Honiara (March, 2014) The United States government and its purse seine fishing industry have tripled what they are paying for fishing rights in waters of the Parties to the Nauru Agreement (PNA). The PNA’s “vessel day scheme” (VDS) now enforces a minimum payment of US$6,000 per fishing day, providing ever-greater financial benefits to island members. And at the end of 2013, PNA began successfully marketing internationally certified sustainably caught skipjack in Europe, generating a premium price for the product.
PNA’s engagement has brought a paradigm shift to the western Pacific tuna fishery long-dominated by distant water fishing nations. “We’ve been successful in dramatically increasing benefits to our islands because of the unity of the Parties,” said PNA CEO Dr. Transform Aqorau, who is based at PNA headquarters in the Marshall Islands. Success brings new challenges, and the PNA faces key decisions at next month’s annual meeting that will shape the region’s US $7 billion tuna industry in 2014 and beyond, he said.
Representatives from Papua New Guinea, Solomon Islands, Nauru, Palau, Federated States of Micronesia, Marshall Islands, Kiribati and Tuvalu will gather in the Solomon Islands March 5-14 for their annual meeting,
Among the PNA’s list of challenges is how to distribute US$93 million resulting from last year’s successful conclusion of negotiations with the U.S. government and its tuna industry. Differing interpretations in 2013 of “non-fishing days” by PNA members turned this into a prominent loophole in PNA’s vessel day scheme, which aims to limit the total number of days to
both create scarcity that drives price and conserve the resource.
Demand for fishing days will only increase with a lineup of foreign fishing fleets beating a path to the lucrative fishing zones of the PNA. “What we do as a group is contingent on what we do individually,” said Marshall Islands fisheries Director Glen Joseph in the lead up to the March
In Honiara, PNA officials aim to resolve these issues:
- Distribution of US$93 million from the US fisheries treaty. Key to this is deciding how many days individual PNA members will provide to satisfy the 8,000 days promised under the new treaty. The U.S. treaty includes provisions for 15 percent of the funding to be distributed equally among all Forum Fisheries Agency members as well as a percentage for administration costs. As a result, actual per day rate of U.S. payments to islands in whose waters tuna is caught will be below the new US$6,000 daily benchmark fee, making it less attractive for PNA members to offer days. Revenue has been sitting since last July, waiting for PNA members to work out the details.
- Defining non-fishing days: Differing definitions of non-fishing days is causing “leakage” in the VDS that is intended to cap fishing days to create scarcity and maintain the price. Allowance for non-fishing days need to be tightened so it is not abused by distant water fishing nations. The terms “transit” and “non-fishing days” need to be standardized. Synchronizing fishing rules at the national level with those at the regional level is crucial to ongoing success of PNA.
- Domestic fisheries development: PNA members are benefiting by foreign vessels gaining domestic designation by accessing licenses through the FSM Arrangement, which allows vessels to fish in multiple exclusive economic zones on a single license. The number of foreign vessels seeking licenses under the FSM Arrangement jumped last year and there is concern that it could be used as a vehicle for cheap licenses at the expense of domestic fleet development and access to the region. “
One important issue that doesn’t fit easily into a bullet point issue for resolution is the difficulty that fisheries access agreements represent to PNA members maximizing the value of a fishing day. As conceived, the VDS aims to create a sellers market, allowing PNA members to auction their days to the highest bidders. But bilateral fisheries agreements — where fisheries and foreign ministry officials from Asian or other nations negotiate deals with their island counterparts for access to fishing zones — has been a mainstay of Pacific fisheries for more than a generation. PNA is encouraging fisheries officials to move away from bilateral
fisheries access negotiations to selling days through the VDS, allowing the market to dictate the price — which he believes will punch the price well above the current $,6000 a day benchmark.
“The strategic environment created by PNA lends itself to other innovative ways in which the value of days can be maximized,” said Dr. Aqorau. “Reforms that will enable these more innovative means of maximising the value of a day will take some time to institute. Without doubt they will create some major changes to the strategic directions of this fishery and firmly place its control in the hands of the Parties.”
Although enforcement of the VDS has already increased revenue to the islands more than three-fold, Dr. Aqorau said this is a fraction of what the industry is worth to PNA members. “With greater cooperation among the Parties to make the VDS more effective and reduce leakages from allowances being made to vessel operators through the manipulation of non-fishing days, revenues generated from sale of days can be trebled,” he said.