By Tyler Omichinski
Despite the political assertions that the new EU-Canada free trade deal will be a major boon for fisheries industries, the situation is actually more complex. The trade deal, as currently reported, will result in the removal of tariffs on seafood within seven years.[1] Government representatives have touted the advantages that there will be for shrimp and lobster producers in expanding into Europe. It is true that the opening of the EU will make nearly 500 million new consumers open to the market of Canadian producers, but it remains to be seen what this will do the small scale fisheries. Please note that without the final text of the Comprehensive Economic and Trade Agreement (CETA) released, which could take as long as 18 months according to some,[2] the following is based upon general free trade principles and the announced portions of the agreement-in-principle.
New Markets
As it stands now, the tariffs on lobster and other seafood is as high as 20% in terms of export into Europe.[3] The removal of this tariff results in an increased ease in exporting these goods to Europe. The increase in capacity to reach this market will certainly be an attractive aspect of the free trade deal for these fishermen. This includes the capacity to utilize the processing facilities in the UK. Opening these markets provides a viable methodology for lobster to be exported as a luxury item to the European markets. The EU has become one of the largest fish importers in the world, and provides an opportunity for fishery market as a whole to gain some major opportunities.[4]
Environmental Downsides
The International Institute for Sustainable Development (IISD), produced a paper on the environmental impacts of trade liberalization. The scale and intensity of fish processing has increased drastically in line with the liberalization. The environmental impacts of these processing considerations are entirely unknown due to the lack of data on the subject. Similarly, the aquaculture programs often involved with production of shrimp and other seafood can result in environmental effects.[5] Though not exclusively, there is a general trend revealed in the study is such that increases to trade liberalization tends to result in environmental degradation as demand goes up, resulting in the intensity of production going up to meet it.
The increase in international trade has repeatedly run up against the environmental considerations of developing nations. In what has been colloquially referred to as the “race to the bottom,” many nations are lowering their environmental regulations in order to remain competitive in situations where the trade has been increasingly liberalized.[6] Environmental treaties are one of the major considerations that have been able to limit the environmental degradation as a result of said liberalization.
These examples lie in line with the general trend of the demands of sudden trade liberalization has upon environmental concerns.[7] The pressures put upon the locals to compete on the international stage drastically increases the level of exploitation and the intensity of it. This includes a predilection to be more willing to have larger by-catch, compounding the environmental effects.[8]
Damage to Small Scale Fishermen
The Senegalese experience with the liberalization of their fisheries resulted in a wide-scale structural adjustment.[9] This structural adjustment resulted in the industrial modernization of the fisheries and a dismantling of the former small-scale fisheries. It similarly resulted in the development of small-scale fisheries in directions that were not environmentally or socially responsible. The resulting fishery does not support the same number of fishermen, nor does it maintain the previous, traditional, way of life. Scientific models have further predicted damage due to the inequality between small scale fishermen and the larger fishermen.[10] Shrimp trawlers, for example, result in high intensity fishing methodologies which prefer larger trawling vessels. The corporatist model favoured by free trade agreements furthermore supports a lack of any individual feeling accountable. Furthermore, the corporate system, including by-catch, can degrade the culture of accountability within a fishery.[11]
There exists a difference between the small-scale fisheries in developing countries and those in Canada. Canada has a more developed and accountable governmental system. Using the capacity for enforcing economic rents and the like can be integral for ensuring the environmental stability of the Canadian fisheries. The limitation to this, however, is that in practice these policies have not been the best to small-scale fisheries.[12] Extra burdens, whether they be in the form of quotas, tracking, etc, are often easier for larger fishing organizations to bear the costs of. A light touch is required for balancing these impositions on the small-scale fisheries with the increased competitiveness of free-trade agreements.
Lessons from NAFTA
The North American Free Trade Agreement remains one of the major free-trade agreements which provides guidance on the Canadian experience. The UPS case provides a particular example of the type of actions which will regularly be brought.[13] In this case, UPS brought litigation against the Canadian government alleging that there was preferential treatment being offered to Canadian operations. Similarly, the softwood lumber disputes have become a being of public knowledge amongst the Canadian population. These disputes have cost either the government or the individuals involved both time and money to stake and defend their claims. Small-scale fishermen may not have the resources, time, or capacity to engage in such a defense of their work.
As I have written elsewhere,[14] free-trade agreements have the capacity to be further shaped and taken advantage of by commercial interests. Even if Canadian interests are able to defend their position in arbitration, the time and cost required to do so may provide opportunities for commercial interests to move in and take advantage of the situation. Strategic use of lawsuits has been reported on in the USA as a means of silencing criticism and engaging in economic warfare.[15]
Conclusions
The small-scale fisheries seem likely to be in the proverbial line of fire in regards to the changes likely to occur from the new free trade agreement. This new free trade agreement, especially in consideration of the burdens already placed upon fishermen from the WTO and other agreements places them in a precarious position. Though lobster and shrimp fishermen are eying the deal with excitement, it remains to be seen what will happen to the small-scale fishermen for non-shellfish seafood. Historically, free trade agreements have not been friendly to the “little guy.” The increased level of competition seems poised to further strain some of the already extremely limited small-scale fishers.
Sources:
1. James McLeod, “Free Trade Deal with Europe Good for Province’s Fishery: Hutchings”, published in The Telegram October 18, 2013.
2. Anrea Janus, “Canada-EU Trade Agreement ‘a big-deal,’ but not as big as NAFTA: Mulrony”, quoting former Prime Minister Brian Mulrony, CTV News, published October 20, 2013.
3. “Lobster Fisherman Eye Canada-EU Trade Deal,” bilaterals.org, published January 28, 2013.
4. “Fisheries,” EU-Canada Partnership, published online at eu-canada.com.
5. Heike Baumuller, Fisheries – Environmental Impacts of Trade Liberalization, International Institute of Sustainable Development, June 2007.
6. Comparing EU free trade agreements: Fisheries, CFFA – Coalition for Fair Fisheries Arrangements (InBrief 6J). Maastricht: ECDPM. (http://www.ecdpm.org/inbrief6j).
7. Howard Epstein, “NAFTA, Other International Agreements And Local Government Jurisdiction — Comments on United Mexican States v. Metalclad Corp,” 34 MPLR (3d) 44.
8. Daniel Pauly, Jackie Alder, Elena Bennett, Villy Christensen, Peter Tyedmers and Reg Watson, “The Future for Fisheries”, 302 American Association for the Advancement of Science 5649.
9.Integrated Assessment of Trade Liberalization and Trade-Related Policies, UNEP/ET/2002/0010, United Nations Publication.
10. Daniel Pauly, Jackie Alder, Elena Bennett, Villy Christensen, Peter Tyedmers and Reg Watson, “The Future for Fisheries”, 302 American Association for the Advancement of Science 5649.
11. John Ward, Lee Benaka, Christopher Moore, and Steve Meyers, “Bycatch in Marine Fisheries”, 74 Marine Fisheries Review 2.
12. Stephen Cunningham, Arthur Neiland, Michael Arbuckle, and Tim Bostock, “Wealth-based Fisheries Management: Using Fisheries Wealth to Orchestrate Sound Fisheries Policy in Practice,” 24 Marine Resource Economics 3.
13.United Parcel Services of America Inc. v. Government of Canada, Award on the Merits of the Arbitral Tribunal (11June 2007), online: Government of Canada.
14. Tyler Omichinski, “Is Employment Insurance a Subsidy for Fishers?”,
www.fishlaw.org, published July 14, 2013.
15. Ralph Nader and Wesley J Smith, No Contest: Corporate Lawyers and the Perversion of Justice in America, Random House, Dec 22, 1998. See also Thomas Walden, “SLAPP Suits: Weaknesses in First Amendment Law and in the Courts’ Responses to Frivolous Litigation”, 39 UCLA L Rev 979 and Bryant Garth, “From Civil Litigation to Private Justice: Legal Practice at War with the Profession and its Values”, 59 Brook L Rev 931.
A version of this article originally appeared in the Winter 2013 Fisheries Law Update, published by the Fisheries Law Centre.