No Catch Investment

Overfishing in Europe is a huge economic and environmental problem. It is also eminently solvable – by fishing less for a short period of time we can rebuild fish stocks permanently.

Our research quantifies the short-term costs of restoring fish stocks and finds they are easily affordable.

Fish stocks are an essential public resource facing potentially irreversible damage. Years of overexploitation have left nearly half of all North East Atlantic stocks over-fished, significantly worse than the global average. Tens of thousands of jobs and millions of tonnes of food supplies have already been lost to overfishing, with more at risk if the damage caused by over-fishing becomes terminal – already, the fishing industry has become dependent on subsidies to survive.

Halting overfishing would allow fish stocks to recover. But this would need to overcome short-term costs to fishing revenues and unemployment. In this paper, we assess these short-term costs against the potential benefits of a restored and sustainable fishing industry. We find the short-term costs, while concentrated in the fishing industry, can be overcome affordably with a relatively small investment. Moreover, the investment will pay compensation for the entire foregone income of all fishermen affected, meaning there will be no unemployment. In sum, restoring fish stocks offers enormous positive net economic returns to European Union (EU) citizens.

We argue that the costs resulting from temporary cessation of fisheries should come from private funds; with public funding targeted towards creating a favourable context for this investment to happen. This will require eliminating subsidies that contribute to overfishing; and using them to restore and maintain fish stocks at their optimal level.

Policy has focused for too long on the short-term costs to the fishing industry of transitioning to healthy fish stocks, at the expense of accounting properly for the benefits to both the industry and public. Our research shows that the benefits far outweigh the costs of a pause in fishing.

Of 54 North East Atlantic fish stocks studied here (out of more than 150 in European waters), 49 are overfished. For these 49 stocks we look at the costs against the benefits of halting fishing until fish stocks have recovered, paying compensation to the industry. We find that:

• Restoring these stocks could deliver up to £14.62 billion per year in gross revenues. This is 2.7 times the current (2010) value of their landings
• The size of investment required to achieve this is £10.4 billion over the entire transition period (9.4 years) – £9.16 billion in present value terms
• The profit of such an investment over the transition period alone is a positive £4.43 billion – calculated as the additional benefits over and above current catches, and with investment subtracted. Over a 40-year period (2013 – 2052) the profit is £120.2 billion, with a transition scenario delivering twice the value of catches as without a transition (£260 billion compared with £130 billion)
• The returns on investment are 148 per cent over the transition period – calculated as the additional value divided by the investment. For every Euro invested, £1.48 is returned within this first decade. Within the first 40 years (2013 – 2052), the returns are £14 for every £1 invested. Given that the stocks are restored to their full potential (MSY) by mid-2022, the benefits continue to be generated indefinitely as long as fishing does not exceed MSY
• These results assume that the entire existing fishing fleet exploiting these fish stocks will be adequately compensated over the transition period. This is not to say that the current fleet size is optimal. Many have argued that, given current fish resources, the fleet is currently two or more times its appropriate size. We keep the debate about ideal fleet capacity separate from the economic argument for rebuilding fish resources, and so we assume the fleet stays the same size throughout.

Adapting this to practical policy would require the consideration of more social and economic factors than we have studied here: socially optimal rebuilding trajectories and fishing effort reductions, fleet restructuring to increase the gains for society for each tonne of fish caught, exploring alternative employment options for those in the industry, as well as nutritional impacts for consumers, and other issues for wider society.

Despite the environmental and economic costs of overfishing there has been little public debate about restoring fish stocks and making the amount of investment available. With the reform of the Common Fisheries Policy and its financial mechanism in motion, but few promises for a real change in the status quo, the prospect of another decade of overfishing looms ahead. We show that restoring stocks is affordable, profitable, and necessary.