FISHING FOR TUNA: THE OPERATION OF DISTANT-WATER FLEETS IN THE PACIFIC ISLANDS REGION

RESEARCH REPORT SERIES No. 3 FISHING FOR TUNA: THE OPERATION OF DISTANT-WATER FLEETS IN THE PACIFIC ISLANDS REGION by David J. Doulman S3 EAST-WEST CENTER

FISHING FOR TUNA: THE OPERATION OF DISTANT-WATER FLEETS IN THE PACIFIC ISLANDS REGION by David J. Doulman 1986 Pacific Islands Development Program East-West Center 1777 East-West Road Honolulu, Hawaii 96848 U.S.A.

II : DAVID J. DOULMAN is a fellow with the Pacific Islands Development Program and project director of the Multinational Corporations in the Pacific Tuna Industry Project. He was formerly chief fisheries economist with the Government of Papua New Guinea. Doulman holds a Ph.D. in resource economics from James Cook University, Australia.

Hi List of Tables Preface CONTENTS Abstract '.. vi Introduction 1 Expansion and Development 5 Fleets and Catches 7 Longline fleets 7 Pole-and-line fleets 9 Purse seine fleets 10 1984 catches 13 Access Considerations 16 Agreements 19 Japanese agreements 21 U.S. agreements 25 Other agreements -28 Regional Cooperation 29 Nauru Group 30 Conclusion 33 Notes 35 References 37 iv v

iv TABLES Table 1. Selected statistics and information relating to Pacific island countries 2 Table 2. Gear type and country of registration of tuna vessels on FFA's Regional Register of Foreign Fishing Vessesls in 1985 8 Table 3. Estimated distant-water catches and value of catches by gear type and major fishing fleets in Pacific islands in 1984 14 Table 4. Ranking of estimated catches by distant-water fishing nation and estimated value of catches in Pacific islands region in 1984 15 Table 5. Distant-water fleet operations in Pacific islands region 19 Table 6. Distant-water fishing nation tuna access agreements with Pacific island countries in 1985... 20 Table 7. Japanese distant-water tuna fishing agreement with Pacific island countries 22 Table 8. Tuna access fees paid by Japan to Pacific island countries, 1978-82 24 Table 9. American Tunaboat Association agreements with Pacific island countries, 1981-85 26

V PREFACE At its inaugural meeting in Pago Pago in 1981, the Pacific Islands Development Program was directed by the Standing Committee of the Pacific Islands Conference to evaluate the potential beneficial role of multinational corporations in the Pacific islands region. In 1984 the Standing Committee again addressed the question of multinational corporations and approved that this study be undertaken on a sectoral basis, with trie tuna industry being the first sector to be examined. The tuna industry was selected as the first sector for investigation by the Standing Committee because the tuna fishery and industry in the Pacific islands region affects all countries and territories. The broad objectives of the tuna sectoral study are (1) to analyze the current and future role of multinational corporations in the tuna industry in the Pacific islands region, and (2) to evaluate the potential contribution these corporations could make to industry development in the region. This is the first time that a comprehensive study of the tuna industry in the Pacific islands region will focus on regional and international issues affecting the industry from the perspective of all island countries. A proposal outlining the tuna sectoral study was drawn up in 1984. This was done in consultation with the Forum Fisheries Agency, and research commenced in January 1985. The study will produce a range of technical reports that will address issues critical to the development, management, and expansion of tuna industries in the Pacific islands region. The Pacific Islands Development Program's tuna study is financially supported by the East-West Center, the United Nations Development Programme, the Australian Development Assistance Bureau, and the United States Agency for International Development.

vi ABSTRACT This publication describes and analyzes distant-water fishing operations in the Pacific islands region. It traces the expansion of the fishery, fleet operations, and catches in the exclusive economic zones of South Pacific Forum member countries and dependent territories. Access arrangements between distant-water fishing nations and Pacific island countries are reviewed. Information relating to agreements, classified by fishing method and country, is presented, with particular emphasis on Japan's access agreements in the region. The issue of regional fisheries cooperation among Pacific island countries is also discussed, including the role of the Nauru Group.

INTRODUCTION The Pacific islands region is a large and diverse area stretching from the Republic of Palau in the west to Pitcairn Island in the east. It has fourteen independent and self-governing countries together with eight British, French, New Zealand, and U.S. territories. The independent and self-governing countries are members or observers of the region's principal political grouping, the South Pacific Forum (SPF), and its Solomon Islands-based fisheries development and management arm, the Forum Fisheries Agency (FFA). All countries and territories in the Pacific islands declared exclusive economic zones (EEZs) between 1977 and 1984. Depending on individual circumstances, countries declared economic zones, fisheries zones, or, in some cases, both. The total area of the region's EEZs exceeds 30 million square kilometers (km 2 ), with the combined EEZs of SPF member countries accounting for approximately two-thirds of the total area (Table 1). As of December 1982 ten SPF member countries had signed the Law of the Sea Convention (Table 1). Large and commercially proven tuna resources exist within the Pacific islands region, with many of the established fishing grounds falling within the EEZs of SPF member countries (Clark 1986:151). Island countries focus on these resources as a means of encouraging distant-water fishing activity within their EEZs and, where possible, the development of domestic fishing and processing industries. Distant-water fishing nations enter into contractual arrangements with island countries in order to harvest the region's tuna stocks. Distant-water fishermen benefit from these arrangements by gaining secure and stable access to rich fishing grounds while island countries derive revenue and, in some cases, fisheries aid. The Pacific islands region is an internationally important tuna fishing area. In 1984 an estimated 650,000 tonnes of tuna of all species were harvested in the region, of which about 90.0 per-

Table 1. Selected statistics and information relating to Pacific island countries Status of 200 Year 2 0 0 6 a r e a Law of sea Country mile zone 3 declared^ ('000 km 2 ) 0 percent signatories* 1 South Pacific Forum member countries' Cook Islands Federated States of Micronesia^ Fiji Kiribati Marshall Islands Nauru Niue Palau Papua New Guinea Solomon Islands Tonga Tuvalu Vanuatu Western Samoa Sub-total Dependent territories American SamoaS French Polynesia* 1 GuamS New Caledonia economic 1977 fishing 1979 economic 1981 economic 1983 fishing 1979 fishing 1978 economic 1978 fishing 1979 fishing/economic 1978 fishing/economic 1978 economic 1979 economic 1984 economic 1978 economic 1977 economic 1977 economic 1978 economic 1977 economic 1978 1,830 6.0 yes 2,978 9.7 yes 1,290 4.2 yes 3,550 11.6 no 2,131 7.0 yes 320 1.0 yes 390* 1.3 no 629 2.1 yes 3,120 10.2 yes 1,340 4.4 yes 700 2.3 no 900 2.9 yes 680 2.2 yes 120 0.4 no 19,978 65.3 390 1.3 5,030 16.5 218 0.7 1,740 5.7

Northern Mariana IslandsS fishing/economic 1978-83 1,823 6.0 Pitcairn Island' fishing 1980 800 2.6 Tokelaul economic 1977 290 0.9 Wallis and Futuna h economic 1978 300 1.0 Sub-total 10,591 34.7 Total 30,569 100.0 J ' h Moore, Gerald. 1985. Limits of territorial seas, fishing zones and exclusive economic zones. Fisheries law advisory program circular no. 4. Food and Agriculture Organization of the United Nations. Rome. 8 p. c South Pacific Commission. 1984. (edition no. 7). South Pacific economies 1981: statistical summary. Noumea. 30 p. d United Nations. 1983. The law of the sea: United Nations convention on the law of the sea. New York. 224 p. Signatories as of December 10, 1982. The Trust Territory of the Pacific Islands (Federated States of Micronesia, Marshall Islands, Palau, Northern Mariana Islands) signed the convention as an observer. L 'Federated States of Micronesia, Marshall Islands, and Palau have applied or are eligible to apply for Forum membership. 'Federated States of Micronesia consists of four states: Kosrae, Pohnpei, Truk, and Yap. 8U.S. territories. h French territories. 'British territory. 'New Zealand territory.

4 Pacific Islands Development Program cent was taken by distant-water fishing fleets (Clark 1985b:2; French Polynesia 1986). The 1984 tuna catches in the region accounted for about 25.0 percent of world production, though in 1983 the proportion had been higher (35.0 percent) (Clark 1986:152). 1 Moreover, in 1985 world skipjack tuna (Katsuwonus pelamis) catches, the major canning species, stood at about 700,000 tonnes. Approximately 64.0 percent of the total was harvested by distant-water purse seine fleets operating in the western sector of the islands region (Forum Fisheries Agency 1986). Distant-water tuna fishing operations in the Pacific islands region were pioneered by Japanese fishermen. Initially, distantwater operations were confined to pole-and-line fishing, but in time longline and purse seine fisheries were developed. As Japanese fishermen demonstrated the viability of distant-water operations, tuna fleets from other nations joined f the fisheries. Against this background, this paper briefly reviews the expansion and development of the region's distant-water tuna fishery in the Pacific islands region. The status of longline, pole-and-line, and purse seine fleets is discussed, and the estimated catch and catch values for 1984 are analyzed. The next sections of the paper focus on access considerations and fisheries agreements between island countries and distant-water fishing nations. The need for, and benefits from, regional cooperation among island countries are considered and some conclusions made about the future direction of the distant-water tuna fishery in the region.

EXPANSION AND DEVELOPMENT Around 1910, Japan's tuna fleets started to move offshore in search of new and less exploited fishing grounds, and by 1922 pole-andline fleets were well established in Micronesia (Matsuda and Ouchi 1984:144). In 1926 longline fishermen moved into Micronesian waters, and after 1927, when Micronesia became a Japanese mandated territory under the League of Nations, fishing operations in the area were strengthened. Shore facilities were established throughout Micronesia to service fleets, and by 1938 more than 7,600 Japanese tuna fishermen were operating in Micronesian waters (Matsuda and Ouchi 1984:159). World War II drastically reduced Japan's fishing capacity and operations in Micronesia, and from 1945 to 1952 the MacArthur Lines restricted the overseas movement of Japanese fishing fleets. However, the 1952 lifting of these restrictions, coupled with the 1953 enactment of legislation by Japan to vigorously promote distant-water fishing as a reconstruction activity, paved the way for the virtually unrestricted movement of Japanese distant-water tuna fleets into the Pacific islands region. 2 Initially, tuna fishing was reestablished in Micronesia, but with time fleets moved progressively farther south and eastward due to improvements in technology, vessel design and construction, government financial support for the industry, and strong market demand for tuna. By the early 1960s, tuna bases had been established as far south and east as American Samoa, Fiji, French Polynesia, and Vanuatu to support Japanese distant-water longline fleets fishing for albacore (Thunnus alalunga). In most cases these bases were established to supply tuna canneries in American Samoa, Hawaii, and on the U.S. west coast. The successful Japanese penetration of the Pacific islands region encouraged tuna longline fleets from Korea and Taiwan to follow. Japanese albacore fleets were gradually replaced by Korean and Taiwanese fleets as the Japanese longliners began to concentrate on more valuable Sashimi (fresh fish) tuna species 5

6 Pacific Islands Development Program (Clark 1985a:22). In some cases, Japanese trading houses were instrumental in facilitating the deployment of Korean and Taiwanese fleets and the replacement of Japanese vessels. The rising demand for canned tuna in the 1960s and 1970s, the desire to eliminate bait problems associated with pole-andline fishing, and the demonstrated labor and fuel efficiency of purse seine fishing, partially prompted the Japanese government to initiate exploratory purse seine fishing in the Pacific islands in 1974. 3 Initial purse seine surveys in the region were undertaken around Palau and in the waters north of Papua New Guinea (Watanabe 1983:3). These and later surveys in the Pacific islands produced encouraging results, and it was found that purse seining could be undertaken throughout the year. The survey results led to the full-time deployment of commercial Japanese seiners in the Pacific islands in 1976 for the first time. 4

FLEETS AND CATCHES All foreign vessels operating in SPF member countries must be registered on the FFAs Regional Register of Foreign Fishing Vessels. As a matter of policy, SPF member countries do not license distant-water vessels under their respective access agreements with distant-water fishing nations if vessels do not have good standing on the Regional Register. 5 In 1985 there were 1,456 distant-water fishing vessels listed on the register, of which longliners accounted for 77.5 percent, pole-and-line vessels 7.7 percent, single purse seiners 10.2 percent, group purse seiners 0.8 percent, and other vessels 4.1 percent (Table 2). Longline fleets Distant-water longline fleets from at least seven countries operate in the Pacific islands region (Table 2). In 1985, 1,128 longliners were included on the Regional Register. However, this number does not accurately reflect the number of vessels operating in the region because (1) it includes Japanese longliners that operate in the Australian/New Zealand southern bluefin fishery, and (2) it probably excludes some or all of the Japanese and Korean longline vessels that operate in the French territories. 6 Longline vessels operating in the Pacific islands range in size from 20 to 300 Gross Registered Tonnes (GRT). In 1985, 48.4 percent of longliners listed on the Regional Register were less than 100 GRT, while 64.7 percent were less than 200 GRT (Clark 1986:158). In SPF member countries, the longline fleets predominantly fish in Micronesia, Papua New Guinea, and Solomon Islands, though larger class vessels also operate in the southern portion of the region for example, in the Cook Islands' EEZ. In the territories, the Japanese (113 vessels) and Korean (55 vessels) longline fleets are 150-300 GRT class vessels. Depending on flag and location of operations in the region, longline fleets concentrate on albacore or sashimi tuna species. 7

Table 2. Gear type and country of registration of tuna vessels on FFA's Regional Register of Foreign Fishing Vessels in 1985 a Gear type Pole-and- Purse seine Purse seine Registration Longline % line % (single) % (group) b % Other % Total % c Cayman Islands 3 3 0.2 Honduras 2 2 0.1 Indonesia 1 1 0.1 Japan 891 112 33 9 41 1,086 74.6 Korea 95 9 104 7.1 Mexico 2 2 0.1 New Zealand 2 2 0.1 Panama 19 6 25 1.7 Philippines 13 2 15 1.0 Taiwan 115 4 2 13 134 9.2 USA 60 60 4.1 USSR 3 13 1 17 1.2 Unknown 3 2 5 0.3 Total 1,128 77.5 112 7.7 146 10.2 11 0.8 59 4.1 1,456 100.0 "Extracted from Clark (1986:157). b Does not include non-fishing vessels, that is, fish carrier and support vessels. ^Percentage totals might not add to 100.0 due to rounding.

Fishing for Tuna 9 The Japanese longline fleet is the largest fleet operating in the Pacific islands (Table 2). According to Clark (1986:154), between 500 and 600 Japanese vessels currently operate in the fishery under close regulation by Japan's Fishery Agency. Vessels discharge their catches at three main ports in Japan Yaizu, Misake, and Shimizu (Clark 1985b:4). Korea and Taiwan also have sizable longline fleets operating in the Pacific islands. Traditionally, these fleets have targeted on albacore for the U.S. canning market, but more recently they have been directing their efforts toward producing fish for Japan's more lucrative sashimi market. This change in direction is apparent from data relating to Japan's imports of tuna from Korea and Taiwan. In 1972 Japan imported about 22,000 tonnes of tuna from Korea and 15,000 tonnes from Taiwan. By 1982, however, imports from Korea had grown to 56,000 tonnes and from Taiwan to 31,000 tonnes (Matsuda and Ouchi 1984:195). This trend is expected to continue because (1) Korean and Taiwanese fishing costs are lower than those of Japanese fishermen, and (2) Japanese trading companies frequently contract and finance Korean and Taiwanese fleets. 7 Pole-and-line fleets All distant-water pole-and-line tuna fishing in the Pacific islands region is undertaken by Japanese fishermen. In 1985, 112 poleand-line vessels were eligible to be licensed by SPF member countries under access agreements with Japan (Table 2). The majority of these vessels (3.8 percent) were over 200 GRT (Clark 1986:158). Approximately 80 pole-and-line vessels currently operate in the islands region from ports in Japan carrying "hardened" live baitfish. The vessels fish in the EEZs of Micronesian countries (including Kiribati) and, despite being permitted by agreement, rarely fish in Papua New Guinea's EEZ (Doulman and Wright 1983:56). The pole-and-line fleet concentrates on surface swimming schools of tuna: skipjack and juvenile yellowfin (Thunnus albacares). According to Japanese industry reports, the species composition of pole-and-line catches averages approximately 94.0 percent skipjack and 6.0 percent yellowfin (Doulman and Wright 1983:56).

10 Pacific Islands Development Program Tuna landed by Japan's pole-and-line fleet normally goes to higher quality uses than canning. In particular, pole-and-line caught tuna is used to produce smoke and dried products as well as tataki (sashimi lightly grilled over straw). In this regard poleand-line caught fish which is more costly per unit of output than purse seine caught tuna is not competing with the purse seine product. For price reasons, if pole-and-line caught fish was competing with the purse seiner product in the marketplace, the distant-water pole-and-line fleet would be quickly rendered obsolete. Since the early 1970s, distant-water pole-and-line fishing has declined markedly in the Pacific islands region. Ishida (1975) reported that about 500 pole-and-line vessels were operating in the western Pacific in 1973, but by 1979 the size of the fleet had dropped to 300 vessels. By 1981 the size of the fleet had been further reduced to 120 vessels (Papua New Guinea 1982:10). The reduction in the size of Japan's pole-and-line fleet has been due to technological advances in fishing (i.e., the rise of purse seining) and increasing fuel and labor costs, as well as to the Japanese government's pole-and-line replacement program. 8 Matsuda and Ouchi (1984:197) show that rates of return on gross income for, and capital invested in, Japan's pole-and-line fleet deteriorated significantly between 1972 and 1982. In 1972 the rates of return on gross income for, and capital invested in, distantwater pole-and-line vessels in the 200-500 GRT class were 4.2 percent and 3.0 percent, respectively. However, by 1982 the corresponding returns were -18.6 percent and -13.9 percent, respectively. Japan's distant-water pole-and-line fleet is expected to decline further despite efforts by industry and government to sustain its current level. The extent and rate of the decline of the fleet will be determined by both the demand for higher quality skipjack in Japan and the ability of the pole-and-line fleet to deliver reasonably priced fish to meet that demand. Purse seine fleets In 1980 the Japanese single purse seine fleet in the Pacific islands, consisting of 14 vessels, was joined by Japanese group seiners (five vessels) and single seiners from several other countries

Fishing for Tuna 11 (Doulman and Wright 1983:54). The fleet expanded rapidly in the early 1980s, peaking in 1984. According to Franklin (1982:18), from 68 to 72 seiners fished in the region in 1981, but by 1984 the number of single seiners exceeded 115 (Doulman 1986a). The number of seiners declined in 1985 and 1986, primarily because fewer U.S. vessels were deployed in the central and western Pacific. 9 The Regional Register of Foreign Fishing Vessels had 146 single purse seiners registered in 1985 (Table 2). Seiners range in size from 300 GRT vessels to super-seiners of over 2,000 GRT. In 1985, 27.4 percent of the fleet was less than 500 GRT, 29.5 percent was between 500 and 1,000 GRT, 27.4 percent was between 1,000 and 2,000 GRT, and 15.8 percent was greater than 2,000 GRT (Clark 1986:158). The fleet came from 11 countries, though 63.6 percent of the registered vessels were from Japan and the United States. While it is possible that the number of purse seiners on the Regional Register could increase, the number of registered vessels operating in any year is expected to be significantly below the number actually registered. As a result of the continuing reduction in the size of the U.S. fleet, the number of seiners operating in the region in the future probably will not exceed the number of seiners that fished in 1984. 10 The purse seine fleet operating in the Pacific islands is characterized by a "core" fleet of vessels consisting of the entire Japanese fleet and about 15 seiners of other flags. This core group of vessels operates throughout the year. In addition, a "floating" fleet component is highly mobile and operates both within the islands region and outside. The core purse seine fleet fishes almost exclusively in the EEZs of the Federated States of Micronesia, Palau, and Papua New Guinea, as well as the high seas pocket between these zones. The floating component of the fleet not only fishes in the zones of these same three countries, but also operates quite extensively around Nauru, Kiribati, and elsewhere. In contrast to the operations of distant-water longline and pole-and-line fleets in the Pacific islands region, a significant proportion of the tuna harvested by the purse seine fleet is transshipped or discharged in the region, but not within SPF member countries. Purse seine caught tuna is transshipped at Guam

12 Pacific Islands Development Program and Tinian (Northern Marianas) for carriage to canneries in American Samoa and Puerto Rico or, alternatively, is discharged directly by the seiners at the American Samoan canneries. Tuna caught by the Japanese purse seine fleet is usually taken to Japan at the completion of each fishing trip. The fleet is based at the ports of Yaizu and Shimizu where catches are discharged. Some of the purse seine product is processed in Japan, but a significant proportion is exported to the United States and elsewhere (e.g., Thailand) for canning. Despite the Japanese government's policy of actively discouraging the transshipment of tuna landed by Japanese flag vessels at foreign ports, pressure from purse seine owners to change this policy has resulted in limited transshipment at Tinian since 1984. In discouraging overseas transshipment of tuna, the Japanese government is better placed to regulate the activities of its purse seine fleet and internal market conditions. Purse seine vessels operating in the Pacific islands concentrate on skipjack and associated yellowfin schools. With their 599 GRT vessels, the Japanese fleet typically averages 30-35 tonnes of tuna per day, while the average catches of larger vessels are 40-50 tonnes per day. The species composition of the purse seine catch for smaller class vessels is approximately 70.0 percent skipjack and 30.0 percent yellowfin, while the larger seiners average 60.0 percent skipjack and 40.0 percent yellowfin and other deep sea pelagic species (e.g., bigeye [Thunnus obesus] and billfish). The difference in species composition between the smaller and larger vessels is primarily a function of the size.of nets used. Larger class vessels can use deeper nets, which enable fishermen to harvest a higher percentage of deep sea species. Eleven group seiners and their support and carrier vessels are registered on the Regional Register of Foreign Fishing Vessels (Table 2). These seiners operate seasonally in the Pacific islands region, usually for about four months each year (February to May) (Doulman and Wright 1983:54). Nine of the group seiners are Japanese. The seiners confine their operations to the Federated States of Micronesia and Papua New Guinea, though one group owned by Taiyo Gyogyo, the Japanese joint venture partner in Solomon Islands operates each year in Solomon Islands waters.

Fishing for Tuna 13 Group seine caught tuna is mainly sold to U.S. canners for processing, some of which is transshipped through Guam. 1984 catches Distant-water tuna fleet catches in the Pacific islands region in 1984 were estimated to be 598,720 tonnes (Table 3). Catches were estimated to have a market value of US$662.7 million. Longline fleet catches totaled 148,620 tonnes (24.8 percent of total catches) and were valued at $385.4 million (58.2 percent of total value), the pole-and-line catch totaled 75,100 tonnes (12.5 percent) valued at $41.3 million (6.2 percent), and the purse seine catch totaled 375,000 tonnes (62.6 percent) valued at $236.0 million (35.6 percent). Longline fleet catches were dominated by yellowfin (53,600 tonnes or 36.1 percent of the longline catch) and albacore (55,320 tonnes or 37.2 percent). The Japanese longline fleet harvested a total of 79,500 tonnes of fish (53.5 percent of the longline catch) for an estimated market value of US$256.1 million (66.5 percent of the value of the longline catch) (Table 3). Korean and Taiwanese longline catches were principally albacore (55,320 tonnes or 37.2 percent of the total longline catch) (Table 3). The estimated value of the Korean and Taiwanese catch in 1984 was US$90.9 million (23.6 percent of the total valuie of the longline harvest). Other nations took an estimated 12,800 tonnes of longline fish (8.6 percent of the longline catch) in the islands region in 1984 at an estimated market value of $38.4 million (10.0 percent of the value of the longline catch). Skipjack caught by the Japanese pole-and-line fleet in 1984 was estimated to be 75,100 tonnes (12.5 percent of total catches) (Table 3). The value of the catch was estimated to be US$41.3 million (6.2 percent of the total value of tuna harvested). The purse seine fleet in 1984 produced the highest catch of the three tuna fisheries, with 71.7 percent being skipjack (269,000 tonnes) and 28.2 percent yellowfin (106,000 tonnes) (Table 3). Fiftyfive percent of the purse seine catch (208,000 tonnes) was taken by the U.S. fleet at an estimated value of US$131.8 million. The Japanese purse seine fleet was ranked second with 141,000 tonnes (37.6 percent of the purse seine catch) valued at $87.7 million. Purse

Table 3. Estimated distant-water catches and value of catches by gear type and major fishing fleets in Pacific islands region in 1984 a Catch (tonnes) % of total Value % of total Gear Skipjack Yellowfin Bigeye Albacore Billfish Total. catch b US$m value Longline Japan Korea/Taiwan Other 40,800 12,800 30,500 55,320 8,200 1,000 79,500 56,320 12,800 256.1 90.9 38.4 Sub-total Pole-and-line Japan Sub-total 75,100 75,100 53,600 30,500 55,320 9,200 148,620 24.8 75,100 75,100 12.5 385.4 58.2 41.3 41.3 6.2 Purse seine Japan USA Other Sub-total Total 105,000 146,000 18,000 269,000 344,100. 36,000 62,000 8,000 106,000 159,600 30,500 55,320 9,200 141,000 208,000 26,000 375,000 598,720 62.6 100.0 87.7 131.8 16.5 236.0 662.7 35.6 100.0 a Catch estimates based on data extracted from Clark (1985b:2) and on actual catch data supplied by French territories. Catch valuations are based on 1984 average prices (by species and end use) at major landing points in Japan. Prices are taken from Clark (1985b:3). 'Percentages might not add to 100.0 due to rounding.

Fishing for Tuna 15 seiners from other nations harvested 26,000 tonnes of tuna (6.9 percent of the total) at a estimated value of $16.5 million. Overall, Japan remained the leading distant-water fishing nation in the Pacific islands region in 1984 in terms of both catches and catch values (Table 4). Japan's tuna fleets harvested an estimated 295,600 tonnes of fish (49.4 percent of total catches) for an estimated value of US$385.1 million (58.1 percent of total value). Although it began operations in the region only in 1980, the U.S. fleet ranked second. U.S. catches of 208,000 tonnes (347 percent of the total) were valued at $131.8 million (19.9 percent of total value). Korean and Taiwanese fleets harvested an estimated total of 56,320 tonnes of fish (9.4 percent) for $90.9 million (13.7 percent). Fleets of other distant-water fishing nations took 38,800 tonnes (6.5 percent) at a value of $8.3 million (Table 4). Table 4. Ranking of estimated catches by distant-water fishing nations and estimated value of catches in Pacific islands region in 1984 a Catch Value Country Tonnes % US$m % Japan' 295,600 49.4 385.1 58.1 USA 208,000 34.7 131.8 19.9 Korea/Taiwan 56,320 9.4 90.9 13.7 Other 38,800 6.5 54.9 8.3 Total 598,720 100.0 662.7 100.0 Consolidated from data contained in Table 3.

ACCESS CONSIDERATIONS Prior to the introduction of extended jurisdiction in the Pacific islands region, distant-water fishing nation fleets fished virtually unhindered. The situation changed, however, when island countries declared EEZs. This change meant that distant-water fishing nations were required (1) to cooperate with Pacific island countries in exploiting the region's tuna resources, and (2) to pay a fee for fish harvested. This situation led to the conclusion of fishing access agreements between distant-water fishing nations and island countries. In entering into these agreements, distantwater fishing nations acknowledged (1) the sovereignty of island countries over tuna stocks within their respective EEZs, and (2) the right of island countries to regulate and control the exploitation of their tuna stocks. Pacific island countries license distant-water fishing nation fleets largely out of self-interest. Countries seek formal arrangements with distant-water fishing nations because (1) their capacity to commercially harvest tuna is small or non-existent, (2) they derive financial benefits from such arrangements, and (3) they recognize Law of the Sea Convention (Article 56) obligations with respect to the utilization of surplus fish stocks within their respective EEZs. In licensing distant-water fleets, island countries essentially view their tuna stocks as a tradable commodity. They are prepared to sell harvesting rights, and in so doing, most countries attempt to derive maximum financial returns. The French territories adopt a slightly different approach to the SPF member countries in licensing distant-water fleets in that their principal objectives are non-monetary. In cooperating with distant-water fishing nations, the territories seek the transfer of technology, training, research, and assistance in the development of domestic tuna industries rather than immediate financial returns. Distant-water fishing nations, on the other hand, have tuna fishing fleets, management and marketing expertise, and often 16

Fishing for Tuna 17 access to markets. But in many cases they possess limited tuna resources in relation to the size of their fishing fleets. Therein lies the basis for cooperation with Pacific island countries. In return for access and harvesting rights, distant-water fishing nations pay island countries predetermined access fees. Generally island countries seek to put their access arrangements on a commercial footing and to relate access fee payments to the value of tuna harvested by each class and type of vessel per period of time. Moreover, as a matter of policy, countries strive to appropriate at least 5 percent of the value of tuna harvested by way of access fee payments. In addition to access fee payments, distant-water fishing nations frequently offer development assistance to island countries as part of access packages. This assistance comes from public sources, and in this respect it represents a subsidy from the distant-water fishing nation government to its fishing industry. The assistance is usually designated for fisheries development projects, including the provision of goods and services, training, and research. The purpose of the aid is to promote more lenient access terms for distant-water fishing nation fleets than might otherwise be the case. However, Pacific island countries generally maintain that fisheries aid should not be directly related to access considerations and that as a matter of principle the two issues access and aid should be de-linked. Island countries also have expressed dissatisfaction over the quality and type of fisheries aid proposed and supplied by distant-water fishing nations. Often goods supplied for example, fishing vessels are inappropriate for either commercial fishing or research. Some training is unsuitable for fisheries officers and conditions in Pacific island countries, and in some cases it constitutes little more than a public relations exercise on the part of the distant-water fishing nation supplying it. Negotiated terms and conditions of access also form an integral and important component of all tuna access agreements in the Pacific islands region. These terms and conditions (1) govern the operations of distant-water fleets in the EEZs of licensing countries, and (2) define other responsibilities that must be accepted and adhered to by vessel operators. Agreements spec-

18 Pacific Islands Development Program ify terms and conditions relating to matters such as restricted fishing areas, license application procedures, vessel reporting requirements, submission of catch records, vessel identification, and the placement of observers on vessels. Failure to adhere to agreement terms and conditions can result in the imposition of penalties and, in the extreme, the removal of vessels from the Regional Register of Foreign Fishing Vessels. Licensing distant-water fishing fleets involves Pacific island countries in transaction (negotiation and administration) and surveillance costs. Island countries, in seeking to maximize net financial returns from their access arrangements, attempt to minimize these costs. Upward pressure on access fee levels can be expected if the returns to island countries are eroded by increased costs. It is therefore in the financial interests of distant-water fishing nations to insure that administration and surveillance problems for island countries are avoided. This can be best achieved by fostering a high degree of voluntary compliance by fishermen with access agreements. In the extreme, if costs exceed financial returns from agreements, there is no basis for cooperation by island countries. Under these circumstances it might be expected that countries would either terminate existing agreements or refuse to renew agreements in the future.

AGREEMENTS In 1985 eight SPF member countries and three dependent Pacific territories had tuna access agreements with distant-water fishing nations (Table 5). The agreements covered the three principal fishing methods: longlining, pole-and-lining, and purse seining. All Pacific island countries listed in Table 5 have access agreements covering longline operations. It is this high-value fishery that brings the largest number of island countries into contact with distant-water fishing nations. Furthermore, it is this fishery that generates the largest amount of access fee payments for island countries. Table 5. Distant-water fleet operations in Pacific islands region in 1985 a Country Longline Pole-and-line Purse seine South Pacific Forum member countries Cook Islands X Federated States of Micronesia X X X Kiribati X X X Marshall Islands X X Palau X X X Papua New Guinea X X X Solomon Islands X X Tuvalu X Dependent territories French Polynesia New Caledonia Wallis and Futuna X X X "Updated and extended from Clark (1985b) and based on distant-water fishing nation agreements with Pacific island countries and information supplied by French territories. Table does not include foreign vessels specifically contracted to Star-Kist (American Samoa), PAFCO (Fiji), Solomon Taiyo (Solomon Islands), and South Pacific Fishing Co. (Vanuatu). 19

20 Pacific Islands Development Program The number of island countries with agreements providing for surface fisheries pole-and-line and purse seine fishing is considerably smaller than that for longlining. All countries with active surface fisheries share two characteristics: (1) having a location on or near the equator, which' has the least seasonal variation in surface tuna stocks, and (2) being members of the subregional fisheries grouping, the Nauru Group. Six Pacific island countries had access agreements providing for distant-water pole-and-line vessels in 1985 (Table 5). The region's purse seine fishery was confined to the EEZs of four countries, though some distant-water fishing nations would welcome the opportunity to have the same geographic area of operation as the pole-and-line fleet. However, this change is not likely because (1) the Marshall Islands and Solomon Islands opt not to license purse seine vessels, and (2) in the case of the Japanese fleet, the Japanese government does not currently permit seiners to operate beyond 166 E. Five distant-water fishing nations had access agreements with Pacific island countries in 1985 (Table 6). Notably absent was the Table 6. Distant-water fishing nation tuna access agreements with Pacific island countries in 1985 Country japan Taiwan Korea USSR Mexico South Pacific Forum member countries Cook Islands X X Federated States of Micronesia X X X X Kiribati. X X X Marshall Islands Palau X Papua New Guinea X X Solomon Islands Tuvalu Dependent territories French Polynesia X X X New Caledonia X X Wall is and Furuna X X Sources: Compiled from distant-water fishing nation agreements with Pacific island countries and information supplied by French territories. X X X

Fishing for Tuna 21 United States, despite the fact that U.S. seiners are important operators in the region. The leading distant-water fishing nation, Japan, had agreements with ten island countries; Taiwan with seven, Korea with three, and the USSR and Mexico with one country each. In recent years the region's agreements with Japan, Taiwan, and Korea have been fairly stable, though Mexico (1984) and USSR (1985) are newcomers to the region. Mexico is looking to deploy part of its overcapitalized purse seine fleet in the Pacific islands, and according to its officials, Mexico is interested in entering into arrangements with island countries on more than a distant-water fishing basis. The USSR is also keen to broaden its tuna fishing operations in the Pacific islands region, and it is prepared to participate in shore-based fisheries development where feasible and possible. Other island nations are expected to take Kiribati's 1985 lead and enter into fisheries arrangements with the USSR. Japanese agreements In 1978 Papua New Guinea was the first Pacific island country to conclude a tuna access agreement with Japan (Table 7). Initially, the agreement was with the Japanese government, but following its break-off in 1979, an arrangement was established with industry in 1981. Shortly after the conclusion of the Papua New Guinea agreement, the Japanese government entered into access agreements with Solomon Islands and Kiribati. Between 1978 and 1981, Japan concluded bilateral agreements with nine Pacific island countries and territories. At first, Japanese access fees in the islands region were based on a guaranteed lump sum payment system. However, Papua New Guinea and Solomon Islands changed to a per vessel and trip system in 1979. The demonstrated financial advantages of this system despite increased administration costs stirred interest among Pacific island countries. The system's flexibility and "payas-you-go" approach also found favor with Japanese industry. Consequently, in 1984 the Federated States of Micronesia, Kiribati, and the Marshall Islands moved to a vessel/trip system of determining access fee payments, though Palau and the French territories retained the lump sum payment approach. According to French territorial officials, the territories are likely to change to

Table 7. Japanese distant-water tuna fishing agreement with Pacific island countries 3 Vessel/ Year Basis of Calcula catch - com lump tion per Vessels restric Country menced sum vessel Aid Status licensed tions Duration 1 * South Pacific Forum member countries Federated States of Micronesia 1981 1981 1984 yes industry c,d,e yes 1-year Kiribati 1978 1978 1984 yes government c,d yes 1-year Marshall Islands 1981 1981 1984 yes government cd yes 1-year Palau 1981 1981 yes industry c,d,e yes 1-year Papua New Guinea' 1978 1978 1979 no industry c,d,e no open-ended Solomon Islands 1978 1978 1979 yes government c,d yes 1-year Dependent territories^ French Polynesia 1979 1979 yes government cd yes 1-year New Caledonia 1979 1979 yes government cd yes 1-year Wallis and Futuna 1979 1979 yes government c,d yes 1-year ^Compiled from Matsuda and Ouchi (1984) and various Japanese agreements with Pacific island countries. b One-year renewable agreements are subject to annual negotiation. c Longline. d Pole-and-line. Turse seine. 'The 1978 agreement was with the Japanese government. From 1979 the agreement has been with Japanese industry. ^French territories worldwide are covered under a single agreement between the government of Japan and the government of France. While the agreement provides for the licensing of longline and pole-and-line vessels in the Pacific French territories, only longline vessels generally operate. However, Japanese distant-water pole-and-line vessels operated on a limited basis in New Caledonia during 1979-84, French Polynesia during 1981-83, and Wallis and Futuna in 1981.

Fishing for Tuna 23 a vessel/trip system in 1987, and Palau is also expected to follow the other SPF member countries. All countries in the islands region, except Papua New Guinea, receive fisheries developmental assistance as part of their access agreements with Japan (Table 7). Papua New Guinea has refused aid in the past because it maintained that fisheries access should be negotiated on strictly commercial terms and that aid should be considered and granted independently of access considerations. A 1986 policy change in Papua New Guinea with respect to tied-aid could mean that aid will be accepted as part of future access agreements. Apart from the Federated States of Micronesia and Papua New Guinea, Japan's access agreements with island countries are concluded on a government-to-government basis (Table 7). There are distinct advantages in.having government-to-government agreements because diplomatic pressure can be brought to bear by island countries should problems arise with the administration and enforcement of agreements. Papua New Guinea has indicated a desire to conclude future agreements with the Japanese government and where possible with the governments of other distant-water fishing nations but this initiative has meet with some resistance from Japan's Fishery Agency. Japan's access agreements with six Pacific island countries provide for the licensing of longline and pole-and-line vessels, while three agreements provide for longline, pole-and-line, and purse seine fleets (Table 7). Apart from Papua New Guinea's agreement, all other agreements provide for restrictions. Restrictions usually consist of two types: ceilings on the number of vessels that can be licensed and deployed in agreement periods or, alternatively, restrictions on the quantity of tuna that can be harvested. Japanese agreements with Pacific island countries are usually concluded for one year and are subject to renegotiation and renewal. However, Papua New Guinea has an open-ended agreement that continues in force until either the Japanese industry or the Papua New Guinea government gives three months' notice of its intention to terminate it. The agreement contains provisions for periodic review and adjustment so that Papua New Guinea is not disadvantaged through becoming locked into a static agreement. The open-ended nature of Papua New Guinea's agreement has

24 Pacific Islands Development Program relieved the pressure and cost of holding annual negotiations within particular time periods, and for this reason other countries in the region are expected to adopt an open-ended approach in the future. Access fees paid to Pacific island countries by Japan for the period 1978-82 are consolidated in Table 8. Between these years Japan paid a total of US$49.5 million to all countries in access fees, of which $24.1 million (48.7 percent) was paid to SPF member countries and $3.2 million (6.5 percent) to dependent territories in the islands region (Table 8). Overall from 1978 to 1982, Japan paid $27.3 million to Pacific island countries in access fee payments or 55.2 percent of its total access payments. Since 1982 Japanese access fee payments to Pacific island countries have been progressively negotiated upward to more accurately reflect catch values at landing points in Japan. This ad- Table 8. Tuna access fees paid by Japan to Pacific island countries, 1978-82 3 Access fees Country Country US$m % of total ranking South Pacific Forum member countries Federated States of Micronesia 8.7 1 Kiribati 3.4 4 Marshall Islands 3.7 3 Palau 1.4 7 Papua New Guinea 5.3 2 Solomon Islands 1.6 6 Sub-total 24.1 48.7 Dependent territories French Polynesia 2.6 5 New Caledonia 0.4 8 Wallis and Futuna 0.2 9 Sub-total 3.2 6.5 Total fees (Pacific islands) 27.3 55.2 Total fees (all countries) 49.5 100.0 a Extracted from Matsuda and Ouchi (1984:205) and from information supplied by French territories.

Fishing for Tuna 25 justment has been possible because of increased flows of catch, landing, and market information to island countries. The increased information has enhanced the negotiating positions of island countries and directly affected the financial returns that they derive from licensing distant-water tuna fleets. According to a senior Japanese official, Japan's total access fee payments to the 16 countries with which it had access agreements in 1985, were approximately US$40.0 million, and between 30 and 40.0 percent was paid to Pacific island countries. 11 Moreover, fisheries aid disbursements associated with access agreements in 1984 were approximately $1.0 million, of which 50.0 percent went to countries in the region. U.S. agreements A small number of U.S. purse seiners moved into the Pacific islands region in the late 1970s and commenced fishing operations on a trial basis in Micronesia and, to a lesser extent, in Papua New Guinean waters. Initially the U.S. fishermen encountered difficulties in adapting to the different fishing conditions in the region, but with time they were able to match the seining skills of the Japanese and to make substantial catches (Doulman and Wright 1983:54). All U.S. fisheries agreements with Pacific island countries have been concluded between island governments and U.S. industry the American Tunaboat Association (ATA). And apart from the 1982 agreement with Papua New Guinea, all agreements have been concluded on a multilateral basis. The first ATA agreement in the region was concluded with the Federated States of Micronesia, the Marshall Islands, and Palau from July 1980 to June 1982 (Table 9). The agreement was extended on an interim basis to December 1982 in anticipation of a broader multilateral agreement to be concluded in 1983. In March 1982 following the apprehension of the U.S. seiner Danica for illegal fishing in Papua New Guinea's EEZ Papua New Guinea entered into a nine-month access agreement with the ATA. This was necessary in order to have a U.S. tuna embargo lifted on Papua New Guinea's tuna exports (Doulman and Wright 1983:52-3). 12 Papua New Guinea did not renew its agreement with the ATA when it expired in December 1982, though it did partici-

26 Pacific Islands Development Program Table 9. American Tunaboat Association agreements with Pacific island countries, 1980-85 Country South Pacific Forum member countries Cook Islands Federated States of Micronesia Kiribati Marshall Islands Niue Patau Papua New Guinea Tuvalu Western Samoa 1980 1981 1982 1983 1984 1985 x x X X X X X X X X X X X X X X X X X X X X X X Dependent Tokelau territories Source: Compiled from American Tunaboat Association agreements with Pacific island countries. pate in preliminary discussions with the Federated States of Micronesia, Kiribati, the Marshall Islands, and Palau for a broader multilateral agreement to be effective January 1983. However, the Marshall Islands and Papua New Guinea opted not to participate in that agreement. The Marshall Islands withdrew because it did not accept the fee levels proposed by the ATA, and Papua New Guinea could not reach agreement with the participating Pacific island countries on how revenue obtained under the agreement would be shared. The second multilateral ATA agreement extended from January 1983 to December 1984 and involved the Federated States of Micronesia, Kiribati, and Palau. Countries met with the ATA to negotiate an extention of the agreement in December 1984, but talks became deadlocked and failed. 13 With a view to expanding the range of operations for the U.S. tuna fleet in the Pacific islands region, the ATA sought a multilateral agreement with five Polynesian countries Cook Islands, Niue, Tuvalu, Western Samoa, and Tokelau (Table 9). The agreement extended from mid-1983 to December 1984. The conclusion

Fishing for Tuna 27 of this agreement represented a gamble for the ATA because purse seiners had not previously fished extensively in the EEZs of these countries due to the highly seasonal nature of skipjack stocks in these waters. Nonetheless, U.S. fishermen were cautiously hopeful that new fishing grounds would be located closer to the American Samoan canneries. Tactically, the ATA's principal reason in concluding the Polynesian agreement was to reduce its fleet's dependence on operations in Micronesia and Papua New Guinea and thereby to strengthen its negotiating position in dealing with these countries. However, because fishing conditions in Polynesia did not prove favorable, the ATA was unable to meet the agreement's minimum requirements. 14 Consequently, when the agreement expired, the ATA made no move to renew it. Fee payments for ATA agreements in the Pacific islands region were based on an annual per vessel basis but related to the net registered tonnage (NRT) of vessels and not to the quantity of tuna harvested and its market value. Island countries proposed that per trip fees be used, a condition that was consistently rejected by ATA negotiators. The negotiators maintained that the ATA membership would not entertain a change in determining access fee payments because previous ATA agreements with Latin American countries had been predicated on a NRT approach. On an annual basis in 1983-84, fees paid by U.S. fishermen to operate in the region were lower than those paid by their Japanese counterparts (Doulman 1986c: 8). Toward the end of 1983, U.S. vessel owners approached Papua New Guinea and requested permission to purchase fishing licenses. With no ATA access agreement in force, Papua New Guinea decided to license the U.S. seiners under the terms and conditions of its agreement with Japan. The U.S. fishermen agreed to abide by the terms and conditions contained in this agreement, and overall there was a high degree of compliance. In 1984 more than 50.0 percent of the U.S. purse seine fleet (65 vessels) were licensed by Papua New Guinea in this way. No ATA agreements have been in force in the Pacific islands region since December 1984. However, since September 1984 SPF member countries have been meeting with the U.S. government to establish a tuna treaty that would provide for, as well as govern,

28 Pacific Islands Development Program the operation of the U.S. purse seine fleet in the islands region. Progress on concluding a treaty has been slow, despite a genuine commitment by countries in the region and the importance accorded to it by the U.S. government for fishing, political, and strategic reasons. More rapid progress in negotiations would have been made if the United States had approached the Nauru Group rather than the entire SPF membership because the Nauru Group (1) has proprietary interests in the purse seine fishery, and (2) is a closely knit grouping whose members are accustomed to working together. The negotiation process, involving fewer countries (seven as opposed to seventeen), also would have been speedier. Moreover, the negotiations have been complicated to some extent by countries that do not have a real interest in the region's purse seine fishery, focusing instead on issues of concern to them, issues that are not germane to fisheries access for the U.S. fleet. Other agreements Access agreements with other distant-water fishing nations in the islands region are similar in content and approach to the Japanese agreements. For most countries, agreements with Japan have become benchmark agreements, and several countries have adopted the approach and format of the 1981 agreement between Papua New,Guinea and Japan. 15

REGIONAL COOPERATION The importance of tuna to the Pacific islands region in terms of both the absolute size of the resource and its relative importance to island countries prompted the SPF to establish a regional fisheries organization. The organization's primary task was to coordinate and manage the development and exploitation of the region's tuna fishery. After lengthy debate and lobbying concerning the organization's membership, the members decided that distant-water fishing nations and the region's metropolitan powers would be excluded. Most Pacific island countries adopted this position because they believed that the organization's purpose and integrity would be compromised through broadly based membership. After several years of politicking, the FFA was established in 1979. The agency's principal objectives are (1) to coordinate and harmonize fisheries policy so as to insure maximum benefits for Pacific islanders, (2) to facilitate fisheries development and the harmonization of fisheries policies in the region, (3) to promote a coordinated approach in relations among member countries, and (4) to improve the capacity of island countries in the surveillance and policing of distant-water fishing activities in the region (Forum Fisheries Agency 1979:2). In pursuit of its objectives, the agency has a comprehensive work program that deals specifically with issues such as fish marketing, training, negotiating access, and compiling fisheries-related statistics. The FFA's work program and activities are directed and maintained by the Forum Fisheries Committee. Composed of officials from SPF member countries, this committee reports annually to the SPF. Since its inception and particularly since 1982 the FFA has assisted member countries to achieve considerable financial gains in dealing with distant-water fishing nations. Financial returns from access agreements since 1982 have increased by at least 50.0 percent in all cases. The agency also has (1) facilitated the standardization of tuna access agreements throughout the region, in- 29

30 Pacific Islands Development Program eluding methods for determining access fee payments and terms and conditions of operation, (2) instituted the Regional Register of Foreign Fishing Vessels as a means of controlling and regulating access to the region's tuna fishery, (3) assisted member countries in standardizing and improving domestic fisheries legislation, (4) provided training in negotiation skills and procedures for Pacific islanders, and (5) conducted studies relating to the development and expansion of domestic tuna industries. In the mid-1970s, Pacific island countries recognized that, despite the formal declaration of extended jurisdiction and their large tuna resources, they would reap few benefits from the new ocean regime if they did not join forces to cooperatively protect their interests. This was particularly important in view of the small size of most countries and their scattered geographic distribution. Countries realized that to avoid dissipation of benefits from the region's tuna fishery, they must (1) not compete with each other in dealing with distant-water fishing nations, and (2) cooperate on fisheries matters in ways not been previously envisaged or practiced. The dividends from this cooperation paid off, and while there is still scope for closer cooperation in some areas, the benefits gained by island countries attest to their success. Nauru Group The Nauru Group is a subregional grouping of Pacific island countries the Federated States of Micronesia, Kiribati, the Marshall Islands, Nauru, Palau, Papua New Guinea, and Solomon Islands that have agreed in a practical way to harmonize and consult on matters relating to their shared fisheries. The group has much in common and thus is a logical subgrouping within the SPF. Nauru Group countries share common tuna stocks and distant-water fisheries and have contiguous EEZs. Following the 1979 establishment of the FFA, there was a degree of concern and frustration among some SPF member countries that the agency was not moving quickly enough to implement its mandate. This added to existing frustration arising from the lengthy period (1976-79) that it took to establish the FFA. Emanating partly from this sense of frustration, informal discus 1 sions concerning the Nauru Group were held at the 1980 SPF meeting in Kiribati between the Federated States of Micronesia

Fishing for Tuna 31 and Papua New Guinea (Anderson 1982:17). These initial contacts led to a series of formal discussions and negotiations in Papua New Guinea and Nauru. At Port Moresby in November 1981, countries initialed the agreement establishing the Nauru Group. The agreement was subsequently signed in Nauru in February 1982 (Nauru Group 1981). The Nauru Agreement provides for implementing arrangements that are designed to operationalize the group's commitment to harmonization and cooperation. The first arrangement, signed in 1982, addressed two basic issues: the role of the Regional Register of Foreign Fishing Vessels and minimum licensing terms and conditions that must be incorporated into all distant-water access agreements concluded by the group (Nauru Group 1982). Other implementing arrangements are to be enacted as the need arises. In many respects the Nauru Group became a trend-setter for relations between distant-water fishing nations and SPF member countries. This was to be expected because the Nauru Group countries have the largest vested interest in distant-water tuna fishing in the region. Some SPF member countries because of ' their location, size of their EEZs, or government policy have little interaction with distant-water fishing nations and therefore have limited interest in harmonizing and coordinating distant-water fishing activities. Principally for this reason, harmonization policies adopted by the Nauru Group tended to be subsequently adopted generally throughout the region. Distant-water fishing nations reacted apprehensively to the formation of the Nauru Group. This feeling was particularly evident in 1982 when Papua New Guinea discussed the Nauru Agreement in consultations with Japanese industry for the first time (Matsuda and Ouchi 1984:188-91). The matter of a regional licensing arrangement for the region's purse seine fishery was also tabled, and this proposal met with a negative response from Japanese industry and government representatives. The reason for this reaction seemed to stem from a fear that a regional access agreement would result in significantly increased bargaining power for participating island countries. However, the advantages of such an arrangement fewer negotiations and

32 Pacific Islands Development Program reduced administrative costs now appear to be recognized and accepted by both Japanese industry and government. -

CONCLUSION The Pacific islands region will remain an important area of operation for distant-water fishing fleets, and Japan will continue to dominate the fishery in numbers of both vessels and catches. The region also will remain an important area of operation for the U.S. fleet, but its relative importance vis-a-vis the eastern tropical Pacific will depend on the the extent of further reductions in the size of the US. purse seine fleet. Total access fees paid to Pacific island countries by all distant-water fishing nations are approximately US$15.0 million per year. However, future payments will depend on (1) movements in fish prices, (2) the level of fishing effort applied in the region, and (3) the bargaining power of island countries in negotiations. In addition to the payment of access fees, Pacific island countries will progressively seek increased benefits from the operation of distant-water fleets in their EEZs. Until now, distant-water fleets have had limited interaction with the economies of island countries, and some countries are anxious that this situation not continue indefinitely. Island countries are seeking more active involvement in the fishery, and if this does not eventuate, they possibly could invoke Law of the Sea provisions and require vessels to off-load their catches at domestic ports. In this way, benefits to island economies will be increased. Foreign fishing vessels based at ports in the region might also receive preferential access in licensing. Some Pacific island countries also seek greater assistance and participation from distant-water fishing nations in developing domestic tuna industries. Distant-water fishing activity is quite compatible with the development of domestic industries in the region as access revenues received by countries can be used to finance domestic industries. Moreover, distant-water fishing nations are able to transfer technology to these industries, as well as provide appropriate training and applied research. 33

34 Pacific Islands Development Program Market access for fish and other products to distant-water nations also might be tied to future fisheries access. A precedent for this type of arrangement already exists with New Zealand (Matsuda and Ouchi 1984:206). Japanese distant-water fleet access to New Zealand's EEZ is tied to Japanese market access for New Zealand's agricultural and forest products. Papua New Guinea, for example, could tie fisheries access to sugar exports, and Solomon Islands could do likewise with exports of palm oil. Regional fisheries cooperation among Pacific island countries has made significant advances since 1976. Indications are that it will continue at a high level, and fishing limitations probably in terms of the number of vessels permitted to fish are likely to be progressively introduced in the region. Restrictions most probably will be introduced first in the purse seine fishery. In addition to a ceiling on the number of seiners permitted to operate at any one time, vessels and fleets most likely will be prioritized and licenses issued accordingly. Priorities are expected to be established with reference to financial and other contributions that individual vessels and fleets make to the overall development goals of Pacific island countries.

NOTES 1. For oceanographic and other reasons, fishing conditions in the western Pacific in 1983 were better than normal, which accounted for the region's higher proportion of landings. 2. For internal policy reasons, Japan's Fishery Agency restricts the operations of tuna fleets in the Pacific islands, usually by gear type and vessel size. The reasons for these restrictions are to protect less efficient fishing methods (e.g., pole-and-lining vs. purse seining) and to prevent gear interaction (e.g., longlining and purse seining). 3. Matsuda and Ouchi (1984:167) point out that Japanese purse seine trials began in the central and western Pacific in 1960. The 1974 survey referred to by Watanabe (1983) relates to the first economic feasibility study for year round tuna fishing in the region. This study was undertaken by the Japan Marine Resource Research Center QAMARC), which was established in 1971. 4. Two research seiners were also operated by JAMARC (Watanabe 1983:5). 5. A vessel in good standing means that it has not been removed from the Regional Register. When applying for registration, all vessels are initially accorded good standing. After registration, however, a vessel can be removed if (1) it fishes illegally in the EEZ of any SPF member country, or (2) it seriously infringes on the terms and conditions of its fishing license under an access agreement. 6. Australia and New Zealand are members of the FFA, but they are not considered to be Pacific island countries. Nonetheless, as a licensing requirement, Japanese longliners operating in the southern bluefin fishery within the EEZs of Australia and New Zealand must be included on the Regional Register. 7. Apart from financial considerations, Japanese trading companies have made this arrangement to circumvent Japan's tight vessel licensing policy. 35

36 Pacific Islands Development Program 8. For details of the replacement program, see Doulman and Wright (1983:55-6) and Matsuda and Ouchi (1984:196-8). 9. In 1984, 65 U.S. seiners operated in the Pacific islands region (Doulman 1986b:12). Catches made by the fleet exceeded those made by the U.S. fleet in the eastern tropical Pacific (Herrick and Koplin 1985:3-4). However, by December 1985 the number of U.S. seiners operating in the islands region had dropped to 35 vessels (National Marine Fisheries Service 1986:6). 10. In May 1986 the American Tunaboat Association reported that 87 U.S. seiners were afloat, of which 67 were actively fishing (Felando 1986). These figures compare with an active US. purse seine fleet of between 130 and 135 vessels in 1980. 11. Statement made by Mr. Norio Fujinami, Special Adviser to Japan's Minister for Agriculture, Forestry and Fisheries at a University of Washington fisheries workshop, Seattle, July 8, 1985. 12. The embargo was levied under the provisions of the U.S. Fishery Conservation and Management Act (1976), commonly known as the Magnuson Act. The embargo was applied to all tuna and tuna products. It was simultaneously levied and lifted on April 8,1982. The embargo was lifted because Papua New Guinea (1) entered into an agreement with the ATA, and (2) sold the seiner back to its former owner in an non-disairninatory manner. The vessel was sold back for US$267,000, a fraction of its market value. 13. For a brief resume of the negotiation, see Doulman 1986c :7-8. 14. The ATA had guaranteed that at least 20 vessels would purchase licenses under the agreement, but this number of vessels did not eventuate. 15. The revised format and approach proposed by Japan for its future access agreement with the French territories are identical to those of the Papua New Guinea/Japan agreement.

REFERENCES Anderson, David. 1982. Developing island states move to protect tuna. Papua New Guinea Foreign Affairs Review. Vol. 2(1). pp. 13-17. Clark, Les. 1985a. Fisheries issues in the Pacific islands. Proceedings of the Second Conference of the International Institute of Fisheries Economics and Trade. Corvallis. Vol. 1. pp. 19-26. Clark, Les. 1985b. South Pacific oceanic fisheries. Forum Fisheries Agency Report 85/2. Honiara. 18 p. Clark, Les. 1986. Tuna industry developments in the south-west Pacific. Proceedings of the INFOFISH Tuna Trade Conference. Bangkok, pp. 151-159. Doulman, David J. 1986a. The tuna industry in the Pacific islands region: opportunities for foreign investment. Marine Fisheries Review. Vol. 48(1). pp. 15-23. Doulman, David J. 1986b. Tuna fleet rides out recession. Pacific Islands Monthly. Vol. 57(4). pp. 11-13 and 47. Doulman, David J. 1986c. Some aspects and issues concerning the Kiribati/Soviet Union fishing agreement. Pacific Islands Development Program. East-West Center. Honolulu. 21 p. Doulman, David J. and Andrew Wright. 1983. Recent developments in Papua New Guinea's tuna fishery. Marine Fisheries Review. Vol. 45(10). pp. 47-59. Felando, August. 1986. A perspective from the U.S. tuna seiner fleet: has there been a change in policies by the U.S. government? Paper presented at the 37th Annual Tuna Conference, Lake Arrowhead. 19 p. Forum Fisheries Agency. 1979. Summary record and report. Forum Fisheries Committee. Honiara (mimeo). 20 p. Forum Fisheries Agency. 1986. News telex No. 2-market and industry notes. April 19. 1 p. Franklin, Peter G. 1982. Western Pacific skipjack and tuna purse-seine fishery: development, current status and future. Forum Fisheries Agency Report IN.11. Honiara. 30 p. French Polynesia. 1986. Catch and number of Japanese tuna fisheries within the 200-mile zones of French overseas territories 1979-86. (unpublished mimeo). 1 p. 37

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