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International Fish Trade recent developments Grimur Valdimarsson, Director Fishery Industries Division FAO, Rome,Italy.

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Presentation on theme: "International Fish Trade recent developments Grimur Valdimarsson, Director Fishery Industries Division FAO, Rome,Italy."— Presentation transcript:

1 International Fish Trade recent developments Grimur Valdimarsson, Director Fishery Industries Division FAO, Rome,Italy

2 Outline Regulatory Framework for Fish Trade Regulatory Framework for Fish Trade Production Production Aquaculture versus WildAquaculture versus Wild Developing versus Developed countriesDeveloping versus Developed countries Trade Trade Major commodities Major commodities Developing versus Developed countries Developing versus Developed countries Growing trade of developing countriesGrowing trade of developing countries Trade flowsTrade flows

3 Outline (cont.) WTO Agreements WTO Agreements DOHA negotiations DOHA negotiations FISH INFOnetwork and the work of FAO in the field of market information and development FISH INFOnetwork and the work of FAO in the field of market information and development Value Added fish products and changes in market structures Value Added fish products and changes in market structures Conclusions Conclusions

4 TRADE LIBERALIZATION was put at the heart of the global development agenda as laid down in Agenda 21 of the Earth Summit on Sustainable Development (Rio) (Rio) in 1992

5 The Earth Summit in Rio in 1992 (Agenda 21) promote sustainable development through trade liberalization promote sustainable development through trade liberalization create a system that is non- discriminatory, rule based, equitable, secure, transparent and predictable create a system that is non- discriminatory, rule based, equitable, secure, transparent and predictable

6 Hunger: 840 million people still suffer from hunger 840 million people still suffer from hunger(FAO) Unequal distribution of wealth: Ten percent of the worlds population produces 70 percent of its goods and services and receives 70 percent of world income - an average of $ 30,000 per person. At the other extreme, half of the worlds population lives on less than $ 2 a day Collier and Dollar (2001)

7 The WTO (and its predecessor,GATT) has mainly been concerned with facilitating international trade through... lowering CUSTOM DUTIES (TARIFFS) but technical issues are becoming ever more important technical issues are becoming ever more important

8 During the 50 years of negotiations to lower tariffs world trade has grown by 6% annually… AGRICULTRUAL goods, such as meat, still carry some 70-80% tariffs whereas AGRICULTRUAL goods, such as meat, still carry some 70-80% tariffs whereas FISH & FISHERY products (classified as industrial goods) carry some 4.5% tariffs in developed countries FISH & FISHERY products (classified as industrial goods) carry some 4.5% tariffs in developed countries

9 Some production figures...

10 Fish Production (in MT) FISHSTAT 2004

11 Fish Production (in MT) FAO FISHSTAT 2004

12 Fish Production (in MT) FAO FISHSTAT 2004

13 Some fish trade figures...

14 International Fish Exports – 2002 (percentage by value) Total export value: US$ 58 billion FAO FISHSTAT 2004

15 International Fish Trade - 2002 FAO FISHSTAT 2004

16 Net exports of food items by developing countries FAO FISHSTAT and FAOSTAT 2004

17 Fish Commodities - Export FAO FISHSTAT 2004

18 Trade Flows 2002 (in billion US$) DevelopedDeveloping Developed Developing Exports Imports 24,65 3,8 25 Calculations based on COMEXT 2004

19 MEAT AND SEAFOOD PRICE INDICES (100 = 1997-1999) FAO FISHSTAT and FAOSTAT 2004

20 The ratio of the first hand price to the retail price Tveteraas 2004

21 WTO Agreements

22 WTO Agreements of particular relevance for fisheries Agreement on Sanitary and Phytosanitary Measures (SPS) Agreement on Sanitary and Phytosanitary Measures (SPS) Agreement on Technical Barriers to Trade (TBT) Agreement on Technical Barriers to Trade (TBT) Agreement on Subsidies and Countervailing Measures Agreement on Subsidies and Countervailing Measures Agreement on Import Licensing Procedures Agreement on Import Licensing Procedures Agreement on Anti-Dumping Agreement on Anti-Dumping Agreement on Rules of Origin Agreement on Rules of Origin Dispute Settlement Dispute Settlement Tariff reduction (GATT) Tariff reduction (GATT)

23 Agreement on Sanitary and Phytosanitary issues (SPS)... Right of Members to apply measures they deem necessary to protect human, animal and plant life and health Right of Members to apply measures they deem necessary to protect human, animal and plant life and health Should not be a disguised restriction on international trade Should not be a disguised restriction on international trade Protection levels should not be more trade restrictive than required to provide appropriate level of protection APLP Protection levels should not be more trade restrictive than required to provide appropriate level of protection APLP

24 Agreement on Technical Barriers to Trade (TBT)... The Technical Barriers to Trade Agreement (TBT) ensures that members do not use technical regulations or standards as disguised measures to protect domestic industries from foreign competition. The Technical Barriers to Trade Agreement (TBT) ensures that members do not use technical regulations or standards as disguised measures to protect domestic industries from foreign competition. Labelling disputes Labelling disputes Testing procedures Testing procedures

25 Some examples of tariffs and WTO Agreement issues..

26 Tariff escalation for cod: EU Cod – fresh and frozen15% Cod – fresh and frozen15% Cod fillets – fresh and frozen 18% Cod fillets – fresh and frozen 18% Cod fillets dried, salted20% Cod fillets dried, salted20% Cod dried, salted13% Cod dried, salted13% Cod fillets – battered25% Cod fillets – battered25% TARIC 2004

27 Tariff escalation for tuna: EU EU tariffs are 18% for frozen whole tuna and 24% for tuna loins and canned tuna EU tariffs are 18% for frozen whole tuna and 24% for tuna loins and canned tuna But there are some special Agreements.. Asian Caribbean Pacific (ACP) countries: 0% duty on all seafood products Asian Caribbean Pacific (ACP) countries: 0% duty on all seafood products GPS-Drug Agreement set certain duty free quotas for canned tuna and tuna loins from Andean Community and Central America GPS-Drug Agreement set certain duty free quotas for canned tuna and tuna loins from Andean Community and Central America EBA (everything but Arms Agreement) of the EU for LDC´s ( least developed countries ) EBA (everything but Arms Agreement) of the EU for LDC´s ( least developed countries )

28 SPS Agreement applied by EU: antibiotics Detention of shrimp with antibiotics (mostly chloramphenicol) in EU Detention of shrimp with antibiotics (mostly chloramphenicol) in EU China (mainland and Taiwan, province of China)China (mainland and Taiwan, province of China) ThailandThailand IndonesiaIndonesia IndiaIndia PhilippinesPhilippines Viet NamViet Nam BangladeshBangladesh and othersand others

29 Examples of TBT/SPS issues Country of origin labeling in USA (COOL) Country of origin labeling in USA (COOL) TEDs (Turtle Excluding Devices) for catching shrimp TEDs (Turtle Excluding Devices) for catching shrimp Tuna-dolphin issue. The certification that dolphins are not killed in fishing for tuna Tuna-dolphin issue. The certification that dolphins are not killed in fishing for tuna Trade description of scallops: Saint- Jacques vs pétoncle Trade description of scallops: Saint- Jacques vs pétoncle Australia: Banning imports of salmon from Canada due to possible fish disease agents Australia: Banning imports of salmon from Canada due to possible fish disease agents Trade description of sardines: Peru vs EU Trade description of sardines: Peru vs EU Sardinella pilchardus vs. Sardinops sagaxSardinella pilchardus vs. Sardinops sagax

30 WTO definition of dumping Three methods to calculate a products normal value. Three methods to calculate a products normal value. The main one is based on the price in the exporters domestic market.The main one is based on the price in the exporters domestic market. the price charged by the exporter in another country,the price charged by the exporter in another country, or a calculation based on the combination of the exporters production costs, other expenses and normal profit margins.or a calculation based on the combination of the exporters production costs, other expenses and normal profit margins.

31 Anti-dumping: Shrimp USA Anti-dumping: Shrimp USA Against countries selling at a price below domestic (US) production prices Against countries selling at a price below domestic (US) production prices Obvious difference between the US definition of dumping and the WTO definition Obvious difference between the US definition of dumping and the WTO definition Complaint to the WTO likely to come soon Complaint to the WTO likely to come soon

32 Resulting US tariffs on shrimp... Countries affected: Countries affected: Brazilup to 67.8%Brazilup to 67.8% Ecuador6.08%-9.35%Ecuador6.08%-9.35% India3.56%-27.46%India3.56%-27.46% Thailand5.56%-10.25%Thailand5.56%-10.25% China27.9%-113%China27.9%-113% Viet Nam4.1%-25.8%Viet Nam4.1%-25.8%

33 9 th Round: Doha Agenda: The Development Round

34 Market access for non-agricultural products (including fish) GOAL OF THE DOHA ROUND: Reduce or eliminate import tariffs Reduce or eliminate import tariffs Reduce tariff escalation and tariff peaks (value-added products) Reduce tariff escalation and tariff peaks (value-added products) Protect special needs of developing countries Protect special needs of developing countries Capacity building on negotiation issues Capacity building on negotiation issues

35 Fish processing in developing countries LARGE POTENTIAL FOR EMPLOYMENT CREATION (NOT THE LEAST FOR WOMEN) LARGE POTENTIAL FOR EMPLOYMENT CREATION (NOT THE LEAST FOR WOMEN) TODAY, TARIFF ESCALATION HINDERS PRODUCTION OF VALUE- ADDED PRODUCTS TODAY, TARIFF ESCALATION HINDERS PRODUCTION OF VALUE- ADDED PRODUCTS

36 Are fish exports bad for developing countries?

37 Impact of Fish Trade on Food Security: 11 countries 2002-2004 Main Findings were Main Findings were international trade in fishery products has had a positive effect on food security through export earningsinternational trade in fishery products has had a positive effect on food security through export earnings international trade has not had a detrimental effect on food security in the form of fish as food.international trade has not had a detrimental effect on food security in the form of fish as food. sustainable resource management practices are a necessary condition for sustainable international trade.sustainable resource management practices are a necessary condition for sustainable international trade. Kurien 2004

38 Helping developing countries with fish trade...

39

40 FIN Magazines

41 Price Reports and Market Analysis

42 FAO GLOBEFISH Webpage

43 Value addition- the future?

44

45 Value Addition...

46

47 Conclusion Fish production continues to grow Fish production continues to grow Developing represent 70% of production (by volume) Developing represent 70% of production (by volume) 38% of fish production enters international trade (by value) 38% of fish production enters international trade (by value) China is the main producing and exporting country, overtaking Thailand in 2003. China is the main producing and exporting country, overtaking Thailand in 2003.

48 Conclusion (cont.) Shrimp is the main commodity trade with 18% of total value. Shrimp is the main commodity trade with 18% of total value. Net-export earnings are very important source of income for developing countries. Net-export earnings are very important source of income for developing countries. Intra-developing countries is very limited at US$ 5 billion Intra-developing countries is very limited at US$ 5 billion

49 References Collier P., Dollar D. (2001). Can the World cut Poverty in Half? How Policy Reform and Effective Aid can meet International Development Goals. World Development 29 (11), 1787- 1802. COMEXT. (2004). Eurostat: Intra and Extra EU trade. CD Rom. Kurien, J. (2004). Responsible Fish Trade and Food Security. www.globefish.org/dynamisk.php4? id=2168. www.globefish.org/dynamisk.php4? id=2168 www.globefish.org/dynamisk.php4? id=2168 Reardon T., Timmer P., Barrett C. & Berdegué J. 2003. The rise of supermarkets in Africa, Asia and Latin America. American Journal of Agricultural Economics 85 (5): 1140- 1146.

50 References (continued) Taric. (2004). WU taxation and Custom Union. www.europa.eu.int/comm/taxationcustom/dss/tarhome/htm. www.europa.eu.int/comm/taxationcustom/dss/tarhome/htm Tveteraas, R. (2004). The competition between aquaculture and agriculture in Europe. www.globefish.org/dynamisk.php4? id=2312. www.globefish.org/dynamisk.php4? id=2312 www.globefish.org/dynamisk.php4? id=2312

51 Reccomended further reading Globefish website: Globefish website: www.globefish.org www.globefish.orgwww.globefish.org COFI Document: Status and Important Recent Events Concerning International Trade in Fisheries Products (including World Trade Organization): COFI Document: Status and Important Recent Events Concerning International Trade in Fisheries Products (including World Trade Organization): ftp://ftp.fao.org/fi/document/COFI/cofift_9/2e.pdf ftp://ftp.fao.org/fi/document/COFI/cofift_9/2e.pdfftp://ftp.fao.org/fi/document/COFI/cofift_9/2e.pdf Fish Trade Issues In Wto And Acp-Eu Negotiations, by Aundun Lem Fish Trade Issues In Wto And Acp-Eu Negotiations, by Aundun Lem http://www.globefish.org/index.php?id=2251 http://www.globefish.org/index.php?id=2251http://www.globefish.org/index.php?id=2251


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