A fish rots from the head down

17-07-2020

 

Why Ukraine is losing its position in the fishing industry and how regulatory changes can help.

Due to the large volume of water bodies, Ukraine has a huge natural potential in the fishing industry.

Despite this, today the average Ukrainian barely consumes 13 kg of fish products per year, instead of the 20 kg recommended by the UN Food and Agriculture Organization.

Every year the catch of Ukrainian fish in reservoirs is reduced. Instead, imported products are hitting the shelves. It accounts for more than 80% of the market.

The annexation of Crimea and the war in Donbas significantly affected the fishing industry. Due to the loss of some water areas, fish catches have decreased by 70% since 2014.

Besides, the don’t care attitude of authorized institutions toward the stocking of water areas, the deterioration of fishing vessels and fishing equipment, and the high level of illegal fishing in the Azov and Black Seas negatively impact.

Traditionally, fishing is divided into fishery (catching fish that grew independently in natural reservoirs) and aquaculture (fish rearing and fish products).

To conserve natural bioresources, developed economies have been moving to reducing commercial fishing and increasing the aquaculture share for many years.

However, the Ukrainian fishing industry is still based on the fishery. It is often an illegal fishery: in 2019, 200 tons of fish were illegally caught in Ukrainian waters.

This exceeds the volume of legal fish catches (recorded by the state) by as much as 75%.

The situation is made even worse because there is almost no liability for such illegal activities.

Despite the high number of reported offences, cases are moving slowly through the courts, and the share of compensation for environmental legislation violations is only 6.7%. Last year, the state lost almost UAH 40 million in the fishing industry.

This situation is largely provoked by the complexity of procedures for obtaining permits for legal, commercial fishing. Due to non-transparent mechanisms, mainly current market participants receive catch quotas from year to year.

Illegal fishing and uncompensated losses lead to the problem of further insufficient stocking of natural reservoirs. Even though the number of farms engaged in the restoration of biological resources is growing every year, Ukraine is steadily reducing commercial fish catch in inland water reservoirs.

There are also significant problems related to the development of Ukrainian aquaculture. Today, less than 4,000 aquaculture farms are registered in Ukraine. Although we have large inland water areas, the only ⅓ of them are leased.

Due to complex procedures for leasing reservoirs, this market is almost not growing.

Another reason for the stagnating market is the high import duty rate on fish feed. The fact is that fish feed accounts for more than 60% of the fish farming cost.

The vast majority are imported products, the duty rate of which is 10%. At the same time, imports of finished fish products have zero import duty. That is why it is not profitable for Ukrainian businesses to invest in this industry.

Currently, a significant proportion of aquaculture farms operate in the informal economy. According to statistics, regional budgets lose more than UAH 60 million annually due to unauthorized occupation of water bodies.

To change the situation with the fish market in Ukraine and support entrepreneurs, BRDO experts offer a list of regulatory changes in the Green Paper “Analysis of the Fish Industry”.

To increase the share of aquaculture farms, it is proposed to simplify cumbersome regulatory procedures for obtaining rights to use fish ponds and reduce import duties on feed-stuff.

It is also important to introduce a transparent procedure for leasing sea areas for fish farming.

The state is in dire need of an inventory of all water bodies and hydraulic structures that can be used for fisheries.

For this purpose, experts suggest creating a single electronic map with a separate data room for each object.

Also, the document proposes a list of steps to prevent illegal fishing. To do this, experts proposed to create an electronic system for tracing the origin of fish products.

Recording commodity operations at all stages of fish delivery from its catch to supply to stores will significantly reduce the number of illegal catches and protect responsible producers.

Simplification of procedures and digitalization will help Ukraine realize its natural potential, which many countries do not have, and stimulate the fisheries industry development.

If we keep doing nothing, Ukrainians risk consuming only imported fish despite two seas’ presence, branching rivers and lakes.

Source: epravda.com.ua

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