MOSCOW'S FISHERIES DEVELOPMENT PROGRAM IN THE NON-COMMUNIST THIRD WORLD: THE NEW OFFENSIVE
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Document Creation Date:
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Publication Date:
August 1, 1986
Content Type:
REPORT
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Confi ential
Moscow's Fisheries Development
Program in the
Non-Communist Third World:
The New Offensive
Confidential
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%, UnHUCUU&I
Moscow's Fisheries Development
Program in the
Non-Communist Third World:
The New Offensive
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Moscow's Fisheries Development
Program in the
Non-Communist Third World:
The New Offensive
Key Judgments The Soviets over the past year and a half have moved decisively to protect
Information available their extensive and profitable fishing interests in the non-Communist Third
as of 30 April 1986 World. Successful initiatives include:
was used in this report.
? The extension of Soviet fishing operations in the Pacific through an
August 1985 licensing agreement with Kiribati, the first with a develop25X1
ing state in the South Pacific.
? A 25-percent increase in 1984 over previous total pledges in fisheries
assistance to LDCs through provision of $100 million in new aid that will
expand shore facilities in Africa for use by the Soviet fleet.
Moscow is also working to gain additional fishing rights in the western
Pacific, an area hitherto fished mostly by US and other Western fleets.
The new Soviet assistance brings LDC fisheries aid to more than half a bil-
lion dollars under a program that has grown steadily since it began in
earnest in the late 1960s. Although this miniprogram represents only about
an estimated 2 percent of total Soviet economic pledges to non-Communist
LDCs, its impact has been extensive, profitable to Moscow, and highly cost
effective in terms of financial outlays. For example, for less than $10
million annually, the USSR has:
? Gained access to ports and fishing grounds for its fishing fleet in 44 less
developed countries.
? Supported $80-125 million a year in hard currency earnings from fish
exports.
? Overcome fuel and services bottlenecks at home (where trawlers some-
times spend inordinate amounts of time in port because of congestion or
diesel shortages) by using the resources of LDC ports for resupply.
? Supported its annual marine catch of 8-9 million metric tons with at least
2 million metric tons from LDC waters.
? Improved the domestic protein supply without the costly investment
required for equivalent results from farm production.
? Improved intelligence gathering capability and potential in case of need.
Research activity to catalog seabed resources also has provided valuable
economic information about the coastal and territorial waters of 30 25X1
countries under the fisheries aid program.
The program has not served Moscow's fishing aid customers nearly as well.
It has failed to develop viable fishing industries in LDCs and has not
helped LDCs remedy their pressing food needs. LDC complaints have
centered around:
? Soviet failure to meet contract obligations to construct promised shore
facilities or train local personnel.
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Contents
Key Judgments
iii
The Soviet Fishing Fleet: Wide Ranging and Profitable
1
The Fisheries Aid Program: Entree at Bargain Prices
1
An Outreach Program for the 1980s
2
Dissatisfaction With the Aid Program
3
Why LDCs Accept Soviet Fisheries Aid
USSR: Assistance to Fishing Industries in LDCs, 1959-31 December 1985
7
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Moscow's Fisheries Development
Program in the
Non-Communist Third World:
The New Offensive
The Soviet Fishing Fleet:
Wide Ranging and Profitable
The Soviet Union has one of the world's most active
fishing industries. It is a significant earner of hard
currency as well as a source of food for the USSR's
population. Soviet exports of fish products have aver-
aged about $250 million annually since 1975, and
reached $360 million in 1983, with at least one-third
of these exports going to hard currency customers,_
In recent years, the USSR's annual ocean catch has
averaged about 8-9 million metric tons, second only to
that of Japan, according to UN statistics. The Soviet
catch peaked at 9.4 million tons in 1976 and fell
steadily until 1978 as 200-mile exclusive economic
zones (EEZs) came into force for most countries.
Anticipating establishment of these zones, Moscow
had begun in the early 1970s to revise traditional
fishing practices by concluding agreements to fish
LDC waters (which contain two-thirds of the world's
fish resources). This process accelerated after the
United States, Canada, and European countries ex-
cluded the USSR from some of its most important
fishing grounds in 1977. In the 1980s the catch from
LDC waters has nearly offset earlier losses elsewhere.
The Fisheries Aid Program:
Entree at Bargain Prices
The fisheries aid program was Moscow's earliest
means to gain entree to LDC ports and servicing
facilities. Since its first extension of fisheries credit to
Guinea in 1959, the USSR has used this cost-effective
program to gain a presence in the fishing sector of 44
non-Communist LDCs. By 1986 the USSR had
pledged more than $500 million in fisheries aid and
proposed 24 joint ventures, of which 12 have become
operational. In 1985 about 1,000 Soviet fisheries
personnel were providing technical services to LDCs,
and more than 750 LDC trainees were studying
fishing in the USSR.F__-]
At the same time, expenditures on this program have
been very modest. Only about $10 million in aid flows
annually to LDCs under Soviet fishing aid agree-
ments. Moscow probably also has paid another $10
million annually in recent years for licensing fees and
the use of drydock facilities. In contrast, the returns
from the fishing aid program are enormous:
The Soviet catch from coastal waters bordering
exclusively on LDCs accounts for about one-third of
Moscow's recorded marine catch, according to UN
statistics (see figure 1).
? The minimum allowable catch from the territorial
waters of only six African countries (Angola, Guin-
ea, Guinea-Bissau, Mauritania, Mozambique, and
Sierra Leone) was valued at about $300 million at
average prices for the USSR's African catch in
1984. Soviet underreporting of catches and poach-
ing could double this value, according to many
fishing experts. At least $1 billion worth of fish is
caught every year by the Soviets off LDC coasts.
annually on the catch from LDC coastal waters.
? Through sales to West European customers, Mos-
cow earns at least $100 million in hard currency
Joint Ventures: An Effective Instrument
The Soviet fishing program in the non-Communist
Third World has evolved from a search for logistic
support in the 1960s, through a focus in the early
1970s on obtaining licensing agreements, to its cur-
rent multifaceted format that uses aid, licensing fees,
and the establishment of joint ventures with partners
reluctant to commit resources without equity partici-
pation.
The USSR has preferred licensing agreements as the
most direct way to gain access to LDC resources
without a potentially burdensome commitment to
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provide port rights for refueling or reprovisioning.
Moscow agreed to pay $1.7 million for one year's
fishing rights, at least 10 percent of Kiribati's budget
for 1985. The prospects for Soviet agreements with
Vanuatu and Western Samoa apparently have im-
proved since the accord with Kiribati was signed.F_
The Soviet Union's interest in the rich southeastern
Pacific fishing grounds off Latin America and in
Antarctic krill reserves has also led Moscow to pursue
fishing agreements in Latin America with renewed
vigor in the past two years. In Peru, where the Soviets
have access to shore facilities they built at Paita in the
1970s, energetic lobbying by Moscow to maintain its
presence in Peruvian waters has increasingly come
under attack by domestic fishing interests. The Soviet
fleet off Peru currently is operating under a short-
term licensing agreement because the new govern-
ment is undecided about renewing a fishing agree-
ment that, in effect, allows Moscow unlimited access
to Peru's resources because of Lima's inability to
police its waters.
While the USSR pursued its aggressive campaign in
the southwestern Pacific and Latin America, it also
continued its contacts in Africa. In the 1980s the
USSR has signed new fisheries aid agreements with
Angola, Guinea, Madagascar, and Seychelles and
renewed agreements with Mozambique and Sierra
Leone. It has made offers to Cape Verde, Congo, and
Mauritius for the renewal of fishing privileges that
have lapsed over the past few years. The agreements
with Angola and Guinea are notable for their large
size and their broad scope. These agreements call for
port construction, processing facilities, and develop-
ment of artisanal and deep sea fishing-activities that
we believe will enable Moscow to maintain its pres-
ence in the fishing industries of these countries.
Dissatisfaction With the Aid Program
Once an LDC has signed a Soviet fishing agreement,
it often finds that the USSR falls far short on
implementation. Complaints have surfaced in several
areas.
? In Ghana, the USSR did not train Ghanaians to
operate the trawlers provided them and pulled out of
Ghana's industry when Accra ran short of cash to
pay for Soviet experts and spare parts. Ghana's fleet
was left crippled.
? A $40 million project in Somalia to relocate nomads
and to use them in developing a local fishing
industry was a complete fiasco. The only beneficia-
ries were the Soviets who were allowed to fish
Somalia's waters as part of the agreement. Somalia
received no profits from the joint venture; its share
went to pay the operating costs of the Soviets, who
dominated the company. Cancellation of the agree-
ment in 1977 was greeted with popular acclaim.
Similar complaints about not receiving promised
equipment have come from Guinea, Guinea-Bissau,
Morocco, and Mauritania.F___1 25X1
Harmful Fishing Practices. Soviet fishing practices
often do substantial damage to the local industry,
according to Western experts. The Soviets have been
guilty of overfishing in Angola, Cameroon, Chile,
Guinea, Mauritania, Morocco, Pakistan, and Peru. In
Sierra Leone, the Soviets have been observed using
extrafine mesh nets that do not permit young fish to
escape, fishing so close to shore that their trawlers
destroy nets set out by local fishermen, and illegally
fishing in the coastal spawning grounds.
Fish Shortages. The USSR's fish deliveries under
quota agreements fail to meet even the most minimal
LDC food production goals. Under typical fishing
agreements, fish deliveries to LDCs generally com-
prise 8 to 15 percent of the total catch. Soviet trawlers
often underreport their catch, reducing the amount of
fish they must surrender for local consumption:
Failure To Meet Contract Obligations. An almost
universal criticism is that the Soviets do not provide
the facilities and training promised under agreements:
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An Intelligence Spinoff
Although the fishing fleet as a whole does not have an
explicit intelligence collection mission, individual
ships report on targets of opportunity and are occa-
sionally tasked by Soviet military and intelligence
organizations. In some cases Soviet fishing vessels
may represent the only Soviet presence close to a
naval action. In addition, Moscow's right to change
fishing crews and/or to make port calls to service the
fishing fleet enables it to move agents in and out of
the country, provides another source of information
on foreign coasts and ports, and helps it to dissemi-
nate Soviet propaganda. In wartime, the Soviet fish-
ingfleet would be subordinated to the military and
could perform some replenishment operations.
The economic intelligence derived from the fisheries
and oceanographic research program probably is far
more useful to Moscow than other types of informa-
tion gathered by the fishing fleet. Fisheries research
vessels under contract to LDCs provide the Soviets
not only with the data on fish stocks and varieties
necessary to fish successfully in LDC waters, but also
data on seabed mineral resources off LDC coasts.
The USSR has conducted extensive studies in the
waters of 30 LDCs under its fisheries aid program.
For Moscow, access to LDC waters and ports will
continue to be the most critical element in maintain-
ing and expanding the Soviet fishing industry. Until
now, the USSR's richest fishing grounds have been
the northwest Pacific and northeast Atlantic; in these
areas, fishing operations have reached capacity. The
UN Food and Agricultural Organization estimates
that the greatest unexploited fish resources lie in the
west Indian Ocean and the Southern Hemisphere,
including the Antarctic. Moscow is expanding its use
of fisheries aid programs to acquire bunkering and
fishing rights to exploit these waters through an
aggressive program of offers to Latin American and
western Pacific countries, while maintaining its pro-
gram in Africa.
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Appendix
Table I
USSR: Fisheries Aid to Non-Communist
LDCs, by Year
Total 516
1959-74 204
1975 63
1976 7
1977 16
1978 NEGL
1979 41
1980 58
1981 _1
1982 10
1984
1985
NEGL
96
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Table 3
USSR: Status of Fishing Programs in
Non-Communist LDCs
Guinea-Bissau b Senegal
Malaysia b
a Although no recent activity has been noted under the agreement,
we have no information of the cancellation of the accord.
b Joint ventures.
Kenya
Madagascar
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Table 4 (continued)
Morocco
1978
1984
1985
Tunisia
1976
Sub-Saharan
Africa
Angola
1976
Agreement for joint companies, import No joint venture formed.
of surplus Moroccan fish, assistance in
organizing Moroccan maritime person-
nel, aid in cannery and export opera-
tion, and fisheries studies on Soviet-
supplied research vessels. For five-year
period.
Protocol on cooperation in fishing.
General protocol on forming a number
of small joint fishing and processing
ventures with equal joint ownership
and an increase in annual 6-year fish-
ing scholarships to 55. Moscow also
proposed formation of joint venture
similar to the one with Mauritania.
Agreement for joint Tunisian-Soviet No activity noted.
company to develop Tunisian industry
and protocol for continued fisheries
research and Soviet assistance.
cluding: boats and two trawlers to be manned
Marine survey. by Soviet crews. Cooperation continues
Survey and development of national in fleet formation, development of port
fishing industry. infrastructure, and training.
Modernization of fish-processing
enterprises.
Provision of vessels and training.
In return, Soviets received exclusive
fishing rights within Angola's 200-mile
zone, plus facilities for anchorage, re-
pair, provisioning, and unloading.
Agreement on joint fishing venture in- In 1978, Moscow donated four fishing
Protocol to provide:
30,000 tons of fish to Angola per
year.
10 additional trawlers and technical
services.
Protocol on aid in training and con-
structing several fish processing plants.
Protocol for joint fishing project,
1979-81, training of Angolans.
1983 Grant of second fisheries protection
vessel.
Value
(million US $I
0.5
10.0
1984 Fishing agreement to cover eight years. Angolans renegotiated agreement in 50.0
Soviets to establish fisheries complex 1985.
with wharves, repair facilities, and cold
storage complex on credit basis.
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Table 4 (continued)
Guinea-Bissau
1975
1977
1978
Kenya
1964
Liberia
1981
Mauritius
1970
1974
Mozambique
1976
Agreement granting the Soviets fishing
rights in return for fishing boats, a
refrigerated warehouse, and an ice
plant, supply of 10,000 tons of fish
annually, training to Guineans, and
rental fees to the government. Moscow
has allocated $2.2 million for fisheries
development study.
Value
(million US $1
Agreement for joint commercial ven- Five boats delivered 1975; fish process- 10.5
ture "Estrela do Mar," with Soviets ing facilities completed 1980.
supplying five refrigerated trawlers
and 90 percent of the personnel. Also.
a 10-year agreement allowing five-year
renewal for fisheries research, training,
and technical assistance establishing
fishing fleet and processing plants. Re-
ciprocal rights granted Soviets for five
boats. Technical services for cash.
Protocol implementing cold storage
plant at Bafata, port modernization,
fisheries infrastructural development,
transfer of four ships, and building
repair docks.
Renegotiated 1975 agreement for
straight partnership with joint receipts
after operating costs split two ways.
Soviets to drop operating charges for
ships.
Under a $44 million line of credit, Training and supply of vessels in 2.0
USSR agreed to construct fish cannery 1965-68.
and related facilities, training, and
supply of vessels.
Soviet research vessel conducted sur- Completed.
vey of Liberian waters.
Credit for two trawlers, marine equip- About $1 million worth of fishing gear 5.0
ment, and services of specialists. Re- delivered.
newable at three-year intervals.
Accord signed in 1974 and renewed in Agreement allowed to lapse by
1976 calls for joint venture for re- Mauritius in 1980.
search and supplying local markets
with 60 tons of fish annually. Ten
trainees to study in USSR each year.
General fishing agreement includes a
joint venture, technical assistance to
fishing industry construction of refrig-
eration and port facilities, and leasing
Soviet boats to Mozambican facilities.
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Table 4 (continued)
Somalia 1963 In protocol to 1961 line of credit, Completed 1970.
USSR agreed to provide credits for
equipment for constructing a fish can-
nery at Laas Qoray with annual capac-
ity of 6 million cans a year.
1975 Credit for fishing industry develop- Suspended 1977.
ment ($19 million), port and processing
facilities ($9 million), training center
for 2,200 trainees, expansion of ship-
yard for fishing boats.
1975 Grant for fishing industry development Suspended in 1977.
and refugee resettlement.
Value
(million US Si
Sudan 1961 Survey of fishing potential of Red Sea Survey completed in 1964. Cannery 0.4
and Nile; fish cannery to be estab- feasibility reports prepared in 1965.
lished at Jabal al Awliya. but no subsequent activity.
Tanzania 1966 Protocol under $20 million credit in-. Marine equipment delivered. Cold 0.9
cludes marine equipment and construc- storage and drying plants canceled.
tion of fish drying and cold storage
plants.
1982 Agreement to carry out fisheries re- Tanzania dissatisfied with inadequate
search in Tanzanian waters. reports that Soviets made available.
East Asia
Indonesia 1964 Agreement under a 1956 credit to pro- $12.5 million worth of trawlers deliv- 15.1
vide trawlers and establish a fishing ered; shipyard and oceanographic
complex. school completed.
Kiribati 1985 One-year licensing agreement permits Fishing operations began in October,
17 Soviet vessels to operate in Kiribati has requested Soviets to sub-
Kiribati's EEZ until August 1986 for a mit a proposal for a detailed agreement
fee of about $1.7 million annually. involving shore facilities.
Singapore
1975 Agreement for joint company to estab- The joint venture company, Marissco,
lish Singapore's first fully integrated processes and markets 65,000 tons of
seafood processing and storage com- fish annually, mostly in Europe.
plex and to provide local market with
seafood and fishmeal.
Malaysia 1974 Agreement for Soviet fisheries assis- Not implemented.
tance, port construction, and possible
joint venture.
Argentina 1974 Agreement for joint fisheries research, Preliminary oceanographic studies 5.0
training. construction of fishing port. completed.
and joint fishing company.
Chile 1968 Following surveys, Soviets agreed to Suspended. 10.0
establish fishing port and crabmeat
plant under a 1967 line of credit.
1971 Agreement for development of fishing Suspended.
ports, training on Soviet vessels. tech-
nical school, and rental of Soviet fish-
ing vessels.
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Table 4 (continued)
Value
(million LS S1
Peru 1983 Contracts with El Pacifico and Mer- Pacific Fishing Enterprise acting as
curio firms and Peruvian Government intermediary for So%ryHot, and leased
to permit Soviets to catch up to 55,000 Soviet trawlers to fish territorial wa-
tons of hake, saurel, and mackerel in ters. Studies by Soviet research vessels
Peruvian waters. Peru to receive 10 to began October 1984.
12 percent of catch.
1984 Contract permitting Soviet catch of up
to 200,000 metric tons. Peru to receive
5 to 12 percent of catch.
1985 Temporary agreement signed extend-
ing 1984 contract for Soviet trawlers to
operate off Peruvian coast for three to
four months in return for 15 percent of
the catch.
Middle East
Egypt 1964 Agreement included Soviet ships for Three-year fish survey in south Medi- 15.0
deep sea fishing and research, techni- terranean completed 1970.
cal training, and assistance in develop-
ing fishing center on the Red Sea.
1967 Number of Egyptians training in
USSR increased from 200 to 300.
1969 USSR agreed to train additional 100
Egyptians.
1971 Agreement to provide Egypt with In 1971, Soviets train Egyptians in 1.5
12,000 tons of fish annually, undertake Atlantic fishing. Trawling equipment
a joint fisheries survey, and assist in delivered, survey completed. USSR
developing Lake Nasser. supplying fish at a highly favorable
price.
1972 Agreement on additional equipment, Survey and training completed.
training, surveys, technical assistance,
and construction of wharf on Red Sea.
1973 Soviet ships to provide Egyptians fish- Status of joint venture unknown since
ing off African coast with fuel and abrogation of friendship treaty in
fishing tackle and to deliver frozen fish March 1976.
to Alexandria.
1975 Protocol on training and trawling
equipment for deep sea operations.
1983 Protocol on cooperation in fishing. So- The sale of fishing boats and equip-
viets to supply Egypt with 26,000 tons ment to Egypt under discussion.
of frozen fish in 1983 and to train
Egyptians.
Iran 1963 Agreement to develop Caspian Sea re- First section of hatchery and cold stor- 2.0
sources, including equipment for large age plant completed 1969. Port equip-
fish hatchery, marine survey, and rec- ment arrived periodically after 1968.
lamation work.
1966 Agreement under a $17 million trade Completed.
credit to expand port and construct
cold storage plant.
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Table 4 (continued)
South Yemen
1979
1980
Syria
1974
South Asia
Bangladesh
1972
India
1966
1978
Maldives
1976
1968
Sri Lanka
1971
(million US S)
Protocol on cooperation in fishing. Two Projects being implemented. 35.0
research vessels to explore resources in
Gulf of Aden; two shore-based scientif-
ic labs to be established; five Soviet
trawlers to fish South Yemeni waters.
South Yemen to receive 2,000 tons fish
per year and two trawlers, whose catch
to be sold on Yemeni market.
Additional credit for facilities at fish- Two wharves. a floating drydock, a 40.0
ing port in Aden. central workshop, and a production
unit under construction.
Fisheries development, Buhayrat al
Asad (Al Asad Lake).
Grant for 10 fishing boats, refrigera- Boats delivered. Cold storage plants 15.0
tion facilities, a training center, and and center completed.
Soviet technicians.
Deep sea fisheries assistance to include Completed.
use of two Soviet trawlers and con-
struction of shipyard.
India asked Moscow for further assis- No agreement reached.
tance. Possibility of joint venture ex-
plored.
Agreement for assistance to local fish- No activity noted.
eries and training aboard Soviet trawl-
ers.
Agreement for oceanographic re- Soviet experts studied land facilities in 2.0
search, design of a fishing port. and 1968. In 1969, three Soviet trawlers
training of fishermen. began training fisheries personnel and
conducting a two-year fishing surveN.
Agreement for technical training and Oceanographic research began Febru- 3.0
establishment of training center. joint ary 1972. Soviet technicians arrived in
fisheries operations, and possible fu- 1973 to assist in setting up training
ture purchase or rental of Soviet fish- center. In 1977, 20 scholarships grant-
ing vessels. ed for training Sri Lankan personnel.
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Sanitized Copy Approved for Release 2011/06/30: CIA-RDP88B00443R002004490072-7
Sanitized Copy Approved for Release 2011/06/30: CIA-RDP88B00443R002004490072-7
Confidential
Figure 2
USSR: Fisheries Relations With Non-Communist LDCs, 1985
- Valid agreement
VP7 Agreement calls for joint venture
- Canceled agreement
ff
Sanitized Copy Approved for Release 2011/06/30: CIA-RDP88B00443R002004490072-7