Feasibility Report on the Fisheries Sector in Somaliland
Description of the fisheries sector in Somaliland
The fisheries sector has historically not been a priority area for the Somaliland people, and hence the agro-pastoral system and livestock sector has remained the economic backbone of the region. Until the droughts in 1974 and 1976, only very few coastal people were seriously involved in the sector. However, as part of an overall Government policy many drought-affected people were resettled along the coast and encouraged to take up fishing. This initiative was followed by the construction of Berbera Cold Storage and the Fishing Centers in Zeila and Berbera. Consequently, an increased trend was observed in fish consumption in the period 1986-1989, even though the Somaliland people remain some of the lowest consumers of fish and fish products.
The main types of fishing activities:
Despite the diversity and abundance of the marine resources available in Somaliland, the sector has still not developed a wide range of fishing activities designed to harvest the variety and diversity of fish species and other offshore resources. The Coastal and Marine Resources Policy in Somaliland identifies five different types of fishing, of which only Artisan and Industrial fishing is of significance for the sector.
Artisan fishing is one of the predominant types of fishing in Somaliland. It operates from 10 coastal settlements. It uses about 450- 500 small vessels of which two-third is motorized and the remaining one-third canoes. The sizes of the boats range from 6.4 to 8.5 meters in length. The size of the available vessels is one of the limiting factors to reach offshore resources and prevents the fishermen from fishing during certain seasons of the year. Traditionally, this sector uses gillnets, hooks for large fish and shark, hand-lines, and to a lesser extent, traps and seine nets.
The vessels for industrial fishing are larger and use inboard engines, operating from formal harbors and use equipment of an industrial nature, (collector vessels included).
This fishing sector has not previously been of economic significance in Somaliland.
During the feasibility study however, there were 36 medium-sized Egyptian vessels operating on the coast west of Berbera. The Ministry of Fisheries and Coastal Development issued fishing licenses to the Egyptian fleet in November 2003. The average monthly catch per vessel is around 30 MT. It is envisaged that the total landing of this fleet would reach 6,480 metric tons by June 2004. Employment and income generation of this fishing sector is limited to 36 fishing inspectors from the Ministry of Fisheries and provides around US$ 200,000 in royalty fee to the government.
It is not easy to differentiate between subsistence and artisan fishing. However Subsistence Fishing can be defined as fishing without the use of boats and where the catch is entirely for private consumption carried out on an individual basis. Thus, this fishing activity does not contribute significantly to employment and income generation.
Less than 1% of Somaliland’s population is currently engaged in the fisheries sector, and of these most are limited to small-scale fishing. Lack of useable coastal roads, adverse temperatures and on-shore infrastructures are the main problems restricting production, processing and marketing opportunities of artisan fisheries. The narrowness of the continental shelf and the predominantly rocky and coralline bottom limits trawling potential to a few areas. The total fish production in Somaliland reached its highest level this year, but is still below 13,000 metric tons.
Fresh fish is harvested out of Loado/Zeila, Berbera/ Karin and Las Qorey. In Loado/Zeila area, fishermen have penetrated the Djibouti market and sell their fish through informal arrangements. On a daily bases, about 7 boats each carrying 500 kilos of fresh fish cross and market their catch in Djibouti City. In addition, 30- 35 fishermen harvest prawns and crabs near Loado and market the product in Djibouti through similar arrangements. The indication is that 2.500 to 3,000 kg of fresh fish are exported to Djibouti per day.
Artisan fisheries around Berbera and Karin supply local markets in Burao, Hargeisa, and
Berbera through Red Sea, Xeeb Soor, and Ximre fishing companies in Berbera,
Discussions with these three fish trading companies indicate a consumption of approximately 100 tons of fresh fish in these three towns per month, making the yearly consumption (9 month fishing season) about 900 tons.
The Las Qorey Tuna Canning Plant is the largest available market for artisan fisheries in the Sanag region. Since the plant started its operations in 2001, more than half of the boats and fishermen in Somaliland work for the plant. During the nine months that small boats are permitted by the winds to fish, the plant operates at full capacity and processes 16 tons of fresh tuna per day, averaging an estimated 4320 tons per year.
This sector is not fully developed in Somaliland; however, there are currently around 36 medium-sized Egyptian trawlers fishing offshore in Awdal waters. Reports from the Ministry of Fisheries indicate a catch of 30 tons per vessel per month. It is interesting to observe the dramatic change in fish landings in 2004. Before, the arrival of the Egyptian trawling fleet, artisan fish landings accounted for over 80% of the total landings. Today, the ratio of industrial to artisan landings is almost 2:1.
Landings from shark fishery and other non-traditional marine resources, such as crabs, prawns and lobsters are difficult to estimate, and are not included in the above table.
Currently the fishermen are only utilizing the fins from the shark, whereas the meat is thrown back in the sea, a fact that illustrates the current inefficiency inherent in the artisan sector. It is important to note that the 7.5 m and 8 m motorized boats can sustain valuable fishing operations assuming that sufficient supplies and appropriate fishing gear is employed. It is again apparent that the yearly total catch by above sized boats could increase substantially if supplied with required provisions and the development of an effective system of collecting catches.
It is hard to obtain accurate statistical information on Somaliland marine resources for three reasons. Firstly, as mentioned in previous sections, people in this region are pastoral nomads lacking basic knowledge of fishing and have shown a distaste of fishing activities and fish eating. The impact of this cultural barrier is also illustrated by the failure to collect fisheries data for many years and the reluctance of the private sector to invest in the fishery sector. Secondly, all existing marine resource estimates were carried out during the pre-war and hence refer to the overall Somali Democratic Republic resources. Thirdly, Somaliland has not executed research activities during its 13 years of independence. Despite this fact, the coastal reef and offshore fisheries are, according to many accounts, highly productive in terms of demersal and pelagic species, and these resources have significant economic value and potential for development of Somaliland. Finally eco-tourism is also very promising business, especially, in the vicinity of Zeila and Loado.
One principal characteristic of the fishery sector is the highly perishable nature of the resource once it is removed from its natural environment. Bacteria and enzymes rapidly spoil the edible flesh of the fish, especially at the high temperatures that prevail through the year in coastal areas of Somaliland. As a result, both speed and careful handling are necessary in the distribution and marketing process. Fish is similarly difficult and expensive to store over long time. In many coastal areas of Somaliland, quick transportation/distribution, freezing or immediate consumption of fresh fish is virtually impossible. Therefore, current marketing opportunities are very marginal, if not impossible.
Future local potential
Historically, the people in this region were known for their cultural dislike towards fishing and fish eating habits. However, the introduction of modern fish processing facilitates in the mid-80’s has had a great impact and changed the biased attitude so that today fish is increasingly eaten by urban populations in many towns.
Interviews conducted in Burao, Hargeisa, Gabiley and Borama all indicate the presence of a high demand for fish products. The three major fish trading companies in Berbera supply around 3-3.5 ton to Hargeisa and 1,5 ton to Burao at present.
International marketing potential
Somaliland fish products could potentially access the global market for fish. One emerging market is land-locked Ethiopia, with over 60 million people without their own supply of fish products. Another lucrative market for fish exists in the oil rich Gulf States. Projections indicate prospective comparative marketing advantages for Somaliland fish exports in these two regions. The only issue to be conscious about is the emerging impacts of globalization of fisheries trade in general.
Impact of globalization on the fisheries trade
The intention is not to examine the overall impacts of globalization on trade, but at thesame time, it will not be possible to discuss its impact on the fishery trade without highlighting some common issues. The technology information revolution has changed the world drastically and has become a dominant socio-economic wave affecting every corner of the planet. The Internet is changing the behavior of individuals and the arrangement of organizations, adding new dimensions to human ability and expanding the range of opportunities.
This is the phenomenon referred to as globalization. Both advocates and critics of globalization agree that it is generating considerable benefits, rapid technological improvements and offering unparalleled opportunities to advance sustainable development. Similarly, both groups concur that the benefits of globalization are unevenly distributed among the poor and rich countries.
The ability of a society to move towards sustainable development is determined by the capacities of its people and institutions. Since the capacities of the people and institutions in Somaliland are weak, fishery trade and development will not currently be competitive on the world market. In addition the fisheries trade has its own unique problems. It is a delicate commodity that spoils very quickly unless it is properly handled and it requires consistent procedures and high quality control mechanisms. In a situation where proper fish handling and storage infrastructures are completely absent, the product is unlikely to meet world recommended standards.
As soon as fish is removed from its environment and until it is put in the pan, it comes in contact with a variety of mediums. Unless those mediums are hygienic, it can easily be contaminated. Typical examples of those mediums include: human contact, the deck of boats, landing and carrying boxes, handling and processing premises and packaging materials. The final and crucial factors determining the quality of fish and fish products are the standard of freezing and storage used. Internationally recommended freezing and storage temperatures of fish are between (–45º C) and (–22º C).
In the absence of ice, freezing and storage facilities, and poor awareness in terms of fish recommended quality control standards on the side of the fishermen, the prospects for the development of the fishery trade in Somaliland is weak. In particular, the standards defined by the developed world are difficult to meet. In European countries for example, fish importing agencies need to present a EUR 1 Form, which provides minimum allowable contents of bacteria and other hazardous substances. At this stage it is difficult for the Somaliland exports to live up to those defined standards, especially since there is a lack of authorized veterinarians to certify the products. In conclusion, the barriers are so many and complex, that access to markets like Europe is difficult, if not impossible.
Constraints facing the Fisheries Sector
Somaliland possesses rich fishing grounds along its northern coast, which could potentially support a developing fishing industry and contribute to the national food security and socio- economic wealth (Van der Elst, ORI, Durban, S.A). The maximum potential catch that could be harvested from Somaliland’s marine resources is estimated
to be between 90-120,000 MT a year, but currently less than 5 % of that quantity is harvested by nationals.
Some of the major constraints impeding development of the fishery sector are as follows:
The coastline is relatively straight and lack natural shelters, protected anchorages and landing sites for artisan fishery. There used to be simple jetties in Zeila, Mait and Las Qore before the war. The jetty in Zeila was made of rocks and cement concretes, but filled by sedimentation. Mait and Las Qore jetties were made of concrete pillars dug in to the sea and roofed by wooden planks. However, currents and lack of maintenances have ruined these facilities beyond repair.
Climatic and oceanographic conditions and shifting winds cause unpredictable currents and waves, which pose a constant threat to the fishing fleet. Prevailing high temperatures through the year, high humidity and the difficulty in accessing the richest fishing areas accelerate fish spoilage and reduces chances of selling catches.
The lack of ice, freezing and cold storage facilities limit the opportunities in the fishing businesses along the entire coast. A number of development initiatives, intended to enhance the fisheries sector were implemented during the Siad Barre regime with international assistance. The most significant development initiatives were the 400 metric ton fish handling cold storage in Berbera, which supported the efforts of FAO/ UNCDF fishing centers in Zeila and Berbera to upgrade artisan fisheries in the area. Another major input was the 400 MT cold storage funded by DANIDA in Berbera in 1986.
Since 1994, limited assistance from COOPI enabled artisan fisheries in Berbera and Zeila to resume fishing activities. COOPI rehabilitated the two fishing centers in Zeila and
Berbera, but the amount of ice produced by these two centers is not enough to cover the needs of the vessels. The problem of the Berbera Cold Storage has not been addressed and has reached a point where its rehabilitation seems impossible.
Another serious technical problem is rooted in the introduction of GRP motorized boats in the 1980’s. As traditional fishermen lack experience in engine and boats hull maintenance, the scarcity of appropriate workshops with qualified technicians, absence of local shops selling engine spare parts and nets are curtailing the smooth running of the fishing activities. The spare parts are usually over-priced and much time is lost in waiting for delivery, leaving many vessels idle for long periods of time. The cumulative impact of these problems reduces the durability and efficiency of GRP boats in general.
Problems in this section are rooted in the political arena of Somaliland. Since 18, May
1991, when Somaliland declared its independence, it has not attained formal diplomatic recognition. In addition, the fishery sector faces some unique problems as discussed, which are not shared by other productive sectors of the country. The poor general knowledge of fishery and understanding of the problems in the sector, also contributes to the lack of appropriate data records in the sector and reluctance of private sector investment. Finally, the lack of formal organizational structures, in the form of fisheries cooperatives and the existence of parallel authorities competing with each other, weakens the position and prospects of the sector.
Fisheries data collection
Another severe problem for the fishery sector is the total lack of statistical data, which could provide the basis for private sector investment. Though, the Ministry of Fisheries and Coastal Development is responsible for data collection, very little has been achieved in this aspect. The problems include, lack of qualified personnel and basic equipments for data collection within the Ministries. It is difficult to manage resources properly without having accurate information on stock sizes, their dynamics and the environment they derive from. To collect this data, basic primary indicators need to be defined and appropriate measuring boards, scales and species identification catalogs need to be provided to data collectors on the landing sites. During the coastal survey in May 2004, data was collected from Berbera, Lughaya and Zeila under the project “Living Marine Resources
Government Policies and Development Strategies
Somaliland was emerging from 30 years of political suppression and economic marginalization when it declared its independence on 18 May 1991. The immediate challenges included securing peace and stability in the country; developing functioning administrations in all regions, and rehabilitating the devastated physical infrastructure as a way to revive the shattered economy. Though, the government has reached tangible achievements in the first two areas, the limitation of available financial resources has curtailed the development of the poor physical infrastructure, which again has discouraged domestic and foreign investors.
Strategy for Poverty Reduction and Economic Recovery (2004-2006). The government has launched its first Strategy for Poverty Reduction and Economic Recovery 2004 – 2006 (SPRER). The SPRER is an attempt to mobilize popular support for the country’s development process, articulate a long- term plan for achieving these strategies and to provide a guide for formulation of medium- term objectives. The strategy aims to achieve the following national objectives within the coming 3 years:
- • Revitalize and restore economic growth in order to generate more income and reduce poverty.
- • Improve social services to the people so as to promote sustainable social well-fair,
- • Promote good governance characterized by transparency, accountability and discipline.
The SPRER identifies the fisheries sector as a priority sector due to its great potential for generating employment and income, enlarging and enhancing the nutritional intake of consumers, and increasing foreign exchange earnings through fish export.
The policy objectives of the strategy for the Ministry of Fisheries and Coastal
Development is as follows:
- • Maximizing the output of the sector in order to raise the income levels of local fishermen.
- • Creating new employment opportunities in the fisheries sector;
- • Earning more foreign exchange through the export of fishery products;
- • Increasing consumption of fish in the local market.
It is generally acknowledged that the most effective development strategy is to make sure that the fishing industry and its development is led by the private sector, while oversight and resource management is handled by the public and/or academic institutions.
The following priority areas are defined for 2004-2006:
- • Rehabilitation of the existing fishing fleet;
- • Addition of more boats to the existing fleet;
- • Provision of sufficient fishing gear and accessories;
- • Improvement of fish handling and processing facilities and techniques;
- • Improvement of market outlets both internally and externally;
- • Promoting research activities and training of personnel;
- • Upgrading existing legal frameworks and formulating other relevant legislatives
enhancing sectoral development.
Enhancing the legal framework
The Ministry of Industry and Commerce has formulated other legal frameworks intended to enhance economic growth and attract private investment, including the Foreign Investment Law and Company Law. These Laws are formulated in the context of the emerging impacts of globalization and designed to create a favorable climate for domestic and foreign private investment. It establishes incentives for investment, including property rights protection, institutional arrangements, defines conditions for investment, investor’s rights and attempts to reduce the cost of bureaucracy.
In order to promote production, improve living conditions of the people and create job opportunities Somaliland has chosen the promotion of a free market economy as its economic policy. To achieve this objective, the government encourages national and foreign investment in the productive sectors.
The Foreign Investment Law comprises of 25 articles aiming at, promoting, protecting and guaranteeing all forms of foreign investments and personnel. It defines forms of foreign investments and investment priority sectors; establishes Somaliland’s Foreign
Investment Board and describes its functions. The Law defines procedures for submission and approval of applications and details procedures of investment, transfer of capital and profits.
The Company Act of Somaliland is a lengthy document touching upon all forms of private and public companies.
In its endeavor to promote an open door trade policy, the government is trying hard to create a Free Zone area in Berbera, introduce the “Build Operate-Transfer” procedures; and to join regional and international cooperation schemes.
An integrated Development Plan for the Somaliland Fishery Sector
The previous sections of this report have outlined the problems and opportunities facing the fishery sector in Somaliland. It is clear that without appropriate planning for renewed investment in the fishery sector the constraints discussed in section 8 of this report will prevail.
The consultant has assessed the current bottlenecks from a regional and sub-regional perspective. During this process the consultant has reached a number of important conclusions to guide future development efforts:
- • Firstly, the consultant believes that any strategy for the future must satisfy the development requirements of each principal fishing center.
- • Secondly, the consultant is convinced that the most serious problem for the future development of the Somaliland fishery sector lies with the lack of on-shore fisheries facilities and the inefficiencies in the existing transportation systems.
- • Thirdly, the consultant believes that plans for fishery development in Somaliland must be tailored to meet local needs and conditions. Although, coastal fishing communities share a common set of constraints and opportunities, each settlement has its own unique characteristics and constraints.
Thus, the recommended strategy for development of artisan fisheries is composed primarily of two core components: the establishment of fish processing facilities and efficient transportation mechanisms, and the development of an adequate institutional framework to deal with private sector investment.
Activities following this strategy begin with the establishment of five fishing stations as identified in the previous sections of the report. The aim is to create self-sustaining fishing stations equipped with small vessels and essential on-shore facilities to enable increased production and trade. This being the point of departure, the following is the road map for developing the fishery with special emphasis on the private sector.
The government of Somaliland proposes to launch a series of initiatives, with the assistance of the international community, to support fishing communities and the private sector and to foster development strategies in the fisheries sector. Establishment of appropriate institutional mechanisms will facilitate the right platform on which to build business relations between Somaliland entrepreneurs and fishing communities and to encourage regional and international private company’s partnerships.
- • The first task is to identify prospective national entrepreneurs or companies interested in developing the sector.
- • The second task is the forging of close business relations between these companies and the coastal fishing communities.
- • The third task will be to identify suitable foreign partners to participate in fisheries investment on a commercial basis (joint- venture agreements).