by
Theodore Panayotou
Faculty of Economics
Kasetsart University
Bangkok 9, Thailand
Summary
This is the preliminary report of a small Workshop held in Rome, 6–9 December 1982. The Workshop was called to examine the concept of territorial use rights in fisheries (TURFs) and the possible use of such rights in the management of small-scale fisheries. The possibility of using TURFs for fisheries management derives from the recent increase in knowledge about traditional territorial systems that continue to exist in a large number of areas throughout the world. The Workshop was exploratory in nature. This preliminary report recounts the highlights of the discussions on the definition of TURFs and on the evaluation of their use with regard to criteria of efficiency and equity.
1. INTRODUCTION
In preparation for the FAO World Conference on Fisheries Management and Development, FAO held a Workshop on Territorial Use Rights in Fisheries (TURFs), in Rome during 6–9 December 1982.
The general objective of the Workshop was to examine the concept of territorial use rights as a means of achieving fisheries management goals. The specific objectives were:
To provide a definition of TURFs
To evaluate the use of TURFs with regard to criteria of efficiency and equity
To identify and assess the conditions affecting the creation or maintenance of TURFs
To suggest needs for further examination
Because of the exploratory nature of the Workshop, a formal report of the detailed proceedings is not warranted at this stage. Moreover, the workshop deliberately refrained from making any formal recommendations except to call for further investigation of traditional territorial use rights and of the potential for strengthening or establishing TURFs in specific cases. The present paper is an account of the highlights of the Workshop as seen by the author rather than a comprehensive formal report of the proceedings. It is intended for consideration at the Expert Consultation on the Regulation of Fishing Effort and for use in further research and testing.
2. TERRITORIAL USE RIGHTS IN FISHERIES: A DEFINITION
As the term clearly suggests, Territorial Use Rights in Fisheries or TURFs involve a certain territory and certain rights of use relating to fishing within that territory. These features, however, are necessary but not sufficient elements of a TURF; for instance, the right (of every nation) to fish in the open seas (a territory) does not constitute a TURF. Other elements are necessary. One element refers to the contents of rights: in addition to the right of use a minimum degree of exclusivity (that is, the right to exclude others) is necessary. In that sense, a country's Exclusive Economic Zone (EEZ) is a TURF as it implies the right of use by nationals of the resources within a given territory and the right of exclusion of non-nationals. Yet, such a broad definition of TURFs is hardly meaningful from the standpoint of fisheries management. At the other extreme, a privately owned oyster-bed may be considered a TURF as it involves a territory, and rights of use to the exclusion of others. However, such a TURF is trivial since it refers to private property which is presumably properly managed. This brings us to the last essential element of TURFs as defined by the Workshop: that is the rights of use and exclusion defined over a given territory are held by a community or a collectivity with socially integrating forces. This last requirement disqualifies both EEZ's and privately held property as TURFs.
Thus, TURFs may be defined as community held rights of use (or tenure) and exclusion over the fishery resources within a specific area and for a period of time. Accompanying these rights might be certain responsibilities for maintenance and proper management of the resource base, as well as restrictions on the excercise of the rights of use and exclusion.
Although a number of other definitions of TURFs were offered by the participants, it was generally agreed that the aforementioned elements, that is community, territory and a set of rights (including a “satisfactory” degree of exclusivity and tenure) and responsibilities are the essential (minimum) descriptive elements of TURFs. It was felt that prescriptive elements should not be included in this (broad) definition of TURFs.
3. TRADITIONAL TURFS AND THE PROBLEMS OF THE OPEN ACCESS FISHERY
Territorial Use Rights in fisheries, in the sense of community-held rights of use over resources within a territory at the exclusion of others have been known to exist for centuries. Examples of traditional TURFs are still found today, among other places, in Brazil (Cordell, 1980), Sri Lanka (Alexander, 1980; Fernando et al., 1982), Papua New Guinea (Johannes, 1982), Oceania (Johannes, 1978; Akimichi, 1981), Ivory Coast (Garcia, per. comm.). While many of these customary rights are now crumbling under the pressures of population growth, technological change and commercialization of subsistence fisheries, they have provided for centuries a check on the expansion of fishing effort and still do where they are sanctioned by governments, as in the case of Japan (Asada, Hirasawa and Nagasaki, 1982; Comitini, 1966).
The growing interest in TURFs stems from their potential role as management tools for fisheries suffering from or threatened by the ills of open access (overfishing, crowding, excessive effort) and yet refractory to conventional management (e.g., prohibitively high monitoring and enforcement costs). A prime example is the case of remote, scattered, and fluid small-scale fisheries.
As it is widely accepted, unrestrained competition in open-access fisheries leads to expansion of effort (employment of capital and labor) far beyond the level which maximizes either economic benefits or sustainable catch, to the point where costs become so high and catch so low that no net economic benefit (or resource rent) is being derived 1. This amounts to a waste both in terms of the resource and in terms of capital and labour. A reduction of effort would reduce fishing costs and (might) also increase catch and gross receipts resulting in net economic benefits (or rents). The economically optimal level of effort is where economic benefits or rents are being maximized. Such a reduction of effort and its control at the optimal level might be attempted through a number of management tools or regulations such as catch quotas, gear restrictions, seasonal and area closures, fishing effort controls, taxes and licences. Apart from possible ineffectiveness and induced inefficiencies, the introduction, monitoring and enforcement of these regulations involves considerable costs which under certain circumstances are prohibitively high, in the sense that they exceed the expected benefits from regulation (i.e., the potential resource rents). This is particularly true of multigear multispecies small-scale fisheries consisting of large numbers of small and fluid units scattered across thousands of kilometres of remote coastlines. The difficulties and costs of designing, implementing and enforcing regulations over such refractory fisheries are further aggravated by the severe budgetary and administrative limitations of the governments concerned.
Under these circumstances, alternative management tools which hold a promise for lower implementation costs through self-management deserve serious consideration. It is in this light that the potential of Territorial Use Rights as a management tool is being studied.
4. EVALUATION OF TURFS AS POTENTIAL MANAGEMENT TOOL FOR OPEN-ACCESS FISHERIES
TURFs as a management tool for overcoming the problems of open access should be evaluated in terms of both efficiency and equity. A TURF is an “efficient” management tool if it provides the means for generating or increasing the net benefits from a given fishery (or part of the fishery). A TURF is "equitable" if it provides the means for improving the distribution of benefits within the community from the exploitation of the fishery. A third attribute of TURFs as a management tool is their possible contribution to the wider community (society) in terms of environmental preservation, resource conservation and possible generation of government revenues.
4.1 TURFs as a Means for Increasing Fishery Net Benefits
The establishment of a TURF may help generate or increase net benefits from a heretofore open-access fishery in a number of ways:
By excluding outsiders from the territory of the TURF
By controlling the use of labour and capital within the territory of the TURF
By dealing with spatial and other externalities partly through internalization and partly through coordination with adjacent TURFs which share the same stocks.
By investing to enhance future returns, negatively through increased incentives to avoid depletion and positively through community works such as landing places, artificial reefs, aggregation devices and aquaculture
By providing flexibility to adjust to changes in technology, markets, resource characteristics and the socio-economic structure of the fishing community (flexibility includes the divisibility of the TURF).
However, these potential means or advantages of TURFs (over a situation of open access) for generating benefits are by no means automatic, certain or costless. To each, are “buts” and “ifs” attached which are discussed in some detail below.
Exclusion of outsiders
Under contemporary conditions effective exclusion of outsiders from a given territory necessitates an external authority to acknowledge and reinforce existing boundaries and rights or to establish and protect boundaries and rights for new TURFs. This requires a decision to recognize an existing pattern of wealth distribution or the politically more difficult decision to redistribute wealth. The latter is also technically difficult in situations where stocks are mobile and there is no clear relationship (identity) between the biological unit (stock) and the socio-economic unit (community). The creation of a TURF should be easier where social and resource territories are “coterminus” and/or where redistribution of wealth is a well-accepted function of government.
However, despite the need of external authority to sanction and protect the boundaries of TURFs, management, monitoring and enforcement costs may be substantially reduced by the creation of TURFs. Instead of having to introduce detailed management regulations and to monitor the actions of thousands of scattered fishing units, the government's role is reduced to resolution of inter-community conflicts while detailed management, monitoring and enforcement activities are relegated to the internal social mechanisms of the community. There would also be little need for monitoring of outside encroachments by the external authority since it would be in the best interest of the members of each TURF to guard jealously their resources and report such encroachments. On the negative side, creation of TURFs might lead to intercommunity rivalry and warfare with the need for continual government presence to maintain law and order.
Control over labour and capital
Whenever profits exist under open access conditions, there is tendency both by outsiders to enter the fishery and by insiders to increase effort (employment of labour and capital) in order to increase their share of the profits. Thus, even if entry from outside the TURF is stemmed still the fishery may continue to suffer from the ills of open access if there is no control of the amount of labour and capital employed by the members of the TURF. Yet, control of the use of labour and capital is necessary if “capital-stuffing” and “racing” (characteristics of open-access fishery) are to be prevented, fishing costs held down and overfishing avoided.
A TURF may serve as a means of controlling the use of capital and labour through appropriate incentives (and penalties) discouraging the use of one or both of these inputs or by establishing appropriate sharing mechanisms among members which promote more the cooperative than the competitive spirit. A TURF may also help break the nexus between capital and labour by reducing the competition for ever more modern/efficient equipment or even by encouraging common ownership of vessels and gear. A TURF may also facilitate controls over the type of capital equipment used (e.g., mesh size) and a curb over the use of destructive fishing methods such a poison and dynamite.
However, TURFs cannot always determine the “optimum” amount of fishing effort especially with fluctuating stocks and rapidly changing technological and economic conditions. TURFs may also have difficulties enforcing controls although they are likely to be an improvement over both open-access and centralized fisheries management because of the social mechanisms available in a closely-knit community such as peer-group pressures, social sanctions, elders leadership, etc. Another difficulty to be faced by TURFs is in deciding who, from within the community, would be allowed to enter the fishery and with what amounts of capital and labour. The question of “membership”, that is, who would be allowed to fish or to share the benefits from the fishery, is a very important one which was not resolved to the satisfaction of the workshop and calls for further study and discussion.
While the creation of TURFs may help reduce monitoring and enforcement costs, it might result in loss of economies of scale in obtaining information concerning the stocks and the fishery wide optimum amount of effort. Even within the TURF there would be costs of acquiring information as to how much and what kind of fishing effort to apply. In certain situations (mobile species or widely fluctuating stocks), the community would need scientific information and outside assistance for determining the appropriate fishing rate.
Dealing with externalities
In an open-access fishery, where each fisherman acts as a separate economic and “management” unit, the actions of one fisherman have an effect on the catch and the returns to all other fishermen who exploit the same stock. The individual fisherman does not perceive this external effect (or externality) or even if he does, he has no incentive to take it into account. The racing, crowding, capital stuffing, and falling catch per unit of effort are different manifestations of the externalities which open-access fishermen impose on each other. TURFs deal with the externalities between their members by internalizing them into one “management” unit, the TURF, within which members are forced to take into account the effect of their actions on each other's catch and returns.
However, unless the community and the resource stock are “coterminus”, some externalities would remain outside the TURF. With shared stocks and migratory species many externalities cannot be internalized unless the TURF is large enough to encompass the entire stock; such a TURF is unlikely to be functional as a management unit since it lacks the integrating social forces of a closely-knit community. While a TURF cannot internalize all externalities, it does provide an entity which can coordinate with adjacent TURFs over shared stocks (including migratory fish, shared resources and water quality). Such externalities might be best tackled through the concept of “TURFs within TURFs” (smaller precisely defined TURFs within larger less precisely defined TURFs) and fisheries coordination committees similar to those established in Japan with both a coordinating role and authority for mediation and arbitration. But, if the externalities left outside the TURF (to be resolved through coordination with other TURFs) are more significant than those which have been internalized, the TURF is unlikely to be successful as a management unit. If the members of the TURF perceive that outsiders' actions have a more direct and pronounced effect on the state and productivity of their portion of the resource (and hence on their future profits) than their own actions they are unlikely to behave differently than open-access fishermen. This suggests that the concept of the TURF is likely to be most successful in the case of sedentary or not very mobile resources such as seaweed, oyster and clam beds, and in the case of resources within well-defined geographical areas such as reefs, tidal lands, swamps, self-contained bays, lagoons and river estuaries. The concept may be more difficult to apply to more mobile resources, but may still be more successful under the right conditions.
Investing to enhance future returns
The creation of a TURF itself may act as an incentive for members to stop regarding the fishery as an extractive industry and begin treating it as a renewable resource, whose productivity can be enhanced through investments including the abstention from fishing in certain areas and seasons (e.g., spawning). For such a change of attitude and behaviour, however, there needs to be a clear perception of the relationship between present actions and future returns. The clearer this relationship is, the stronger the incentive for self-management/self-enforcement. The TURF's membership or leadership may reinforce this change of attitude and behaviour through regulation (e.g., close areas and seasons) as well as through incentives. Again, the design of regulations and incentives involves costs, in terms of information on yields, fishing effort, expenditures and revenues.
A TURF may also facilitate or promote community investments in fishing infrastructure (landing places, artificial reefs, fish aggregation devices) as well as in fish culture as a supplementary source of income and employment. TURFs may increase government willingness to support investments, as well as to organize the community for demanding such assistance. Important considerations with respect to such investments are the security of tenure (sufficient time to pay-back and earn a satisfactory return) and possible leakages of benefits to outsiders which might diminish the incentive to undertake such investments.
Flexibility to adjust
Many management tools and regulation often fail over the long-run, despite an early success, because of rigidity, that is, lack of flexibility to adjust to changing socio-economic technological and resource conditions. Moreover, centralized fisheries management takes into account the average conditions in a fishery rather than the particular circumstances of each specific location/community. In contrast, TURFs have the advantage of being both localized and flexible enough to take into account local circumstances and to adjust to a changing bio-socio-economic environment. The characteristics of both the resource and the fishing community change over time and so do markets and technology. TURFs can evolve or be modified through adjustments in territory, rights or membership to account for these changes in circumstances.
However, for such flexibility it might be necessary to incorporate in the concept of TURFs the ability to lease or sell shares (transferability) and the ability to divide or merge the TURF with adjacent TURFs, all of which entail risks and call for safeguards to preserve the essential elements of the system.
4.2 TURFS as a means for improving the distribution of benefits
TURFs may help improve the distribution of benefits among the members of a fishing community in a number of ways:
By improving local employment opportunities
By increasing local income, consumption and nutrition and evening out fluctuations in income
By making possible the preservation of community social organization and reducing intra-and inter-community conflicts
By promoting social mobility and “learning by doing”
Again, these benefits are by no means automatic, certain or costless; there is certain likelihood that they will be realized if certain conditions are met or courses of actions are taken as discussed below.
Improving local employment opportunities
Following the creation of a TURF in a given community, the employment opportunities within the community might increase while those outside the community might decline as a result of the exclusion of outsiders. Employment opportunities within the community might improve for a variety of reasons: (a) transfer of employment opportunities from outsiders to insiders through resource redistribution (e.g., exclusion of trawlers from coastal resources); (b) inducement of a more rational input mix with higher labour component as a result of reduction of capital stuffing, termination of subsidized mechanization and increased interest in retained benefits to the members of the TURF as a group; (c) use of part of the generated rents (see Section 4.1) to expand employment opportunities within the community (e.g., aquaculture, fish aggregation devices and other community-supported projects); and (d) improvement of secondary employment opportunities (local processing, marketing, etc.) through an enlarged catch (following the recovery of the fishery) and through deliberate action to encourage local processing, etc.
However, for such benefits to be realized it would be necessary to set appropriate criteria for TURF membership and/or for sharing of benefits. This becomes more evident in the earlier stages of the life of a TURF if (primary) fishing employment must be reduced to allow the fishery to recover. Earlier on, the issue is who would pay the cost for the fishery's recovery (through exclusion from employment) and later on, as the fishery recovers and employment opportunities are improved, who would share in the benefits (through better-paying jobs).
Membership in the TURF, number of shares per member, and their transferability would determine who would benefit from the improved employment opportunities. Setting up criteria for membership is not an easy task; residing in the community, being an active fisherman for certain period of time, depending significantly on fishing, abiding by the community rules, etc. are possible criteria. Similarly, it is necessary to set up criteria and procedures for termination or transfer of membership. These issues arise not only in relation to the distribution of employment benefits but also in relation to the distribution of all other benefits (and costs) from TURFs. But, other things being equal, increased employment opportunities would mean a better distribution of benefits since those with the least amount of capital are likely to benefit most from additional employment on improved terms.
Increasing local income, consumption and nutrition
The creation of a TURF might increase local incomes in a number of ways: (a) by acquiring a larger share of resources following wealth redistribution (see section “Exclusion of outsiders” above); (b) by generating rents, captured in part or entirely by members, through fishery management (see Section 4.1); (c) by retaining a higher percentage of generated income within the community; and (d) by facilitating more integrated development, i.e., community control over processing, marketing and distribution, and further enhancing local economic linkages.
Increases in local incomes are counted here as contributors to improved income distribution based on the presumption that (small-scale) fishing communities under conditions of open access are at the bottom of the income scale. The outsiders who are excluded by the creation of the TURF are, presumably (large-scale), trawler and purse seine owners which are higher up on the income scale. To the extent that low-income people (actual or potential fishermen) such as migrants are denied access to the fishery by the creation of the TURF, income distribution deteriorates. Again, the membership and the nature and distribution of shares among TURF members are deciding factors of the distributional outcome of TURFs. Transferability of shares, internal power structure and equalitarian values of the community will also play a role in the intracommunity distribution of benefits. An important issue requiring further study is the appropriate nature of the share: a share in net benefits, a privilege of access (licence), or a vote in decision making?
Other difficulties related to “increasing local incomes” is the trade-off between efficiency and distribution: efficiency requires that shares are transferable but transferability (and flexibility) introduce difficulties in assuring that incomes remain local. On the other hand, the system may break down if a substantial portion of the increased income consists of rents. Rent differentials with other TURFs and non-TURFs would create pressures for enlarging access, increasing considerably enforcement and policing costs. In many cases, rent differentials may not be great, but where they might be, the outside pressure may be eased by taxing away part of the rents which would contribute to both fairness and efficiency (reduction of policing costs).
The creation of TURFs might also have a positive impact on local fish consumption (and hence nutrition) over and above that which might be induced by higher local income. This might be the result of wider participation of the benefits from the fishery within the community (improved distribution) or a “by-product” of local processing.
The impact of TURFs on the fluctuations of income levels is rather ambiguous. On the one hand, the creation of TURFs might even out fluctuations through resource management and induced social sharing and, on the other, it might worsen fluctuations by confining fishing operations within a more limited area than under open access.
Preserving social organization and reducing conflicts
Community organizations and social relationships including the spirit of cooperation and sharing rather than antagonism and conflict may be promoted by the creation of TURFs in which members have common and more or less equitable interests. Community organization and social relationships are likely to contribute to improved distribution of benefits from communal resources and opportunities which extend beyond the fishery. Moreover, a healthy community organization with democratic decision making and amicable social relationships may be valued for its own sake.
A TURF may help reduce intracommunity conflicts because of the sense of greater common interest which it is likely to bring about. However, this requires a sense of security of tenure and “fairness” in the distribution of benefits (or at least opportunities) as well as a set of procedures for orderly and peaceful resolution of occasional conflicts. Intercommunity conflicts may also be reduced through coordination and a set of formalized procedures for mediation and arbitration for dealing with externalities. The frequency and severity of intercommunity conflicts would depend on the size of TURFs (or more precisely the relative sizes of the social and the biological units) and the sensitivity and certainty with which the boundaries are drawn. Intercommunal conflicts may be exacerbated by unfair distributional decisions, pervasive externalities and wide rent (or income) differentials brought about by changes in resource characteristics or economic parameters.
Promoting social mobility and “learning by doing”
Social mobility might be enhanced by the creation of TURFs to the extent that crewmen and landless labour in the community acquire shares in the TURF which enable them to derive income from property beyond the income from their labour. On the other hand, the TURF may facilitate the loss of rights to the resource by allowing or even encouraging the sale of shares (including forced sales) which might result in concentration of shares in few hands and “proletarization” of the marginal fishermen (downward social mobility).
TURFs may encourage “learning by doing” in a variety of ways including community development, familiarization with new technology and access to a broader capital market. Community tenure over a resource may help develop community responsibility and improve existing social organization (see Section “Preserving social organization and reducing conflicts”) or even provide a new form of social organization which can be built on. TURFs may facilitate acquisition and use of new technology because: (a) large-scale operations may be excluded allowing the community to fill the gap; and (b) security of tenure and collective control may encourage use of new gear and possibly investments in aquaculture. TURFs may promote access to a broader capital market by providing greater status and security (property) to fishermen as well as by opening up opportunities for new technologies provided that there are sufficient indications of high future returns.
4.3 Improving benefits to society
A TURF may operate in a way beneficial not only to its members but to the society at large as well, by conserving resources, preventing environmental degradation and possibly generating some government revenues. TURF members have incentives to manage the fisheries and conserve (“optimally use”) the resource because of security of tenure or at least a clear and lasting association between the state of the resource and their incomes. However, technical information for proper management may have to be provided by external (government) sources.
It is to the best interest of TURF members to prevent damaging alterations of the environment such as water pollution, felling of mangrove forests and destruction of coral reefs within their territory because such actions would have a pronounced negative effect on their livelihood. Preservation of the environment contributes to non-fishery uses of the territory and adjacent areas (e.g., for recreation and tourism) and to the general ecological stability of area. TURFs may promote social responsibility by giving fishermen more effective voice in planning and decision making.
Finally, TURFs, or at least the most successful of them, may produce revenues for the society at large: (a) by saving on management and enforcement cost; (b) by reducing the need for costly welfare/development assistance to depressed fishing communities; and (c) by generating substantial resource rents, part of which may be creamed off by the government through appropriate levies.
5. CONCLUDING REMARKS
In concluding, it should be noted that our examination of TURFs was based on the assumption of community rather than private individual controls. The Workshop envisaged that an overall benefit of a TURF is that it allows the government to turn over to the local community many of the functions and responsibilities of management (including the determination and distribution of benefits, the acquisition of information) and enforcement.
While there was more or less consensus on the potential benefits and difficulties of TURFs as a management tool, as described above, the workshop recognizing the paucity of knowledge on the subject refrained from making any recommendations for the establishment or promotion of TURFs at this stage. It was, rather, concluded that governments are well advised to examine and give careful consideration to traditional TURFs and their potential contemporary relevance as tools for fisheries management and rural development.
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