WTO Fisheries subsidy negotiations being used to undermine sovereignty and development

This week the World Trade Organisation (WTO) is negotiating new rules for fishing subsidies that will impact conservation measures, sustainable development and the livelihoods of fishing communities around the world, especially in Developing and Least Developed Countries. Those nations with already subsidised and expansive fleets are looking to ensure that strict prohibitions will undermine any future challenges to their existing market dominance.

While the WTO has attempted to negotiate rules on fisheries subsidies for many years now, the United Nations Sustainable Development Goal 14.6 provided a boost to securing an outcome that will “by 2020, prohibit certain forms of fisheries subsidies which contribute to overcapacity and overfishing, and eliminate subsidies that contribute to illegal, unreported and unregulated [IUU] fishing...” as well as provide “appropriate and effective special and differential treatment” for developing and least developed countries (LDCs). There are currently 6 Pacific Island Countries who are Members of the WTO – Fiji, Papua New Guinea, Vanuatu, Solomon Islands, Tonga and Samoa.

Despite the postponement of this year's WTO Ministerial due to COVID19 there is a push to secure an outcome by the end of the year without a Ministerial. The current Chair of the negotiations, Ambassador Wills from Chile issued a Chair's Text in June 2020 in an attempt to provide a roadmap for an outcome. This comes as previous proposals for online negotiations during the start of the COVID19 pandemic were rejected by civil society groups and developing country members and ignores the ongoing burden for developing and least-developed countries in dealing with the pandemic.

Of major concern is how some proposals will see the undermining of existing international agreements on the areas of national sovereignty. Under the United Nations Convention on the Law of the Sea (UNCLOS) a nation has sovereign rights and responsibilities to manage and conserve the natural resources in their 200 nautical mile Exclusive Economic Zone (EEZ). Current proposals in the Chair's Text allows for the exclusion of only the 12 nautical miles of a Member's territorial waters from the prohibitions, capturing the majority of a sovereign nations EEZs.

While there is some scope in the proposals for exclusions to apply to the full EEZ of LDCs and some developing countries who need to meet a number of criteria (per capita national income, level of fish production, distant water fishing and more), such sovereign rights shouldn't be up for negotiation in the first place. By excluding the EEZs from the prohibitions it allows developing countries, and LDCs especially, the ability now and into the future to have government support for the capacity of the domestic fishing industry, leading to greater value addition of sovereign resources for communities. It also isn't a stretch to believe that the undermining of the existing rights under UNCLOS in the WTO will set a precedence in other fora. It is unsurprising that the negotiations on a complex issue like fisheries subsidies will have it encounter the other mechanisms and institutions involved in managing fisheries – national authorities and regional fisheries management organisations (RFMO’s). The WTO must ensure however that any commitments in these negotiations do not undermine the existing frameworks for fisheries management, this includes procedures on determining IUU fishing, managing resources etc. The proposals that have been included in the Chair's text however take a ‘sustainable’ management-based approach to curbing subsidies, allowing subsidies if the fisheries are being managed properly. The Chair's Text allows for some subsidies on Overfished Stocks provided that there are “appropriate measures” in place to ensure the rebuilding of the fish stock. This is problematic as it invites the WTO, a body with no expertise on fisheries management, to determine whether or not the national sustainable management of fisheries is appropriate – a term that is not defined.

In the negotiations on Overfishing and Overcapacity, again the Chair's text allows such subsidies provided that a country can demonstrate it has policies in place to ensure the stocks remain at a sustainable level. This once again raises the issues around the WTO making decisions on the management measures of countries without any relevant expertise. Allowing the WTO to make determinations around the management measures of Members will draw it into conflict with not only a Member's right under UNCLOS but also other decisions determined by the very bodies whose remit it is to make such decisions. Fisheries management doesn't need the WTO to undermine what are already incredibly complex processes.

Despite being a key component of the SDG mandate for negotiations, “special and differential treatment” (SDT) is frequently framed as a problematic part of the discussions – an impediment to an outcome for the U.S and others. The current proposals on SDT mostly relate to exclusion from prohibitions for developing countries within their territorial waters and in other cases potentially out to the EEZ of a Member. What is currently proposed in the Chair's text is a start but doesn't go nearly far enough, yet already countries like the United States are saying what is being proposed goes too far.

If SDT is to be “appropriate and effective” like the SDG mandated, a good place to start is to ensure that the entire EEZ of developing countries and LDC members are excluded. This would allow those Members to manage and conserve their resources as per their obligations under UNCLOS without the WTO making determinations on management measures as well as provide the ability for these nations to support fishing of their own resources without relying on outside capacity. Such an approach would provide development flexibility, conservation integrity, be easier to administer as well as focus efforts on curbing subsidies in the high-seas or another member's EEZs.

Another issue for SDT to address is the need to provide adequate technical assistance and capacity building. Many of the proposals require administrative effort and capacity to be able to comply with, something that is notoriously difficult for many developing countries and LDCs. For these members, their commitments should be relative to their level of capacity and contingent on the provision of assistance. This will ensure that developing countries are better able to engage in their fisheries and WTO obligations, a win for all involved.

The WTO is currently on track to fail in delivering on its SDG mandate. The first Chair's text is bringing in proposals that will undermine the development prospects of developing countries, the resource holders of the remaining fish stocks. The mandate is clear on the need for appropriate and effective and Special and Differential Treatment yet that is not what is being proposed.

The problem of over-fishing needs to be addressed and curbing subsidies is one part of broader efforts to do that. What is currently being proposed at the WTO by many industrial fishing nations will only act to lock in their existing competitive advantage and capacity, undermine the management measures of countries by allowing the WTO to rule whether or not they are appropriate and work against greater value-addition for fishing communities.

It is possible to have an agreement that supports conservation and development but the rush for a 2020 outcome is driving a conclusion over the substance of an outcome. Fishing communities, developing countries and the global community deserves better.

Adam Wolfenden is the Trade Justice Campaigner for the Pacific Network on Globalisation.

Orginally published on 7 October 2020 as an Op Ed by Pacific Islands News Association, Fiji.