Ocean wars that no one can win

Spain and Canada's clash is no sideshow. Over-fishing could have serious global consequences Instead of restricting fleets, governments have restricted catches - a recipe for cheating

There is an element of high farce in the new fish war between Spain and Canada. That a Spanish trawler should be impounded by the Canadian authorities for allegedly catching "juvenile" fish off the Newfoundland coast might seem familiar. The Spaniards are always getting into trouble over fish - usually, and very recently, with Britain. But the absurdity is highlighted by the idea that Spain's retaliation should be to require Canadian visitors to obtain visas. When the Spanish seem happy enough to take our criminals and lager louts, it seems odd that they should seek to exclude elderly, peaceable Canadian tourists.

Farce maybe, but tragedy, too. And at three levels: politics, economics, and conservation.

The political issue first. This happens to be one fishing row in which Britain is not directly involved. But we are indirectly, because as law-abiding members of the European Union we happen to be taking the side of the Spaniards. The precise legal position is (as so often) pretty unclear, but most people here will probably have a strong suspicion that we are being forced to support the wrong side. This is not just on the "kith and kin" argument, nor even because Canada is a member of the Commonwealth, but mostly because our sense of natural justice would seem to give Canada the benefit of the doubt on two counts. First, it should be able to control fishing off its coast; even if the dispute is just outside Canada's territorial waters, the fish don't know that. Second, it looks very much as though the Spanish are cheating.

Besides, it is difficult not to feel some respect for Canada. If only we could do the same. We, too, have off our shores a large chunk of continental shelf, the richest form of fishing waters. If only we could control these waters so that our own fishing industry could benefit, instead of allowing countries which have not traditionally fished there to come in because their own waters have been fished out. Not only would our own industry benefit in the short-term; we would be better able to conserve stocks for the future.

To put the argument in those terms may not be wholly fair, but it is how many people will feel. The political impact of the row is to remind us that, though some of our industries may have gained by EU membership, others have lost. Fishing is one of our industries which has lost the most.

From an economic standpoint, fishing is an area of commercial endeavour where the market works particularly badly. As an industry it loses money: the United Nations' affiliate, the Food and Agriculture Organisation, reckons the industry's annual losses are running at $54bn, losses which, as the FAO points out, are largely met by taxpayers. Governments give subsidies to build ships, and of course too many ships are built, so there have to be subsidies to stop the fishermen taking them out to sea. The problem is that fishing boats cannot easily be transferred to other uses - trawlers do not make good cruise liners. The result is that once a ship has been built, provided it can cover its variable costs, there is a strong financial case for putting it to sea. The result is overfishing.

Overfishing is both an economic and an environmental concern. For the industry as a whole, overfishing is gravely damaging, because it cuts the long-term catch. But for an individual operator it makes sense. There is no financial incentive to the individual skipper to keep his boat in harbour as a contribution to conserving stocks -someone else will simply go out and take the fish he would have caught.

The economist would point to two possible solutions. One would be to create property rights for fishermen. If they "owned" a chunk of waters, it would be in their interest to conserve the fish in it, taking only the optimal number out each year, for they would benefit from any rise in the value of the stock of fish. This system has been used successfully for shellfish beds, as shell-fish do not move about much. But it is very difficult to make it work in the ocean, though Australia in particular is trying to establish such schemes.

A second solution would be to restrict the growth of the industry. The best way of so doing is to restrict the size of the fishing fleets so that the value of the capital stock is held down and the stock is used efficiently. Alas, most governments have failed to do so, even though since 1976 the law of the sea has allowed countries to claim fishing rights for 200 miles off their coast. It is within these areas that the best fishing is to be had, on the nutrient-rich continental shelves. The open ocean, which is still free for anyone to fish, is by contrast pretty much of a desert.

Instead of restricting fleets, governments have used their power over these waters to restrict catches. Aside from being inefficient (the EU's fleet could still catch its full quota of fishwere it 40 per cent smaller), this is a recipe for cheating, rows over net size, and arguments about enforcement. It has been estimated that more than 30 per cent of the world's catch is illegal and sold for cash outside the regular markets - which goes some way to explaining why ships stay at sea, even though on paper they are losing vast amounts of money. Restricting catches (rather than fleets) is also a poor way of encouraging conservation: unprofitable fish caught in the nets are often simply dumped.

And so to the final concern: the environment. The fishing row co-incides with a new study in today's issue of Nature magazine. Until now, the mainstream view about the world's sustainable catch has been that we are roughly at the limits of what can be taken out of the oceans without endangering future fish stock levels. Some people argue that we are already beyond those limits: the world's catch has been declining since 1989. The new study is even more alarming, for it looks at the whole ocean eco-system. It argues that we are not just taking too many fish, we are unbalancing the whole food chain of the various types of fish in the ocean.

The frustrating element here is that, despite all the uncertainty about the sustainable level of fishing, we really do know what should be done: we should start by cutting subsidies. As it is we have the worst of all worlds: taxpayers paying large subsidies, fishing wars, dwindling stocks, reduced diversity of species, and more and more expensive fish.

For us here in the rich world this may be bearable. We can pay the silly subsidies, put up with the bad behaviour of the Spaniards (and others), rely more on fish-farming, pay the higher prices. But for much of the developing world, which relies on fish as a primary source of protein, the prospect is not one of inconvenience. It is one of hunger. This isn't just a row about Canada and Spain. It is about feeding the world's growing population. If there is a serious decline in the global fish catch over the next generation, it will be the rich world's fault.