TNRC Blog Connections between IUU fishing and corruption

Image representing TNRC's four focus areas: wildlife, fisheries, forests, and finance

Targeting Natural Resource Corruption

Harnessing knowledge, generating evidence, and supporting innovative policy and practice for more effective anti-corruption programming

Connections between IUU fishing and corruption — and how the global community can combat them

This post captures insights on the connections between global illegal, unreported and unregulated (IUU) fishing, the role of corruption in facilitating IUU fishing and the criminality and human rights abuses often associated with it. These insights were contributed by experts in a TNRC virtual panel on 27 August 2020. Discussion focused on learning and approaches that global practitioners can consider to protect marine resources, address governance challenges, and safeguard rights. The panel was attended virtually by practitioners based in over thirty countries. A recording is above, and a PDF of the slides from the event can be downloaded here.

Key Takeaways

  • IUU fishing and associated crimes is a problem of global significance. Current estimates are that 20-50% of the global fish catch is IUU with illegal and unreported fishing valued at up to $36 billion annually. 90% of world fisheries are either overfished or fished to their biological limit.
  • Corruption is a major—often unidentified—actor in IUU fisheries crimes, and is found throughout the supply chain, including at the processing and distribution points. It’s a problem that consumer countries must address, not just a problem in source countries. Moreover, is not a case of a few bad actors – it is a systemic, deeply entrenched problem throughout the sector.
  • Ten percent of the world’s population depends on fisheries for their livelihoods. In 2017, 3.3 billion people were reliant on fish consumption for 20% or more of their animal protein intake. IUU fishing has human as well as ecological consequences and the corruption associated with the trade has a serious impact on human security.
  • In too many cases, the supply chain for fisheries is based on artificially low prices, little oversight and no safeguards for labor. This business model leads directly to corruption, unsustainable IUU practices and widespread reliance on the de facto subsidy of human trafficking and forced labor.
  • Corruption in fisheries is a complex problem with many layers, but the basic solution is to build transparency and traceability into every stage of the process.
  • Effective traceability, enhanced capacity for monitoring and enforcement, data-sharing, public access to information, the right for workers to freedom of association and collective bargaining, and a whole-of-government approach are all important components of a complex, long-term solution.
  • Recently improved laws in the United States (US) and China demonstrate that progress is possible, but it requires long term engagement. Even in countries with highly corrupted institutions and limited capacity, champions of transparency can be found to work with and support.

What are the most effective methods to reduce corruption and IUU Fishing?

Corruption in IUU fishing thrives behind closed doors and in back-room deals. Secrecy opens opportunities for corruption, especially in underdeveloped countries that do not have sufficient capacity to enforce laws against illegal fishing. In the world of fisheries the chains of ownership and responsibility are particularly opaque because of the anonymity of beneficial ownership of vessels, use of flags of convenience, secrecy of access agreements and complexity of the seafood supply chain.

Transparency can change all this. Vessel monitoring systems and Automatic Identification Systems (AIS) should be mandatory at all times and the results made public, along with ownership of vessels and access agreements. We need to know who owns the ship, how much they catch, how much they are allowed to catch and how the supply chain works. Effective traceability is key. The European Union (EU), and US have traceability systems and Japan is beginning to develop a system, but they use different approaches. There is a great deal of falsification along the seafood supply chain which is easy when catch information is paper-based and data about catch is not shared throughout the system. Within countries we need a whole-of-government approach, because many agencies are involved. The new US SAFE act is a great model for this. Between countries we need a much higher level of cooperation and data sharing. Nations needs to ratify the international Port State Measures Agreement on IUU fishing and work with the UNFAO to implement it.

---Sally Yozell, Senior Fellow and Director, Environmental Security, Stimson Center

Tell us about the role of China in IUU Fishing? Is it evolving?

It is important to distinguish between three very different segments of the Chinese fishing industry:

  • Domestic fishing in the Chinese exclusive economic zone (EEZ), which is heavily regulated with a concern for sustainability;
  • Fishing in the South China Sea, which is complicated by the maritime disputes, and where geo-politics takes precedence over any concerns about IUU fishing; and
  • The distant water fishing fleet (DWF) on the high seas, which operates in the EEZs of other countries and on the high seas which is not comprehensively regulated. There is little incentive or ability to promote sustainability so far from home. DWF expansion was unchecked until 2014, but in the last five year plan it has moderated and vessel caps have been imposed, in large part because of adverse publicity and “shaming” of China’s reputation, for example, an incident in 2016 when a Chinese fishing vessel was sunk by an Argentine coast guard vessel.

So, there has been some positive evolution in China, but a lot remains to be done. The new Chinese DWF regulations provide some penalties and mandate additional reporting requirements, and new measures will require reporting on transshipments on the high seas. China’s existing seafood traceability system does not yet provide for mandatory, comprehensive and more detailed reporting at the national level. Customs codes across countries often do not match and are not standardized to the genus or species level—that’s an entry point for IUU fish too. There is an additional problem of government subsidies, where China is responsible for an estimated 27% of the world’s harmful capacity enhancing subsidies.

---Dr. Tabitha Grace Mallory, Affiliate Professor, Henry M. Jackson School of International Studies, University of Washington; Founder & CEO, China Ocean Institute

How do you see the problems of IUU fishing in Africa? What can be done?

Western nations do a lot of finger-pointing when it comes to corruption and Africa, but we need to look more closely at business practices in developed countries, where many of the root causes of African corruption can be found. Corruption is complex, so we need complex solutions involving long-term capacity building. Even in countries where corruption is widespread, there are individuals in government who are working hard to promote sustainability, transparency and improved fisheries practices. We need to find these champions, provide them with long-term training and support, and empower them to make a difference in their countries.

Here are some guidelines:

  • Work at all levels – but operate where you can contribute;
  • Target the weak spots – identify the problems, reverse cherry-picking;
  • Stop corruption early – stop problems from moving along the value chain;
  • Promote good work – give a platform for recognition, nurture champions;
  • Break the chain – corruption is transnational, we can disrupt it at any point;
  • This is not just a fisheries issue – we need to link across sectors;
  • Expose the criminals – use political, diplomatic, popular pressure;
  • Work together – change the culture of corruption to a culture of compliance.

---Per Erik Bergh, Coordinator, Secretariat, Stop Illegal Fishing

Why is forced labor so often associated with the fishing industry? What can be done about it?

“Dirty, difficult, and dangerous” or “3D” jobs is the term traditionally used to describe to the fisheries industry. The situation has been made more precarious by the current business model, which is economically distorted, based on state subsidies, artificially low prices, little industry oversight and no safeguards for labor. More vessels are competing for fish stocks that are steadily shrinking, while consumer demand for cheap seafood continues to grow. As fixed costs go up, cutting labor costs becomes the only way to remain profitable, especially when crew are legally disempowered migrant workers and captains can exert control by holding on to their passports. This is a business model that invites corruption and thrives on it. Governments and businesses are often mutually profiting from the situation. Vessel owners are often powerful, respected community members, sometimes involved in organized crime, and whistleblowers are suppressed and persecuted.

This is a problem that requires strong federal regulation of Western companies rather than down-streaming responsibility solely to supplier countries, where capacity is often low and victims are often migrant workers who are terrified of reporting violations to officials. There are solutions: transparency and supply chain mapping; vessel monitoring; rigorous port inspections; real penalties for perpetrators; regulation of recruiters and brokers; collective bargaining rights and unions. Technology can be a useful tool, but is not the sole solution. All of these issues go back to the basic business model where prices are kept artificially low and cost is the main driver of sourcing decisions.

---Ame Sagiv, Director, Forced Labor & Human Trafficking, Humanity United

Any final thoughts on moving from a culture of corruption to a culture of compliance? Are there any success stories to point to?

Corruption plays a key role in the problem of zoonotic disease transmission, which has become a threat to global health and biodiversity. We need to take a multi-disciplinary, integrated approach, rather than focusing just on law enforcement or environment, and work together with the global health community.

Effective seafood traceability could make huge difference. We need to keep the pressure up and make sure that treaties and laws are actually implemented and that there is funding for capacity building. Also, following-the-money is crucial. South America is an example where drug traffickers are getting into the seafood business to launder drug profits. All this convergence needs to be targeted by institutions who can follow the money.

---Sally Yozell, Senior Fellow and Director, Environmental Security, Stimson Center

We need to bring more attention to these issues through media, investigative reporting and research. Countries react to negative stories, but we need to acknowledge positive steps as well. Also, there is a difference between being merely compliant and acting in accordance with the letter of the law, versus the spirit of the law.

---Dr. Tabitha Grace Mallory, Affiliate Professor, Henry M. Jackson School of International Studies, University of Washington; Founder & CEO, China Ocean Institute

We need to not just criticize, but also provide incentives and capacity to do the right thing. Work at the local level to shine a light on champions and politician who are promoting sustainable fisheries. Task forces can create pressure to improve transparency and fight corruption. Having a joint communications platform creates peer pressure for improvement.

---Per Erik Bergh, Coordinator, Secretariat, Stop Illegal Fishing

Transparency is key because corruption and trafficking thrive in darkness. The EU Yellow Card and the US TIP reports have spurred changes in Thailand, even though durable change takes time. Now there are some champions within the Thai government, and they play a critical role when there is pressure to backslide. But we need similar standards for seafood-producing countries across the globe.

---Ame Sagiv, Director, Forced Labor & Human Trafficking, Humanity United

© Brian J. Skerry / National Geographic Stock / WWF

Image attribution: © / Jen Guyton / WWF; © Brian J. Skerry / National Geographic Stock / WWF; © Georgina Goodwin / Shoot The Earth / WWF-UK; © Hkun Lat / WWF-Aus