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II. Agreement on Agriculture

 


Module
11


International Trade in Fishery Products and the New Global Trading Environment



E. Ruckes
Fishery Industries Division


 

PURPOSE

The objective of this module is to review specific issues related to fish and fishery products which may become relevant in future multilateral trade negotiations and to review past and ongoing technical assistance activities initiated by FAO.

CONTENTS

11.1 Introduction

11.2 Subsidies to the fishery sector

11.3 Issues on trade and environment

11.4 Dispute settlement - examples involving fishery products

11.5 Position of some major players on various issues

11.6 Technical assistance and information sources

11.7 Concluding remarks

Annex 1: Summary and conclusions of international environmental instruments and the fishing industry

KEY POINTS

11.1 INTRODUCTION

Fisheries products treated as industrial products under GATT...

The Agreement on Agriculture of the Uruguay Round excludes fishery products from its coverage. This means that trade in fishery products is subject to general WTO rules that apply to non-agricultural products, i.e. industrial products. Trade in fishery products, unlike agricultural products, is not one of the mandated subjects for multilateral trade negotiations (MTN) to begin in 1999. However, disputes involving fishery products are on the rise and a number of related issues, e.g. subsidies to the fishery sector and links with the environment, are being intensely debated in several international fora, including WTO's Committee on Trade and Environment (CTE). In view of this, there is some expectation that the next MTN may include trade in fish and fishery products.

...may be included in next negotiations because of growing problems but not required to be

The importance of international trade in fishery products hardly needs to be emphasized. Fish and fishery products represent a category of food products which have the highest share in international trade among foods. At the same time, trade in these products is a major source of foreign exchange earnings of the developing countries in particular. This group of countries accounts for roughly half of the fishery products traded internationally.

The purpose of this module is to provide background information on selected topics on international trade in fishery products in the context of the new global trading environment. It covers the following:

11.2 SUBSIDIES TO THE FISHERY SECTOR

11.2.1 The extent of subsidies and related initiatives

Subsidies are widespread in the fisheries sector...

Various efforts have been made to estimate subsidies paid to the fishery sector. The results differ widely because of the difficulties in obtaining reasonably precise information and also because there are different opinions with regard to the classification of certain governmental financial payments as subsidies. World Bank and FAO figures indicate an order of magnitude of around US$7 000 - 15 000 million. Notwithstanding the wide range of these estimates, the numbers indicate that subsidies are substantial and can be expected to have a distorting effect on production costs and competitive positions in international trade.

...with adverse environmental effects

Subsidies at these levels also have environmental consequences. There is a widespread belief that these subsidies have been and are encouraging excess capacity of fishing fleets which in turn have led to over-fishing. They thus contribute significantly to the process of resource depletion of the world's fish stocks (based on FAO information, 70 out of 200 stocks, or 35 percent, are in a precarious state, show declining yields and need management intervention). The FAO Committee on Fisheries (COFI) adopted an International Plan of Action for the Management of Fishing Capacity in February 1999 with a view to adjusting world fishing capacity to the level at which fishery resources can be exploited sustainably.

The issue of subsidies in fisheries is under intense discussion in the Fisheries Working Group of APEC (Asia Pacific Economic Cooperation) and in the Committee for Fisheries of the OECD. In OECD's case, the discussion has focussed on certain aspects of subsidies and production, not in relation to trade. The Commission for Sustainable Development (CSD) has also discussed the subsidy issue and requested WTO to co-operate with FAO in further analysis of the problem. Collection of information and analysis of the impact of subsidies on international trade will remain on FAO's work programme and will be considered by the COFI Sub-Committee on Fish Trade.

11.2.2 Which multilateral rules govern fisheries subsidies?

Subsidies Code governs fisheries subsidies

As said above, the Agreement on Agriculture excludes fish and fishery products and so domestic support and export provisions do not apply to fisheries. As non-agricultural products, subsidies to fisheries are governed by general GATT rules and the new Agreement on Subsidies and Countervailing Measures. One major difference in provisions between the two Agreements is that while the Agreement on Agriculture permits export subsidies, if the right to use these is reserved in country Schedules, export subsidies are prohibited in the Subsidies Agreement. The rules on domestic support measures also differ somewhat as the Subsidies Agreement has its own definition of various subsidies.

11.2.3 What may happen?

As said in the beginning, trade in fishery products, unlike the case of agriculture, is not one of the mandated subjects for the next MTN. However, some issues in this area are becoming increasingly important, as well as controversial, e.g. subsidies and their environmental effects, including issues on endangered species. Also, disputes involving fishery products are on the rise. In view of these reasons, there is some expectation that the next MTN may include trade in fish and fishery products in its agenda. In fact, some initiatives have been taken already in this area in other fora. For example, APEC members have included fish and fishery products in the fast track of their Early Voluntary Sectoral Liberalization initiative which is an indication of the strong interest among trading nations to deal with the issues.

11.2.4 Issues of interest to developing countries

Few developing countries have subsidies...

Although a complete and clear picture on subsidies in global fisheries cannot yet be drawn, it is of interest to note that the structure of the fishery sector in developing countries is different from most OECD countries. In the former, subsidies are not a very common feature, the industry operates rather small-scale production units and therefore the impact of subsidies on production capacities and over-fishing is hardly visible, unlike in a number of developed economies. If subsidies were part of the MTN it would appear that developing countries could use an argument for compensation in other areas, because they have not much to give up in fishery subsidies. It is in the interests of major developing country fish producers and exporters to support subsidy reduction, because this should improve their competitive position on the world market.

...so further disciplines would benefit exporters

To the extent that reduction of subsidies in subsidizing countries lead to lower production and exports to fish deficient countries, world market prices of fishery products could rise. This would be beneficial to non-subsidizing exporting countries.

11.3 ISSUES ON TRADE AND ENVIRONMENT

11.3.1 What issues are being discussed?

Problem of over-fishing

Environmental issues have repeatedly emerged in disputes involving fishery products. In large part, the problems relate to the exhaustible nature of the fishery resource with several fish species or other species caught with the fish considered endangered. Subsidies are also linked to the problem of over-fishing as mentioned earlier. In fact, the linkages between subsidies and environmental effects have attracted considerable attention at the WTO CTE.

Issues relating to international trade in fishery products and the environment have been and still are on the agenda of several international agencies/inter-governmental groups:

The COFI Sub-Committee discussed the issues at its Sixth Session in 1998 with regard to the:

The discussions in WTO and OECD are largely concerned with subsidies whereas the Convention on International Trade in Endangered Species of Wild Fauna and Flora is mostly concerned with the biological and trade status of animals and tries to regulate or prohibit trade in the animals and products derived from them in order to prevent extinction. Aquatic animals which are presently listed in Appendix 1 or 2 of the Convention include whales and sturgeons. The biological and trade status of sharks has been under discussion since 1994 and led to a number of activities in FAO and regional fishery bodies culminating with the adoption of an International Plan of Action for the Conservation and Management of Sharks by COFI in February 1999.

11.3.2 What issues are relevant for the developing countries?

Developing countries lack the information to negotiate effectively

As a matter of fact, all the issues being discussed are important for developing countries, some more directly than others. One of the key issues of concern for them is overexploitation of fishery resources in their own waters, often without their knowledge. The current imbalance in the knowledge base between the developing and the developed countries may hinder discussions between the parties and thus make negotiations for mutually beneficial solution difficult. In such a situation, the introduction of a regulatory framework may not be to the advantage of the developing countries if it does not properly reflect the specificities of their fisheries. Although the application of science-based rules is desirable, in general, for all countries, the lack of access to proper documentation and analysis would result in a weaker position of the developing countries when a formal dispute occurs.

SPS difficulties

The difficulties that many countries experience with the application of the Uruguay Round agreements and their extension, e. g. to fish quality assurance and product safety systems, are evidence of such disadvantages. Although it is usually recognized in international fora such as COFI that developing countries need assistance and advice, the competitive position will remain weak, in principle, until the required level of technology has been reached.

11.3.3 What may happen?

If the overall theme of the forthcoming MTN will be "mainstreaming sustainability" and if fishery products are included in the negotiation package, environmental issues will be discussed and it is likely that international agreements will be sought which can mitigate the negative impacts. It will then be important to be informed and to be present.

It is also conceivable that eco-labelling schemes will gain ground in fisheries and aquaculture. These could develop in the private sphere and under conditions where participation of developing countries could be very restricted.

With regard to possible developments in CITES it can be assumed that the participation of NGOs will continue to be very strong and it is equally likely that the biological and trade status of further aquatic species will be scrutinized; however, the criteria to be used for listing species in one of the appendices may be modified in the near future.

11.4 DISPUTE SETTLEMENT - EXAMPLES INVOLVING FISHERY PRODUCTS

Even before the establishment of the WTO, there were many disputes that involved fishery products, e. g. the cases of tuna and dolphins, and shrimp and turtles. Trade embargoes and other barriers were also intensely debated in other international fora such as the COFI Sub-Committee on Fish Trade (in 1990) which in turn contributed to paving the way for the development of the FAO Code of Conduct for Responsible Fisheries (concluded in 1995). There had been also disputes about salmon between Canada and the United States, and between Canada and Australia/New Zealand on another salmon matter. The latter case is yet to be resolved.

Tuna-dolphin dispute

One major source of these disputes was the exceptions (to general GATT rules such as Most Favoured Nations treatment or National Treatment principles) written into Article XX of GATT 1994. The most frequently invoked exception has been on environmental grounds (Article XX(b)), which allowed exceptions "necessary to protect human, animal or plant life or health;" and Article XX(g) "relating to the conservation of exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption".

The famous "tuna-dolphin" dispute highlighted several of these arguments. In this case, the United States unilaterally restricted imports of tuna fish caught with purse seine nets that also catch and kill dolphins, particularly from countries fishing in the Eastern Tropic Pacific. These countries, led by Mexico, challenged the United States as discriminating among Product and Processing Methods (PPMs) (the kind of net) under the GATT Article III National Treatment principle (producing a "like product" - tuna in any case). Environmentalists argued that the United States ban was legitimate on grounds that it was necessary to protect animal life (Article XXb), that dolphins are an exhaustible natural resource (Article XXg), and that the ban applied equally to domestic producers (Articles III and XX). The WTO's dispute panels eventually agreed with Mexico and other complainants, having determined that the ban inappropriately discriminated among like products (Article III) and, because it was a trade measure taken by an individual government rather than multilaterally, it did not qualify for an Article XX exception.

Shrimp-turtle dispute

The equally contentious "shrimp-turtle" dispute, in which Malaysia and others complained that a United States ban on imported shrimp from their countries on the grounds they are mostly caught with ships lacking turtle-excluder devices went a bit further. In this case, the WTO Appellate Body acknowledged that the Article XX(g) exception would be applicable, formally interpreting the 1947 GATT law regarding exhaustible natural resources to include living resources and citing several Multilateral Environmental Agreements (MEAs) including the United Nations Law of the Sea and the Convention on International Trade in Endangered Species to demonstrate there is a contemporary international consensus favouring environmental protection of biodiversity. However, the Appellate Body objected to the United States ban, on grounds that it applied the measure in a discriminatory fashion and obliged other countries to adopt a particular policy response - the turtle-excluder device - rather than setting a standard to which they could respond with greater flexibility and a potentially less trade-restrictive measure. "It is not acceptable," the appellate ruling said, "for one WTO member to use an economic embargo to require other members to adopt essentially the same comprehensive regulatory programme, to achieve a certain policy goal, as that in force within a Member's territory, without taking into consideration different conditions which may occur in the territories of these other Members." Furthermore, citing Agenda 21, the Convention on Biological Diversity and other MEAs, the Appellate Body commented that the United States had failed to attempt to negotiate bilateral or multilateral agreements to protect and conserve sea turtles before enforcing the unilateral ban.

What follows are brief summaries of some recent disputes, presented here to illustrate the range of issues involved1.

United States - Import Prohibition of Certain Shrimp and Shrimp Products, complaint by India, Malaysia, Pakistan and Thailand (WT/DS58). This request, dated 8 October 1996, concerned a joint complaint by India, Malaysia, Pakistan and Thailand against a ban on importation of shrimp and shrimp products from these countries imposed by the United States under Section 609 of the United States Public Law 101-162. Violations of Articles I, XI and XIII of GATT 1994, as well nullification and impairment of benefits, are alleged. The Panel found that the import ban in shrimp and shrimp products as applied by the United States is inconsistent with Article XI:1 of GATT 1994, and cannot be justified under Article XX of GATT 1994. The Appellate Body reversed the Panel's finding that the United States measure at issue is not within the scope of measures permitted under the chapeau of Article XX of GATT 1994, but concluded that the United States measure, while qualifying for provisional justification under Article XX(g), fails to meet the requirements of the chapeau of Article XX. The parties to the dispute announced that they agreed on an implementation period of 13 months from the date of adoption of the Appellate Body and Panel Reports i.e. it expires on 6 December 1999.

Australia - Measures Affecting the Importation of Salmon, complaint by Canada (WT/DS18). This request for consultations, dated 5 October 1995, was in respect of Australia's prohibition of imports of salmon from Canada based on a quarantine regulation. Canada alleged that the prohibition was inconsistent with GATT Articles XI and XIII, and also inconsistent with the Sanitary and Phytosanitary Agreement. The Panel found that Australia's measures complained against were inconsistent with Articles 2.2, 2.3, 5.1, 5.5, and 5.6 of the Sanitary and Phytosanitary Agreement, and also nullified or impaired benefits accruing to Canada under the Sanitary and Phytosanitary Agreement. The Appellate Body reversed the Panel's reasoning with respect to Articles 5.1 and 2.2 of the Sanitary and Phytosanitary Agreement but nevertheless found that Australia had acted inconsistently with respect to Articles 5.1 and 2.2 of the Sanitary and Phytosanitary Agreement; broadened the Panel's finding that Australia had acted inconsistently with Articles 5.5 and 2.3 of the Sanitary and Phytosanitary Agreement; reversed the Panel's finding that Australia had acted inconsistently with Article 5.6 of the Sanitary and Phytosanitary Agreement but was unable to come to a conclusion whether or not Australia's measure was consistent with Article 5.6 due to insufficient factual findings by the Panel.

Australia - Measures Affecting the Importation of Salmonids, complaint by the United States (WT/DS21). This request for consultations, dated 17 November 1995, concerned the same regulation alleged to be in violation of the WTO Agreements in WT/DS18, in respect of which a panel had been established.

United States - Countervailing Duty Investigation of Imports of Salmon from Chile, complaint by Chile (WT/DS97/1). This request, dated 5 August 1997, was in respect of a countervailing duty investigation initiated by the US Department of Commerce against imports of salmon from Chile. Chile contended that the decision to initiate an investigation was taken in the absence of sufficient evidence of injury, in violation of Article 11.2 and 11.3. Chile also contended a violation of Article 11.4, in relation to the representative status of producers of salmon fillets.

11.5 POSITION OF SOME MAJOR PLAYERS ON VARIOUS ISSUES

11.5.1 Japan

Fundamental idea as regards WTO fishery negotiation. Fishery resources are exhaustible natural resources, which can be depleted without proper management. Therefore, there is a need to establish trade rules that would contribute to conservation and sustainable utilization of fishery resources. For this, it is also necessary to have a framework in the next WTO negotiations, under which conservation and sustainable utilization of fishery resources can be duly take into consideration.

Emphasizes links between fish trade and conservation

Conservation of fishery resources. Considering that many of fishery stocks are over-exploited and about 40 percent of world fishery products are traded, trade in fishery products should supplement or strengthen conservation measures, or at least, should not undermine the conservation efforts. If trade liberalization is pursued without having proper fishery conservation measures, unregulated exploitation of fish stocks and the subsequent trade of the products are likely to become the cause of depletion of the fish stocks. In particular, Japan, as the biggest fish importing country accounting for about 30 percent of the world fish trade, needs to keep this point in mind. Currently, international fishery conservation frameworks such as ICCAT (International Commission for the Conservation of Atlantic Tunas) are taking trade-restrictive measures for conservation purposes. Also, some countries are taking unilateral trade measures for similar reasons.

Food security and multifunctionality of fishery. In order to stabilize the supply of world fishery products, each nation should be responsible for the rational utilization of fishery resources in its 200-mile zone, and thereby provide fishery products to its nationals in a stable manner. This point should also be given due consideration in formulating fishery trade rules. Also, multifunctionality of fishery such as the sustenance of remote communities should be considered.

Market access. When discussing international trade measures including tariffs, consideration should be given to various factors, including the extent to which each nation is responsible for the rational utilization of fishery resources, how to secure a stable supply of fishery products and the multi-functions of fishery in each country. Japan's tariff levels on fishery products have been reduced to 4.1 percent on average as a result of the repeated negotiations in the past. If reduction in tariffs on fishery products encourages the illegal fishing operation of vessels (like vessels under flag of convenience), which ignore international conservation measures, causing over-exploitation of fishery resources, such a reduction will not be justified2.

11.5.2 New Zealand

Concerned about fisheries subsidies

Fish subsidies, trade, development and the environment. "Fish and fishery products are the most international of all foodstuffs. Annually, between 35 and 40 percent of fisheries production is traded internationally, reaching a value - as traded - of about US$50 000 million. Developing countries currently account for half of this exchange and, in 1996, derived a net surplus (value of exports minus value of imports) in the order of US$17 000 million)"3. The fact that fish is such a heavily traded commodity means that the nature and scale of subsidies in this sector present a number of important issues for the multilateral trading system. In particular:

11.5.3 United States

The United States brought to the WTO Seattle Ministerial meeting in 1999 the message that environmental concerns must be taken into account in the next trade round.

Highlights links between subsidies and the environment

Some general guidelines on what the United States would like to see in the new round have been developed by the United States Trade Representative:

11.5.4 WTO and other international fora

WTO and fish subsidies. The issue of subsidies in the fisheries sector has attracted close attention at the WTO CTE in recent years. The issue was considered in some detail at several meetings of the Committee in 1997. In 1998 the Secretariat produced, at the Committee's request, a detailed paper which describes relevant WTO rules and offers an overview of fishing industry subsidies notified under Article 25 of the SCM Agreement. Fishing industry subsidies continue to be an issue of particular relevance to the ongoing work of the CTE.

Action in other international fora. The problem of overfishing has attracted close scrutiny in a range of international fora, including the FAO, CSD, OECD, UNEP, UNCTAD and APEC. The Rome Declaration adopted by the FAO Ministerial Meeting on Fisheries in March 1999 highlighted concern that so many of the world's major marine fishery resources were subject to overfishing, destructive and wasteful fishing practices and excess capacity, resulting in reduced yields and economic returns. There was extended debate in 1999 in the Commission on Sustainable Development on the specific issue of subsidies to fishing industries. The OECD Ministerial Meeting in Paris in May 1999 called for further examination of the impacts of government financial transfers on fishery resource sustainability, including over-fishing5.

11.6 TECHNICAL ASSISTANCE AND INFORMATION SOURCES

11.6.1 The nature of the problems faced by developing countries

Fishery products contribute a major share to the animal protein supplies in developing countries and at the same time they contribute substantially to their foreign exchange earnings through exports of a varied range of products. In order to maximize these revenues it is essential to have knowledge about and links with the most profitable markets and to exploit the opportunities of gaining through value addition as much as possible. For this, information and technical know-how are essential.

11.6.2 What has FAO done here?

FAO initiatives

In order to assist developing countries expand their participation in international trade in fish and fishery products and improve their competitive position in the international market place, FAO created a fish trade support system starting in 1976 which was discussed and endorsed by the FAO World Conference on Fisheries Management and Development in 1984. This now consists of:

In recent years a component has developed through which developing countries can obtain information and direct technical assistance in quality assurance and fish product safety which is a response to changes in import regulations and quality requirements of the major developed country import markets. These activities will be increasingly important in the coming years. A more detailed coverage of these matters is provided in a companion module called Food Control: Fish as Food (Module III.14).

11.7 CONCLUDING REMARKS

Preparing for negotiations

Past experience has shown that developing country delegations at MTN tend to lack specific fishery knowledge and in turn fishery experts or officers become aware too late of what the implications of newly agreed international trade rules and regulations are for their countries. Therefore, it is a prerequisite to organize a sharing of information and experience at the national level. Whether it is viable to establish such a process at the regional level would depend on the inclination of countries to share their position with others. Many times there is reluctance to reveal beforehand details of negotiating positions for fear that it could weaken the position of the country concerned.

However, on a more positive note, countries should recognize that there are useful fora where technical issues of international fish trade can be discussed and where countries can influence the agenda and the depth of analysis. One of these is the COFI Sub-Committee on Fish Trade, which met for its Seventh Session in Bremen, Germany, during 22-25 March 2000. Useful contributions to regional positions could be prepared by using the regional fish marketing organizations INFOFISH, INFOPÊCHE, INFOPESCA, INFOSAMAK and EASTFISH.

In conclusion, in view of the anticipation that environmental considerations could play a major role in the next Round, Annex 1 reproduces a section on Summary and Conclusions from International Environmental Instruments and the Fishing Industry by Tsamenyi and McIlgorm, which is an excellent summary of the main issues in this area.

Annex 1

Summary and conclusions of international environmental instruments andthe fishing industry, by Tsamenyi and McIlgorm (FRDC)6

The effects of international environmental instruments

The implications of international environmental instruments are summarised here. We have ranked the implications in order of frequency of appearance in binding and non-binding instruments.

In the binding environmental instruments the following objectives are most frequently mentioned:
I (i) Conservation and optimum utilisation
(ii) Conservation of areas as a management tool
(iii) Endangered species and catch prohibition (though only two conventions have formal listing)
(iv) Rehabilitation/restoration of species/stocks
The following issues occur less frequently in the binding instruments:
II (v) Bycatch issues
(vi) Banning of fishing methods
(vii) Trade issues
Finally, the comparatively new precautionary approach has impacted some of the newer binding instruments:
III (viii) Precautionary approach
The non-binding instruments have the following issues occurring most frequently:
I (i) Area closures
(ii) Bycatch/incidental species
(iii) Protection of endangered species
(iv) Restoration of endangered species
(v) Banning of fishing gear
The following are mentioned less frequently, but are no less important:
II (vi) Management plans required
(vii) Precautionary approach

The dominance of threats are also apparent in the Appendix B, Tables A1, A2, and A3. The Tables review the threats and opportunities for the fishing industry by sector (A1), areas (A2), fishing methods (A2) and species groups (A3). The threats vary, but are diverse as previously identified: bycatch, endangered species, area closures, and limitations on fishing methods.

Conclusions from the study

This revised study confirms that international environmental instruments affecting fisheries can be divided into two categories: those that are binding and those that are non-binding, but nevertheless have political force. Non Government Organisation initiatives are also having an influence in the international arena, as are developments in the fisheries trade and environment interface.

The binding instruments can be further sub-divided into those that address fisheries directly and others of general application with indirect implications for the fishing industry. The ones in the latter category pose more serious threats to the fishing industry, because they were initially conceived to deal more with terrestrial problems (CITES, Bonn Convention, Biodiversity, and World Heritage) and are open to different interpretation in terms of their application to the marine environment. It is in the interest of the industry to monitor and participate in any domestic policy to implement the non-fishery specific instruments.

Since 1995 several of the instruments have developed from draft status and some have also come into force. The implications of the instruments are still becoming apparent. The implementation of the agreements in the industry and in fisheries management is progressing.

From the overview of the instruments, the standard objectives of "conservation" and "optimum utilisation" of resources found in many binding instruments are now being refined by more specific issues in the second wave of non-binding' instruments. The new on-binding instruments tend to be more problem specific e.g. protecting species, restoration, banning of specific gears, minimising bycatch and specific actions in management plans. The major trend in the instruments is the move from general objectives in currently binding agreements to more specific constraints and management methods in subsequent non-binding instruments. This also has requirements for processes of management in trade and fisheries to be transparent and environmentally accountable.

The review shows that the major issues for industry are:

i. the interpretation of "conservation and optimum utilisation" - terms have been around for some time. Other more specific and measurable objectives are superseding these generic objectives;

ii. conservation of areas has major implications for vessel access through marine park formation and fishery restructuring to achieve sustainability;

iii. endangered species protection and restoration has implications for closure of areas, banning of fishing methods, and bycatch legislation;

iv. greater detail is required in the management planning process for example with reference points, performance indicators and the precautionary approach;

v. there is a growing trend in the non-binding instruments towards a shifting in the burden of proof. Thus the industry may have to prove that fishing practices are not damaging to the environment rather than government proving that they are;

vi. industry developing and adhering to Codes of Conduct and being seen to follow international initiatives;

vii. greater evidencing of performance and achievement of objectives in management for example with reference points and fulfilling the precautionary approach;

viii. a widening of the number of agencies involved in the management of fisheries issues. The issues are gradually becoming more generic and involve more agencies that previously, for example the Coastal Zone and Marine Protected Areas.

All of the above can be classified as changes for industry. However the long term benefits should flow to the industry from greater sustainable harvests.

The tightening of environmental constraints in fisheries management will be gradual, though the diversity of issues make the time for implementation of policies uncertain. The political and moral power of the non-binding instruments are unpredictable. Many non-binding instruments may become binding given time. Elements of non-binding instruments, such as the precautionary principle and endangered species provisions have already been included in national legislation in Australia (for example the precautionary principle in NSW fisheries legislation, amended AFMA legislation 1997, and endangered species declaration under the national Endangered Species Act, 1992).

Trade instruments are less likely to be used as sanctions by other countries to enforce environmental concerns such as bycatch, fishing method or endangered species. The trade threat can be minimised by addressing these issues through fisheries management and implementation of bycatch strategies.

Trade sanctions in the form of Sanitary and Phyto-Sanitary (SPS) regulations and food residue legislation could affect nearly all species in the form of non-tariff barriers. Eco-labelling and HACCP requirements could also have ramifications for the seafood industry. The industry must also be aware of the latent conflict between the WTO and the protection of the marine environment under international environmental instruments and how this area is changing due to important test cases.

If there are any short term benefits or opportunities apparent they will be from conforming to environmental instruments and trying to obtain any gain available from consumers. This may require an in depth study of the niche markets available for high quality "environmentally friendly" product.

It is recognised that there will be long term benefits in keeping a clean environment, but higher short term returns may be forthcoming from conforming to the eco-labelling preferences of discriminating consumers, probably in foreign markets. The jury is still out on this issue. Other opportunities for industry may be in getting local authorities to adopt standards in limiting pollution of the coastal area. This will protect the fisher's most fundamental long term asset - the marine environment.

______________________________

1 These are taken from WTO web site (http://www.wto.org).

2 Source: Japan Fisheries Agency.

3 FAO. 1999. State of the World Fisheries and Aquaculture.

4 Steenblik, R.K. & Munro, G. 1998. Current International Work on Subsidies in Fisheries: A Survey.

5 Source: WT/CTE/W/IZI, Submission by New Zealand to WTO Committee on Trade and Environment.

6 Tsamenyi, M. & McIlgorm, A. 1999. International environmental instruments and the fishing industry in The report of the FRDC (Fisheries Research and Development Corporation) project 97/149, p. 70. Hurtsville (Australia), Dominion Consulting Pty Ltd.

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