Potential Welfare Impact of Fishery Subsidy Removal

The main objective of this paper is to analyze the potential economic impact of fisheries subsidies removal in case of applying the World Trade Organization’s (hereinafter “WTO”) agreement on fisheries subsidies. The existence of substantial annual global amounts of fisheries subsidies contributes to unsustainable levels of fishing capacity. It is estimated that more than one-third of the world’s fish stocks are overexploited. Although an initial WTO subsidy agreement was reached at the twelfth ministerial conference on 17 June 2022, up to date twenty percent of additional WTO members are needed to submit acceptance for the agreement on fisheries subsidy to come into effect.
Analytically, the final effects of subsidy removal will depend on time horizon, spatial scale, and social and political context. The potential dynamic impact of fishery subsidy removal is a complex issue with a wide range of potential outcomes. Some of the most likely impacts include increased fish stocks, increased competition, improved fish welfare, increased food security, decreased illegal fishing, temporary Job losses, and Increased prices.
Based on the partial economic analysis adopted in this study, the potential net welfare impact of fishery subsidy removal is expected to be positive for both exporting and importing countries. Furthermore, the study provided many economically rational justifications for countries to abandon fisheries subsidies. In light of the study findings, policymakers in all countries are strongly recommended to take the necessary steps needed to finalize the WTO’s fisheries agreement.

Link: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4779953