WTO Fish

WTO fisheries subsidies agreement: stars aligning, but success not guaranteed

The World Trade Organization’s twelfth ministerial meeting at the end of November represents the institution’s big chance to secure a deal to limit subsidies to the fisheries sector, after 20 years of trying. But success is still by no means guaranteed.

Sentiment among delegates at the WTO Public Forum in Geneva this week is that a deal on fisheries at MC12 is within reach this autumn, despite continuing disagreements between leading players over various elements within the current draft text.

“The stars are aligned for a deal at MC12,” said one close observer of the talks. “But if it doesn’t happen this year, our chance might be gone.”

The topic – imposing disciplines on government support to the fisheries support in the interests of improving the sustainability of marine resources – is arguably a little distant from the ‘mainstream’ of WTO debate.

But the negotiations have become emblematic of the challenges facing the Organization as a whole, and are widely seen as a vital test of the WTO’s ability to conduct and conclude multilateral negotiations – and thus of its relevance as an institution.

Political tailwinds

There are undoubtedly helpful political tailwinds behind the fisheries negotiations at present.

For one thing, all WTO members have signed up to negotiate on the basis of the draft text presented earlier this year by the chair of the fisheries negotiations, Colombia’s Santiago Wills, following a green light by trade ministers at an unprecedented ‘virtual summit’ on the topic in July.

The desired deal also has the mandate of the United Nations behind it, in the form of UN Sustainable Development Goal 14.6 which calls for an agreement on subsidies by the end of 2020. The WTO is already one year late in delivering on that particular promise, but that can be blamed primarily on the pandemic.

Perhaps most tellingly of all, the fisheries talks are being vigorously supported by WTO Director General Ngozi Okonjo-Iweala, who, it could be argued, is still in something of a ‘honeymoon’ phase after just eight months in the job.

But the impetus which a ‘new’ DG can bring to a thorny political issue is inevitably short-lived – and it may not survive a setback at MC12.

Seasoned observers of WTO politics see a potential parallel with the agriculture negotiations in the WTO Doha Round, which in late 2008 appeared to be within touching distance of an agreement.

But the deal collapsed at the last minute, the parties retrenched to their old set positions, and the moment for an agreement had passed. Indeed, on the evidence of the current state of the WTO agriculture negotiations, that ‘moment’ has yet to return.

Intense work schedule in weeks ahead

Two separate meetings were held on the fisheries text last week, and more will follow in early October. This should pave the way for more or less continuous negotiations between 11 and 29 October – at which point chairman Wills and his team will take stock of progress.

The schedule for November remains currently hazy, with no specific cut-off date for the talks. In July, trade ministers mandated their negotiators to wrap up a deal on fisheries ‘before’ MC12 – which starts on 29 November.

But observers believe the plan will be to elaborate a mostly ‘clean’ text to present to ministers at MC12, with only a few specific issues left to resolve at the highest political level.

This, however, is something of a ‘best-case’ scenario – and a lot of pieces would need to fall into place in the meantime for the deal to materialise.

Changes still being proposed

Efforts continue to be made by national capitals to influence the negotiations by proposing changes and exemptions of various types to Wills’ draft text.

The most politically sensitive issue remains the special and differential treatment to be offered to developing countries.

India caused some raised eyebrows last week when it tabled a proposal to exempt developing countries from the proposed prohibitions for subsidies related to overfishing, for a period of some 25 years.

This exemption, it said, would not apply to developing countries with distant-water fishing fleets – which is code for ‘China’.

India also wants overfishing to be self-determined by each member – instead of the proposed approach whereby certain types of subsidy would be presumed to contribute to overfishing unless there were grounds to assume otherwise.

But there are plenty of other flashpoints as well – notably the extent to which fuel subsidies should be covered by the scope of the agreement, and the extent to which subsidies may be permissible if they are granted in the context of a national management programme which is aimed at conserving resources.

The latter point in particular is seen by developing countries as potentially giving a ‘free pass’ to the EU, simply by virtue of the fact that principles of sustainability are a core tenet of its Common Fisheries Policy.

Political trade-offs may not help the environment

As the negotiations continue, the pressure will build to find compromises – and the easiest way to do that would be to give developing countries what they wanted on exemptions from core obligations, in return for developed countries being allowed to maintain fuel and other subsidies.

However, the more the deal got watered down, the less likely it would be to deliver on its core mission to make global fisheries more biologically (and thus economically) sustainable.

It is this dilemma that will make the negotiations so complicated over the next two months.

It will not be possible to pass off a weak deal on fisheries as ‘better than nothing’. If global fish stocks do not recover significantly over the next couple of decades, then the deal will be declared a failure.

The stakes are therefore very high – but in a situation where all 164 WTO member members are engaged in the deliberations, and arguing on the basis of a single draft text, there are still hopes for a worthwhile outcome. Perhaps, on this occasion, the ‘moment’ will be seized.

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