Economic Impacts of Climate Change in Fiji and Kiribati Islands

Now we have learned tuna distribution shift due to climate change in the Pacific islands, let's shift our attention to its economic impacts on the market.

What are the economic impacts of climate change as Tuna species shift their range?

What type of feedback do you think climate change will have on economic system of Fiji islands and Kiribati?

Let's learn more!

Refer to the table below.

The data shows that tuna fishery contributes only about percent of the total export value.

About 80% of total catch of tuna in the Pacific are sold in domestic consumer market.

Given this fact, the economic impacts would be considerable mainly in the domestic market.

Although it will not have a significant impact on profits from exports, it is likely that revenue from property rights will decline since Fiji islands charge foreign vessels for fishing in their economic zone.

Consequently, the effects of changes of revenue from foreign fishermen may be higher than that of exports.

                                                         Figure A: Main Economic Indicators for Fiji Islands and Kiribati

In both Fiji islands and Kiribati, revenue from tuna fisheries play an important role in economy.

Tuna caught from Kiribati makes up significant portion of total catch of tuna in southwest Pacific Ocean, and usually they are more susceptible to climate-induced change than in Fiji islands.

Although tuna fisheries have expanded substantially during1990s in Kiribati, they were vulunerable
to more climate change. In constrat to Kiribati, the tuna fish supply in Fiji islands was at a stable level with exception of variations that occured annually after 1994.


How does this affect the price of tuna on market?

           
                                    
                                                                 Figure B: Prices of frozen tuna in Japanese market from 1989 to 1998

With the exception of Bigeye that shows high rate of fluctuation, prices of other tuna speices such as Yellowfin,Albacore, and Skipjack have been quite stable .

This is understandable considering the growth in demand has met with an increase in supply for tuna in the market.

Bigeye is one of the most commercially important fish species in the world. The price of Bigeye has shown a great fluctuation, dramatic upward trend in 1995 and downward tren in 1997. Also, notice how the prices have shown equalized trend over species in regard to time. For example, the price of albacore was about three times as high as the price of sikpjack in 1990, and the last fiscal year when the tuna prices were analyzed, the difference was approximately 25 percent, representing the same relative difference in prince in the previous year. In long term, the price trend of skipjack increase only to a certain extent. The change in the catch in both Fiji islands and Kiribati are not reflected int he prices since contribution made from Fiji islands and Kiribati to the total catch of tuna in the Pacific Ocean is minimal.



Tuna is thermo-sensitive and they are likely to respond to change in climate conditions and shift their habitat range immediately to find ideal temperature. As a result of this, the change in sea temperature does not always have a direct effect on the total stock of tuna.

How might this apply in macroeconomic scale?

Using data from Fiji islands, the model was calibrated and compared the solution of a base case with alternative options for the price of fish, catch in commercial fisheries, catch in subsistence household and a change in the cost of fisheries.


Now, we have investigated how climate change can influence not only local economy, but also the global fish market. How do we deal with this problem? What plans do we have? Can you think of any suggestions?

References

1. Adheim, Asbjørn and Sygna, Linda "Economic Impacts of Climate Change on Tuna Fisheries in Fiji Islands and Kiribati"

June 22 2000 CICERO Report 2000:4 Online

2.Rising Raw Material Prices and Political Uncertainty make for nervous markets August 2011Globe August 2011 Globe Fish
<http:www.globefish.org/tuna-august-2011.html>

3. The Pacific Tuna Fishery. ESCAP virtual Conference. "Integratint Environmental Consideration into Economic Policy Making Proceess" http://www.unescap.org/drapd/vc/conference/ex_pi_17ptf.htm

*The diagrams and graphs used in this section were borrowed from the scholarly articles above otherwise known as "Reference."