The State of Fisheries Management in SA

On 17 October 2012, Pieter van Dalen, the Deputy Shadow Minister for Fisheries (DA) addressed the Cape Boat and Ski-Boat Club on the state of fisheries management in South Africa. This is his address.

"By way of preface, it is worth situating the state of fisheries in South Africa in the broader global context. The world’s fisheries are the quintessential case of the “tragedy of the commons”, whose symptoms include persistent over-fishing and fleet overcapitalisation. This tragedy shows how individually rational agents will use a common resource in a socially irrational way because, when each agent exploits the resource, they ignore the negative externalities that this generates for other agents. The consequence is that the resource is over-utilised in a dramatic way, even though all those involved could change their behaviour (extract less) and leave everyone better off. Such a scenario raises notable political economy challenges in developing country-specific pathways of reform.

 

The World Bank reports that despite growing evidence of success in selected fisheries, less than two percent of the world’s fisheries have actually undergone effective reform because of these challenges. “It is estimated that the world’s fisheries could generate at least US$50bn per annum and the economic benefits generated could be much higher if management systems were established to enable investment in growing this important economic sector in a sustainable manner”. The trade in global seafood and fish products is worth more than R480 billion annually according to the Food and Agriculture Organisation of the United Nations. Importantly for South Africa, fisheries are crucial for enhancing economic growth and alleviating poverty as we have significant fisheries assets – one of the top 5 producers in Africa.

 

 

In 2011, South Africa’s commercial fishing industry was worth at least an estimated R5.54 billion, landed 498 000 tons of fish and presently employs approximately 30 000 people directly in full and part time jobs. Investments in fixed assets have an insured value of approximately R12bn. More than 3000 commercial fishing right holders deploy some 1400 fishing boats each year in South Africa’s exclusive economic zone (EEZ). The commercial future of the South African fishing industry is increasingly dependent on the sustainable utilisation and sound management of its wild marine living resources. However, accurate data on the fishing industry is increasingly less available in the wake of institutional dysfunction at the Department of Fisheries (DAFF). Without accurate and reliable socio-economic data it is impossible to properly regulate commercial or recreational fisheries. Regulation is particularly crucial in this industry as its long-run profitability is almost entirely contingent on fishing within a clearly identified ‘maximum sustainable yield’ (MSY). But the MSY cannot accurately be established without continued research to establish the levels and viability of fish stocks.

 

In ordinary circumstances, DAFF would conduct annual research in this respect for each component of the fisheries industry. Once the MSY has been determined, a Total Allowable Catch (TAC) is established. The TAC provides the grounds on which quotas are then allocated. The situation is so bad that the Africana had to leave on the 15 th of Oktober 2012 for us to be able to set these TAC. This sadly did not happen and now there is a real chance of the TAC being halved. That would mean halve of income and half of the industry shedding jobs. This is of real concern and the industry had offered to assist. The minister is so stubborn that she will not accept the help. It is a recognised world practice that industry can help. It is estimated that the salaries lost in the pilchard industry (which will be cut by 50 000 M/Tons) will be R100 mil.

The anchovy industry (which will lose 180 000M/tons) will lose about R200 mil.

This is not counting taxes that are paid plus it will hugely escalate this country’s food security and especially poor communities which relies on Fish as one cheap source of protein.

 

Of course, circumstances are currently anything but ordinary, especially with research cruises only being undertaken under great pressure from the industry. Research vessels are tied up at Simon’s Town harbour under the auspices of the Navy, though the Algoa was recently handed over to the Department of Environmental Affairs to be manned by Smit Amandla Marine. This strange situation is attributable to the administrative bungling of an R800 million tender in November last year, infamously and prematurely awarded to Sekunjalo Consortium before being withdrawn. The contract is to operate and maintain state-owned research and patrol vessels. The next round of allocating commercial fishing rights in 16 commercial fisheries is due to take place in 2013 and 2015 respectively. But DAFF's 2009 review of industry performance (published only in 2012) has been woefully inadequate, littered with errors, including getting the number of rights holders in certain sectors incorrect. Further, DAFF has not undertaken any substantive measures to even begin preparing for these quota allocation processes, which take approximately two and a half years to properly prepare for.

 

 

To add to the general malaise, Small Scale Fishing Policy adopted by Cabinet wildly contradicts the findings and objectives of the National Development Plan (NDP). The policy calls for new entrants and additional quota holders to gain from the industry under the name of redress, but the NDP is opposed to this as it threatens the sustainability of the already depleted fish stocks. Moreover, the NDP emphasises that the allocation of quotas should be done in such a way as to ensure compliance, yet the department insists on allocating the interim relief lobster quotas, which have proved to be an illegal fishing racket. Small-scale fishing is not the solution to poverty and unemployment – the promise of communal fishing rights only fuels discontent. Finally, the allocation of more small-scale fishing rights (over against focusing on industrial fisheries development) will ultimately lead to fewer jobs being created.

 

The Fisheries Branch remains without a plethora of top and senior managers, including having been without a permanent DDG, head of Fisheries Management and CFO since at least December 2010.

 

Undoubtedly the greatest institutional challenges facing the sustainability of South Africa’s fisheries, then, are poor management, policy incongruence and illegal, unregulated and unreported fishing.

 

In the current context of South Africa’s political landscape, it appears that the relevant politicians – namely Minister Tina Joemat-Pettersson – do not actually operate under an incentive structure that encourages them to execute actions carefully computed by economists and policymakers that will make fisheries, and the communities that depend on them, better off. Certainly the last three years of fisheries management has witnessed the destructive effect of institutional dysfunction. It turns out we are not alone, though.

 

Economist James Robinson makes the important point that, globally, the number of metric tons of fish caught per fisher has fallen since the 1970s, from 5.25 tons in 1970 to about 3 tons in 2000, and this occurred despite considerable technical change. The World Bank report to which he refers is “the most canonical example that market failure proceeds unabated with little effective response from governments of from private agents. Indeed, only New Zealand and Iceland have managed to construct the type of rational fisheries regulation which would solve these problems.”  He goes on to point out that it is not enough, then, for economists to propose sensible solutions to fisheries management as these already exist. The problem is that the sensible solutions are not adopted because political forces are not aligned in the right way. It is currently not politically feasible for Minister Tina Joemat-Pettersson, for instance, to implement the optimal policies. She is more concerned with using her department as an instrument of political gain for President Zuma’s  Mangaung campaign than ensuring the sustainability of the fishing industry. And there are very few countervailing measures to stop her – not even three concurrent investigations into her conduct, repeated calls from the DA for her resignation and a damning exposé in Noseweek.

 

Without an increasingly powerful opposition party and increased activism from civil society, the South African government will have perpetually little incentive to intervene in order to promote real efficiency in the fisheries sector."