PACIFIC VIEWPOINT By Netani Rika Islands Business Magazine The United States is on a collision course with Pacific nations as it attempts to get itself off the hook on a fishing deal signed in September.

State Department officials are scrambling to sell back 2000 fishing days worth around US$20 million before payment becomes due on January 1, 2016.

Every one of the Pacific’s 17 fishing nations stands to gain from the 5700 days sold to US fishing companies for the 2016 season – a deal struck at considerable cost to the region.

Chairman of the Parties to the Nauru Agreement, Eugene Pangelinan, described the situation as unfortunate.

“They came asking for more days, we struggled, we found the days, now they have changed their mind — that’s not negotiating in good faith,” he said.

On the fringes of the Western and Central Pacific Fisheries Commission 12th Session in Bali, US officials are approaching their Pacific counterparts to take back the days.

The ink on the contract is barely dry.

In August the Pacific Forum Fisheries Agency states concluded a deal with the State Department for US companies to access tuna stocks.

“They (the USA) pushed for a significant number of days from us and basically we did enough in the end to find those days to meet their demand. This was a demand by the US fleet,” Pangelinan said.

The additional days for the Vessel Day Scheme were given up by Pacific nations from time which would otherwise have been bought through bi-lateral agreements with partner nations.

“For them to come back to us in December asking to return the days to us and make amendments to the treaty is a major concern,” Pangelinan said.

“This treaty has come at great cost to us. If the US returns those days we will need to look at our options but at the end of the day we believe a deal is a deal.”

For many Small Island Developing States in the Pacific, the US Tuna Treaty had significant impact on financial projections for 2016. Some states developed their budgets around prospective revenue under the deal.

Any back-tracking by Washington will force a huge amount of work on regional fisheries agencies to take measures to make up the short-fall.

“You can imagine the position we are all placed in to try and go back and cut our budgets and then tell our finance people we may need to revisit our projections,” Pangelinan said.

According to the PNA Chairman, the US signalled its desire to reopen negotiations on the treaty signed less than three months ago.

At this stage Pangelinan does not want to describe Washington’s action as reneging on a deal made in good faith with the Pacific.

But if the US Pacific tuna fleet does not pay up on the due date, the region will have a problem.

“We are taking steps on our own to mitigate the losses if the US refuses to pay,” Pangelinan said.

“But in the end the fact remains that the US Department of State signed the treaty, we allocated days and now all we expect is payment.”

Unofficially, the US stand is that its tuna fleets have suffered serious losses in the past 12 months and cannot afford to pay licence fees for the days agreed under the treaty with Pacific nations.

Neither the State Department nor its industry representatives made any mention of financial difficulties during negotiations.

Pangelinan said Pacific countries shared a long relationship with its much larger partner but did not rule out decisive action – even legal option – if the deal agreed under the treaty did not come about.

“We hope to avoid court over the matter but we’re not going to rule out ways to resolve the matter,” he said.

“It could be a bit tricky but I think there is a way to address the issue through the treaty and there is an option for a Court of Arbitration.”

Pangelinan is adamant that the US State Department has signed a deal and has to deliver.

“When we signed we expected both parties to deliver. We have done our part and met the obligations,” he said.

“We’ve had a 25-year relationship and all we’re asking for is that the US honours its obligations.”

While there is unlikely to be a shortage of nations willing to take up the 2000 days, any renegotiation of the treaty will cost the Pacific nations in terms of administration, travel and time already spent securing the current agreement.

This may be small change for the US but in a region in which revenue streams are in short supply and fisheries is a major earner, the loss of two months in fishing licence payments is a big deal.

Ironically at least one Pacific nation – Fiji – came close to becoming a US dependency in 1855 after the warlord Ratu Seru Cakobau could not pay US$55,000 in damages for the destruction of property belonging to Washington’s consul.

It was a paltry sum to the US which demanded payment as a matter of principle despite the financial difficulty imposed on a small Pacific territory.

Worried that the US would despatch its navy to deal with him, Cakobau began negotiations to cede Fiji to Great Britain.

Today, 160 years later, it is the Pacific which demands payment as a matter of principle. - IB