VZCZCXRO4491
RR RUEHCN RUEHDBU RUEHGH RUEHIK RUEHLN RUEHPOD RUEHSK RUEHSL RUEHVC
RUEHYG
DE RUEHVK #0091/01 2570220
ZNR UUUUU ZZH
R 140220Z SEP 09
FM AMCONSUL VLADIVOSTOK
TO RUEHC/SECSTATE WASHDC 1195
INFO RUEHXD/MOSCOW POLITICAL COLLECTIVE
RUCNCIS/CIS COLLECTIVE
RUEHZG/NATO EU COLLECTIVE
RUEHOO/CHINA POSTS COLLECTIVE
RUEHVK/AMCONSUL VLADIVOSTOK 1300

UNCLAS SECTION 01 OF 02 VLADIVOSTOK 000091 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: SENV EFIS ECON EINV ETRD EWWT PGOV PREL PHSA RS
SUBJECT: INTERNATIONAL FISHERY CONGRESS TOUTS STRENGTHS OF RUSSIAN 
FISHING INDUSTRY 
 
VLADIVOSTO 00000091  001.2 OF 002 
 
 
¶1. (SBU) Summary:  The Sixth International Fishery Congress, 
hosted in Vladivostok September 8-10, has grown in significance. 
 This year's event was attended by over 500 participants from 
across Russia, including all of the Russian Far East (RFE) 
regions, as well from the U.S., Europe, and Asia.  For the first 
time ever the Director of the Federal Fisheries Agency Andrey 
Krainiy attended.  He reported that the Russian fishing industry 
was one of the few sectors of the Russian economy to experience 
growth in 2009.  Krainiy criticized cumbersome legislation which 
has hampered the industry and announced plans to promote the 
construction of more shipyards.  The congress also discussed 
steps needed to improve sustainable development in the Russian 
fishing industry and to include some type of international 
ecological certification to appeal more to western consumers. 
End summary. 
 
-------------------------------- 
Russian Fishing Industry Growing 
-------------------------------- 
 
¶2. (U) Director of the Federal Fisheries Agency Andrey Krainiy 
opened the congress by proudly stating that Russia's fishing 
industry was one of the few industries in the country that 
showed the growth in 2009.  The RFE is Russia's leading fishing 
region despite numerous problems, including financial 
difficulties, an outdated fleet, inadequate refrigeration and 
processing facilities, and cumbersome legislation.  RFE salmon 
fishing saw a record year with a catch of over 500,000 tons, 
almost 200,000 tons more than in 2007.  (Note:  The RFE accounts 
for over 30 percent of Russia's fishing industry and is 
influential in the Asian market.  End note.) 
 
---------------------------------------- 
Legislative Improvements and Impediments 
---------------------------------------- 
 
¶3. (U) Krainiy admitted that systemic flaws existed in the 
fishery management system, including an inadequate legal 
framework.  He cited the Fishery and Aqua Bio-resources 
Preservation Act of 2004, which has been amended over 30 times 
in 2008 alone, as a prime example.  Krainiy said granting 
regional governments the authority to start the fishing season 
based on scientific forecasts is a great achievement.  He 
praised former Kamchatka Governor Mikhail Mashkovtsev for 
opening the 2002 salmon season before getting permission from 
Moscow, despite the criminal case launched against him in 2004 
for having done so.  Krainiy called for greater coordination 
between fishing companies, law enforcement agencies, and border 
guard service.  Despite having reached certain agreements, these 
agencies continue to obstruct fishermen with numerous 
inspections, but law enforcement also interdicts tons of 
illegally harvested seafood. 
 
-------------------------- 
Russian Fish for Russians! 
-------------------------- 
 
¶4. (U) A new regulation on fisheries that came into effect on 
January 1 demands that all fish caught in the Russian economic 
zone be delivered to Russian ports.  This law has been expressed 
by the slogan "Russian Fish to the Russian Shore."  Before that 
law came into effect, half of the fish caught in Russia's 
economic zone (over 1.5 million tons) was sold abroad.  This was 
seen as depriving Russian costal settlements of jobs, the 
Russian treasury of revenue, and Russian consumers of fish.  The 
2009 salmon fishing season, however, exposed the illogic behind 
the law, as RFE fishermen struggled to make a living due to the 
mismanagement of fish processing companies and a lack of 
coordination with Russian railroads.  Well before the end of the 
salmon fishing season, seafood processing companies were stuck 
with no way to move their product, having filled all available 
refrigeration storage facilities in RFE ports.  As a result, the 
retail price of salmon is up to 200 rubles (USD 6.30) a kilogram 
in the Volga region, while the wholesale price in Sakhalin is 10 
rubles (USD 0.30) a kilo and 25 rubles (USD 0.70) per kilo in 
Vladivostok.  The fishermen had no choice but to sell salmon to 
China and South Korea before the fish spoiled in order to pay 
for fuel, labor, and other costs.  Fish sold abroad usually 
fetches higher prices as well.  Prime Minister Putin was forced 
to intervene and ordered the Russian Railroad Company to free up 
more refrigerator cars to move RFE fish. 
 
---------------------------------------- 
Outdated Vessels and a Lack of Shipyards 
---------------------------------------- 
 
¶5. (U) The aging Russian fishing fleet was also discussed at the 
congress.  Most of the Russian fleet is already exceeding its 
 
VLADIVOSTO 00000091  002.2 OF 002 
 
 
normal lifespan.  The RFE fishing industry will need over 200 
new vessels in the course of the next decade.  The lack of 
high-sea fishing vessels force fishermen to operate only in 
Russia's economic zone (mainly the Sea of Okhotsk, the Bering 
Sea, and the Sea of Japan).  Fishing companies neither have 
money nor access to bank loans to buy new, costly vessels. 
Krainiy said that federal financing for the construction of new 
fishing boats, to be leased to fishing companies, would 
significantly help to bring the fleet up-to-date.  This is 
currently being discussed by the national government. 
 
¶6. (U) This strategy will work only when new, well-equipped 
shipyards are put into operation or foreign vessels are allowed 
to be purchased with lower import duties.  The lack of adequate 
shipyards in Russia causes Russian fishermen to import new and 
used vessels, mainly from East Asia.  At the congress it was 
rumored that a new Russian-South Korean shipyard will be put 
into operation in Nakhodka, in the Primorye Region next year. 
Amur Governor Oleg Kozhenyako attended the congress and said his 
region was prepared to build small seiners at the Blagoveschensk 
shipyard.  He promised fishermen discounts and bonuses on the 
contracts. 
 
--------------------------------------------- -- 
Progress in Ecological Certification Assessment 
--------------------------------------------- -- 
 
¶7. (U) During the congress there was a roundtable discussion of 
the Sustainable Fisheries Partnership on the progress of RFE 
pollock fishing companies toward ecological certification of 
their products at the world market.  Director of 
Vladivostok-based ROLIZ Fishing Company Petr Savchuk said much 
had been done, but more is needed before the whole process 
becomes transparent from boat to plate, such as ending the 
practice of using flag of convenience vessels, bringing Russian 
fishing regulations in line with Marine Stewardship Council 
(MSC) standards, and ending illegal, unreported, and unregulated 
catches.  (Note:  The Kurils-based Gidrostroy Company was the 
first-ever Russian fishing company to meet MSC requirements. 
Gidrostroy received an MSC ecolabel on September 10.  End note.) 
 
------- 
Comment 
------- 
 
¶8. (SBU) Over the past six years the annual International 
Fishery Congress has proven to be an increasingly effective 
forum for RFE fishermen to air their concerns with the national 
government.  It also has given industry representatives 
opportunities to meet and coordinate their efforts to promote 
the seafood industry's development.  The opportunity for RFE 
fishermen to communicate with their foreign partners has also 
served to improve sustainable development and to work towards 
meeting international standards. 
ARMBRUSTER