Addressing potential impacts of climate change on fisheries trade

26 November 2010

The world’s fisheries and fisheries trade will be affected by climate change in numerous ways. Foreseeing the changes and taking adequate adaptation and mitigation measures can help developing countries continue to derive benefits from this valuable resource – including through exports.

The world’s poorest countries will be most affected by global climate change, including in the area of fisheries. Meanwhile, poorer countries tend to be more nutritionally and economically dependent on fish than wealthier countries, due to their higher per capita consumption of fish products, and the fact that they derive a greater share of employment, Gross Domestic Product (GDP) and export earnings from fish. While agriculture, forestry and freshwater resources have been central in climate policy discussions, the effects of climate change on fisheries resources, and thus the implications for health and livelihoods in the developing world, have been largely ignored.

Climate change impacts in the fisheries sector

Projected changes in fish populations and ecosystems due to climate change may be significant, and will lead to impacts within the fisheries sector and on national economies (see Box 1).

Impacts can occur at two main levels, which correspond approximately to the domains of micro- and macro-economic analysis:

  • within the sector - impacts on the incomes, assets, and livelihoods of individual fishers, fish farmers, processors, and those engaged in marketing and the provision of inputs to the sector; and
  • at the national level - impacts on revenues, exports, per capita fish supply, and contributions to employment and GDP.

Macro-economic concerns arise only when fisheries are sufficiently prominent in society and the economy to be a concern for national economic planning. This will be the case for many developing countries, particularly many island states, where fisheries often number among the major export revenue sources.

Assessing potential future impacts of climate change requires recognition that climate change is just one of many factors impacting on a country’s fisheries sector, and not necessarily the most important one. In addition, assessing the magnitude of potential change over different, and potentially long, timescales is difficult, especially at the country level.

For these reasons, it is virtually impossible to make quantitative projections about climate change impacts in individual countries. Nevertheless, one can suggest the different types of physical changes resulting from climate change, and the possible impact pathways to the effects on ecosystems and fish production, and in turn the impacts on trade and competitiveness of the fisheries sector and on fishers, communities and nations.

Within-sector impacts

All those in the supply chain – producers, processors, those transporting and selling fish – will be affected by changes in incomes, value-added, employment and food security. These changes may include:

  • Changes in fishing/business strategies and methods, such as types of gear or forms of processing, to reflect changes in the abundance, distribution, and phenology of different fish species;
  • Changes to aquaculture as coastal and inland areas become more or less suitable for aquaculture with changes in sea or lake levels, and changes in water quality and properties;
  • Changes in marketing chains and end market destinations, resulting from shifts in the species mix of wild catches, changes in the balance of production between capture fisheries and aquaculture, and changes between marine and inland resources;
  • Shifts in the balance between fishing, fish farming and other livelihood activities, with those in the sector seeking to divest if fishing or fish farming becomes less profitable. Alternatively, reduced livelihood opportunities in agriculture and other sectors may result in more people looking to fishing as a “safety-net” occupation;
  • The willingness of stakeholders to invest in community or participatory management, itself important in enhancing adaptive capacity, may change if stocks are seen to be subject to climate-driven processes beyond the control of local management. Conversely, the threat of climate change impacts may galvanise local management to minimise impacts and enhance adaptation;
  • Changes due to mounting costs of adaptation in an attempt to maintain income and employment; and
  • Changes due to damage to infrastructure and assets, and increased safety risks from increased severity and potentially frequency of extreme weather events.

Wider impacts

Climate-induced changes in the fishery sector may also have wider societal and economic implications at the national level, and these will be greatest where fish and fisheries play important roles in society and the economy. Examples include:

Rent generation from the sector. For many developing countries, the value of fisheries in the Exclusive Economic Zone (EEZ) is considerable and the sale of fishing licences to foreign vessels in return for access to national waters makes substantive contributions to GDP. Governments also generate revenue from domestic fisheries through the collection of various fees and taxes relating to fishing, processing and trading inputs and outputs.

Food and nutritional security. Food security at the household and national level is achieved through trading of fish to generate income used for purchase of other food items. In addition, having access to fish provides direct nutritional security in the form of access to a healthy, balanced diet, rather than just access to sufficient calories. The fisheries sector also plays an important role with regards to food security in many countries by acting as a safety net whereby people may start fishing when other food or income generating activities are threatened. As climate change begins to impact inland and near-shore fisheries, the role of fisheries as a safety net is likely to become less viable. In addition, global levels of fish exports are rising, especially from developing countries. At the same time, per capita supply of fish is decreasing globally – despite the rapid rise of aquaculture production – due to population increases. Therefore, policy makers face important challenges in terms of balancing local nutritional needs with the revenue generating potential of export-oriented production.

Costs of adaptation. To maintain the flow of benefits to society and the economy from fisheries, governments are likely to have to increase their investments in developing coherent “climate proof” sectoral policy and legislation, management and development.

Trade competitiveness. At the most fundamental level, climate change has the potential to impact on total fish production volumes available for trade, both domestically and to export markets. Trade impacts could include changes such as trade volumes shifting to different export market destinations due to their different preferences for particular species, changes to total trade value, changes in the production for export and local consumption, and changes in balance between marine and inland fisheries and aquaculture. There could be changes to the contribution of fisheries to exports and trade earnings, and the reliability of supplies could diminish.

The ability of individuals, communities and countries to deal with the wide range of climate change induced impacts listed above depends on their vulnerability. As shown in Box 2, vulnerability is a product of exposure and sensitivity combining to form potential impacts; and the adaptive capacity to respond to these impacts.

Responses to climate change impacts

What then can individuals and countries do to ensure that they maintain trade competitiveness in the face of the potential impacts of climate changes? Responses in the form of adaptation and mitigation offer potential to maintain or increase fisheries trade both domestically and internationally.

Adaptive measures in the fisheries sector

Fisheries-specific adaptive measures offer potential to maintain or increase fisheries trade both domestically and internationally, on a sustainable basis. Examples of such measures are provided below.

Re-building stocks and improving fisheries governance. Stocks that are not over-fished are likely to be more resilient to climate change impacts. Thus, initiatives aimed at management of the sector – such as decommissioning superfluous vessels, introducing fishing rights, improving monitoring, control and surveillance – will help improve the adaptive capacity of fisheries to climate change.

Strategies regarding onshore fisheries and coastal infrastructure. Provision of safe havens or harbours for the fishing sector to protect vessels can ensure continuing levels of catches. Climate-proofing any such developments through careful positioning and appropriate engineering will be increasingly important.

Managing declining incomes if fish catches fall, and efforts aimed at diversification and fostering alternative livelihood activities. Enabling exit from the fishery sector in response to downturns, by providing training in alternative occupations or through general investments in skills and capabilities, may be important in fisheries that are declining or subject to reduced productivity under projected climate change.

Dealing with fisheries’ status as a safety net activity. In many countries, climate change impacts on livelihoods in other sectors, such as agriculture, may result in increased pressure on fish resources. This, in turn, requires specific policies to deal with part-time and occasional fishermen wishing to exploit fish resources. Such an approach ensures that fish catches are sustainable.

Disaster preparedness and response. Policy-level responses can include investing in improved weather information and storm warnings, as well as ensuring that the fishery sector is included in national disaster preparedness and response planning.

Aquaculture development. Aquaculture production increases can sometimes help offset capture fisheries production declines. These aquaculture assets should be climate-proofed. Other adaptive measures include species selection, selective breeding and genetic modification in aquaculture.

Ecosystem-based adaptation. Coastal ecosystems like wetlands, coral reefs and mangroves all provide natural shoreline protection from storms and flooding. This in addition to their role in maintaining sustainable fish supplies by providing breeding and nursery areas.

Mitigation in the fisheries sector

Mitigation options in the fisheries sector are very much at the early stages of investigation. Few studies of energy consumption by the world’s fishing fleets have been conducted and the current contribution of the fisheries sector to global warming is not yet known.

Policy options for climate change mitigation could include taxation, regulation and incentives related to fuel use and vessel engine emissions. Other options include supporting technical innovations to reduce fuel usage and emissions in fishing vessel engines. Countries could promote fuel-efficient fishing methods – such as using static methods rather than active gear such as trawling, with its high energy requirements – through differential licensing conditions and decommissioning support. The development of low-impact aquaculture, such as herbivorous aquaculture species, also has a role to play.

In addition, improvements in building design and handling practices to reduce energy requirements and improve energy efficiency can make a contribution. Fuel use for the further transportation of fish to markets can also be made more efficient. Other than addressing the need for better technologies, it will be important to protect and rehabilitate mangroves, as they have a valuable role to play in sequestering carbon.

In many cases, countries could increase their competitive trading position by implementing adaptation and mitigation policies. For example, if countries protect wetlands, coral reefs and mangroves – and the range of ecosystem services they provide – they may be able to access tangible financial benefits in the form of tradable permits and payments. These could include conservation payments, payments for environmental services, linkages with carbon markets (e.g. Reducing Emissions from Degradation and Deforestation (REDD) for mangroves), and funding or revenues through eco-tourism ventures. Countries and companies could also brand and promote their products as climate- and environmentally-friendly, thereby positioning themselves favourably on markets for sustainable products. In addition, efficient production methods can lead to cost reductions in and of themselves.

Funding to address climate change impacts and fisheries trade

As seen from the above discussion, individual countries can, and should, do a great deal in order to address climate change impacts on the fisheries sector. This will allow them to maintain trade competitiveness and the very significant benefits – both in economic and social terms – that they derive from the sector. Some potential sources of funding for adaptive and mitigating responses to climate change are discussed below.

Aid for Trade. Set up in the course of the long-running Doha Round of global trade talks, the WTO work programme on Aid for Trade aims to mobilise additional funding to help poor countries overcome supply-side constraints that hamper their ability to benefit from the multilateral trading system. While Aid for Trade is primarily trade-related, the economic resilience that it creates could have positive effects in helping countries deal with the potential impacts of climate change on fisheries. This would be particularly true if Aid for Trade could anticipate possible climate impacts on trade-related infrastructure or on key fish species or sectors likely to be impacted, and respond accordingly in the design, implementation and financing of relevant projects. Given the very significant potential impact of climate change on fisheries trade, Aid for Trade could potentially and legitimately be used to support many of the adaptive and mitigating measures discussed above. For example, at least two dimensions of the Aid for Trade initiative are relevant for enhancing the competitiveness of fisheries: strengthening trade-related infrastructure (which may need to be climate-proofed) and building productive capacity (especially for small and artisanal fisheries). Enhancing the competitiveness of the sector is a key adaptive measure, making the sector resilient to external shocks, including climate change impacts.

The Integrated Framework (IF) for Trade-Related Technical Assistance. The IF was established in 1997 to support least-developed country (LDC) governments in trade capacity building and integrating trade issues into overall national development strategies. Through the IF, the participating agencies (including the UN Development Programme, the World Bank and the WTO) combine their efforts with those of LDCs and other development partners to respond to trade development needs. The ultimate goal is to support the integration of LDCs into the global trading system in order to contribute to poverty reduction and sustainable development. The IF has two objectives: To “mainstream” (or integrate) trade into national development plans; and to assist in the coordinated delivery of trade-related technical assistance in response to needs identified by the LDC. Clearly, there is potential for technical assistance to focus on fisheries sector trade related needs in response to climate change impacts.

NAPAs and PRSPs. Specific reference to the fisheries sector in National Plans of Adaptation (NAPAs) to climate change signals priority for expenditure on adaptation in the sector. Therefore, countries could make sure to include the sector in on-going reforms to existing plans or preparation of new NAPAs. Inclusion in Poverty Reduction Strategy Papers (PRSPs) helps to ensure fisheries and aquaculture in the highly indebted poor countries receive a budget allocation in associated medium-term expenditure frameworks. This can contribute to maintaining sustainable fisheries and ensuring government investment in infrastructure, services and regulatory institutions that help to maintain or improve trade competitiveness.  PRSPs have also become the standard tool in the search for trade-related assistance, since they serve as the platform on which donors base their aid planning.

Graeme Macfadyen is the Director of Poseidon Aquatic Resource Management. This article summarises and updates work funded by the Commonwealth Secretariat (Macfadyen, G., and Allison, E: Climate Change, Fisheries, Trade and Competitiveness: Understanding Impacts and Formulating Responses for Commonwealth Small States. 2009).

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