Redistribution and Transformation in the South African Fishing Industry: The Case of the Squid Fishery

Abstract

Political normalisation in South Africa during 1994, and the drafting of the Marine Living Resources Act 1998, led to the imperative to transform the fishing sector to more equitably reflect the racial demographics of the country. The squid fishery, like most other South African fisheries, has historically been dominated by white ownership of access rights and vessels. The squid fishery is an effort limited hand-jig fishery with each operator possessing permits for a certain number of individual fishers. Imposition of racial equity in the squid industry was attempted by means of simple redistribution of a proportion of fisher permits, away from existing boat owners to new entrants from historically disadvantaged communities. The lack of human skills and capital - which is a persistent legacy of apartheid - of the new entrants, coupled with one year tenure of permits, resulted in a market for paper permits, which were then leased back by boat owners who had lost them. The attempted “transformation” of the squid industry was thus, in effect, a revenue tax on established operators, and participation in the industry by new permit holders was minimal. However, many vessel owners who lost a proportion of their permitted crew in the redistribution process, did not lease back permits but simply went to sea with a full crew and fished illegally. The net result was an increase in total effort in the fishery threatening the sustainability of the resource. An incentive market based process of transformation is proposed. The paper argues that long term access rights on vessels can be used as a behavioral incentive for boat owners to internally transform their own ownership structures, and promote meaningful participation of previously disadvantaged individuals in the industry.