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p. 9 of 20 BACK | NEXT I. Introduction II. The Context: Fisheries in the Asian and Pacific Region III. The Bank's Experience in the Fisheries Sector A. Lending Operations B. Technical Assistance Operations IV. The Issues: Challenges and Opportunities V. The Recommended Strategy for the Bank

Policy on Fisheries : III. The Bank's Experience in the Fisheries Sector

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A. Lending Operations

Cumulative Bank lending for fisheries (see Appendix 4) accounts for over 8 percent of lending to agriculture and agro-industry. Since 1969, the Bank has approved at least one fishery loan in each year, except in 1971. The highest number of projects financed in a year was four (in both 1978 and 1980), and the largest amount extended was in 1989, when three loans totaling $118 million were approved for Indonesia and the Philippines. Of the total Bank lending of $1,125.78 million for fisheries, $473.15 million or 42 percent equivalent was from the Bank's concessional Special Funds resources, and $652.63 million or 58 percent was from ordinary capital resources.

Of the 18 DMCs borrowing from the Bank for fisheries, the largest recipient was Indonesia, with the Philippines a distant second, followed by Pakistan, Bangladesh, Sri Lanka, PRC, Malaysia, Thailand, Republic of Korea, and Nepal. Taipei,China, the recipient of the Bank's first fishery loan, and the Republic of Korea, which borrowed for two fishery projects, have not borrowed from the Bank for fisheries during the last decade. India has not yet borrowed from the Bank for fishery projects.

The 1979 Bank Staff Working Paper described the major objectives of the Bank's fisheries operations as to

1. increase the availability of fish and fish products for domestic consumption;

2. increase fish exports and/or replace fish imports in order to earn or save foreign exchange; and

3. generate employment for and increased incomes of fishers, fish farmers, and others in related occupations.

Reflecting the primary objective of increasing production, most lending operations in the first decade emphasized marine fisheries and financed the acquisition and modernization of vessels, gear, and equipment for small- and large-scale fishing industries, as well as support for postharvest facilities and related infrastructure. Projects with primary emphasis on marine fisheries received 72 percent of Bank lending to the sector, while the remainder went to infrastructure, aquaculture, and other ancillary projects.

The Bank contributed to catalyzing the rapid expansion of aquaculture in the Region. Lending for aquaculture and culture-based projects started in the late 1970s, and as of the end of 1996, the Bank had approved 15 aquaculture projects and 5 fisheries projects with aquaculture components. These projects supported the expansion of pond area, introduction of more intensive aquaculture technology, stocking of reservoirs and lakes, and provision of related infrastructure. Some projects funded vertically integrated fishing or aquaculture activities such as the provision of inputs, production, postharvest handling, and distribution or marketing. Starting in the late 1980s, Bank lending placed greater emphasis on policy reforms, explicit consideration of environment and the community, strengthening of institutions, research, and training.

Of the 52 fisheries projects (54 loans) financed by the Bank, 43 have been completed and one was cancelled (Viet Nam). Project completion reports have been prepared for 35. Twenty-six projects in 11 DMCs have been postevaluated and project performance audit reports on them prepared. A summary of postevaluation results is presented in Appendix 5, which shows that the performance of the Bank's fishery projects improved substantially over time, as lessons learned from past projects were incorporated in the design and implementation arrangements of new ones. During the first decade (1970-1979), when 18 of the evaluated fisheries projects were approved (14 of these in marine fisheries), only 17 percent of them were evaluated as generally successful, with 33 percent partly successful. In the second decade (17 fishery projects approved), 65 percent (11 projects) were generally successful and 29 percent partly successful. By drawing on implementation experience, the Bank diversified its operations in the fishery sector to include aquaculture and fisheries extension, research, and training projects.

In addition to the project completion and project performance audit reports on individual projects, an impact evaluation study¹² on Bank assistance to the fisheries sector was prepared in 1985. Periodic assessment of fisheries projects has also been undertaken while reviewing the Bank's agricultural operations, updating country strategies, and processing new projects. These findings provide valuable lessons for the formulation of the Bank's policy on fisheries and planning its future directions.

Despite past difficulties in implementing projects in the fisheries sector, postevaluation findings indicate that the Bank can have important roles in (i) assisting DMCs particularly to develop institutional capability and a policy framework for fisheries resource planning and management, and (ii) identifying viable approaches to improving small-scale fisheries. Postevaluation experience also suggests that the Bank's major role should be to help governments create an environment that will be supportive of private sector fishing operations. Major lessons learned can be categorized under the following general headings:

1. A Holistic Approach to Project Design. Projects should address broad sectoral and intersectoral concerns and carefully assess the ecological-economic linkages. The Bank should promote an integrated and sustainable resource management and development approach. Ecosystems must be assessed more thoroughly. Environmental inputs and outputs should be priced properly to better evaluate tradeoffs, particularly in the expansion of aquaculture through the conversion of intertidal areas and wetlands into fishponds. Increasing production should not be overemphasized.

2. More Accurate or Realistic Project Appraisal and Design Parameters. Projects, especially in marine fisheries, should guard against overestimation of resource potential by taking into account the biological status and capabilities of fish stock production. Comprehensive assessments of the socioeconomic status of beneficiaries are also necessary. Feasibility of institutional arrangements, the policy framework, and the availability of local expertise to implement projects should be carefully assessed.

3. A More Participatory Approach to Project Design and Implementation. Careful assessment of the preferences of the beneficiaries should be conducted in projects involving transfer of technology, purchase of fishing equipment, and the like. Involvement and participation of the private sector (e.g., communities, industry leaders, NGOs, and project beneficiaries) in all aspects and phases of the project constitute one of the success factors. The private sector should be tapped in the implementation of projects where it has a comparative advantage.

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