Fish Farm Subsidies Add Up To Big Losses

The fishing industry and agriculture have more in common than a shared interest in food. They are also both entangled in a generous heap of subsidies. And those subsidies have ended up playing an enormous, unmistakable role in overfishing.

First, a bit of history: half a century ago, subsidies were introduced to encourage fishermen to build more boats and increase the size of the fishermen’s haul. It worked. But the industry has been stagnant now for decades, and many of the boats have ceased to turn a profit. That hasn’t been as much of a deterrent as you might expect. Consider Spain, which received almost half of the European Union’s fisheries subsidies between 1994 and 2006. Most of the subsidies went to building new boats and upgrading Spain’s existing fleet. We’re not talking about conservation and biodiversity and other lofty environmental goals for the moment: in purely economic terms, this is just bad investment. The World Wildlife Fund has estimated that the number of fishing boats is more than double the number needed for a sustainable catch.

In the U.S., fisheries collect subsidies totaling $713 million a year, with fuel subsidies for boats accounting for the largest portion, a recent paper shows. Globally, fisheries subsidies are estimated to be worth at least $30 billion a year. About $20 billion of that, or 25 percent of the value of the world’s catch, is considered to be harmful to fish (that is, directly contributing to unsustainable fishing). The other major allocation of fisheries subsidies goes to research, some of which promotes sustainability and some of which investigates new species to farm and new markets to tap.

That might not be so shocking until you consider that a recent World Bank study estimates, conservatively, that $50 billion is lost annually from poor fisheries management and overexploitation. Here’s what that means.

First of all, the $50 billion doesn’t factor in the losses that stem from illegal fishing, diminished biodiversity, and other ecosystem degradations—it’s just straightforward pluses and minuses. That whopping figure represents the shortfall between the actual size of the global fishing economy and marine fisheries’ potential. The problem is that virtually all the world’s fisheries are underperforming. Given global fisheries’ depleted stock, the report concludes that the current marine catch could be produced with half the global fishing effort. The relationship boils down to this: with smaller fish stocks, there are fewer fish to catch. That means that the cost per fish is higher, in terms of fuel, labor, and so forth. And with too many fishers chasing to few fish, a lot of extra effort ends up going to waste—and that contributes to overfishing, which exacerbates the original problem.

It may well be that eliminating subsidies for fisheries is the most dramatic way to combat overfishing and improve the long-term yield of the world’s fisheries. While there’s hardly any room in today’s marine environment for growth in the size of the global catch, there’s plenty of potential to curb unsustainable exploitation and to reap many billions of dollars in good marine management.

Posted by Sandra Upson

Image Credit: World Bank