by
Paul Adam
Head of Fisheries Division
OECD
Paris
Distant-water fishing has been subject to two main criticisms from coastal fishing communities:
- Maintaining an excessive level of exploitation detrimental to less mobile coastal fisheries which do not have alternate deployment opportunities.- Disregarding the priority rights of the coastal fishermen.
These criticisms were often justified, but it is only fair to add that coastal-based fishermen have, too, overexploited indigeneous stocks. Furthermore, some stocks could not be profitably exploited by local fishermen, whereas distant nations had the catching capability and domestic markets.
The new regime for the sea has institutionalised the rights of the coastal States, to the extent that is sometimes interpreted as validating property rights for the local fishermen; it has, anyway, required the far-distant fishing nations to seek fishing privileges against fees, or various concessions.
This development is well-known and leads to the question of what kind of a future is to be expected for the far-distant fisheries.
If it is obvious that the survival of far-distant fishing enterprises depends upon access to foreign fishing zones, it should be remembered that it will not be sufficient to obtain quotas and to catch fish. It is often under-emphasized that a profitable industry needs strong links with the market place, and it is too readily assumed that the domestic industry which has inherited the coastal resource will be able to dispose of its production surpluses on the international market.
I. BEFORE THE NEW REGIME
The most publicised type of far-distant exploitation is that of the East European fleets, ready to deploy in all the world's oceans for practically any species of fish with the objective of procuring the maximum quantity of animal protein to supplement an insufficient domestic supply of meat. The consequences of those activities may have been very detrimental to certain shoaling fish stocks, i.e. pelagic species (herring, capelin, mackerel) or for haddock which, although a demersal species, presents some shoaling behaviour (e.g. the big catches of USSR on the Georges Bank in 1965-66 and in the North Sea in 1976). But for species not so easily harvested in such quantities, this exploitation pattern would still be serious although less critical.
The point to keep in mind is that the means of production in centrally-planned economies, in spite of what has been often said about their lack of profitability, is also, in fact, market orientated. But they emphasise bulk catches because they measure revenues in proteins rather than in dollars, yen or marks, while the fisheries in free-market economies have to ensure profitability in money values.
Other examples will show that industrialised countries, engaged in far-distant fisheries, although they were very often using similar boats and techniques had widely different objectives and organizations. The common points were in the ways with which these objectives were achieved: long voyages to and from the fishing grounds and exploitation of the same fish stocks. But, principally, deployment was a factor of the prevailing market conditions, as were decisions regarding the type of processing undertaken onboard these vessels.
In the North Pacific, Japan was competing with the USSR for Alaska pollack which was processed on board. But whereas the Soviet catches are distributed and defrosted in retail outlets throughout the country, the Japanese public was keen on the roe neglected by many consumers of that kind of gadoid; the fish itself was used for the preparation of kamaboko, a type of fish "paté"; and only relatively small quantities were exported in frozen slabs, mainly to the United States.
The Grand Banks, off the Canadian east coast, were a meeting point for many far-distant fleets. The French, Spaniards and Portuguese had been exploiting those waters for centuries in search of cod which was salted on board. France turned to freezer trawlers with only limited success but had better results when it combined both processes: the salt fish market, in spite of all which was said about its obsolescence, was remaining important, but salting at sea was requiring a relatively large crew at a time when the catches per unit of effort were diminishing. The French catch gradually dwindled so that the country had become a net importer of salted fish before 1977, but the choicest fish were utilized in salting where the returns were greater.
Spain, and even more so Portugal, maintained, for a longer time, their salt fish sector due to a strong internal demand for the product and to an abundance of manpower ready to accept conditions which would not have been accepted in other industrialised countries. This last remark applied mainly to Portugal, where the dory vessels, abandoned by all other European fleets after the Second World War, remained active until the 1970's, due to their higher productivity at a time when the cod stock was dispersed, and perhaps over-exploited, and not so easily fished by the conventional bottom trawl.
Conversely, and at the same time, Spain developed a large and modern fleet of freezer trawlers to catch South Atlantic hake which was frozen whole, carried back to Spain and for which a market was gradually developed in part because of the scarcity of the more appreciated European hake.
German fisheries developed in the west Atlantic when the salt fish trade was beginning to decline. It grew into a complex exploitation, having three alternative targets: herring or redfish, for which the German market was biggest in Europe, or cod which was mostly exported as far away as the US. It is important to note that the crews were composed of a significant number of immigrant workers: the long absences and the harsh conditions of the work were not acceptable to most Germans.
The UK, in spite of a few tentative forays, did not undertake any recent fishing ventures of commercial significance in the waters of the north-west Atlantic. It concentrated on the northern and Arctic waters of the north-east Atlantic (Iceland, the Barents Sea, Spitzbergen and Bear Island). Two reasons may be given. Firstly, the British industry concentrated its efforts on the landings of whole fish which, frozen at sea and defrosted ashore, corresponded to a market in which fish and chip shops had the biggest share. Secondly, the crews were British and not disposed to working on board ships for extended periods with short turnovers between trips. A UK freezer trawler, while remaining at sea for one month, required a crew complement of around half that of German trawlers which remained at sea for more than two months. It was more cost-effective to employ a plant worker ashore than at sea.
As a final example, it is worth noting that the tropical tuna fisheries were pursued by a number of long-distant fleets. Their operations were similar, both in the highly technological sense and also because of the dominant position of the few markets which were importing the bulk of domestic production surpluses: apart from Japan, where the consumption pattern is more diversified, most of the production is utilized for canning.
All in all, the conclusion to be derived from the practice of long-distance fishing before 1977 is to note the importance of the competition which was taking place on the grounds between the different fleets (e.g. Japan and the USSR in the Bering Sea, Japan, USSR, Spain in the south-east Atlantic; USSR, Poland, Spain, Portugal, France and Germany in the north-west Atlantic, etc.). Because of this competition, production was held at a maximum, i.e., often significantly above the maximum sustainable yield. But this severe competition was not based on equal or equalised economic conditions. If, in many cases, the means and methods of production were similar, the markets and the costs and earnings relationship were widely different. It explains how new kinds of production/market systems, possible in one country, could push out other production/market systems of countries confronted with different national market and economic conditions. To this extent the movement towards the new law of the sea was precipitated by the need to avoid the damaging consequences of excessive competition.
II. THE FIRST YEARS OF THE NEW REGIME
A first consequence of the new regime for fisheries, which was implemented by many countries in 1977, was to give to the coastal States the right of reserving the living resources of their zones to their nationals, i.e., the right of excluding the foreign fleets, most often far-distant fleets. In this respect, the new regime for fisheries was rapidly implemented and, sometimes, with brutal consequences. Whereas the EEC took more than seven years to agree on the internal distribution of the common resources of the North Sea, the exclusion of the Soviet fleets from the North Sea as well as the corresponding exclusion of the EEC fleets from the Barents Sea, took a matter of a few months.
The rapidity of the reallocation processes led to increased expectations of national fishermen and, whether or not the fleets expanded, the control and organisation of national fishermen is, six years hence, a considerable management problem. Meanwhile, foreign activities were very quickly, if not immediately, drastically controlled and supervised.
The general position, all over the world, is that the access of foreign fleets:
(a) should be given only for that part of the resource which cannot be harvested by the national fishermen;(b) should be conditional: the less developed countries may find in licence fees a source of income; or in joint ventures, the opportunity of soliciting assistance for the development of their domestic fisheries; the industrialised countries are looking for either a compensation of the costs of control and management in their zones or for commercial concessions for their exports.
In other words, the countries which were active in far-distant fishing operations are confronted with:
(a) significant increases in costs: those resulting from the new regime of the sea (fees, etc.); those which are the effects of the economic situation (fuel costs, etc.);(b) significant decreases in fishing opportunities.
Their situation in recent years was so difficult that there was obviously no consideration of undertaking new investments and that even deployment of the existing fleet on what were traditional fishing grounds, could not be secured. In such situations, profitable exploitation was no longer possible; owners could only hope to minimize losses through solutions more unsatisfactory than satisfactory.
It is, in fact, impossible to give a comprehensive account of the many existing situations. Many joint ventures or fishing agreements, even when they are concluded after various public sector interventions and conditions, are considered as private business and therefore not open to scrutiny. Where information is given, e.g., in specialised journals, it is rarely complete and does not present a full picture. Furthermore, the conditions are changing rather rapidly and much of the available information is, in fact, outdated shortly after is it disseminated.
Consequently, if the information given in Part I was a series of summaries of the situations of the different far-distant fleets, Part II can only present a set of examples without the possibility of comprehensive assessment.
(a) The first reaction has been to deploy, wherever opportunities were still available: large freezer trawlers have been sent to far-distant shrimp grounds; boats made for the north Atlantic have been sent to the Antarctic for new species hitherto unknown to the fishermen or to the consumers; once again the millions of tons of krill have been publicised as if they were to be harvested, in a normal commercial manner, before the end of the year; the same is true for blue whiting and many hake species. But, the number of under-exploited resources, anywhere in the oceans, has quickly disappeared and the hopes of overcoming technological or marketing difficulties for new products have regularly taken much more time to materialise than was expected.
As the situation has materialised, the best deployment possibilities were inside the regulatory frameworks built up by the different coastal States having, in their zones, resources that they could not readily or easily exploit.
(b) Factory vessels or freezer trawlers used as floating plants: this has taken the form of experimental short-term joint ventures, the idea being for the coastal State to test the viability of such an occupation in remote areas and to buy similar vessels in the case of favourable results. A different situation was created when foreign factory vessels were used as "landing" stations for local boats: it was then an export made directly "over-the-side". And the procedure has even been simplified, avoiding transshipments, often impossible at sea, by the transfer of the cod ends from the catchers to the foreign factory vessel. Finally, in between the two extremes, the factory on board the vessel was placed at the disposal of the coastal State and/or for the use of the foreign importers. Various systems for the sharing of the processed catches have been put into practice because the far-distant fleets usually belong to countries having an important domestic market to supply.
(c) Fishing rights and joint ventures; the case of non-reciprocal fishing rights being granted by a coastal State to foreign vessels is so rare that it can be overlooked.
Joint ventures, on the other hand, are common, and it is impossible to give a comprehensive review of all types of deployment. Apart from the special case referred to in (b) above, the following are worthy of mention.
- Change of flag of large vessels to be operated directly from the coastal State; there may be associated shore investments in which case the catch would be processed by the coastal State for transshipment to traditional markets which are most likely located in the joint venture partner's State. A whole range of options are available, but these arrangements tend to be confined to far-distant industrialised countries and less developed coastal States.- Access to coastal State fishing grounds in return for market concessions; the partners are most likely to be industrialised countries.
- Feasibility fishing arrangements, which are now becoming less common as the extent of the domestic resources are better understood.
(d) Finally, the exchange of quotas by neighbouring coastal States, whether or not the exchange refers to transboundary stocks, is the basis for agreement. The rationale for such an exchange would lie in divergent national objectives.
The wide range of existing situations and the necessity of finding resources for so many far-distant vessels, make it very difficult to formulate an economic assessment. The only clear fact is rather negative: it is only for tuna that new far-distant vessels were ordered and the recent developments in the markets for tuna (end of 1982-beginning of 1983) would not encourage new orders when it is no longer known if these ships, ordered but not as yet launched, will be viable.
A remark can be made about the market side of the problem, but before doing so, it is worth remembering that around 12 million tons of fish, most of which was for human consumption, was harvested from "foreign waters" at a time when the world catch for human consumption was around 45 million tons.
Those products which are the most common landings of far-distant vessels, i.e. frozen fillets of demersal fish, have, over the last two to three years, been faced with stagnating prices, which means decreasing prices when taking inflation into account. Conversely, it is a well-known fact that costs, and fuel is a very important one, have increased at a faster rate than inflation. When it is recalled that some far-distant fleets of the European countries were already close to, or below, the break-even point in the early 1970's, without those new burdens, it is questionable that their operation would be profitable today. The problem is perhaps academic in the absence of new investments.
III. FUTURE FAR-DISTANT ACTIVITIES
In a simple economic model, far-distant operations will appear to be more costly than coastal operations: the space reserved on board for processing is significantly more expensive than shore-based processing facilities; the manpower will also be significantly more costly; and the costs associated with getting to and from the fishing grounds are considerable. But it is true that this cost/benefit reasoning was as valid before the new regime and did not impede the development of the far-distant fisheries.
The economic justification for far-distant fisheries was the creation of a favourable relationship between production and the market which benefited far-distant fisheries vis-a-vis coastal fisheries, or some far-distant fisheries vis-a-vis other far-distant operations.
The new regime for the sea effaced this economic rationale because of the protection given by the coastal State to its coastal fishermen, a protection which can take two different forms:
- A negative one by fees and other special conditions which are imposed on foreign fleets and are limiting their possibilities and adding to their costs.- A positive one, by various direct or indirect aids given by the coastal State to its own fishermen and somewhat distorting the competition on the markets: such a distorting effect may only affect the international trade but in view of the importance of international trade in fisheries, it concerns all fishing countries.
Because of this protection, which varies from one country to another but with a tendency to increased protection, the former economic justification for far-distant fisheries, i.e. the relationship between production and the market, can be recreated.
Before examining the problem from the international stand-point, it is of interest to point out that the problem can also be found in the national framework.
(a) "National" far-distant fleets
The size of a country such as the USSR and the structure of its fleet make it obvious that any change in the deployment of the fleets implies far-distant activities. But there are other cases such as the heritage of colonisation. France, which claims to have the third largest fishing zone in the world, has made trials with large freezer trawlers sent to the Kerguelen Islands: the additional costs for the distance and the marketing of unknown species rendered the venture, at least until now, non-profitable. Using the same kind of jurisdictional facilities, a partial deployment of the French tuna fleet in the waters around New Caledonia was envisaged, but it did not materialise because the tuna fleet could still find profitable grounds off the West African coast while the freezer trawlers were laid-up.
Other examples are not so extreme, but, nevertheless, clear. It seems that the development of the Alaskan fisheries is easier with boats based at Seattle, than with boats based in Alaska. The operations may be mixed, with boats provisionally based for the fishing season in Alaskan ports and returning south for refitting only. But there are also projects of factory vessels, which would undertake the first processing, so avoiding landings in Alaska. If such projects are to be successful (Alaska pollack must be processed shortly after being caught) they will represent an obvious case of national far-distant fisheries.
More generally there is often, within the national fishery, conflicting interests between coastal boats and larger vessels which are only equipped for gutting, icing and boxing on board, but which can stay at sea for a week or more. The difference in time at sea and the distances covered make it that one cannot speak of those operations as being far-distant; it is only middlewater. But the coastal fishermen can be more adverse to middle-water operations, the competition of which could be more direct. This is particularly the case in the Atlantic waters off Canada and in the North Sea. It shows that the spatial limits between far-distant fisheries and other fisheries cannot be established arbitrarily.
(b) International far-distant fisheries
It is most probable that far-distant operations inside national EEZ's will continue for the same reasons and in ways similar to those existing before the new regime for the sea. The economic and technological conditions, and indeed the demand for fish products, are so widely different that the coastal States cannot expect to enjoy comparative advantages in all that concerns their domestic resources. It is therefore likely that resources available in the relatively large quantities will be subject to bargaining between coastal States and far-distant "hungry" countries, even if this kind of operation will be less common than in the regime for free access.
Having said this, it remains difficult to tender a forecast as developments in fish production and consumption are highly correlated to general economic development. Suffice to say that the coastal States will have the means of exploiting "their" fish resources and the markets to absorb this production in times of economic growth, and much less so when their economy is stagnating.
(c) The future?
If the future cannot be known, it can be imagined and if Utopian futures are too often imagined it is one more reason to propose futures somewhat more logical and beneficial than the present situations, especially when they are implied by recent developments.
The prejudice, or hypothesis, on which this section is based is that past and present far-distant fishing operations can only have a limited future in as much as they are based on bulk catches at one end and mass-produced fast-food outlets at the other end, i.e., on a kind of activity which cannot be further developed, for two reasons: the resources of the sea are limited, and the price that this particular market can offer is limited by the price of other food items for which mass-production is significantly easier.
The only solution which could help towards overcoming the two above-mentioned limiting factors is to recreate a direct and more favourable relationship between the production and the market.
Let us examine the example of the Bering Sea, and list the possible alternative solutions for exploiting the main resources of the area accessible to far-distant operations as opposed to the coastal fleets which would supply plants ashore.
1. Coastal fleets, which may come from relatively closely based ports (Seattle) supplying foreign factory vessels.2. Coastal fleets (as above) supplying domestic factory trawlers.
3. Allocation of quotas to foreign fleets.
Translating those possibilities into catches taken by individual countries, another classification has to be adopted:
1. The above 1. and 2. should be combined to supply the US market for blocks of frozen fish.2. The above 3. should be broken down to supply the Japanese market for Alaska pollack roe and Kamaboko...
3. And the Soviet market for frozen fish (whether Alaska pollack or other species, is not the main problem) to be defrosted on the counter in retail fish shops.
Each of the main countries involved considers the best interest of its fishing industry; the agreement or decision finally adopted is a compromise, more or less favourable, to the different partners in the bargaining game. In other words the liaison between production and the markets is resolved by the individual nations. There is no global strategy for deciding what combination of these different production/market systems would lead to an optimisation of benefits.
Further developments in the area would have to consider more carefully the advantage of, e.g., the Japanese markets for Alaska pollack roe, but no result could be assessed without a parallel study of the frozen fish slabs in the US which would involve the Atlantic cod problem, etc. In fisheries, few problems can be isolated and world-wide repercussions are a usual feature. But this raises problems which go further than the far-distant fisheries question.
The main motivating factor behind the new regime of the sea was that it would be necessary for ensuring the protection of the common heritage of mankind. If the implementation of such a noble principle leads to the scrapping of boats which are still operational, even if it is a loss borne by one nation only, it cannot be considered as good management of the world resources. Furthermore, and economically more important, if the value of the common heritage is, as regards the living resources of the sea, assessed at the landing stage without any consideration of the processing and marketing chain, it excluded the largest part of the added-value generated by the fishing industries taken as a whole.
The responsibility of surveying and managing the fish resources within the 200-mile zone has been institutionalised by most, if not all, the world's coastal States. It is also recognized that the fish resources transcend State boundaries, consequently scientific research and the rule for management cannot be optimally managed by the coastal States in isolation. International cooperation, either by bilateral contacts or through various multilateral procedures, are indispensable. Although the progress made along such lines is not spectacular, the corresponding bureaucracies are gradually moving ahead.
Marketing problems are also international but cannot be treated in the same manner. Cooperation in market field is, by nature, entirely left to the initiative of the individual country and to the dynamism of the fishing industries.
The international markets for mass-produced fish-food are not at present giving a sufficient remuneration to the producers. And no trade or production measures would be likely to improve the situation as long as the price trends are bound to food items which do not bear the same kind of costs and which are not limited in quantity as fish is by the state of the resources. The solution to this difficult problem can only be in more diversification through a better adaptation of the production to the various markets it is most likely that to cover such an objective, far-distant operations which have pioneered the fish production revolution, would again have a role to play. But the question arises whether the present management systems are ready to entertain a global approach which cannot be the result of a bureaucratic organization but should take its origin from better contacts between all professionals concerned.
