Fisheries

3.4 Cost-benefit analysis of greening fisheries

As presented earlier, greening the fisheries sector would lead to an increase in value added from fishing, globally, from US$ 17 billion to US$ 67 billion a year. This is a net increase of US$ 50 billion a year. Given that the cost of restructuring the global fishing fleet under scenario three is a one-time investment of about US$ 240 billion, benefits would be realised very quickly if fish stocks recover fast. Discounting the flow of US$ 50 billion per year over the next 50 years at 3 per cent and 5 per cent, real discount rates represent a present value from greening ocean fisheries of US$ 960 and US$ 1,325 billion, which is between 4 and 5.5 times the mean estimate of the cost of greening global fisheries. This signals that there is a potentially a huge green advantage. Although a variety of assumptions are needed to produce estimates in this section, it is clear that economic gains from greening world fisheries are substantial enough to compensate for even drastic changes in these assumptions.

3.5 Managing fisheries

Effective management is crucial for ensuring a green marine fisheries sector, although this has so far proved difficult to achieve. Research suggests that implementing a form of management known as individual transferable quotas (ITQs), also known as catch shares, can explain the improvement and rebuilding of many fish stocks around the world (Costello et al. 2008; Hannesson 2004). However, it has also been argued by many authors that ITQs are no panacea and need to be designed carefully (Clark et al. 2010; Essington 2009; Gibbs 2009; Hilborn et al. 2005; Pinkerton and Edwards 2009; Townsend et al. 2006).

Catch shares can be an effective tool in controlling fishing pressure. Because they are underpinned by Total Allowable Catch (TAC) limits, they can constrain catch to sustainable levels and, therefore, become valuable management tools (Arnason 1995). Individual transferable quotas do not confer full property rights to the ITQ owner, and furthermore, it is widely acknowledged that even if they were to provide such rights, there are still conservation and social concerns to worry about (Bromley 2009). Understanding these limitations to ITQs as a management regime, where this tool is implemented, must be part of a broader management system that ensures that these limitations are addressed appropriately. Measures are needed to ensure that ITQs work to improve economic efficiency, while ensuring the sustainable and equitable use of the fishery resources and the ecosystems that support them.

Below are some of the strategies that are needed as part of an ITQ management system if it is to achieve economically, ecologically and socially desirable outcomes (Sumaila 2010):

■ Individual transferable quotas must be supported by an arm’s-length stock assessment unit that is independent of industry and backed by strong monitoring, control and surveillance (MCS) to deal with the lack of full property rights, which can lead to "emptying" the ocean of fish under certain conditions;

■ Some restrictions on the ownership of ITQs to people actively engaged in fishing may be needed to mitigate against diluting ITQ performance when quota owners are different from those who fish;

■ Measures to ensure resource sustainability by taking an ecosystem-based management approach including

Box 5: Illegal, unreported and unregulated fishing and the greening of fisheries

The FAO identifies Illegal, Unreported and Unregulated (IUU) fishing as one of the major factors driving overexploitation of marine resources worldwide (FAO 2001). Based on case studies, MRAG (2005) estimate that the total loss due to IUU fishing is about 19 per cent of the total value of the catch. The commonly accepted economic reason for the persistence of IUU fishing is that detection rates and fines are too small relative to the catch value (Griggs and Lugten 2007; Kuperan and Sutinen (1998). In fact, Sumaila et al. (2006) suggest that the reported fines should be increased by at least 24 times to equalise the expected costs and benefits.

To green fisheries and prevent overexploitation, it is necessary to reduce IUU fishing. The direct way is to strengthen monitoring and control through strict policy enforcement, and the indirect way is through economic incentives, e.g., increasing fines or decreasing reporting costs. While reducing IUU fishing within a country using these direct and indirect ways is important, cooperation among countries is also very critical, since lots of IUU fishing occurs in the areas accessed by multiple countries. Source: OECD (2004)

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