Untying the puzzle of beneficial ownership of fishing vessels in Ghana

Nii Marley lives in Jamestown, a fishing community in Ghana’s capital, Accra. Mending his nets on the shores of the Gulf whilst speaking to this paper, he says, he regrets not having formal education to enable him to land some white-collar job, particularly as it has now become harder to make a decent living from fishing.

“When I started fishing, things were better. We were getting a lot of fish,” Nii Marley indicated, expressing his disappointment that “Every day I risk my life to cross the dangerous sea only to return home empty-handed or with very little catch.”

Nii Marley has been working in the fishing sector for nearly three decades and boast of his expanse experience.  He thinks that the sector is experiencing bad returns due to the influx of foreign-owned fishing vessels, which according to him, compete with locals such as himself for species they are not licensed to fish.

“Now things are bad and we are forced to find other jobs to help fend for our families,” Nii Marley, the father of four, pointed out, blaming the inability of fishers to make ends meet on the government. 

For him, the government has failed to protect the livelihoods of artisanal fishers at the expense of trawl vessels, which he suspects, are owned by foreigners.  According to him, the ‘foreign trawlers’ compete with local fishers (artisanal sector) for fishes they are not licensed to fish.

Like Nii Marley, Kwame Amoah, and Kweku Ainoo, all fishers at Cape Coast, also believe that many of the trawlers on Ghana’s waters are owned by foreigners and such vessels engage in many illegal activities, resulting in the suffering of artisanal fishers.

Beneficial ownership

The subject of beneficial ownership of fishing vessels on Ghana’s waters has gained prominence in recent times in the media, with regulators, players, fisheries experts, and Civil Society Organisations locking horns over the subject.

A recent report by a UK-based environment and fisheries resources management, a non-governmental organisation (NGO), Environmental Justice Foundation (EJF), released earlier this year, titled: “At what cost? How Ghana is Losing Out In Fishing Arrangements With China’s Distant Water Fleet”, claims that nine out of every 10 fishing trawlers operating in Ghana are beneficially owned by Chinese corporations.

This is in contravention of a prohibition against foreign ownership or control of trawlers flying the country’s flags.

According to the EJF’s report, the foreign owners usually operated through local front companies using opaque corporate structures to import their vessels, which they registered and with which they obtained licences to fish.

The report further estimated that Ghana was currently losing between $14.4 million and $23.7 million annually in the trawl sector due to low licence fees, as well as the lack of enforcement of revenue for fisheries-related infringements.

“Overall, it is estimated conservatively that Ghana could be generating an additional US$14.4 – 23.7 million annually from its trawl sector by way of fishing licence fees and enforcement revenue for fisheries-related infringements. The concealment of beneficial ownership behind local front companies may serve to justify the application of low licence fees and the imposition of financial penalties at well below the statutory minimum,” the report indicated.

The report also called for accountability in the trawl sector, saying “There is a need to enhance accountability through parliamentary oversight of industrial fishing licences, as required by the 1992 Constitution, and to effectively enforce the law governing the nationality of vessel ownership set out in the 2002 Fisheries Act.”

Disagree

The Fisheries Commission, the agency responsible for regulating the sector, has since the release of the EJF’s report, disputed the findings of the study, describing it as “unfortunate.”

The Fisheries Programmes Manager of EJF, Socrates Segbor, is quoted as having said that the overexploitation of the fish population is driving many fishers, particularly artisanal fishers into ever more precarious situations, saying that the depletion of fish stocks puts pressure on fishing operators to maintain catch rates and profitability.

Ghana’s fishing sector

The fishing sector plays an important role, contributing significantly to Ghana’s economy in the areas of employment, livelihood support, poverty reduction, food security, and foreign exchange earnings.

The sector is estimated to contribute about 4.5 percent to Ghana’s total Gross Domestic Product (GDP) as well as provide employment opportunities for about 2.6 million Ghanaians, representing 10 percent of the country’s population.

According to Food and Agriculture Organisation (FAO),  Ghana’s fishing industry started in 1700 as an artisanal fishery with very simple and inefficient gear, craft, and methods, operating close to coastal waters, lagoons, estuaries, and rivers but transitioned to three fishing operations namely industrial, semi-industrial and artisanal subsectors which served as a means of regulating the industry.

Where are we?

The once-lucrative fishing industry in Ghana now faces eminent threat of collapse due to the fast depletion of the fish stocks—resulting from overcapacity, particularly in the trawl vessels. Some experts and industry players believe that the trawl sector is recording an increase in fleets to the involvement of foreigners in the sector, who allegedly use local people to front for them to obtain license to operate.

Recent studies conducted on Ghana’s fisheries by some experts point to the fact that the country is fast losing its stocks due to Illegal, unreported, and unregulated (IUU) fishing practices, coupled with over-capacity, particularly in the trawl sector.

IUU fishing remains one of the greatest threats to marine ecosystems due to its potent ability to undermine the national fisheries sector.

Fisheries Commission 

The Executive Director of the Fisheries Commission, Mr. Michael Arthur Dadzie, objected to the findings of the EJF’s study that suggested that nine out of every 10 fishing trawlers or 90 percent of trawlers operating in the country were beneficially owned by Chinese corporations.

He said there were no foreign vessels fishing on Ghana’s waters and that Ghanaians entering into agreements with some foreigners to buy vessels to fish in the country’s waters could not be described as “foreign vessels fishing in Ghana’s waters”.

He said licensing is not owned by foreigners and, therefore, one could not say vessels fishing in the country’s waters were foreign vessels.

“Under the trawl sector, Ghanaians are the holders of the licenses. It will be unfortunate to say foreign vessels are in Ghana’s waters,” Arthur Dadzie explained.

For him, many Ghanaians did not have the means to buy vessels outright and, therefore, had to go into hire purchase agreement with some foreigners to bring in the vessels.

GITA

Also speaking on the subject of beneficial ownership of fishing vessels in Ghana, the Board Secretary of Ghana Industrial Trawlers Association, Nana Oyeaman Ofori-Ani, corroborated what the Fisheries Commission boss said, saying that it is untrue that fishing vessels in Ghana are owned by foreigners, particularly the Chinese.

He expressed unhappiness about EJF and other reports, claiming that fishing vessels in Ghana are beneficially owned by foreigners through local front agents.

For him, EJF and others have failed to consult key stakeholders in the sector for better clarification on issues before publishing their so-called “investigations in the trawl sector.”

Nana Ofori-Ani said since Ghana did not have any locally trained captains or engineers to operate industrial fishing vessels, it had no option other than to engage the services of expatriates such as the Chinese, (builders of the vessels) to man industrial fishing vessels in its waters.

He further explained that since Ghana’s laws permitted the recruitment of expatriate fishers in its fishing industry, bringing on board foreign captains and engineers was not in contravention of the fishing regulations.

He said Ghana lacks technical expertise in the trawl sector, adding “We have to engage the services of some foreigners such as the Chinese.”

The board Secretary explained that since most of the trawlers were coming from China, many of the expatriates they engaged are Chinese, pointing out that engaging Chinese on fishing vessels in Ghana did not make those vessels Chinese vessels.

Nana Ofori-Ani indicated that Ghana currently had about 75 vessels in its waters and that 25 percent of the fishing crew were expatriates.

RMU disagrees

In a story published by the Daily Graphic on April 13, 2021, titled “Ghana has no fishing vessel operators — Official” quoted the Dean of the Graduate School of the Regional Maritime University (RMU), Dr. York Ababio, of having said that it is not true that Ghana did not have locally trained captains and engineers to man its fishing vessels.

According to him, the lack of employment opportunities had driven many Ghanaian trained captains, engineers, and other key deck officers away from the fishing industry.

He explained that because many of the fishing vessels were foreigner owned, and the country’s laws permitted a certain percentage of the crew to be foreigners, the owners of the vessels tended to bring in their own captains and other key staff, leaving only the minor positions for Ghanaians, thereby denying Ghanaian trained captains and engineers the opportunity to get employed.

Dr. Ababio said until the country changed the clause in its fisheries laws and specifically defined which roles could be allowed for foreigners to take on the vessels, owners of the vessels, who are foreigners, would continue to reserve the key positions for their compatriots.

CSOs

The Lead for Ghana Hub of Sustainable Ocean Alliance based in the United States, Gideon Sarpong, in an interview monitored by this paper, said local authorities have not done enough to safeguard Ghana’s ocean ecosystem. He said some aspects of the country’s fisheries management plans are being disregarded.

He expressed concern, for instance, about the seeming lack of oversight on the number of industrial fishing vessels operating on the country’s waters.

“There is a structural problem when it comes to ocean conservation and protection of marine species and that stems from Fisheries Commission and the Ministry of Fisheries and Aquaculture. We are supposed to have 46 industrial fishing vessels in our waters, according to the Fisheries Management Plan as of 2017, officials figures indicate that there are 76 and unofficial figures pointed at over 100 industrial fishing vessels on our waters,” Mr. Sarpong noted.

He said it is worrying that many industrial vessels are now competing with local fishers for the same species, explaining that such a situation threatens the very livelihoods of artisanal fishers in the country.

The Minister

The Minister of Fisheries and Aquaculture Development, Mrs. Mavis HawaKoomson, at a press conference in Accra last Sunday, disclosed that requirements for the registration of industrial fishing vessels or trawlers are to be reviewed to seal loopholes in the operation of foreign-owned vessels in the country’s territorial waters.

She said the review of the licensing regime was part of steps being taken to weed out “front men” or foreign “beneficial owners” from the fishing industry to prevent illegal fishing and increase revenue generation from the sector.  

The Minister observed that because of the ban of foreign vessels from industrial fishing in the country, some companies were using dubious means, such as engaging in hire-purchase agreements with local entities and other special-purpose vehicles, to operate.

“We are aware of their activities, and that is why we are working on the requirements for licensing and the reason industrial vessels have not been allowed to go to sea yet,” she pointed out.

The big puzzle

As it stands, the puzzle of the beneficial ownership of fishing vessels in Ghana still rages on, with industrial players siding with regulators that there is no foreign ownership of fishing vessels, artisanal fishers, fisheries experts and Civil Society Organisations believing otherwise.

Untying the puzzle of beneficial ownership of fishing vessels in Ghana

By Benedicta Gyimaah Folley