In a move to enhance tuna fisheries management in the Pacific, the New Zealand Ministry of Foreign Affairs and Trade (MFAT) committed NZD 4.9million to the Pacific Islands Forum Fisheries Agency (FFA) yesterday.
This funding will be used by FFA to support a project that will establish and enhance catch documentation schemes (CDS) for FFA members over the next five years. The new Grant Funding Agreement was signed by Fletcher Tabuteau, Under Secretary for Foreign Affairs, New Zealand and FFA Deputy Director General, Matthew Hooper.
“FFA Members work collectively to effectively manage their Pacific tuna fisheries, and this project will support members to access high value export markets while tackling illegal, unregulated and unreported fishing” said Mr Hooper on accepting the funding support.
The project aims to ensure FFA’s Pacific Island members maintain market access for their fishery products, by improving traceability along supply chains through the integration of fisheries monitoring, control and surveillance systems, the implementation of electronic reporting and the development of technological solutions to strengthen national capacity.
The project provides support for the development of national and regional CDS frameworks, national regulatory and policy frameworks and the development of CDS tools and associated training and capacity building.
The agreement follows almost two years of preparation and builds on work being undertaken to strengthen port state measures in the Pacific and complementing the existing comprehensive regional monitoring, control and surveillance framework implemented by FFA members.
About Pacific Islands Forum Fisheries Agency (FFA)
FFA was established to help their 17 member countries sustainably manage their fishery resources that fall within their 200 mile Exclusive Economic Zones (EEZs). FFA is an advisory body providing expertise, technical assistance and other support to its members who make sovereign decisions about their tuna resources and participate in regional decision making on tuna management through agencies such as the Western Central Pacific Fisheries Commission (WCPFC). www.ffa.int
The Chinese-founded Asian Infrastructure Investment Bank (AIIB) wants to help Pacific Island nations manage their fisheries.
The multilateral development bank’s president, Jin Liqun, believes the Islands have “limited capacity” to do so on their own, so need the international community’s help.
Speaking at a round table discussion in Auckland attended by interest.co.nz, Jin said, “This is a huge resource that would be sufficient to make these countries very rich, but they have no power to drive away all these illegal fishing boats.
“We can help them…
“Maybe we would work with the New Zealand Government, combining our resources.”
Beijing-based Jin went on say, “I think Pacific Island countries still have to develop their institutional capability. That may take a bit of time, but with the support of New Zealand and other members of the international community, we would be able to help them to be more effective.
“These countries do need concessional funding.”
China’s position in the AIIB vs NZ’s
The AIIB has committed US$4.2 billion to financing 24 projects since it started operating in January 2016.
It offers sovereign and non-sovereign loans for projects in energy and power, transportation and telecommunications, rural infrastructure and agriculture development, water supply and sanitation, environmental protection, and urban development and logistics.
New Zealand is one of the Bank’s founding members, in 2015 committing to investing NZ$125 million in it over five years.
However New Zealand has dedicated a total of US$462 million (NZ$630) to the Bank. The difference between this figure, and the amount already paid can becalled upon by the AIIB as required.
Jin confirmed that while New Zealand is technically eligible to receive funding from the Bank, its priority is developing countries.
“I’m sorry we can’t invest in your country, even though I’d love to,” he said.
The US$462 million pledged by New Zealand makes up only 0.49% of the total committed by the AIIB’s 84 regional and non-regional members. This means it holds a 0.68% voting stake.
China has committed US$30 billion, so has a 27% voting stake.
Japan and the US aren’t part of the AIIB.
Jin is adamant: “It’s not China’s bank. China has China Development Bank, Exim Bank. The combined overseas assets are now beyond US$500 billion – more than the combined assets of all the multilateral development banks.
“So if it’s supposed to be China’s bank, why should we do it? It doesn’t make any sense. It’s a multilateral institution.”
‘Need and temptation often leads to greater risk’
Deputy Prime Minister and Foreign Affairs Minister Winston Peters wants New Zealand to contribute more to multilaterals working in the Pacific.
He made this intension clear when he revealed New Zealand’s “re-energised Pacific strategy” in a speech delivered at a Lowy Institute event in Sydney on March 1.
Peters didn’t mention the AIIB specifically, but said the World Bank and Asian Development Bank were “vital institutions” that could offer “sustainable investment choices for Pacific nations”.
Overall he said he wanted New Zealand to increase aid payments to the Pacific, further to these falling from 0.30% of Gross National Income in 2008, to 0.25% in 2016.
Nonetheless, his speech had a cautious undertone.
“The Pacific overall has also become an increasingly contested strategic space, no longer neglected by Great Power ambition, and so Pacific Island leaders have more options. This is creating a degree of strategic anxiety,” he said.
While Peters said the Pacific was attracting “an increasing number of external actors and interests”, he didn’t mention China.
“So much is changing in the Pacific and sometimes it is not for the best. Need and temptation often leads to greater risk than prudence would suggest,” he said.
Scepticism from Pacific Island fisheries expert
These risks are ever clear to veteran New Zealand journalist and former press secretary for the Samoan Prime Minister, Michael Field.
Having spent a large part of his career in the South Pacific and covering the Pacific, and written a book on fisheries in the area, ‘The Catch’, Field said he was “completely sceptical” about the AIIB’s interest in the Pacific’s marine resources.
“I find it a really cynical move involving a country that is at the very moment engaged in an extensive plunder of the fisheries resources of the South Pacific.”
He said China’s interest in funding regulation could start by it cutting back on the subsidies it offers Chinese fishing boats.
Further, China should be “cutting back on the number and style of their fishing operation, and they should prove to the Pacific first that they are capable of effective internal regulation before they start wondering around telling other people what to do.
“The Chinese operation in the Pacific so far has been a complete disaster. It’s a matter of great shame to China. Everywhere you look; China is over-fishing and ripping off Pacific countries.”
Field said the existing regulatory system of fisheries in the Pacific was “the best option we’ve got”.
Yet he noted one of the bodies that monitors the Pacific – the Western and Central Pacific Fisheries Commission – was “stymied year after year by nations like China who refuse to cut back on their catches, or refuse to limit their catches”.
You can see the extent of China’s fisheries in the Pacific using this Global Fishing Watch resource.
As for the concessional loans made in the past, Field noted the struggle Pacific Island countries were facing, trying to repay these.
The Australian in January reported Vanuatu was forced to lift its GST-style consumption tax from 12.5% to 15%, largely in an attempt to help service huge concessional loans from China.
Meanwhile Tonga was scrambling to start repaying massive Chinese debts with a five-year amnesty brokered by the International Monetary Fund to expire in coming months.
The Australian also reported the building boom that has taken place across the Pacific is on the back of concessional loans with provisos the borrower nations spend the money building infrastructure using Chinese construction groups.
Nonetheless, the AIIB’s Jin said it was important for donors to work with recipient countries to ensure they prioritised funding the right projects.
“So if anything goes wrong, don’t put the blame on the recipient countries, or else you have a problem,” he said.
“As long as donors and recipient countries will learn from lessons [of the past] they certainly will do a better job as we move forward.”
As for the relationship between the AIIB and China’s Belt and Road initiative, Jin acknowledged both were proposed by the Chinese leader Xi Jinping.
Yet he said, “These two are different things. They are not the same, although there is some relationship…
“Belt and Road is a platform, inviting all the interested countries to work together. China does not dominate, China does not dictate, China cannot impose any project in any country. We are all working with sovereign governments.”
Seven fishing companies benefited from the Tuna Support Fund (TSF) when Acting Prime Minister and Minister for Economy Aiyaz Sayed-Khaiyum distributed about $3.2 million to them on October 7.
The TSF was setup in 2014 to mainly provide funding assistance to fishing companies that are locally owned and also controlled. The fund was created to assist these companies to raise their financial capacity to compete with foreign fishing companies that receive large subsidies from foreign Governments. To start the fund, Mr Sayed-Khaiyum said six cent per litre of bunker fuel levy was imposed of which 4 cents was transferred to the TSF account.
The issue of distributing the funds went on for two years and they finally came up with a formula (See: Box). Mr Sayed-Khaiyum said it was critically important for people to understand that fishing companies faced a lot of competition.
“The fishing industry is getting very restrictive because fish stocks are no longer as much as it uses to be,” he said. Moreover, there are more companies competing, more foreign companies that received subsidies, which resulted in local companies finding it difficult to compete with them.
The fishing business was prone to a number of anomalies, wherein some of them were engaged in corruption or misrepresentation of facts or not necessarily providing the right information both to the Fishing Industry Association and to the Ministry of Fisheries, Mr. Sayed-Khaiyum said.
TUNA SUPPORT FUND RECIPIENTS
Hangton Pacific Company Ltd
Hou Fisheries Ltd
Sea Quest Fiji Ltd
Solander Pacific Ltd
Solander Viti Ltd
The Fiji Fish Marketing Group Ltd
Trying to allocate the funds was a long process, mentioned Mr Sayed-Khaiyum. From the Government’s perspective, he said there was need to support local companies, especially when they operated in an environment which was not just competitive but was also sometimes detrimental to the security of the Fijian companies. “It’s a tough business,” he said and stated that in the South Pacific, Fiji was the only country with a domestic Tuna Industry.
Reacting to the initiative, the Fiji Fish Marketing Group Ltd executive chairman Grahame Southwick acknowledged the initiative from the Government. He said; “The funds might not solve all their problems but it gives the necessary support at this particular time when they really in need.
The industry is suffering from many aspects, some of it is local but many are foreign basis and is not within the control of Fiji.” The aid from the government was a relief for the local companies.
“This gives us a bit of breathing space. We are happy now; this will take us through to the next critical years as we try and solve other problems,” he added.
Mr Southwick explained how some of them with experience of over 30 years in the fishing business had travelled through the tough road and listing the two main problems faced by the industry.
For the past 10-15 years, over fishing has been going on in the Pacific and within Fiji.
“The overfishing that is going on in the Pacific is devastating, the controls within Fiji waters are quite strong but it can be a little bit better,” he added.
This was because there were too many licenses offered within the Fiji group, which was within the powers of Fiji to fix and we working towards tying to fix that problem. The other issue, which was of concern, was the foreign fleet fishing around Fiji on our perimeters, which was not sustainable.
“Just too many boats fishing in the high seas surrounding us preventing fish from coming into Fiji,” he said.
“We can’t stop them from fishing. Before the situation can improve, the regional over fishing and the fleet has to be slashed by at least 50 per cent.
These are long term problems, and for us companies to get through the next five to 10 years, it is going to be extremely difficult,” added Mr Southwick.
He also felt that these were problems that were not solved easily or quickly, and needed a few years of recovery.
He commented that it was a matter of trying to retain the skills, market, captains, engineers, knowledge and everything in the phase of major loses by the industry.
“Some of these generations of the fishing companies are not going to be around to see the recovery.
“It is going to be a long time before private business people can look into fishing industries and say; ‘oh this is a good industry to invest in’.”
The TSF has been a blessing for the local shipping companies in the fishing space. This support is necessary so that local companies can get through this period so that in 10 – 15 years time all is not lost.
“If the industry fails, we will lose all our skills and market. The Fishing Industry must survive,” stressed Mr Southwick.
“The training, skills, engineers, the captains, fishermen, processing workers has to be reserved for the next five to 10 years down the trail.
“It is very close to failing and if it fails now, there is no future for this industry,” he added.
At the same time, it was also important to ensure that the companies receiving the funds were compliant with various regulatory requirements. And were above board in their dealings. Mr Sayed-Khaiyum said that there are fishing companies that don’t necessarily do the right thing.
For number of years, a lot of fishing companies hid behind different companies to hide their shareholding.
For instance, he mentioned how some fishing companies had stolen letterheads and made representations on different letterheads to the Fishing Industries and to the Ministry of Fisheries.
It is for this reason that only companies that were genuinely impacted benefited from the TSF.