidies, Transparency Mechanism for RTA’s, LDC Waiver in Services, NTB’s package in NAMA, Ministerial decisions on Para 31(i) and 31(ii) of the Doha Ministerial Declaration, Implementation of the Hong Kong decision on Duty Free Quota Free treatment for LDC’s, a Ministerial decision on the Monitoring Mechanism for S&D provisions, as well as a Ministerial Decision on the issues raised by the C-4 on Cotton."

It is interesting to see how this list compares with other lists, such as the one proposed by the US, which includes, next to trade facilitation, fisheries subsides or the liberalisation of trade in the so called "environmental goods" but no "cotton" or duty-free quota-free for LDC's.

Here is the link to the article:

http://www.voxeu.org/index.php?q=node/6497

EU: WWF and its allies call for real reform of the EU's Fisheries Policy (also of subsidies?)

Just before the start of the European Seafood Exhibition in Brussels the WWF posted on its website a leaflet on the above subject with as head title "A shared vision for sustainable European fisheries"

I went through it and to my great surprise I did not find the "s" word, i.e. subsidy, subsidies, (financial) support. So, this piece of policy (not negligible) does not appear in this document. You could read such absence in different ways. One could be: subsidies must go, they should disappear, so do not mentioned them. The other way of reading the document would be: do not touch subsidies, keep them as they are (or at least at the same level). Another way of looking at it would suggest that, as subsidies are such a contentious issue, it is better not to address them. 

  

I found also interesting the sentence that reads as follows:

"This reform should seek to maximise the economic benefits for society through the sustainable management of these vital and renewable resources for future food security."

 This sounds like agriculture. Would this mean that the EU has to ensure that it can be self sufficient in its supply of fish products, for food security purposes?

At any rate, the EU subsidses the production of the leaflet! Should we call this a virtuous (or good, or green) fisheries subsidy? I leave the answer to the readers of this blog.

Here are a few links on this document:

http://wwf.panda.org/what_we_do/how_we_work/policy/wwf_europe_environment/initiatives/fisheries/fisheries_policy/wwf_industry_alliance_cfp/

http://www.wwf.eu/fisheries/cfp_reform/?194279/WWF-and-its-Allies-call-for-real-reform-in-European-Fisheries