$25 billion a year? Who gets it?

Those opposing subsidies argue that they distort trade by creating fishery overproduction which is then exported, so affecting fish prices and the fishing industry in other countries.

Korean interest

The retention of fishing subsidies is of particular concern to South Korea, Japan and Taiwan; all of which have large domestic and distant-water fishing fleets. The three governments are keen to maintain fishing industry subsidies in the future and are expected to collaborate to defend them. Opposing South Korea, Japan and Taiwan (which would prefer a set of rules written around a list of prohibited subsidies -- a so-called "bottom-up approach") is the "Friends of Fish" group. This consists of Australia, Argentina, Chile, Ecuador, New Zealand, Philippines, Peru, Norway, Iceland and the United States, which support a broad ban on fisheries subsidies with certain exemptions, a so-called "top-down approach."

The European Union (EU), in principle, opposes all subsidies that cause fishing overcapacity or increase fishing capacity. However, the EU accepts subsidies that reduce fishing capacity and subsidies that mitigate negative social and economic impacts caused by restructuring. It also grants subsidies to retrain fishermen or help them with early retirement

Who decides?

Trade disputes referred to the WTO are resolved by negotiations between the member governments. However, non-governmental organisations (NGOs) play an important role in marshalling and coordinating support among domestic and overseas interest groups. They try to influence their own ministers with the views of their NGO membership.

One person who has been working hard this year preparing for the WTO Ministerial Conference is Hoon-Chong Yi. He is the manager and chief negotiator for the Korea Fisheries Association's WTO team for fishing subsidy negotiations.

Part of his regular job is tell foreign organisations about his association's support for fishing subsidies. This is part of a strategy to rally support for subsidies to be maintained and win backing at the WTO.

"The South Korean government gives fishery subsidies but we do not think it is so much compared to other countries," Yi said. "There are many subsidies in different countries: some good, some bad. We argue that scrutiny is needed and that there should be criteria for good and for bad subsidies.

"Some countries argue that all fishery subsidies should stop, but we do not agree. Japan and Taiwan agree with us, but the Friends of Fish group is against this."

The South Korean government and fishing industry want a selective rather than total ban on subsidies. More investigation is needed into the correlation between fishery subsidies and resource depletion, Yi argues, before any subsidy abolition package is discussed. In fact, some subsidies which restore depleted fishery resources and protect the marine ecosystem may need to be increased, he says.

"For South Korea, the issue of subsidies depends on their definition. We argue that many fishery subsidies are good for strengthening resource management. All our fishermen receive subsidies. Tax-exempt fuel is 80 per cent of the subsidy bill. This is crucial. Also, fishermen receive loans with rates which are cheap compared to commercial bank rates. The loans are used for studying, fishing village improvement, IT training and disaster prevention."

Domestic market

Fish is an important part of the Korean diet. Per capita consumption of fishery products averages some 40kg annually. Most fish is eaten at home

though many restaurants offer fish dishes. Some species are eaten raw including sea bream, halibut and tuna; and occasionally mackerel and hair tail. South Korea's declining fish catch has resulted in more fishery products being imported, much from nearby China.

Banning subsidies would cause a sharp decline in fishing activities, Yi says, and lead to a further decline in the fishing communities where fewer young men are choosing fishing as a career than previously.

"Fisheries is only a small part of our economy but we cannot discard it in future. There are only 200,000 fishermen in South Korea, plus Chinese and Indonesian fishermen who are hired for deep-sea fishing. Young Korean people do not want to go deep-sea fishing or work in agriculture. They want to work in the cities.

"Japan also subsidises its fishermen in a similar way, mainly with tax- exempt fuel, subsidies for village improvement, disaster prevention and computer education. Taiwan is similar too."

Lobbying

Yi has attended meetings in various countries in the run up to Hong Kong. He has been monitoring other NGOs' views on fishery tariffs and trying to advance the South Korean position that more research is needed, on the relationship between subsidies and marine resource depletion, before individual subsidies are subject to review.

"There are multilateral NGO negotiations to collect industry opinion and to transfer opinion to government officials. We cooperate with the South Korean government."

Other international gatherings are held where fishery subsidies are among the topics discussed. In October, pre- Hong Kong, Yi attended a meeting of the International Coalition of Fishery Associations at the FAO headquarters in Rome. The coalition is a group of NGOs from 18 countries which meet to swap information about fishing company interests.

Some NGOs are for subsidies and others against, often reflecting their government's official policy on fishery subsidies.

Yi says: "Our basic position is that after scrutinising the status of fishing subsidies worldwide, we think WTO members should then decide which are good or bad. We have asked the WTO secretariat to examine this. Those opposing fishing subsidies think they have a bad effect on the environment and create trade distortion. We do not agree. We do not think subsidies cause trade distortion. The good side of subsidies is that they are resource strengthening and provide support for fishing villages."

How much cash?

The actual size of subsidies remains a matter of debate. According to the World Bank, subsidies in global fisheries vary between US$14 billion to $20 billion annually. That represents about 20 to 25 per cent of the total fishery sector turnover.

The Organization for Economic Cooperation and Development (OECD) and the Asia-Pacific Economic Cooperation (APEC ) country grouping believe the figure to be less, at around $12 billion. In 1999 an OECD study estimated the amount of subsidies being paid was about US six billion annually, made up of Japan $2.5 billion, EU $1.2 billion, the United States $1.1 billion, Canada $500 million and South Korea $400 million.

Whatever the actual subsidies paid to South Korea's fishing industry, most of the country's 200,000 fishermen are considered to be poor, in contrast to the more affluent urban population. The Korea Fisheries Association's main priority is to protect this group of fishermen, recognising that the deep-sea fishing fleet is operated by larger, more profitable companies.

"South Korean deep-sea fishing companies do not worry about subsidies as most subsidies are paid to small fishermen and just a small amount to deep-sea fishermen."

Of the 89,000 or so fishing vessels registered in South Korea, 95 per cent are under 10 tonnes. The total number of fishing boats has fluctuated over the last decade. Today there are about 5,600 non-motorised, less than one third of the number a decade ago. The number of fishing vessels in service is due to decline further. Under the government's vessel buyback programme, about 6,300 coastal fishing vessels are scheduled to be removed from operation by 2008.

The number of fishermen has declined during the past decade. Many of those quitting are believed to have been part time fishermen as well as older people taking retirement. The number of fishermen has dropped by about 60 per cent from 500,000 in 1990.

South Korea's fishery catch still fluctuates. In 2004 it was 2.52 million tonnes, up 1.6 per cent, compared with 2.48 million tonnes the previous year. Some 1.1 million tonnes was caught in South Korean waters, the same as in 2003. Marine fish farms produced 918,000t, up 11.2 per cent, of which about 460,000t were seaweed. Inland fishing totalled 25,000 tonnes, up 35 per cent, and the deep-sea catch was 499,000t, down 8.3 per cent. South Korea's deep-sea fishing fleet operates mainly in the North and South Pacific and the Indian Ocean, targeting mainly tuna and Alaska Pollack. Most of the latter is brought back to South Korea for domestic consumption while about 50% of the tuna catch is landed in foreign ports. The deep-sea fleet also fishes squid near the Falklands.

Tuna is the largest item in the deep-sea catch and of that skip jack is 65 per cent by weight. The 234,000t of tuna caught in 2003 accounted for 42 per cent of the total deep sea catch. Pollack normally comes in second, however, only 22,000t was caught in 2002, accounting for just five per cent of the annual catch. This compares with 2001 when Alaskan Pollack made up 25 per cent of the total deep-sea catch. Squid has moved into second place with 145,000t caught accounting for 25 per cent of the deep-sea catch. Saury and croaker are the other important species for South Korea's deep-sea fishermen.

The catch for Korean waters in 2003 was 1.1 million tonnes and the three largest species caught are anchovy (250,000t and 23 per cent of the catch; squid (233,000t -- 21 per cent) and 122,000t of mackerel making up 11 per cent of the catch. Other important species are yellow croaker and swordfish.

Important species raised in marine cage fish farms include sea bream and flounder. Cage farmed fish production is believed to be about 300,000t a year.

Fishermen and farmers

The Korea Fishery Association plans to send a delegation to Hong Kong to observe the WTO conference. According to Yi, about 50 South Korean fishermen are also expected to be there to protest against any withdrawal of subsidies. But they will be outnumbered by an estimated 1,500 South Korean farmers who plan to protest against any withdrawal of agricultural subsidies - these are largely in the form of tax-exempts fuels.

"The Hong Kong WTO Ministerial Conference will include fishery subsidies and proposed tariff elimination for all products; tariff code elimination is an important topic for South Korean fisheries," Yi said. " At the last WTO Ministers' Conference in Cancun in September 2004, one South Korean farmer committed suicide. That was oner reason no consensus emerged. We hope there will be no incidents in Hong Kong," Yi added.