Editorial
Rethinking the fish market
The commercial fishing industry in Guyana has traditionally been perceived stigmatically, at least in social terms. We speak of raucous behaviour as being fit only for a fish market, or typical of a fish vendor. The fisherman is usually represented as the stock representation of the uneducated, poor and socially backward. Indeed, one of the ‘Goals of fishery management’ in the Draft Fisheries Management Plan 2007-2011 is “To promote the image of fishing as an occupation that is socially desirable and financially rewarding.”

It probably time we collectively reexamine this stereotype. From a fledgling industry started half a century ago, fishing has surpassed the once powerful rice in export earnings in recent times. The fishing industry has contributed an average of US $53 million to Guyana’s GDP over the past few years and directly employs some 12,000 people.

As the country seeks to diversify its range of economic activity, the fishery sector has the capacity for exponential growth. Unfortunately, it also has the capacity for enormous failure. Investing time, energy and resources into developing Guyana’s fishing industry is as big a gamble as fishing itself. It is casting a net, a line into a future as murky and rich with possibilities as the ocean itself.

This inaugural edition of the GCER focuses on some of the issues facing the industry today at the national level, with a look at the industrial marine fishing industry and a glance at the fledgling aquaculture sector. Our next issue will be largely on the artisanal fishing both at sea and inland. Yet two, or even four, issues are not enough to provide any comprehensive analysis or even illustration of this sector. They are a start however.

While GCER plans to examine a broad range of economic activity over the lifespan of this publication, the fishing industry is one that is at such a critical state of development as to warrant continual analysis and examination.

Correspondence
From the chairman's desk
Dear Readers,
I am privileged to officially launch this inaugural issue of the GCER. This initiative by Guyana National Newspapers Limited (GNNL) is one that has been long in the planning.

Keith Burrowes

As a state-owned company, GNNL has a mandate to deliver quality reportage and analysis to the people of Guyana, in any sphere of activity – social, political, cultural and economic.

While we have in the past kept abreast of economic affairs through our coverage in the Daily Chronicle and the Sunday Chronicle, this has for the large part been more incidental news reporting than focused analysis. This is not the era to continue to do so, particular from the perspective of a national newspaper.

With regard to economic activity, we live in particularly interesting times. From the national imperative to diversify our economy, to our regional alliances (most notably the CSME), to the looming global crises in terms of trading relationships among nations, rising food prices and the search for alternative energy, there is a great deal of information that needs parsing and analysis. This is what the Review intends to do.

For the upcoming months, the GCER has a wide range of topics to cover and GNNL will be working with all stakeholders involved in order to bring a fair and in-depth analysis of what is taking place in the economic sphere locally.

This publication is part of several initiatives that we have planned throughout 2008 and beyond. Indeed, these represent a necessary diversification for this company, at a time when diversification is a watchword for the local economy, giving us an opportunity to add value to our raw material, news coverage, resulting in a better product and a better service not only to Guyanese but to anyone interested in any way in this country and what it has to offer.

I trust that your reading of this first issue will be as interesting as it is enlightening, and that the same holds true for subsequent editions.
Yours truly,
Mr. Keith Burrowes
Chairman of the Board
GNNL

A Timely venture
Dear Sir,
The Guyana Office for Investment (GO-Invest) welcomes the publication of this new supplement, the Guyana Chronicle Economic Review. We commend the Board and editorial staff of the Guyana National Newspapers Limited for this initiative.

In the most dynamic developing economies in the world today, namely China, India and Brazil, new entrepreneurs and the general public can access, through many publications, feature articles that analyze what is happening in their business sectors. They learn about the strengths, weaknesses, opportunities and threats in their countries and region and about the triumphs and struggles behind some of those entities that emerge on top. This information has helped to encourage thinking, learning and creativity among young men and women who are establishing or want to create new business ventures.

In Guyana today, there are many success stories among the hundreds and hundreds of large, medium, small and micro businesses. Yet the perception exists that “nothing is happening”. Why? The primary reason in our view is that there is little information sharing among and about businesses, and other economic-related activity in the country.

How much do we know, for example, about E-Networks Incorporated, Broadband Incorporated and Global Technology and their young owners, Mr. Persaud, Mr. Yong and Mr. Melville, two of whom remigrated from the USA in order to contribute directly to Guyana’s development? How much do we know about Jerlon Pork Limited and Jack’s Farm and their young owners, Mr. London and Mr. Jack? Do we know about the group of women in the Pomeroon who persevered over 5 years, overcame many challenges, and successfully established a modern food processing facility in Charity? And there are hundreds more like them.

We look forward to a long life for the Review and you can count on our support.
Yours truly,
Mr. Geoff Da Silva
CEO
GO-Invest

Sinking or Swimming?
The state of Guyana’s fishing industry at present
The good news is that the sector is growing in terms of its contribution to the country’s GDP. According to acting Principal Fisheries Officer in the Department of Fisheries, Ministry of Agriculture, Mr. Tejnarine Geer, the sector has grown from 3% of Guyana’s gross domestic product (GDP) in 2003 to an estimated 5-7 % at present.

Too much of a good thing

“It was the third most important export after sugar and gold,” according to GO-Invest’s website, “amounting to nearly US$62 million in 2005. The U.S. is the primary market for most seafood exports. In 2004, however, Guyana was certified to export seafood to the lucrative EU market, creating a range of new market opportunities. While the seafood industry primarily consists of marine species caught in Guyana’s exclusive economic zone (EEZ), aquaculture has recently attracted significant investment growth.”

The fisheries sector is diversifying with the Ministry of Agriculture spearheading ventures into aquaculture, a sub-sector which has attracted millions of US dollars in investment in recent years; and we have an EEZ that is roughly equivalent to 64% of Guyana’s 214,970 square kilometers of land.

What then is the big problem? The short answer seems to be success.

“Seafood production,” quotes a 2004 USAID study on the industry, “has emerged as a major contributor to the country’s GDP, export earnings, and employment level. These gains could be short term and detrimental to the future of the industry.”

All the production graphs in the Draft Fisheries Management Plan for Guyana (2007-2011) show general downward trends in production marked by occasional annual spikes. Large penaeid shrimp (prawns) production peaked in 1995 at 2998 tonnes but was around or below 1200 tonnes since 2003. Seabob production peaked at almost 20,000 tonnes in 2003 – up from some 6,000 tonnes in 1998 – but plummeted to 9,236 tonnes the very next year, going up only 4000 tonnes in 2005. Snapper landings peaked at 612 metric tons in 2003 but dropped down to 399 mt in 2005, the lowest since 1999. Even coastal pelagic fish, like mackerel and small tunas, which are only caught incidentally have seen a decline in recent years. Spanish mackerel, for example, reached 1143 metric tons in 1999, but dropped won to 214 mt the next year, eventually creeping up back to 523 in 2005 – still slightly below the 1997 landing figure.

“Since 1995,” reads the USAID report, “concerns have been expressed on the rate of harvest and sustainability of fisheries stock. Every study or forum since then has reconfirmed these concerns. In the absence of recent scientific assessments, studies are continuing to extrapolate rates of harvest and ratio of by-catch from production figures. The results are showing declines and harmful trends.”

“The growth of the industry,” according to former Principal Fisheries Officer and industry consultant, Mr. Reuben Charles, “is dependent on the resource out there. This is a living resource and you have to manage it.”

From the Ministry of Agriculture perspective, the Draft Fisheries Management Plan –itself indicative of the onus placed by the government on resource management – aims among other things,

“*To maintain or restore populations of marine species at levels that can produce the optimum sustainable yield as qualified by relevant environmental and economic factors, taking into consideration relationships among species.

*To preserve rare or fragile ecosystems, as well as habitats and other ecologically sensitive areas, especially estuaries, mangroves, seagrass beds, and other spawning and nursery areas.”

At least one large company seems to be up to date with the spirit of these goals. According to Mr. Ronald Deen, Chief Financial Officer of Pritipaul Singh Investments (PSI), his company – the only one in Guyana licensed to catch prawns, and a major harvester of seabob – is adamant on operating in a sustainable manner. There is an annual close period of two months for the harvesting of seabob, which allows the shrimp stock to replenish. And the company is currently looking into methods of phasing out the tickler chain method of harvesting prawns – tickler chain harvesting involves running a chain along the seabed, the prawns nesting ground, causing them to jump up into the net which trails behind the chain.

It is not that there aren’t other very serious issues facing the industry. Rising fuel costs are hampering the sustainability of local trawling and seafood processing operations (see story on page 6) and the issue of security for artisanal fishermen, scheduled for attention in the next issue GCER, is of very pressing concern to the industry. But the impact of high fuel prices is exacerbated when fuel is wasted on the small catches caused by the depletion of the stock, as the declining figures in yield per vessel make clear. And once the security concerns are addressed, in the long term what may well happen is that the artisanal fishermen may well find themselves at sea with nothing in their nets.

“The growth of the industry is dependent on the resource out there. This is a living resource and you have to manage it.”

Danger signals
The following results came out of a 2003 CARICOM-EU workshop on the fishing industry in Guyana Suriname:

· Seabob –“Unless immediate action is taken, this fishery is likely to collapse. The effort (vessels) in this industry is three times that which was registered, thus a cap should be placed on the number of vessels in the fishery, with an eye to reducing same.”

· Trout and Bangamary – “These two ground-fish species showed that they were fully exploited by gillnets and trawl fishery. The artisanal gillnet is an open access fishery and measures should be taken to restrict the effort in the fishery”.

· Red Snapper – “the deep and slope fishery for southern red snapper was assessed and the initial results show that the fishery is underexploited. However, only one gear type was used in the assessment and further analysis needs to be done for a complete picture of this fishery, so it would be unwise to add any new vessels to the fishery at this time”.

Nigerians catch man-size fish at frantic festival
By Estelle Shirbon
ARGUNGU, Nigeria (Reuters Life!) - Thousands of half-naked men hurled themselves into a river to catch giant fish in hand-held nets in a manic contest at the Argungu festival in remote northwestern Nigeria at the weekend.

The hour-long fishing frenzy, in a shallow stretch of river so crowded that the brown water was barely visible, marked the high point of a four-day extravaganza that also featured wild duck-catching and blindfolded swimming contests.

An "elephant fish" was the biggest catch at this year's festival and the man who wrestled the 65 kg (143.3 lb) monster out of the river with his bare hands won a prize of 4 million naira ($34,200) - a fortune in one of the world's poorest countries.

The Argungu festival commemorates a 1934 visit by the Sultan of Sokoto, who came to celebrate peace between his Fulani ethnic group and the rival Kabawa, the main group in the Argungu area.

The government of Kebbi state, where Argungu is located, has tried in recent years to promote the festival as a tourist attraction and it is now a curious mix of corporate sponsorship and age-old fishing prowess.

On one side of the river were V.I.P. stands branded with the colors and logos of a mobile phone network and a popular soft drink. Traditional rulers in colorful turbans mingled in the stands with politicians and foreign diplomats.

On the other side of the river stood a crowd of several thousand men, mostly barefoot subsistence farmers and fishermen from Kebbi and the surrounding areas.

"If Allah wills it, I will catch the biggest fish," said Kassim Yusuf, 31, who normally grows corn and millet to feed his family, as he untangled his net ahead of the competition.

The contestants arrived hours early and stood in the baking sun in a long line parallel to the river, about 1,000 meters away. On the shot of a gun, they charged across the parched terrain towards the water, raising a cloud of dust like a fast-approaching army.

"It was absolute chaos," said Andy Akinwolere, a Nigerian-born presenter on British children's television program Blue Peter, who was being filmed taking part.

"There was a false start so everyone started running but then I saw men on horse-back charging at the crowd to beat them back. Luckily the excitement got me through," he said.

Within minutes, an unstoppable flow of thousands of contestants jumped into a stretch of river barely 1 meters long and started diving and scooping with their fishnet scoops. Many of the men used calabashes or empty plastic jerry cans as flotation devices, paddling in search of fish.

Every time a particularly big fish was caught - one worthy of being weighed on large scales set up in front of the V.I.P. stands - the crowds roared and cheered from the riverside. Drummers were rowed up and down the river on board a precarious canoe, encouraging the fishermen with their beat.

"It was an exhilarating experience," said Akinwolere.

Festival officials said fishing is banned on the stretch of river for the rest of the year to make sure the fish get fat. As the last of the fishermen staggered out, shivering from the cold, a prize-giving ceremony took place where the biggest catches were displayed on the floor in a bloody row.

"This is the first prize," an official said, pointing to a huge grey fish with scales so thick they almost did look like elephant hide.

Rise and decline

According to an FAO article on Guyana, “A preliminary stock assessment, conducted by the Guyana-Brazil Western Central Atlantic Fisheries Commission WECAFC ad-hoc Working Group in May 1998, indicated that the penaeid shrimp resources had probably reached their maximum sustainable yield…”

As the graph shows, over the past twenty-four years, seabob has come to surpass prawns in terms of tonnage of catch.

However, as information sourced from the Department of Fisheries shows, seabob has scene a sharp decline from its peak in the late nineties, consistent with the WECAFC working group findings.

The Blue Revolution
Hope for the industry also lies further out
Speak of sustainability and potential for growth of Guyana’s fishing and the first word that presents itself is “aquaculture” – an activity that is carried out either very close to the shore or completely inland. Yet within Guyana’s vast exclusive economic zone (EEZ) – which extends some 200 nautical miles from the coastline and covers an estimated area of 138,240 square kilometers – there are large untapped marine resources, outside of the much lauded and hoped for petroleum.

Minister of Agriculture, Mr. Robert Persaud.

Guyana EEZ is divided into four zones of fishery activity. At present, the furthest out ships go to harvest is Zone 3, or the Prawns Area, which is between 50-80 km from the shoreline with a depth of between 25 and 50 metres. But beyond that, beginning at 100 km from shore and going some 100 metres deep, lies the bounty – a largely unexploited area of dark blue sea teeming with large pelagic fish (like sharks) and school fish, particularly tuna and mackerel.

This is the staging ground for what Minister of Agriculture Mr. Robert Persaud refers to as “The Blue Revolution” – one of two areas, the other of course being aquaculture, in which the Minister sees potential for growth and diversification within the local fishing industry.

By all indications it is going to be costly revolution. According to a June, 2004 USAID funded Technical Report, prepared by Paul Geer, exploitation of this area is going to require “relatively large capital investment” which would go to financing the large capacity ocean vessels, catching fleets and factory ships that are necessary in harvesting this resource. A substantial sum would also have to be invested in upgrading Guyana’s involvement in regional resource management bodies, like the International Commission for the Conservation of Atlantic Tunas (ICCAT) in which the country currently only has cooperating party status.

Ray of sunlight, the deep blue sea offers hope for Guyana’s fishing industry.

In April, Mr. Persaud told the Review, the Ministry of Agriculture will be hosting a national consultation on exploiting Guyana’s deep sea treasure.

“Together we will try to muster the resources,” the Minister said, “and the other wherewithal so we can then move very aggressively and quickly into tapping those resources. There has been an interest by our local fishing community as well as external [entities] and we want to bring those interests to a reality.”

One of the key topics that is sure to be discussed at that consultation is the present energy crisis, which is currently hitting even the existing sectors in the industry hard (see story on page 6) as well as the issue of policing such an extensive area. Nonetheless, the revolution seems to be an historical inevitability – as the world’s fish resources continue to dwindle, the occasional foreign fishing vessel that is spotted illegally harvesting in Zone 4 of our EEZ will show up increasingly often. And that is a situation we can ill afford.

Conservation efforts abroad
Europe Clamps Down on Overfishing of Bluefin Tuna
BRUSSELS, Belgium, March 20, 2008 (ENS) - The European Commission has launched a major EU control campaign aimed at preventing a repeat of last year's overfishing of Mediterranean bluefin tuna by a number of EU member states. This season, 16 aircraft and 49 large and small patrol vessels will conduct inspections at sea, while 50 inspectors will visit vessels in port.

The launch of the Joint Deployment Plan marks the EU's determination to ensure that the 15 year recovery plan for the giant tunas, agreed within the International Commission for the Conservation of Atlantic Tuna, ICCAT, in November 2006, is fully respected.

Prized by sushi lovers, especially in Japan, Atlantic bluefin tuna can command prices of hundreds of dollars per kilo at Tokyo's Tsukiji fish market.

The Commission says that even effective control measures will not suffice to ensure the sustainability of the fishery until the member states concerned tackle the gross overcapacity of the fleet that targets bluefin tuna.

As documented in a report published last week by the global conservation organization WWF, the whole fishery is plagued by overfishing by a fleet that keeps growing in size and efficiency both in the EU and in the other coastal states that target bluefin tuna.

Joe Borg, European Commissioner for Fisheries and Maritime Affairs, said, "I welcome the cooperation of the member states in organizing the joint control effort. However, they need to go much further to tackle the root of the problem with courage and determination by ensuring the necessary scrapping of vessels till a sustainable balance is found between fishing capacity and fishing possibilities."

"Public funding is available under the European Fisheries Fund for vessel owners and crews affected by such scrapping. Financial support is also available to the fishing communities concerned to help them diversify their economies," said Borg.

He pledged that the Commission "will do all it can" to help the member states return the fishery to "ecological, economic and social sustainability." But the country with the greatest overcapacity, Turkey, is not an EU member state, and Algeria, Libya, Tunisia and Croatia, which also fish for bluefin tuna in the Mediterranean, are not member states either.

Until the fleet overcapacity has been reduced in line with the sustainable level of the resource, control and enforcement will continue to be a critical issue in the fishery.

The Joint Deployment Plan, which will be coordinated by the Community Fisheries Control Agency, marks an unprecedented effort, in terms of both the scale of operations, and the technical means deployed.

The plan will bring together the resources of the seven main member states involved in the fishery - Cyprus, France, Greece, Italy, Malta, Portugal and Spain - and will cover all stages in the market chain, including controls at sea, onshore, and at fattening farms. A special Technical Joint Deployment Group will be set up in Brussels on April 1 to coordinate activities under the plan, and will remain in operation there until the end of the year.

The ICCAT recovery plan includes a new control scheme to address the issue of underreporting in the eastern bluefin fishery, which is the most radical and comprehensive scheme of its kind ever adopted by a Regional Fisheries Management Organisation. In practical terms, the Community Fisheries Control Agency will coordinate joint inspection and control activities of 13 large patrol vessels, 36 coastal patrol vessels and 16 aircraft.

There will be 14 campaigns at sea involving in all 30 inspectors representing overall 160 patrol days. Twenty-five joint inspections involving 50 inspectors are planned in the ports concerned. Commission inspectors will also be involved in 32 inspection visits both at sea and in ports.

The Commission has welcomed the report published by WWF, which analyzes the causes of the overfishing of bluefin tuna and its conclusions on the need to eliminate this overcapacity. This WWF-commissioned report, researched and compiled by independent consultancy A.T.R.T., is the first real estimate of the actual catch capability of the Mediterranean purse seine fleet targeting bluefin tuna.

The report, "Race for the Last Bluefin," says that "fleet overcapacity in terms of number of vessels, as well as in terms of gross registered tonnage and total installed engine power, is by far greatest in Turkey, followed by Italy, Croatia and Libya." An economic analysis based on the minimum catches required to cover costs and generate minimum economic revenues shows strong overcapitalization particularly in Turkey, Libya, Croatia and Italy.

WWF says that "the current operational purse seine fishing fleet targeting bluefin tuna in the Mediterranean Sea from the 11 coastal states ... has a calculated yearly catch potential of 54,783 metric tonnes that is almost double the annual total allowable catch set by ICCAT - 28,500 metric tonnes in 2008. The fleet's catch potential is more than three and a half times the catch levels advised by scientists to avoid stock collapse - 15,000 metric tonnes.

Based on database searches, shipyard censuses and supported by evidence from photographic documentation of vessels, still, WWF notes, the report does not take into account the catch potential of the rest of the bluefin tuna fleet - the longliners, traps, bait boats, pelagic trawlers, and hand line boats.

The WWF report finds that to merely comply with the legal quotas Libya should eliminate from the fishery 22 vessels (58 percent capacity reduction), Italy 17 vessels (36 percent capacity reduction) and France a total 15 vessels (45 percent capacity reduction). To match sustainable catch levels and saving the stock, fleet reduction should be far more drastic: decommissioning as many as 31 large purse seiners in Italy (67 percent capacity reduction), 30 vessels in Libya (78 percent capacity reduction) and 23 vessels in France (72 percent capacity reduction).

Turkey is a case apart, the report says, with an estimated need of capacity reduction ranging between 94-97 percent, equivalent to 168-173 large seiners. Fleet reduction needs have also been quantified for Algeria, Croatia, Spain and Tunisia.

Fish Food Fact

Guyanese are some of the biggest consumers of fish in the region, packing away close to 60 kg of fish person annually, some 200 to 300 percent more than most other countries in the region. And this is on the increase. Whether it’s simple fried fish and chips or more fancy fare, like the baked trout with olive and tomato dressing pictured here, seafood doesn’t seem to last too long on the average Guyanese dinner table.

The energy to go on
The global oil crisis is still hurting the industry
Sixty percent. That is the share of the operating costs of Pritipaul Singh Investments (featured in our company profile on page 7) that goes to fuel. According to Mr. Ronald Deen, Finance Controller of PSI, had the government of Guyana not intervened four years ago and given the industry a special concession on buying oil the entire industrial fishing sector in Guyana would have collapsed.

Mr. Bruce Vieira, President of the Guyana Association of Trawler Owners and Seafood Processors (GATOSP).

Under a special arrangement, trawler and other small vessel owners are able to buy cheap fuel from Venezuela or Trinidad and avoid paying consumption tax once the fuel isn’t landed, and used exclusively at sea. According to Mr. Deen, speaking to GCER in an interview last week, this mechanism provided an essential lifeline to the industry.

This assessment concurs with that given by Mr. Bruce Vieira owner of BEV, one of Guyana’s oldest seafood harvesting, processing and export companies. Vieira is also President of the industry lobbying body, the Guyana Association of Trawler Owners and Seafood Processors (GATOSP).

Back when the agreement between GATSOP and the Government of Guyana was hammered out, the price per barrel on the world market was a nostalgia-inducing US $55 - recently, world crude oil prices hit the US $100 mark and there is no indication that they will be coming down anytime soon. In essence, the trump card that the industry was dealt four years ago is becoming increasingly irrelevant now, as appreciative as those in the business feel about the gesture. According to Vieira, the industry is also highly appreciative of the government’s decision to zero rate certain input items for the industry. Still, he says, the relief in terms of a refund instead of at exemption at sale ties up a lot of cash when cash flow in the industry is at a serious low.

To mitigate the effects of the energy costs on the industry, Vieira says, every major seafood processor in Guyana has resorted to producing their own electricity. Yet generators run on fuel and the cheap fuel concession agreement with government does not apply to any equipment on land.

Aquaculture to the rescue?
While caught fish prices are rising on the global market due to the cost of fuel, aquaculture fish prices are remaining stable. In fact, Vieira credits the global aquaculture industry with

Powering up. Seafood processing companies have to resort to their own power generation in order to alleviate some of the effects of skyrocketing fuel prices.

The fuel costs for aquaculture rearing are, relative to the marine capture industry, virtually non-existent. Marine fishing requires fuel to carry the ships out to sea and bring them back, and this against a backdrop of dwindling stock. Energy is needed for refrigeration or ice on the ships. In the processing industry, energy is needed to run equipment, pump water and freeze the product at temperatures cold enough for export.

The aquaculture industry requires a fraction of the fuel and electricity costs associated with maritime fishing. The Review put the question of a possible transition to, or investment in, aquaculture to Deen, who responded that he had no problem with the idea, except one. PSI, he stated would gladly invest substantial resources into local aquaculture production on the condition that their investment was insured by government against flooding. Without that sort of backing, he stated, the vagaries of the weather in recent times does not make aquaculture

A global phenomenon
To be fair, the price crunch is not only affecting the local industry – it is a global phenomenon and fisheries in rich and poor countries alike are feeling the squeeze.

In April of 2006, some 2000 fishing trawlers – more than ten times the amount in Guyana – operating in the Gulf of Thailand were forced to remain in port due to the escalating costs of fuel prices.

Global oil prices have escalated in recent years, hitting the US $100 a barrel mark earlier this year.

Two years ago, rising fueling prices crushed the tuna fishing industry in the Miyagi prefecture of Japan – a country with one of the most sophisticated and well-established fishing industries on the globe.

“For the deep-sea vessels which ply distant waters,” reads one article on the crisis, “rising fuel costs are a serious issue. The surge in oil prices have boosted annual fuel costs for a deep-sea long-liner by some 50 percent from 40 million yen two years ago to about 60 million yen to 65 million yen, erasing the profits made on their catches, industry officials say.”

And earlier this week, Scottish fishermen were lobbying government – as their Northern Irish counterparts had also recently done – to provide some sort of subsidy for fuel for the industry. They haven’t been as fortunate in their efforts as those in the Guyanese fishing industry have

This means that even as Guyana is considering exploring its resources farther out at sea (see “The Blue Revolution” on page 5), the global situation is giving all indications that the fuel crisis has crested the profitability, perhaps even sustainability, wave for industrial fishing.

French fishermen wince as fuel costs climb
By James Mackenzie
LE GUILVINEC, France (Reuters) - A protest by French fishermen last year forced President Nicolas Sarkozy to promise steps to cushion the effects of high fuel costs on the industry, but soaring oil prices have piled on the pain.

"The main problem we have is the price of fuel," said Marcel Le Roy, who owns seven boats. "It represents between 25 and 30 percent of turnover, which is enormous."

France's President Nicolas Sarkozy (L) shakes hands with fishermen after a meeting in Le Guilvinec, western France, November 6, 2007. A protest by French fishermen last year forced Sarkozy to promise steps to cushion the effects of high fuel costs on the industry, but soaring oil prices have piled on the pain. (French.jpg)

As crude oil has climbed above $108 a barrel, the cost of marine diesel has risen to about 57 cents a liter, almost double the 30-cent ceiling fishermen say they need to stay below to remain profitable, casting gloom over France's fishing regions.

"The price of diesel has become unbearable for fishermen," said Christian Berrou, manager of the fish market in the Breton port of Le Guilvinec where scores of boats unload and sell their catches of monkfish, langoustine and sole each day.

Consumers may complain fish is expensive, but the price obtained by fishermen at the market is only one part of the final cost once transport, packaging and processing is factored in, and there is little room to pass on higher fuel costs.

"The price of fish fluctuates. There's supply and demand. It depends on the quantity there is on the day," said Berrou, whose market handles almost all the catch brought to Le Guilvinec.

Declining stocks have led to a 40 percent cut in the French fishing fleet since 1990 and the country's 24,000 fishermen have grown used to bad news but the latest fuel rises touched off five days of strikes at Le Guilvinec and other ports.

Sarkozy was given a hostile reception when he visited but he vowed not to abandon the industry and the government promised an aid package worth 310 million euros ($476 million) over three years, funded by a tax on fish sales, to modernize the fleet.

The president also questioned the European Union's quota system, designed to protect dwindling stocks, although the government quickly backtracked in the face of dismay from its partners, saying it only wanted greater flexibility.

Despite the measures, fishermen in Le Guilvinec say they have seen little relief and the mood remains somber among the men waiting on the quayside or toiling aboard the trawlers that chug in and out of the harbor.

There are complaints about what most see as unscrupulous competition from Spanish boats, burdensome red tape and a sense that the government and EU authorities would like to see the fishing industry disappear.

" People are completely fed up with it all," said Michel Cosquer, skipper of the Ixia, which fishes off Brittany for langoustine, a small lobster-like delicacy that sells for up to about 18 euros a kilo on the quayside.

Cosquer, whose 15-metre (450-foot) trawler consumes about 1,000 liters (220 gallons) of diesel fuel in 24 hours, reckons he needs to take between 2,200 and 2,300 euros a day, equivalent to about 120 kg of langoustine, to make a decent return.

"Much less than that and it isn't really worth it," he said, a few hours before landing some 80 kg of langoustine as well as sole, mullet and crab at 3:00 a.m.

Fishermen are used to a hard life that keeps them at sea for days or weeks at a time, in cold and wet conditions where sleep is snatched between hauling the nets in every few hours.

The rising cost of fuel makes the hardships less and less bearable for men whose pay depends directly on the return from their catch.

"We don't take on fewer workers, but the fact is that the fishermen's wages are cut by 300 to 400 euros a fortnight," said Le Roy, who employs about 70 crew and maintenance staff.

Many accept that the relentless rise in the price of oil leaves the government little room to maneuver, but fishermen have shown they are willing to take direct action and no one in Le Guilvinec rules out a repeat of last year's protests.

"Everyone's angry, it just needs something to set it off," said Cosquer.

Company Profile
Kingfishers
Pritipaul Singh Investment Limited
The way Pritipaul Singh Investments Limited is run is the way you’d probably expect a decades-old business to run, people with eons of experience in the fishing industry. A visit to company’s McDoom headquarters is a lesson in efficiency, even if a casually executed efficiency at that.

Ronald Deen, PSI’s Finance Controller.

The company however, at just eight years old, is relatively as new as Guyana is to industrial level commercial fishing. PSI’s tersely worded mission statement however sums up what appears to be the internal corporate ‘zeitgeist’ that has defined this entity since its establishment eight years ago.

“We are,” the statement says, “in the business to harvest and process shrimp and fish. Our goal is to be the best in this business. In order to accomplish this goal, all personnel must believe in this goal. Our ability to be able to achieve this mission is the responsibility of all personnel. Pritipaul Singh Investment Inc will provide everyone with the necessary tools to do this. PSI Inc. will do its part and expects everyone involved to do his or her part. By doing this we will continue to grow and prosper.”

The men behind PSI are Pritipaul Singh, the company’s Founder and Managing Director, and Ronald Deen, the Finance Director. Singh, unavailable at the time of the Review’s visit possesses an iconic status within PSI – and one suspects outside of – as a visionary and risk taker. A former trader and primary school teacher, Mr. Singh’s gamble on the fishing industry in Guyana – financed through contacts provided by the older Deen – has paid off and though it still owes money to the banks, PSI is servicing its debts without slippage.

Mr. Deen is obviously the more pragmatic element within the company’s dynamic. On the job, he is grizzly, tough talking and shrewd, able to make productive workers out of the many hardened young men from depressed areas that have found employment at the company – in total, the company employs some 1,500 workers directly with about 500 artisanal fishermen dependent on the company to buy their catch. The semi-militaristic air of efficiency which pervades the PSI headquarters seems to virtually emanate from the Finance Director.

“Time is our working capital,” Deen told us. On a tour of PSI’s processing plant, this principle is evident everywhere, from the design of the facility, geared as much to smoothly transfer workers from one section to the next as it is to manage seafood from the company’s fleet of finfish, seabob and prawns trawlers. It takes about fifteen minutes, for example, for shrimp to move from loading baskets to the packaging and sealing machine, cleaned, graded, weighed and ready to be frozen before the long journey to the company’s markets in the Caribbean and North America. It is not long before PSI product – sold under its Mid-Atlantic Seafoods brand – finds its way into European kitchens, with the company now under the rigorous process that comes with EU certification. Once that comes through, all things considered, the sky seems to be limit for PSI.