Global marine fisheries are currently underperforming, largely due to overfishing. An analysis of global databases finds that resource rent net of subsidies from rebuilt world fisheries could increase from the current negative US$13 billion to positive US$54 billion per year, resulting in a net gain of US$600 to US$1,400 billion in present value over fifty years after rebuilding. To realize this gain, governments need to implement a rebuilding program at a cost of about US$203 (US$130–US$292) billion in present value. We estimate that it would take just 12 years after rebuilding begins for the benefits to surpass the cost. Even without accounting for the potential boost to recreational fisheries, and ignoring ancillary and non-market values that would likely increase, the potential benefits of rebuilding global fisheries far outweigh the costs.

Funding: The Sea Around Us Project and the Global Ocean Economics Project are funded by the Pew Charitable Trusts, Philadelphia ( http://www.pewtrusts.org/ ). The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript.

Copyright: © 2012 Sumaila et al. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

Over the past decade, we have gathered data on the economics of global fisheries from a range of sources, including scientific, economic, governmental, inter- and non-governmental publications, to create several global databases on catch [15] ; ex-vessel fish prices [16] ; subsidies [17] ; and fishing costs [18] ( Tables S1 , S2 , S3 , S4 , S5 and S6 ). From these databases, we compile landed value of catch, cost of fishing, payments to labor, earnings of fishing companies, and fisheries subsidies for 144 maritime countries of the world. We then compute both current and potential maximum resource rent, wages, and earnings to fishing enterprises.

Fisheries economists use resource rent (i.e., what remains after fishing costs and subsidies are deducted from revenue) as an indicator of fisheries performance [12] , although others argue that this is inadequate because it does not capture all the benefits derived from marine fisheries [13] . Here, we adhere to using resource rent as our primary indicator of economic performance, but we also report payments to labor (i.e., wages) and earnings to fishing companies as additional indicators of fisheries benefits. With these additional indicators, we recognize that fishing capacity is not often converted to other uses easily (i.e., it is non-malleable) and that the opportunity cost of fishing labor (i.e., the alternative wages that fishers can earn if they did not fish) in many fishing communities is low due to a dearth of alternative employment. Even with these additional indicators, other important contributions of fish populations to the economy, such as the value created through the production chain [1] and non-market values [14] are not captured.

Fish are among the planet’s most important renewable natural resources. Beyond playing a crucial role in marine ecosystems, fish support human well-being through employment in fishing, processing, and retail services [1] – [3] , as well as food security for the poor, particularly in developing countries [4] . Overexploitation [3] , [5] , [6] and rising ocean temperatures threaten global fisheries [7] – [9] . As demonstrated by the collapse of northern cod off Newfoundland, the depletion of fish stocks can have devastating effects on human well-being [10] , [11] . As human populations continue to grow, the future benefits that fishery resources can provide will depend largely on how well they are rebuilt and managed. However, policy makers often perceive that rebuilding fisheries is too expensive in the short-term and therefore avoid taking the necessary actions to sustainably manage fish stocks. Therefore, a crucial question for policy makers is what is the potential net economic benefit of rebuilding global fisheries? Here, we address this question on a global scale.

Global fisheries are not living up to their revenue potential; the total cost of fishing is too high and governments provide harmful subsidies to the sector, which results in a negative resource rent (i.e., economic loss to society) of about US$13 billion per year ( Table 1 ). Rebuilding would result in a gain in resource rent of US$66 billion per year, which when discounted over the next 50 years using a 3 per cent real discount rate, generates a present value of between US$660 and US$1,430 billion ( Table 1 ), i.e., between 3 and 7 times the mean cost of fisheries rebuilding reform. Furthermore, it would likely take just 12 years after rebuilding efforts begin for the gains to exceed the costs of adjustment ( Figure 3 ). A higher discount rate will reduce the present value of gain from rebuilding and increase the time needed to balance the gain with the costs of adjustment, and vice versa (see Materials and Methods for the justification of a 3% discount rate). Our results suggest that, even without accounting for the potential boost to recreational fisheries, processing, retail and non-market values that would likely increase, there is a substantial net economic benefit to be derived from rebuilding global fisheries, with net gains large enough to compensate for uncertainties in our assumptions and estimates. Rebuilding fisheries makes good business sense. The challenge is how to move global fisheries from their current dismal economic state to a more prosperous one.

Using the unit cost of reducing fishing effort calculated in Materials and Methods, the total amount that governments need to invest to rebuild world fisheries ranges between US$130 and US$292 billion in present value, with a mean of US$203 billion. This total transition cost would be spread over the time required to rebuild fisheries within each country.

The world’s current fishing capacity is estimated to be up to 2.5 times more than what is needed to land the Maximum Sustainable Yield (MSY) [21] . This suggests that to rebuild global fisheries, we need to trim excess capacity from the current 4.3 million fishing boats [3] . Assuming that current capacity is between 1.5 and 2.5 times the level needed to maximize sustainable catch, fishing effort needs to be reduced by between 40 and 60 per cent, or up to 2.6 million boats. Fisheries currently employ more than 35 million people globally [3] . If we simplify by assuming linearity between boats and people, this implies that between 15 and 22 million fishers would need to be moved to other livelihood activities in order to rebuild global fisheries. This is a challenge, but one that is surmountable. For instance, even though in some fisheries most fishers may see fishing as a way of life and therefore may not want to exit fishing [22] , it has been reported that up to 75% of fishers in Hong Kong would be willing to leave the industry if suitable alternatives or compensation were available [23] . Similar sentiments are likely to also occur in many other countries. In any case, it is better to undertake this transition as part of a rebuilding policy rather than having it forced upon us through loss of resources [10] , [11] .

The real cost to society of rebuilding fisheries, once the elimination of an estimated US$19 billion per year of harmful and ambiguous subsidies is taken into account [17] , is negative, implying that society as a whole will make money by engaging in rebuilding ( Figure 3 ). However, fishing enterprises and fishers will lose profits and wages during rebuilding. Hence, to implement a rebuilding reform, governments may need to temporarily invest extra resources to mitigate these impacts.

Global marine fisheries landings are projected to average 89 million t per year (range 83–99 million t) ( Table 1 ) when rebuilt [19] , with a corresponding mean landed value of US$101 billion per year (range US$93–116 billion). The wide ranges help to address uncertainties about the magnitude of global overfishing currently debated in the literature (as discussed in Materials and Methods). The cost of fishing in this rebuilt scenario is estimated at US$37 (US$29–44) billion compared to US$73 (US$50–96) billion per year currently. Returns to capital invested (i.e., normal profit) and payments to labor would amount to US$3 (US$2–4) billion and US$16 (US$12–19) billion per annum, respectively, while resource rent from rebuilt global fisheries would be US$54 (US$39–77) billion per year (summary of current resource rent is displayed by country in Figure 1 , with details in Table 1 ). (The Sunken Billions report of the World Bank [20] , which estimated economic rent without addressing the cost of reform, arrived at a potential resource rent of US$50 billion per year, using a different approach.) Gains in resource rent from the current situation to a rebuilt global fishery would be US$66 (US$51–89) billion a year, while wages and returns to capital will decrease to US$16 and US$3 billion, respectively ( Table 1 ). Figure 2 summarizes the net gains in resource rent by maritime country.

A recent fishing industry report [24] provides financial data over 3 years (up to 2009), including pre-tax profit for the top 1000 commercial fishing companies worldwide. The numbers in this report support some of the counterintuitive outcomes of our study. These 1000 companies operate in 43 countries on all continents. The total annual sales value for all companies is about US$21 billion or 25% of estimated landed value worldwide. Of these 1000 companies, 339 reported negative annual pre-tax profits. Thirty-one of the 43 countries have at least one company reporting negative pre-tax profits, and of the 12 countries that report only positive pre-tax profits, nine countries had only one company in the dataset, suggesting that the optimistic results for these countries may be a result of limited data. Sixteen of the 43 countries for which data were reported had negative average pre-tax profits at the aggregate national level, at which the average ratio of pre-tax profit to sales volume is only marginally greater than zero ( Figure 4 ). These data present an interesting and more micro-level view of the industry that is complementary to our estimates, showing that within the same country, some firms may be quite profitable, while others are much less so, resulting in negative aggregate profit at the national level.

There are also situations where large maritime countries (e.g., Peru, Chile, and Indonesia) may show counterintuitive estimates. Similarly unexpected results for countries such as Australia and Iceland, known to have good fisheries management regimes were found. In these cases too, the result of the statistical estimation required in the absence of observed or collected, publicly available country-specific data may be a reason. However, the reported results may indeed be correct yet unanticipated, as explained below.

Even though the overall results we present are consistent with other estimates about the extent of subsidies, excess fishing pressure and the potential for increased biological yield, the country-by-country analysis ( Tables S1 , S2 , S3 , S4 , S5 and S6 ) may reveal results that differ from expectations. This is not surprising, as our analysis produces estimates with ranges, and therefore computing midpoint estimates may over- or underestimate numbers for some countries. This is more likely to happen for small developing countries where observed data are limited, and we therefore had to rely on statistical methods to produce estimates for these countries. The key to improving our estimates is for the collection of economic data for fisheries to be given priority by maritime countries.

Materials and Methods

To estimate the potential gains from rebuilding global fisheries, we use estimates of catch loss [19], defined as the difference between current landings and Maximum Sustainable Yield (MSY) for those species that are considered to be over-exploited. It should be noted that MSY does not maximize economic yield (MEY) except when the stock size of fish does not affect the cost of fishing, and discount rate is zero. Still, we apply MSY in this analysis for practical and policy reasons, as it is a stipulated target or management reference point for many national legislations and international conventions. Other assumptions made in our analysis are: (i) the real ex-vessel fish price is constant through time (they have remained relatively stable since 1970) [16], [25]; (ii) during rebuilding, the costs of fishing change in proportion to changes in effort; (iii) the costs of fisheries management increase by 25% to US$10 billion a year, to support effective management under a rebuilt scenario; and (iv) the reported US$19 billion of annual harmful and ambiguous subsidies [17] are eliminated, since providing capacity-enhancing subsidies is fundamentally at odds with rebuilding fisheries. We also assume a rebuilding period of 10 years (e.g., Magnuson–Stevens Fishery Conservation and Management Act of the USA). Further support for this assumption is given by Costello et al. [26], who found that under an optimal rebuilding strategy, stock recovery requires between 4 and 26 years (with a mean of 11 years), depending on the fish species.

1. Estimating Global Fleet Size The FAO estimates that there are currently 35 million people engaged in capture fisheries on either a part- or full-time basis [3]. The same report indicates that 90% of these fishers participate in the small-scale sector, while the remaining 10% can be classified as large-scale. The FAO also reports that the world’s fishing fleet is comprised of 4.3 million vessels, 59% of which are motorized and 14% of motorized vessels (8% of all vessels) are greater than 12 meters in length [3]. In this study, we take a broad definition of large-scale vessels that includes all motorized vessels over 12 m in length, which is of sufficient size to represent considerable fishing pressure and potential impact on the environment. Under this criterion, we estimate the number of large-scale fishing vessels worldwide to be 355,000, with the remaining 3.94 million vessels are classified as small-scale.

2. Estimating Effort Reductions Required to Rebuild Global Fisheries We model the global fishery using the Schaefer surplus-production model commonly applied to single-stock fisheries [27]. Since many fish stocks around the globe are either fully- or over-exploited, the global fishery is currently using more effort than needed to produce maximum sustainable yields (E MSY in Figure 5), which we use as a global proxy for sustainable fisheries. We are cognizant of the diversity of fisheries management uses of biomass levels with MSY (either slightly above or below) as management reference or target points. In order to achieve maximum sustainable yields, effort will need to be reduced from current levels (e.g., E 0 in Figure 5) to a lower level that is consistent with maximum sustainable yield (E msy ). At E msy , the total cost of fishing is reduced from TC 0 to TC msy . For our calculations, we make the simplifying assumption that there is no substitution between labor and capital, so the shares of components of fishing costs (i.e., fuel, wages, etc.) remain constant. PPT PowerPoint slide

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larger image TIFF original image Download: Figure 5. The Schaeffer surplus-production model, based on Gordon The Schaeffer surplus-production model, based on Gordon [27] https://doi.org/10.1371/journal.pone.0040542.g005 Recognizing that large- and small-scale fisheries have different fishing power, and in order to minimize the effect of effort reductions on fishers (labor), who are predominantly in the small-scale sector, we weigh effort reductions more heavily on large-scale operations. We express total fishing effort in the global fishery as: (1)where LSF and SSF are the number of large- and small-scale fishers, respectively. The parameters P l and P s represent the fishing power of large- and small-scale fishers, while γ represents the power of large-scale fishers relative to small-scale fishers. Total current fishing effort is δ 0 . By re-expressing LSF, SSF and δ 0 as terms that are relative to the total current fishing effort (i.e., dividing both LHS and RHS of eq. 1 by δ 0 ), we have: (2)Pauly [28] reports an estimate of γ, which places the fish catching power of large-scale fishers at 18 times that of their small-scale counterparts. This leaves us with a system of two equations with two unknowns that can be solved for P l and P s , which are used to estimate the proportions of large- and small-scale fishers required to reduce overall fishing effort: (3) The parameters LSF’, SSF’, P l and P s are defined as in the system of equations (1 & 2) above, while δ represents the ratio of current effort required to rebuild fisheries, while w l and w s represent the weight of effort cuts levied on large- and small-scale fishers, respectively. The parameters x and y, which represent the proportion of large- and small-scale fishing activity to be cut, are estimated from equations (3) and used to estimate the total reductions in large- and small-scale fishers as: (4) Lastly, we use our earlier estimates of the current number of large- and small-scale fishers and fishing vessels to estimate the number of large- and small-scale fishers and vessels that must be removed from the global fishery corresponding to our estimates of required reductions. We explore a range of weights (w l and w s ) that represent equivalent total effort reductions. As can be seen in Figure 6, the trade-off between the cost of fishing effort reduction per fisher is non-linear, while the number of total fishers reduced is linear in the weighting placed on large-scale fishing effort. We suggest that by placing 80% of the weight of fishing effort reduction on large-scale fishing operations, it is consistent with cutting 60% of large-scale and 30% of small-scale fishing activity. PPT PowerPoint slide

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larger image TIFF original image Download: Figure 6. Trade-offs between reductions in cost of fishing effort and total fishing effort (in terms of number of fishers) reduced as the weight of effort cuts on large-scale fishing varies. https://doi.org/10.1371/journal.pone.0040542.g006

3. Estimating the Potential Value of Rebuilt Fisheries For our present purposes, we assume that the estimated catch losses to overfishing reported by Srinivasan et al. [19] (Figure 7) may be fully regained after a period of rebuilding fisheries worldwide. To calculate potential catch losses, Srinivasan et al. [19] used catch time series from the Sea Around Us project for 1,066 taxa of fish and invertebrates in 301 EEZs, along with an empirical relationship they derived from catch data and stock assessments for 26 Northeast U.S. species from the U.S. National Oceanic and Atmospheric Administration (NOAA). The log-linear relationship that they found between a species’ mean maximum catch C max from catch data and its maximum sustainable yield (MSY) from stock assessment was robust (R2 = 0.84, p<0.001), and has since been tested for 50 fully assessed stocks in the Northeast Atlantic, where variation in MSY accounted for 98% of the variability in C max [29]. Therefore, given the dearth of detailed stock assessments for the majority of species in the world’s fisheries, Srinivasan et al. [19] applied the relationship they derived (with a 50% prediction interval) to estimate MSY levels for all stocks they identified as overfished. By comparing with reported catch levels, they arrived at estimates of lost catch by mass, reporting that without overfishing, potential landings worldwide in the year 2000 may have been 9.1 million t higher than current landings (50% prediction interval: 3.6 to 19 million t higher). PPT PowerPoint slide

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larger image TIFF original image Download: Figure 7. Lost catch potential due to overfishing for the six FAO regions of the world (top) and worldwide (bottom). Figure drawn using results reported in Srinivasan et al. [19]. https://doi.org/10.1371/journal.pone.0040542.g007 To calculate the value of these potential landings under rebuilt global fisheries, Srinivasan et al. [19] used a database of ex-vessel fish prices by Sumaila et al. [16]. For each taxon-EEZ pair designated as overfished, a price-per-tonne p for the maximum sustainable yield (MSY) was set by taking a weighted average of the actual prices corresponding to catches of the taxon within ±30, ±50, or ±100% of the estimated MSY level, in order of preference depending on data availability. This approach was used to account for the impacts of overfishing, and thus scarcity, on price levels. There is debate among fisheries scientists as to the reliability of overfishing estimates based on catch trends rather than stock assessments, with some arguing that catch-based approaches are prone to overestimate depletion [30]. Srinivasan et al. [19] were careful to avoid the biases described by Branch et al. [30], with the result that the former’s estimate of the percentage of overfished stocks worldwide (16–31%) was similar to, but more conservative than, that reported by Branch et al. (28–33%), and similar also to a recent assessment by the FAO [31]. Indeed, Froese et al. [29] demonstrated that both stock- and catch-based assessments of overfishing in the Northeast Atlantic show the same trends, although the catch-based methods were generally late to recognize declines in biomass. Thus, a catch-based method would underestimate lost catch, i.e., the direct opposite direction of the bias over which Branch et al. [30] have expressed concern. Moreover, Worm et al. [6] compared areas where there were both detailed stock assessment information and more general data including catch time series, and found that catches follow biomass trends, if belatedly. PPT PowerPoint slide

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larger image TIFF original image Download: Table 2. Wages, normal profit and resource rent for current fisheries by FAO region. https://doi.org/10.1371/journal.pone.0040542.t002 Based on Costello et al. [26], who estimated the recovery time for 18 simulated fish species to be 11 years on average, with a range of 4–26 years depending on the species, we assume a rebuilding period of 10 years (t = 0–9) in this study. During this period, we assume that the only gains to occur are those from a reduction in the current net resource rent loss from negative US$13 billion per year to zero. Following modelling work reported in UNEP’s Green Economy Report [32], we also assume that global fisheries landings decline linearly from ∼80 to 50 million tonnes per year from t = 0–5 as fishing effort declines, but then rise linearly to the rebuilt level (∼90 million tonnes) by t = 9. Once global fisheries have been rebuilt, this potential gain in resource rent would recur annually into perpetuity; here we consider only the flow for the subsequent 40 years after rebuilding (t = 10–49). We estimate R, resource rent adjusted for subsidies, as follows: (5)where LV represents the landed value of officially reported marine landings. The total variable cost of fishing is represented by C and subsidies are represented by S. The computed resource rents for the six major Food and Agriculture Organization of the United Nations (FAO) regions (Africa; Asia; Europe; North America; Oceania; South and Central America plus the Caribbean) are summarized in Table 2. We compute the gains from rebuilding (P gains ) as the value of the rebuilt resource rent (R rebuilt ) minus the value of current resource rent (R current ): (6)where t represents time. We assume that globally, rebuilt fisheries will be successful in avoiding subsequent unsustainable increases in effort. We calculate the present value of net gains from rebuilding global fisheries as follows: (7)where PV is the present value of the net gain in resource rent, r is the prevailing rate of discount and t represents time from present . In our analysis, we assume a fixed discount rate of r = 0.03 (i.e., 3%) and compute the present value of net gains in resource rent for 50 years after rebuilding. We use this discount rate because many environmental economists have argued for and applied lower-than-market rates due to the central role of environmental resources in ensuring sustainable economies through time [33]–[35] Changes in the value of fisheries landings, costs, subsidies and resource rent through the transition time period are summarized in Figure 3. PPT PowerPoint slide

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larger image TIFF original image Download: Table 3. Wages, normal profit, resource rent and increase in rent from rebuilt fisheries. https://doi.org/10.1371/journal.pone.0040542.t003

4. Estimating the Cost of Rebuilding Global Fisheries In addition to differences between current resource rent and that which is captured during the period of rebuilding, we estimate the costs necessary to reduce fishing capacity to levels required to allow fish stocks to rebuild. These costs are estimated based on the cost of effort reductions described earlier in the methods. We estimate wages, profits, resource rent and increase in resource rent from rebuilding for the six major FAO regions (Africa; Asia; Europe; North America; Oceania; South and Central America plus the Caribbean) in Table 3. Since the real cost of rebuilding fisheries is foregone resource rent that may occur as fishing effort is reduced initially, we estimate the cost of rebuilding global fisheries through the transition to rebuilt fisheries as the difference between current fisheries resource rent and that which is realized through the period of transition. We hold the assumption that all harmful capacity-enhancing and ambiguous subsidies (Table 4) must be cut immediately or re-directed to make them beneficial subsidies, e.g., by investing in managing the rebuilding process. PPT PowerPoint slide

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larger image TIFF original image Download: Table 4. Annual global fisheries subsidies by category Annual global fisheries subsidies by category [17] https://doi.org/10.1371/journal.pone.0040542.t004