Fisheries and Aquaculture

On April 24th Federal Minister of Fisheries and Oceans, Robert Thibeault, announced the closure of the last remnants of the Gulf of St. Lawrence and the northern cod fisheries. The economic impact on Newfoundland will be minimal, however the federal government is coming to the aid of rural communities with up to 25 million in make work programs.

When the crab fishery resumes next April, the Northern Peninsula town of St. Anthony plans to impose a tariff on shellfish landed in their harbour and shipped out to other Newfoundland centres. It is the latest in a series of attempts by the province to shield workers from having to compete with the rest of the world on a level playing field. While individual provinces have tried to bar workers and other companies from competing in their internal market, we now have a town attempting to secure work for its citizens by levying a tariff on fish that is shipped out of town. Peter Fenwick, AIMS’ voice on Newfoundland and Labrador, explains in this commentary why, in the end, this protectionist approach impoverishes the entire rural sector of the province and prevents capital formation that could be used to expand the economic base of rural Newfoundland.

Peruvian economist Hernando de Soto argues, most recently in his award-winning book "The Mystery of Capital", that the world's poor often possess considerable capital which could be used to generate wealth, income and employment. Unfortunately, because that wealth is tied up in things like self-built houses to which no formal title exists, it cannot be used as collateral and no bank will lend against it. It is, in de Soto's words, "dead capital", capital whose value has been destroyed by the absence of clear, simple and defensible property rights. In this Commentary, former AIMS Director of Communications, Peter Fenwick, applies these insights to Newfoundland and its perennial problems of economic underdevelopment. He writes: "Although Newfoundland is far from a third world country when it comes to property rights, long held attitudes towards the commons have severely stunted any attempt to use the natural wealth of the province as the grubstake to build prosperity."