Fish Trouble for Asian Trade Policy

Marine natural resource policy was a Stoa debate topic two years ago. Ocean shipping and regional and global fishing issues and disputes turn out to be significant for the coming year’s Stoa resolution:

Resolved: The United States federal government should substantially reform its trade policy with one or more of the following nations: China, Japan, South Korea, Taiwan. 

Robert Zoellick’s July 9, 2015 WSJ oped, How the Pacific Trade Pact Could Feed a Hungry Planet cites the UN FAO for world overfishing problems, and cites Chinese fishing fleets:

90% of marine fisheries in every region of the world are now significantly depleted or recovering. Chinese fleets, for example, are devastating West African fisheries because countries such as Senegal, Sierra Leone, Guinea Bissau and Guinea have weak enforcement capabilities.

Environmental groups oppose the Trans-Pacific Partnership, arguing that it does not contain adequate environmental regulations:

The proposed Trans-Pacific Partnership is a huge pact that would govern about 40 percent of the world’s gross domestic product and one-third of world trade, said Jake Schmidt, international climate policy director for the Natural Resources Defense Council (NRDC). 

The agreement involves a sprawling cast of countries: Australia, Brunei, Chile, Japan, Malaysia, New Zealand, Peru, Singapore, Vietnam, Canada, Mexico, and the U.S. (National Geographic source)

National Geographic, in a January, 2014 article, claims:

The nations considering the Trans-Pacific Partnership have a “responsibility” to provide adequate protection against overfishing, but the draft agreement fails to provide that, said Carter Roberts, president and CEO of WWF. 

The countries negotiating the agreement account for about a third of global fisheries production, Roberts notes, so the stakes are high.

Those countries have a range of direct and indirect subsidies for their fishing fleets, including payments, discounted loans, reduced prices on fuel, and so on. 

A Council of Foreign Relations study, The Global Oceans Regime (2013), has a section on recent developments, which looks at a number of shipping and fishing issues relating to China, Japan, and other countries, including this note from January, 2014:

On January 1, China imposed new restrictions on foreign fishing vessels entering disputed portions of the South China Sea. The move angered China’s neighbors Vietnam, Taiwan, Malaysia, and the Philippines and drew criticism from the United States, where a U.S. State Department spokeswoman called the act “provocative and potentially dangerous.” Japan’s defense minister claimed that China was “unilaterally threatening the existing international order,” especially in light of China’s unilateral declaration of an Air Defense Identification Zone (ADIZ) over the East China Sea in November 2013. In recent months tensions have increased throughout the East and South China Seas, as China, Japan, and others claim sovereignty over disputed territories, such as the Senkaku/Diaoyu Islands.

Can (and should) U.S. trade policies with China and Japan try to address the role of Asian (and U.S.) fishing fleets in global overfishing, or on fishing disputes in the South China Sea or other fishing area disputed by China, Japan, South Korea, or Taiwan?

The U.S. could try imposing fine or tariffs on fish caught in disputed areas, but that invites confusion and retaliation, including fines or tariffs on fish imported by U.S. firms to China, Japan, SK, and Taiwan.

Students who debated the marine natural resources topic will be familiar with “catch shares” and other property rights based reforms for fishing disputes and overfishing. In a 2014 post, Sovereign-to-Sovereign Relations in High Seas Fisheries, a 2012 study on open ocean fishing rights is recommended, Fish of Fence? Sovereign-to-Sovereign Relations in High Seas Fisheries.

The paper discusses a model for high seas fishing agreements,  Regional Fisheries Management Organizations (RFMOs), and explains problems with these organizations:

A rough framework for the joint management of high seas fisheries exists under UNCLOS, but it fails to resolve fundamental questions about sovereignty and exclusion. The UN Fish Stocks agreement requires states seeking to conserve high seas resource to create regional fisheries management organizations (RFMOs).10 Seventeen RFMOs currently exist, with anywhere from two to nearly fifty members in each.11 A list of these RFMOs and their members is given in the appendix …

Current institutions for high seas fisheries governance are inadequate for effectively managing stocks that overlap multiple jurisdictions. The UN Fish Stocks Agreement provides a basic format for cooperative efforts but does not resolve underlying questions of sovereignty and excludability. By explicitly allowing for the inclusion of new members to RFMOs, the treaty precludes sovereign’s ability to ensure exclusive access to the resources they seek to manage. To the extent that provisions within the agreement could be beneficial, it is uncertain whether they represent any sort of binding agreement. Enforcement on the high seas is uncertain on two levels: as a practical matter physically policing the high seas is nearly impossible, and formal mechanisms for redressing violations are utterly lacking. Current UN policy may provide a starting point for negotiations, but sovereigns are still essentially on their own when it comes to forming concrete agreements for resource access and management.

The United States government should perhaps keep away from fishing disputes in the South China Sea and others between China, Japan, Taiwan, and South Korea. These disputed seas and islands are a long way from U.S. territory and U.S. interests. (The Argentine-Uruguayan Shared Fishing Zone, discussed in the paper (p. 17) could perhaps be a model for Asian fishing zone management).

U.S. fishing firms and organization would likely be upset to find China or Japan interfering with U.S. fishing disputes with, say, Canada, Mexico, or Cuba.

Open seas fishing management reforms to address ongoing overfishing problems would invite U.S., China, Japan, South Korea, and Taiwan involvement, since all countries have major global fishing fleets and consume significant quantities of fish.

After examining a number of regional fishing agreements, the paper concludes:

Sovereign-to-sovereign disagreements over resource use are subject to many of the same problems as individual disagreements. For this reason, the settlement-dispute resolution literature from law and economics is a useful starting point thinking about the prospects and pitfalls of agreements to limit over-fishing on the high seas. As over-exploitation becomes apparent, conflicting claimants have a choice of whether to fish or fence. The former is a zero-sum game which, if continued, can dissipate all the rents. 

Agreeing to limit fishing by fencing has obvious benefits, but not without costs. Agreements will only be pursued if the net benefits of fencing exceed the net benefits of the expected race to fish. If the perceived benefits are small because the stock response to reduced fishing effort is low, depleting the resource may be optimal. The application of property rights to fisheries under the banner of transferable fishing quotas offers some hope for reducing over-fishing on the high seas, but only if some restrictive conditions exist.