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Can Big Business Save Japan's Fishing Industry?

When a 9.0 earthquake struck northern Japan in March, Yukihiro Osawa felt prepared. Like most fishermen in his village on Miyagi Prefecture’s Oshika Peninsula, he docked two of his boats on a nearby island where they would be sheltered from the coming tsunami. He then hurried to shelter, and looked out to sea.

“I could see the tsunami over the top of the island, and I said to myself, this is gonna be a bad one,” says Mr. Osawa.

He was right. When the waters calmed, his two boats were all that remained of his fishing and aquaculture business that had previously employed about 15 people. Replacing what he lost will cost 40 to 50 million yen, nearly $600,000 dollars, he estimates. He’s determined to rebuild his business by next year, but a recent proposal by the local government in an effort to save the industry as a whole could hurt his business and change the industry altogether in the process.

Miyagi Governor Yoshihiro Murai says he doesn't think older, smaller-scale fishermen will be able to recover even with government help. So, in what he says is an effort to salvage the billion dollar industry, he has proposed opening coastal waters – long restricted to independent fishermen belonging to Fisheries Cooperative Associations – to big-business investors.

The proposal has drawn harsh criticism from the fishing cooperatives who say it's just a move to pander to big business and fear they will be pushed out of the market. And many academics argue that the proposed system would expose coastal communities and ecosystems to exploitation and abandonment.

“We don’t need this,” says Osawa, who fears large companies would easily undersell him.

Under fisheries law enacted in 1948 and amended in the 60s, cooperatives have preferential access to coastal fishing rights, which they distribute to their members. Nearly all commercial fishermen belong to a cooperative in Japan. Outside investors can get involved by forming partnerships with fishermen or by claiming leftover fishing rights.

Mr. Murai has petitioned the central government to designate a special fishing zone where companies would have the same access to fishing licenses as cooperatives.

A little less than half of Japan's roughly $3 billion in annual food exports comes from seafood. But even before the tsunami struck, cooperatives nationwide were plagued by shrinking membership, financial troubles, and declining fish stocks.

Masahiro Yamao, a fisheries expert at Hiroshima University’s Graduate School of Biosphere Science, says the Miyagi proposal is a test case for a larger restructuring of the struggling fishing industry.

Miyagi officials say investment from outside businesses is crucial now because the extent of the damage is so extreme. Norimitsu Kobayashi, technical director of the Miyagi Fisheries Recovery Department, has the numbers to support the government’s claims. Ninety percent of boats were destroyed in the tsunami, all 142 fishing ports were damaged, there was $25 million in damages to aquaculture, and $2.5 billion to processing facilities.

According to an April United Nations report, "Considering that agriculture and fisheries are one of the biggest industries in Tohoku Region, reconstruction of these sectors ... will be critical for the reconstruction of livelihoods."

On top of that, 60 percent of Miyagi’s fishermen are over the age of 50, and in one survey 30 percent said they plan to quit the business because of the tsunami.

“It’s really hard for people in their 60s and 70s to start over again,” Mr. Kobayashi says. If large companies set up coastal fishing businesses, they could hire local fishermen as salaried workers who wouldn’t need to buy their own boats.

But Mr. Yamao, the fisheries expert, sees a risk in inviting big businesses into the local fishing industry.

In Japan, marine resource management is left nearly entirely to the local cooperatives, which regulate net size, fishing periods, and other aspects of the industry.

“Locals have been here for generations managing the resources,” says Yamao. “The priority for a corporation is profit. If there’s no profit, they leave.”

A new framework would be necessary to prevent overfishing, should big companies get involved outside the existing system, says Michael Clark, a Fishery Management Specialist with the National Oceanic and Atmospheric Administration.

“US fishing laws start and end with a quota for most species, so it doesn’t matter if you’re a mom-and-pop operation or a big company. [But] Japan only has quotas for seven out of hundreds of species,” says Mr. Clark, who spent a year in Japan studying the fishing industry as a 2008-2010 Mansfield fellow.

“[The Miyagi plan] would affect the whole country,” says Yamao. “But it’s caused so much conflict between fishermen and the government that it’s become an obstacle to reconstruction.”

According to a recent poll by the Asahi Shimbun, the second most circulated newspaper in Japan, Miyagi residents are divided on the proposal. Fishing cooperatives officials said that even their members can’t agree if inviting big corporations in is a good idea or not.

There are other approaches to dealing with the suffering fishing industry. Neighboring Iwate Prefecture, which endured damage nearly as extreme as Miyagi’s, does not plan to request a similar exception to the fisheries law, but instead will funnel national and prefectural recovery funds through existing cooperatives to spur recovery.

Fukushima Prefecture has halted all coastal fishing due to the nuclear disaster and has not yet drafted a recovery plan.

Meanwhile, despite government proposals, fishermen have plans of their own.

On a Sunday in September about 150 people from Tokyo and other distant cities gathered on a fishing pier in Ogatsu, Miyagi Prefecture, to help tie seed oysters to ropes and suspend them in the bay. The visitors each paid 10,000 yen, about $130, to join the fisherman’s version of a community supported agriculture business.

The up-front investment will pay for boats and other equipment. Investors will eventually be paid back in oysters, scallops, and salmon by the 10 fishermen and two marketing specialists who own the business. Company president Hiromi Ito says it’s the first business of its kind in Japan.

“Because we have this, we’ll be fine even if big corporations come in,” he says. For many other small-scale fishermen in Japan, the future is unfortunately much less certain.

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