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Many countries subsidize their fishing industries because of the important roles they play in the economy and food supply. Annual subsidies for fishing amount to about $26 billion world wide, only $7 billion of which goes towards fisheries management and the support of conservation. On the other hand, $16 billion --more than 25 percent of the annual $56 billion trade in fish-- is going towards the sponsorship of fishing fleets, thus encouraging the global fishing effort and increasing fishing capacity. This has led to a 250% increase in the global fishing fleet (Sumaila & Pauly, 2006).
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The U.S. and Canadian governments have also provided subsidies to promote domestic fishery development for many years. In addition, they have also used approximately $3 billion on income maintenance for unemployed fishermen and fish plant workers and to improve fishery science. In the 1990s, when people started to realize the problem of overfishing, both countries began subsidizing the development of technologies to reduce capacity , for example, new fishing vessels, to alleviate the unnecessary over-fishing pressure caused by side-effects of undeveloped fishing technologies (Schrank, 2003).
Norway, one of the largest cod-catching countries, grants loans to its fishing industry to support the export of their fishing marketprotect its domestic fish production. It also provides price support, insurance subsidies, operating subsidies, minimum income guarantees, vacation support and unemployment insurance, bait subsidies, gear subsidies and damage compensation (Schrank, 2003).
In view of the harmful nature of some subsidies, the WTO agreed World Trade Organization advised its members on restricting subsidies designed to promote exports and established controls over other form of subsidies. Canada, Japan, and other countries with a large fishery industry, however, endorse the "no-need approach" in which no restriction of subsidies should be imposed as they dispute the causal link between subsidies and overexploitation of fish resources. They propose fisheries management regimes deal with catch controls (quotas), effort controls (restrictions on boat size, engine power and days at sea, etc.) and right-based structures (permits, individual transferable quotas, etc.). Therefore, in Japan's view, it would be unfair if these varying situations are ignored and certain fishery subsidies automatically prohibited (Benitah, 2004).
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