China’s demand for special status a sticking point in WTO fishing subsidies negotiations

World Trade Organization (WTO) talks on ending harmful fishing subsidies resumed this week, and a return to intensive negotiations has been set for September. The timeline, however, creates a tight squeeze to reach the 31 December deadline for a deal.

Santiago Wills, the chairman of the talks, brought the heads of delegations together on 21 July for a plenary session, the first such in-person session in a month. But while there had been hopes recently of a pathway to a deal, there appears to be new friction between Beijing and Washington over China’s claims to developing nation status.

Zhang Xiangchen, China’s ambassador to the WTO, has said this week he wants to special and differential treatment (SDT) for China. The United States and other countries are loath to agree to the request, even though India has also sought such a carve-out for its fishery sector (which, compared to China’s, remains largely confined to domestic waters).

The American ambassador to the WTO, Dennis Shea, has ruled out a deal that contains current proposed SDTs, claiming it would undermine the benefits of any deal on ending harmful subsidies.

The scale of China’s distant-water fleet dwarfs that of any other developed or developing nation, with some of it registered under overseas registered companies and sailing under foreign flags.

While targeting illegal, unreported, and unregulated (IUU) fishing, the negotiations have also looked at curtailing subsidies that lead to overexploitation of fish stocks and overcapacity of fleets. But disagreements remain over what defines overcapacity, and China has sought to present itself as a developing nation entitled to the same opt-outs that might apply to coastal nations in Africa, where small-scale fishing is central to food security.

Besides China, Japan has also been a focus of the negotiations. In its latest regular Trade Policy Review published this month by the WTO, Japan was “urged to reduce its fisheries subsidies and improve their transparency so as to ensure that they do not contribute to illegal, unreported, and unregulated fishing or overfishing and overcapacity.” Likewise, Japan was “encouraged to rationalize its fossil fuel subsidies regime.”

The European Union has also been urged by non-governmental organizations to refrain from reintroducing capacity-enhancing subsidies under the auspices of a COVID-19 recovery package.

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