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If you were to read only one thing…
NYT – China’s Appetite Pushes Fisheries to the Brink – Andrew Jacobs 4/30
- “Overfishing is depleting oceans across the globe, with 90% of the world’s fisheries fully exploited or facing collapse, according to the United Nations Food and Agriculture Organization. From Russian king crab fishermen in the west Bering Sea to Mexican ships that poach red snapper off the coast of Florida, unsustainable fishing practices threaten the well-being of millions of people in the developing world who depend on the sea for income and food, experts say.”
- “But China, with its enormous population, growing wealth to buy seafood and the world’s largest fleet of deep-sea fishing vessels, is having an outsize impact on the globe’s oceans.”
- “Having depleted the seas close to home, Chinese fishermen are sailing farther to exploit the waters of other countries, their journeys often subsidized by a government more concerned with domestic unemployment and food security than the health of the world’s oceans and the countries that depend on them.”
- “Increasingly, China’s growing armada of distant-water fishing vessels is heading to the waters of West Africa, drawn by corruption and weak enforcement by local governments. West Africa, experts say, now provides the vast majority of the fish caught by China’s distant-water fleet. And by some estimates, as many as two-thirds of those boats engage in fishing that contravenes international or national laws.”
- “China’s distant-water fishing fleet has grown to nearly 2,600 vessels (the United States has fewer than one-tenth as many), with 400 boats coming into service between 2014 and 2016 alone. Most of the Chinese ships are so large that they scoop up as many fish in one week as Senegalese boats catch in a year, costing West African economies $2 billion a year, according to a new study published by the journal Frontiers in Marine Science.”
- “Many of the Chinese boat owners rely on government money to build vessels and fuel their journeys to Senegal, a monthlong trip from crowded ports in China. Over all, government subsidies to the fishing industry reached nearly $22 billion between 2011 and 2015, nearly triple the amount spent during the previous four years, according to Zhang Hongzhou, a research fellow at Nanyang Technological University in Singapore.”
- “That figure, he said, does not include the tens of millions in subsidies and tax breaks that coastal Chinese cities and provinces provide to support local fishing companies.”
- “When it comes to global fishing operations, China is the indisputable king of the sea. It is the world’s biggest seafood exporter, and its population accounts for more than a third of all fish consumption worldwide, a figure growing by 6% a year.”
- “The nation’s fishing industry employs more than 14 million people, up from five million in 1979, with 30 million others relying on fish for their livelihood.”
- “But as they press toward other countries, Chinese fishermen have become entangled in a growing number of maritime disputes.”
- “Indonesia has impounded scores of Chinese boats caught poaching in its waters, and in March last year, the Argentine authorities sank a Chinese vessel that tried to ram a coast guard boat. Violent clashes between Chinese fishermen and the South Korean authorities have left a half-dozen people dead.”
- The good news is that “Beijing has become sensitive to accusations that its huge fishing fleet is helping push fish stocks to the brink of collapse.”
- “The government says it is aggressively reducing fuel subsidies — by 2019 they will have been cut by 60%, according to a fishery official — and pending legislation would require all distant-water vessels manufactured in China to register with the government, enabling better monitoring.”
- “’The era of fishing any way you want, wherever you want, has passed,’ Liu Xinzhong, deputy general director of the Bureau of Fisheries in Beijing, said. ‘We now need to fish by the rules.’”
- “But criticism of China’s fishing practices, he added, is sometimes exaggerated, arguing that Chinese vessels traveling to Africa were simply responding to the demand for seafood from developed countries, which have been reducing their own fleets.”
- “’People come to me and ask, ‘If China doesn’t fish, where would Americans get their fish to eat?’’ he said.”
Worthy Insights / Opinion Pieces / Advice
WSJ – Whatever You Do, Don’t Read This Column – Jason Zweig 4/28
- “Investors have a hard time looking truth square in the face.”
NYT – Internment, America’s Great Mistake – George Takei 4/28
FT – London housing: too hot for young buyers – Nathan Brooker 4/26
- “Some first-timers need to borrow 40 times their salary to buy in parts of the city.”
- Clearly this isn’t an affliction unique to London.
Real Estate
WSJ – Daily Shot: John Burns Consulting – Home Building Material Cost Increases 4/28
WSJ – Daily Shot: FRED – US Household Growth 4/28
WSJ – Daily Shot: FRED – Household Debt / GDP – Australia, Canada, & US 4/28
Energy
WSJ – Daily Shot: eia – US Dry Shale Production 4/28
China
- “Since taking up his post in late February, Guo Shuqing, chair of the China Banking Regulatory Commission, has issued a stream of directives aimed at, among other issues, clamping down on shadow banking practices and raising lending standards in the interbank market.”
- “Applying a squeeze on interbank market liquidity by guiding short-term rates higher has become the strategy of choice for Chinese monetary authorities trying to rein in the country’s credit bubble without causing it to burst.”
- “One of the main targets of the squeeze is a huge proliferation of ‘wealth management products’ issued by banks but often kept off their balance sheets to elude capital regulations. These WMPs, the outstanding amount of which stands at Rmb29tn ($4.2tn) or equivalent to 40% of GDP, are regarded as culprits behind the swelling of China’s unregulated shadow finance market in recent years.”
- “The danger for China, though, is that by squeezing liquidity to curb WMP issuance, Beijing is also jeopardizing a key funding source for some of the weakest institutions in the financial system, namely small and medium-sized banks. A scramble among such banks for liquidity has prompted a surge in issuance of bank certificates of deposit, increasingly at higher interest rates than such banks are receiving from their WMP investors.”