2. Growth and equity: Grounds for inserting fisheries into key national policy documents

It is contended that the sector can have a particularly important role to play in the national development process on two counts. First, when it either contributes, or could potentially contribute, to underlying growth processes in a substantive manner (“the growth argument” for including fisheries in the national development discourse). Second, in those instances where a substantial number and/or substantive percentage of a country’s fisheries-dependent population is enmeshed in poverty (“the equity argument” for inserting fisheries in the national development discourse).

A. Fisheries: The growth argument for inclusion

A pivotal component of the development strategy prescribed by major multilateral institutions like the World Bank during the 1980s and early 1990s, and one that carried over into many of the poverty reduction strategies of the early years of the twenty-first century, has been the emphasis on export-led growth. For countries without a substantial manufacturing base, oil or other non-renewable resources, renewable resources such as agriculture, forestry and fisheries have invariably been key components of export promotion strategies. Although the fisheries sector is not the principal motor of growth in any of the developing APFIC states it can still play an important ancillary role in enhancing growth rates over time through:

• developing new or underexploited fisheries - a limited option given the current status of regional resources however (Sugiyama, Staples and Funge-Smith, 2004: 20ff);
• developing aquaculture and mariculture - the two fastest growing food export activities in the world in value terms (Delgado and Courbois, 1997);
• improving fisheries management - the recent APFIC regional workshop on low-value and “trash fish” in Asia and the Pacific region (2005), for example, identified a series of intervention points and actions designed, among other things, to improve policy coherence between the demands of aquaculture development and the ecological, economic and social needs of capture fisheries;
• improving value added in production - new investments in landing and processing facilities, for example, can help reduce wastage rates and/or create new market opportunities; and
• encouraging greater integration of the sector, where warranted, in tourism and coastal zone management programmes so as to derive benefits through eco-tourism and marine park initiatives, sport fishing and similar activities (FAO, 1996: 10).

Although the sectoral importance of fisheries can be evaluated in a variety of ways (fisheries contribution to GDP, generation of resource rents, net or gross export earnings, licence fee receipts, inward investment into the sector, the role of fisheries in contributing to food security etc.) this paper focuses on two criteria for illustrating the current significance of the sector in growth terms. First, the importance of the sector as a generator of foreign exchange⁵ is highlighted, arguing that the larger its contribution, the more likely is, or the greater the opportunities are for, its insertion into national policy formulation processes. Second, the national reliance on the sector for the provision of animal protein needs is highlighted. The greater the reliance on fish protein, the greater the likelihood that national development strategies will reflect this, embracing policies designed to either safeguard or develop this protein source and/or reduce dependence thereon. In Viet Nam, for example, where fish provides 37 percent of daily animal protein intake, the government introduced a Sustainable Aquaculture for Poverty Alleviation (SAPA) Strategy and Implementation Programme as part of a wider Hunger Eradication and Poverty Reduction (HEPR) Programme (Government of Viet Nam, 2001).

B. Fisheries: The equity argument for inclusion

Poverty reduction strategies are increasingly central to the development planning process. Concessional lending by the International Monetary Fund (IMF) and World Bank, with their concomitant demands for beneficiaries to submit a Poverty Reduction Strategy Paper (PRSP) prior to the release of funds, merely serves to underline this emphasis (Box 1).

However, for the fisheries sector to benefit from the opportunities offered by PRSPs, there must be sufficient evidence substantiating the extent and endemic nature of poverty within fishing communities. Yet, since Gordon (1954:132) noted half a century ago that “…fishers typically earn less than most others, even in much less hazardous occupations or in those requiring less skill”, the poverty of fishers and fishing communities has often been taken as given (see Macfadyen and Corcoran [2002] for a summary of anecdotal evidence of this). Fortunately, in the case of developing APFIC states, evidence has been more forthcoming. A sample of recent FAO Fishery Country Profiles observed:

• eighty percent of Indonesian fisher families received incomes below the national poverty threshold (FAO, 2000);

• Filipino fisher households suffered from a higher incidence of poverty and worse access to basic necessities (FAO, 2005b);
• Bangladeshi fishers were “among the extremely and moderately poor people” (FAO, 1999); and
• most Vietnamese fishing communities were described as “poor” (FAO, 2005c).⁶

Similarly the STREAM initiative (2000:23) reported that 88 percent of very low-income households encountered in Tay Ninh Province in Viet Nam in 1999 were linked to the fisheries sector, compared to only 44 percent of high income households. There remains, nonetheless, still only a limited understanding of the underlying causal mechanisms linking poverty and fisheries (see, for example, Allison and Ellis [2001]; FAO [2002a]; Cunningham and Neiland [2005], FMSP [2006]).

This paper identifies two measures to consider the equity argument for fisheries representation in development plans. First, given the absence of data on poverty among fishers, a headcount index of rural poverty in the APFIC countries is used as a second-best measure to reflect the likely magnitude of poverty in the sector. This analytic oversimplification is justified given that the vast majority of fishers in the region are to be encountered in rural, as opposed to urban, areas. The more profound the nature of rural poverty then, the more likely it is that poverty reduction strategies will target the sector, thereby benefiting the fisheries sector either directly (specific interventions in the fisheries field) or indirectly (by, for example, reducing the costs of accessing rural credit for productive purposes). Second, the potential for poverty-reducing, fisheries-specific, policies grows in line with the numeric size of the sector. The more poor fishers there are, the greater the potential for mobilization, and the more difficult it is for policy-makers to ignore such voices. The greater the magnitude of rural poverty and the greater the number of fishers then, the greater the potential opportunities for inserting the fisheries sector into national development and poverty reduction strategies in the APFIC region on equity grounds.

C. The socio-economic importance of fisheries in developing APFIC States

APFIC members accounted for approximately 40 percent of world fisheries production in 2003, with China alone responsible for approximately half of member’s harvests from capture fisheries, and one-third of aquaculture production. APFIC, though, embodies many other significant fisheries and aquaculture producers and, with the exception of Cambodia, Nepal, Pakistan and Sri Lanka, other APFIC developing states all produced over one million tonnes of fish each during 2003. Moreover, capture fisheries and/or aquaculture production were substantive contributors to national income in many APFIC developing states (Table 1).

Table 1. Fisheries/aquaculture contribution to GDP in developing APFIC states: 2001

Seafood, for example, is Viet Nam’s most important export after textiles and oil (FAO, 2005c), and its contribution to GDP is approximately equal to that of education and training (General Statistics Office of Viet Nam, 2006). National accounts, however, do not relay the sector’s full importance, as fisheries also make a significant contribution to national food security in a number of APFIC states, although there are concerns that current patterns of production and trade are compromising this contribution.⁷

Here, the growth and equity issues outlined above are analysed in greater detail. Growth considerations are examined by plotting the association between fisheries’ contributions to trade and consumption. Figure 1 plots the value of each country’s fisheries exports during 2003, measured as a proportion of that year’s total agricultural exports (hereafter Trade), against average per capita fish and seafood consumption during 2003, measured as a proportion of total daily animal protein (hereafter Consumption). Data and sources are set out in Appendix 1.

Figure 1 is divided into four quadrants by reference lines. These are set at 18.5 percent for Trade, the average value computed by Thorpe (2005: 18) for a sample of 127 developing economies during 2000, and at 19.4 percent for Consumption, the average for 129 countries in the same year. These reference lines reveal the relative importance of fisheries trade and consumption to developing APFIC states relative to the world’s developing economies. Fisheries contribution to Trade is above average in nine countries (and only marginally below for India and Indonesia), and all the countries in the sample (with the exception of Nepal⁸) enjoyed a surplus on fisheries trade during 2003, in many instances measurable in billions of US dollars (FAO, 2005d:A-7). Similarly , Consumption was typically greater than the developing world average.

Figure 1. Fisheries contribution to trade and consumption

Countries in the northeast quadrant (Bangladesh, Cambodia, Myanmar, the Philippines, Thailand and Viet Nam) recorded the greatest fisheries contribution to both agricultural export earnings and national diets. As a result, it could be anticipated that the sector would feature prominently within these countries’ national development strategies. China, despite being the world’s largest exporter of fisheries commodities by value in 2003, has a marginally above average contribution to Trade allied to a marginally below average contribution to Consumption, and is the only country located in the southeast quadrant. Three countries (Indonesia, Malaysia and Sri Lanka) are found in the northwest quadrant, suggesting that the sectoral contribution is relatively more important in consumption than trade terms (although Indonesia did record a substantial fisheries trade surplus in 2003). Furthermore, population and income growth in Indonesia and Malaysia in particular are expected to increase the demand for fisheries commodities sharply in these countries (FAO, 2000; 2001). The sectoral case for inclusion in development strategies on the grounds of its contribution to growth is least strong for those countries located in the southwest quadrant (India, Nepal and Pakistan). The presence of landlocked Nepal among this group is unsurprising, although the true extent of fisheries consumption here is uncertain because of the entirely artisanal character of production and the absence of an organized distribution network (FAO, 1997). Although Pakistan has a coastline of some 1120 km (FAO, 2003a), only about nine percent of the population lives within 50 km of the sea (World Resources Institute, 2006). This fact, a limited distribution network, and a concentration on fishmeal production⁹ are the crucial factors explaining low consumption.

Figure 2 examines the strength of the equity argument for the sector’s integration into development strategies. It does so by illustrating the association between employment in fishing as a proportion of the labour force (hereafter Employment), and the level of rural poverty (hereafter Poverty).¹⁰ In this instance, the reference lines are once more set at the developing world averages of 1.3 percent and 44.3 percent for Employment and Poverty respectively, as reported by Thorpe (2005: 18).

Figure 2. Fisheries employment and rural poverty

Asia accounts for some 85 percent of global fisheries employment, although this probably understates engagement in the sector (Sugiyama, Staples and Funge-Smith, 2004: 2). It is therefore unsurprising that most countries are positioned in the northeast or southeast quadrants. Bangladesh and the Philippines exhibit a strong association between high fisheries employment and above average rural poverty. Although employment is above average in China, India, Indonesia, Sri Lanka, and Viet Nam, the available survey evidence suggests that these countries enjoy below average levels of rural poverty. Malaysia, Nepal, Pakistan, and Thailand are all located in the southwest quadrant, while only Cambodia is located in the northwest quadrant.

Nevertheless, even if countries post modest contributions on Trade/Consumption grounds and exhibit a low incidence of Employment/Poverty, this does not necessarily imply that development and poverty reduction strategies should overlook the sector. At the local (or regional) level, the concentration of fisheries activities in coastal zones or major watersheds is likely to produce pockets of fisheries dependence (whether in Trade, Consumption or Employment terms); although it may be the case that such region-specific needs are best dealt with at the decentralized planning level. What is clear from the preceding analysis, however, is that there are substantive differences in the extent to which APFIC countries rely on the fisheries sector in regard to trade, domestic protein consumption, employment and rural poverty at the national level. Yet sectoral significance, in terms of either Trade / Consumption or Poverty/Employment, does not guarantee that the sector will be effectively incorporated into the national development discourse.

⁴ Developing APFIC nation states, for the purposes of this paper, are defined as countries with a 2004 Gross National Income per capita [Atlas method] of US$5 000 or less [in corrent US$] (World Bank Development Indicators, 2006a).

⁵ FAO (2003b) have, in fact, highlighted that “net export revenues from fish exports earned by developing countries reached US$17.7 billion in 2001, an amount larger than for any other traded food commodity such as rice, cocoa, tea or coffee.”

⁶In parts of the APFIC region, historical as well as current cultural and management contexts underscore a clearly defined link between poor people and fishing as a component of livelihoods. In India, for example, fishing has been a low-caste activity for centuries – with important contemporary ramifications. Such caste-based systems have, moreover, generally been strongly resistant to change as the traditional policy discourse precluded poorer stakeholders from participating – a situation the PRSP process attempts to redress.

⁷For example, the FAO (2005b) profile of Philippine fisheries suggests that “the ability of the sea to provide a cheap source of food and income for the Filipino masses has been severely compromised”.

⁸FAO (1997) suggest that imports to Kathmandu from India, Thailand, and Singapore are “mainly destined to hotels and restaurants catering for tourists and foreign residents”.

⁹ The most recent profile of Pakistani fisheries suggests that approximately 40 percent of marine fisheries production is converted to fishmeal to supply the poultry industry (FAO, 2003a).

¹⁰ It was not possible to find a reliable estimate of the level of rural poverty in Myanmar.