Potential Risks and Rewards of Sino-Somalia Fishing Agreement

[Deeq A.]

By: Mohamed Amin

Context

During the most recent Beijing Summit of the China-Africa Cooperation Forum in September 2018, Chinese President Xi Jinping pledged $60 billion in financing for projects in Africa in the form of assistance, investment and loans. Chinese investment and trade with Africa have increased significantly over the past few years, surpassing Europe and the United States (US) which used to be the predominant sources of foreign investment and the main market for African exports.[ii] Some of the primary motivations behind China’s push toward increased investments in Africa include the desire to secure a dependable source of raw materials to fuel it’s own rapidly growing economy, the desire to increase China’s global political influence and the opportunities presented by emerging market economies in Africa.[iii]

Sino-Somalia Relations

In a meeting with the President of Somalia, China’s president stated that China had always aided Somalia in preserving its national sovereignty, security and territorial integrity.[iv] The remarks testify to the historical significance of China- Somalia relations. Some of the most notable buildings in Mogadishu such as the National Theater and the Football Stadium were built by China.[v]

President Jinping said that China and Somalia enjoy a long history of friendship, adding that Somalia was the first country in East Africa to establish diplomatic relations with China and that Somalia was also one of the countries supporting the People’s Republic of China in restoring its lawful seat in the United Nations.[vi] Since 1991 China has invested in over 80 infrastructural projects such as hospitals, stadiums and roads in Somalia.[vii]

In the latest iteration of the two countries’ relationship, the Federal Government of Somalia (FGS) granted fishing licences to 31 Chinese vessels to exploit tuna and tuna-like species off its coast in a bid to tap the sector for economic growth.[viii] In addition, bilateral trade volume between China and Somalia reached 485 million US dollars in 2017 with year-on-year growth of 20 percent.[ix]

The Agreement

In a ceremony on December 11, 2018 Somali President announced that his administration has granted 31 fishing licenses to the China Overseas Fisheries Association. “These licenses allow tuna fishing, and this shows that Somalia issues licenses through the legal process,” he said.[x] According to the FGS, the new licenses are restricted to migratory tuna stocks, and will not affect local fisheries as the licence restrictions reserve the waters within 24 nm of the coast for local fishermen.[xi] Upon entering or leaving Somalia’s Exclusive Economic Zone, the boats will also have to declare their positions, besides the weight of catch on board by species.[xii]

Some observers, however, fear that this may aid the return of Somali pirates as fishing stocks could be depleted and the livelihoods of local fishermen threatened. There are also concerns that China would dump toxic wastes in Somalia’s waters thus leading to environmental degradation.[xiii] Moreover, it is not clear how Somalia will ensure compliance with the letter and spirit of the agreement or if it even has the necessary monitoring regime and tools.

Somalia, Somalis and Fish

Somalia’s estimated 3300 km coast is the longest in continental Africa[xiv] spanning the Indian Ocean and the Red Sea. Nevertheless, the weak FGS does not exert control over all of Somalia’s coast. For example, Somaliland declared independence from the rest of Somalia in 1991 and does not recognize agreements signed by the FGS. Equally, the semi-autonomous region of Puntland in north eastern Somalia manages its coast more or less independently. Both regions have signed agreements with companies in the past in defiance of the FGS.[xv]

Although Somalia’s coast is among the richest fishing grounds in the world teeming with shark, tuna, sardines, snapper and lobster,[xvi] the irony is that ethnic Somalis who make up around 85%[xvii] of the population prefer livestock meat to fish.[xviii] Traditionally, the majority of those in Somalia who engage in fishing for subsistence are ethnically non-Somalis. These non-Somali ethnic communities include the Barawani who live in the coastal town of Baraawe, the Baajuun in the lower Juba and nearby islands and the Arab and Shaanshi in Mogadishu area. Fish and chicken tend to be regarded as inferior foods by ethnic Somalis.[xix]

Nonetheless, a discussion about Somalia coast cannot elide the issue of piracy off the coast of Somalia. Although Somali piracy has been occurring since 1991 and even before,[xx] it is since 1995 that piracy has emerged as a major concern for ships passing through the Gulf of Aden, the Arabian Sea, and the western Indian Ocean.[xxi] After several high profile hijackings by Somali pirates such as the cargo ship Faina and the very large crude carrier (VLCC) Sirius Star in September and November of 2008, Somali pirates got the attention of the world community in part because the Faina was carrying shipment of arms destined to South Sudan and could have ended up into the hands of Somali militants. The hijacking of the Sirius Star was no less eventful as it was carrying two million barrels of crude oil. The Faina was released after a ransom payment of a $3.2 million.[xxii]

Several theories have been proposed to explain the phenomenon of piracy in Somali waters in the last two decades such as the absence of capable central government, poverty, toxic waste dumping, and illegal, unreported and unregulated (IUU) fishing.[xxiii] Afyare et al argue that crime of opportunity explains the motives of Somali pirates and their ring leaders although other factors contributed to it.[xxiv] On the other hand, Lucas argues that while economic and geographic factors offer a partial explanation for Somali piracy, they do not account for the dramatic increase in pirate activity over the past twenty years. Instead, he argues that this rise is primarily a result of Somalia’s political instability.[xxv]

Potential Rewards of the Agreement

In addition to the menace of overfishing by foreign vessels, Somalia currently does not possess the capacity to fully benefit from its abundant marine resources as it lacks the requisite infrastructure and human resources.[xxvi] To build the necessary infrastructure for Somalia’s fishing industry and cultivate competent labour force, the country needs substantial investment. A Somalia proverb says, “Be a Rock or Lean Against One.” Hence, this is where China can be a rock against which Somalia can lean and be of great benefit to Somalia for a number of reasons.

First, China is the second largest economy in the world and some analysts estimate it will overtake the US in 15 years.[xxvii] Second, China has the necessary technology and human resources needed to build infrastructure for Somalia’s fishing industry and train its labour force. Third, China possesses immense financial reserves that could be leveraged for greater investment in Somalia. China has by far the largest foreign currency reserves in the world with over two and a half times more than the second largest reserve holder, Japan. When China and Hong Kong reserves are considered together, the total is $3.6 trillion.[xxviii] Finally and perhaps most importantly, with over 1.4 billion people[xxix] and the largest middle class in the world,[xxx],[xxxi] China offers Somalia huge market for its fisheries resources.

Furthermore, China’s expanding military and naval power could hypothetically be leveraged to protect Somalia’s coast from illegal fishing. In fact, China’s first oversea military base is in neighboring Djibouti. China’s permanent seat in the United Nations Security Council may also benefit Somalia especially in areas where the interests of the two countries overlap. On the other hand, China will get access to one of the world’s richest fishing grounds as well as the opportunity to strengthen its political and economic influence in Somalia which may allow it to enter into additional investment agreements in other sectors of Somalia’s economy. Hence, China has in abundance what Somalia lacks and needs and Somalia has in abundance what China wants. The agreement can be mutually beneficial but similar to any trade and investment agreement, it is not risk-free.

Potential Risks of the Agreement

Somalia’s constitution remains provisional and without a doubt will undergo additional revisions. This is particularly important since relations between FGS and its member states have been shaky recently in part due to the meddling of external powers.[xxxii] One of the contentious issues between the FGS and the regional administrations centres on the control of resources. Article 54 of the provisional Constitution of the FGS states that the allocation of powers and resources shall be negotiated and agreed upon by the Federal Government and the Federal Member States (FMS) except in matters concerning foreign Affairs, national Defense, citizenship and immigration, and monetary policy.[xxxiii] Therefore, it is probable that existing resource-based disputes between FMS and FGS may be exacerbated. In such scenario, China will be forced to choose sides.

Furthermore, it does not appear that the FGS has carried out any grassroots consultations with those most affected before it signed the agreement. This is noteworthy because in Somalia groups who traditionally have depended on fishing for their livelihood are primarily non-ethnic Somalis. These groups are marginalized and neglected as they lack armed militias and consequently are underrepresented in decision-making circles. There is also the risk that resentment over the deal could lead to anger, inter-communal competition for dwindling stocks and even the return of piracy.[xxxiv]

Moreover, on February 14 Kenya recalled its Ambassador to Somalia and expelled Somalia’s Ambassador to Kenya. It also issued a strongly worded statement which just fell short of declaring Somalia an enemy state[xxxv] . Kenya accused Somalia of auctioning blocks in a disputed maritime border area believed to contain oil and gas deposits.[xxxvi] Somalia and the company that performed the seismic survey, Spectrum Geo, deny the allegations.[xxxvii] The area is claimed by both countries and is now under consideration in the International Court of Justice (ICJ).[xxxviii] The escalation of the dispute will likely adversely affect the agreement.

Finally, will China help Somalia build capacity in its fishing industry? China has been accused of employing Chinese workers and focusing on extraction of raw materials rather than employing African workers and developing their capacity.[xxxix] Some African countries have pushed back against China’s development activities.[xl] Grievances range from poor compliance with safety and environmental standards to unfair business practices and violations of local laws.[xli] This has triggered fierce criticism from some leaders and African workers have also begun to fault Chinese companies for unfair labour practices, including disputes over wages and working conditions.[xlii] Will Sino-Somalia fishing agreement face similar challenges? Only time will tell.

Concluding Thoughts

China’s interest in trade and investment in Africa should be a welcome proposition. It expands choices for African nations. The decision of the FGS to enter into a fisheries agreement with China offers plenty of benefits to Somalia as it can benefit from Chinese technology and investment. Illegal fishing has been taking place in Somalia waters for decades. The agreement with China mitigates this problem to a certain extent as it will be in China’s interest to eliminate unlawful competition.

The agreement will also benefit China by giving it access to one of the richest fishing grounds in the world. Nevertheless, if the agreement is not implemented in a mutually beneficial way, it can have deleterious consequences for Somalia and the Sino-Somalia relations. For China to overcome the perception that it only cares about extraction of raw materials and employment for its citizens, it must treat African workers respectfully, develop capacity of African workers, and care about the short and long-term environmental impact of the projects it implements.

All these apply even more to the case of the Sino-Somalia fishing agreement. After nearly three decades of civil war, Somalia lacks human resources and infrastructure. China should teach Somalis to fish rather than just giving them fish. On the other hand, African leaders in general and Somali ones in particular should weigh the short and long-term risks and rewards of any major agreement with China or other countries. One way to do so is to be transparent and adopt a bottom-up decision making rather than top-down one.

Mr. Mohamed Amin is a Horn of Africa Policy Analyst and can be reached at:
Amin35@yahoo.com

References

Disclaimer: The views expressed in this article are the author’s own and do not necessarily reflect Caasimada Online’s editorial stance.

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ii Baah, Anthony A. and Herbert Jauch, eds. 2009. Chinese Investments in Africa: A Labour Perspective. Accra, Ghana. African Labour Research Network.

iii Maverick, J.B. 2018. ‘’The 3 Reasons Why Chinese Invest in Africa.’’ Investopedia, October 14, 2018. https://www.investopedia.com/articles/active-trading/081315/3-reasons-why-chinese-invest-africa.asp (accessed on 07-03-09).

iv CGTN, ‘’China Pledges to Support Somalia’s Development,’’ August 31, 2018, https://news.cgtn.com/news/3d3d514d3363444f79457a6333566d54/share_p.html (accessed on 09-03-19).

v . Xinhua, ‘’Feature: Somali students hail Chinese scholarships for aiding country rebuilding,’’September 7, 2017, http://www.xinhuanet.com//english/2017-09/08/c_136594815.htm (accessed on 09-03-19).

vi CGTN,‘’China Pledges to Support Somalia’s Development,’’ August 31, 2018, . CGTN.. https://news.cgtn.com/news/3d3d514d3363444f79457a6333566d54/share_p.html (accessed on 09-03-19).

vii Xinhua, ‘’China vows to support Somalia’s peace, reconstruction,’’ September 29, 2017, http://www.xinhuanet.com//english/2017-09/29/c_136649211.htm(accessed on 09-03-19).

viii Dahir, Abdi Latif. ‘’China will start fishing along Somalia’s coastline just as piracy makes a comeback. Quartz Africa.’’ Quartz Africa, December 24, 2018, https://qz.com/africa/1506419/somalia-gives-fishing-license-to-31-china-vessels/(accessed on 09-03-19).

ix CGTN,. 2018. ‘’China Pledges to Support Somalia’s Development,’’August 31, 2018, . CGTN.. https://news.cgtn.com/news/3d3d514d3363444f79457a6333566d54/share_p.html (accessed on 09-03-19)..

x The Maritime Executive. Somalia Issues Fishing Licenses to Chinese Operators. https://www.maritime-executive.com/article/somalia-issues-fishing-licenses-to-chinese-operators (accessed on 13-03-19).

xi Ibid.

xii Dahir, Abdi Latif Dahir. 2018. ‘’China will start fishing along Somalia’s coastline just as piracy makes a comeback. Quartz Africa.’’ Quartz Africa, December 24, 2018,

[https://qz.com/africa/1506419/somalia-gives-fishing-license-to-31-china-vessels/]. (aAccessed on 09-03-19).

xiii TRTWORLD. 2019. “China-Somalia fishing deal may revive sea piracy.’’March 12, 2019. https://www.trtworld.com/africa/china-somalia-fishing-deal-may-revive-sea-piracy-24879 (accessed on 13-03-09).

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Xvi Stewart, Catrina. ‘’Somalia threatened by illegal fishermen after west chases away pirates.’’ October 31, 2015, https://www.theguardian.com/world/2015/oct/31/somalia-fishing-flotillas-pirates-comeback(accessed on 09-03-19).

xvii World Population Review, http://worldpopulationreview.com/countries/somalia-population (accessed on 09-03-09).

xviii Jirdeh, Nimo. ‘’Somalia Fisheries Industry, a Potential Gold Mine.’’ Oxfarm Horn, East and Central Africa Blog. https://www.oxfamblogs.org/eastafrica/?p=8080(accessed on 13-03-19).

xix State of Queensland-Metro South Health. 2015. Food and cultural practices of the Somali community in Australia – a community resource. https://metrosouth.health.qld.gov.au/sites/default/files/content/heau-cultural-profile-somali.pdf.( accessed on 09-03-19).

xx Elmi, Afyare A., Ladan Affi, W. Andy Knight & Said Mohamed. ‘’Piracy in the Horn of Africa Waters: Definitions, History, and Modern Causes’’ African Security 8 (2015): 147-165.

xxi Ibid.

xxii Lucas, Edward R.. “Somalia’s “Pirate Cycle”: The Three Phases of Somali Piracy.” Journal of Strategic Security 6, no. 1 (2013): 55-63.

xxiii Elmi, Afyare A., Ladan Affi, W. Andy Knight & Said Mohamed. ‘’Piracy in the Horn of Africa Waters: Definitions, History, and Modern Causes’’ African Security 8 (2015): 147-165.

xxiv Ibid.

xxv Lucas, Edward R.. “Somalia’s “Pirate Cycle”: The Three Phases of Somali Piracy.” Journal of Strategic Security 6, no. 1 (2013): 55-63..

xxvi Jirdeh, Nimo. Jirdeh. 2015. ‘’Somalia Fisheries Industry, a Potential Gold Mine.’’ Oxfarm Horn, East and Central Africa Blog. [https://www.oxfamblogs.org/eastafrica/?p=8080]. (aAccessed on 13-03-19).

xxvii Kennedy, Simon‘’China will overtake the U.S. economy in less than 15 years, says HSBC, challenging Trump’s claim.’’ Financial Post, September 25, 2018, https://business.financialpost.com/news/economy/china-will-overtake-the-u-s-in-less-than-15-years-hsbc-says (accessed on. 09-03-19).

xxviii Picardo, Elvis. ‘’10 Countries with the Biggest Forex Reserves.’’ Investopedia, February 6, 2019, https://www.investopedia.com/articles/investing/033115/10-countries-biggest-forex-reserves.asp.

xxix Worldometers, http://www.worldometers.info/world-population/china-population(accessed on 09-03-19).

xxx Iskyan, Kim.‘’China’s middle class is exploding.’’ Business Insider, August 27, 2016, https://www.businessinsider.com/chinas-middle-class-is-exploding-2016-8(accessed on 09-03-19).

xxxi Babones, Salvatore. ‘’China’s Middle Class Is Pulling Up the Ladder Behind Itself.’’ Foreign Policy, February 1, 2018, https://foreignpolicy.com/2018/02/01/chinas-middle-class-is-pulling-up-the-ladder-behind-itself(accessed on 09-03-19).

xxxii Malley, Robert. ‘’What Happens in the Gulf Doesn’t Stay in the Gulf.’’ The Atlantic, June 7, 2018, https://www.theatlantic.com/international/archive/2018/06/somalia-gulf-crisis-vegas-rules/562292/(accessed on . 09-03-19).

xxxiii Somalia Federal Government The Federal Republic of Somalia Provisional Constitution. http://hrlibrary.umn.edu/research/Somalia-Constitution2012.pdf(accessed on 09-03-19).

xxxiv Bagnetto, Laura Angela. ‘’Somalia: Chinese deal angers fishing communities, sparks concerns over sovereignty and piracy.’’ RFI, February 7, 2019, http://en.rfi.fr/africa/20190207-Somalia-Chinese-deal-angers-fishing-communities-sparks-concerns-over-sovereignty-and(accessed on 14-03-19).

xxxv Gathara, Patrick. ‘’Kenya should let the ICJ settle its maritime dispute with Somalia.’’ Aljazeera, March 2, 2019, https://www.aljazeera.com/indepth/opinion/kenya-icj-settle-maritime-dispute-somalia-190301085647698.html (accessed on 16-03-19).

xxxvi Macharia, Ken. ‘’Kenya recalls ambassador to Somalia after Mogadishu auctions oil blocks in disputed area.’’ CapitalFM News, February 16, 2019, https://www.capitalfm.co.ke/news/2019/02/kenya-recalls-ambassador-to-somalia-after-mogadishu-auctions-oil-blocks-in-disputed-area(accessed on 16-03-09).

xxxvii Müller-Jung, Friederike. ‘’Kenya or Somalia: Who owns the sea and what lies beneath?.’’ DW, September 19, 2016, https://www.dw.com/en/kenya-or-somalia-who-owns-the-sea-and-what-lies-beneath/a-19557277(accessed on 17-03-19).

xxxviii Mutambo, Aggrey. ‘’Spectrum Geo denies collecting data on ‘Kenyan’ oil blocks.’’ Daily Nation, February 20, 2019, https://www.nation.co.ke/news/Spectrum-Geo-Kenya-Somalia-oil-conflict/1056-4990300-114t4uk/index.html (accessed on 16-03-09).

xxxix Ibid.

xl Mourdoukoutas, Panos. ‘’What Is China Doing In Africa?.’’ Forbes, August 4, 2018, https://www.forbes.com/sites/panosmourdoukoutas/2018/08/04/china-is-treating-africa-the-same-way-european-colonists-did/#4173a15c298b(accessed on 17-03-19)

xli Aidoo, Richard. ‘’African countries have started to push back against Chinese development aid. Here’s why.’’ The Washington Post, October 16, 2018, https://www.washingtonpost.com/news/monkey-cage/wp/2018/10/16/african-countries-have-started-to-push-back-against-chinese-development-aid-heres-why/?utm_term=.dfc8bd5df87e (accessed on 09-03-19).

xlii Albert, Eleanor. ‘’China in Africa.’’ Backgrounder, Council on Foreign Relations. https://www.cfr.org/backgrounder/china-africa(accessed on 09-03-19)

xliii Ibid.