Dhonis have been made more efficient by modern technology.

Photo by Yassin Hameed. Courtesy Portrait Gallery, Maldives

Fishing has always been the lifeblood of the Maldives. Stranded on remote atolls over hundreds of kilometers, the earliest islanders soon figured out that it was the way to not only survive, but prosper. Until the last few decades, however, practices had changed little in thousands of years. Now the industry, always a subsistence craft, is becoming a lifeline to the nation’s future.

Fishing is both the principal industry and main traditional occupation in the islands outside the capital, where it is often the only significant employer. It is the country’s largest contributor to exports, and employs 20 percent of its population. Fishermen still fish with pole and line, catching each fish individually and eschewing modern mass-fishing techniques. “A large proportion of the rural livelihood is dependent on income related to fisheries,” says Dr. Fathim Hameed, a director at the Ministry of Fisheries, “and food security is linked to this. So what affects the fisheries affects the people.”

The industry is heavily dependent on tuna, especially skipjack, which constitutes 86 percent of the catch. However, reports that the population is suffering on account of Maldives’ fishing and the volatility of prices on the international market have made the industry fragile over recent years, and the government has frequently intervened to forestall its financial problems and to create needed infrastructure.

“In the last 28 or 30 years, fisheries have changed greatly,” says Abdul Rasheed Hussain, Minister of Fisheries, Agriculture and Marine Resources. “Earlier, we had mainly tuna fisheries, we were making very few products and our main export was to Sri Lanka’s markets. But since 1972 we have started diversifying our products and exporting new items to new markets.”

The catch is now expanding to different tuna-related species like Yellowfin, and to grouper and reef species. The islands also export exotic fish, mainly to South Asia. More diversification is still needed, however, if these species are not to be over-fished soon.

Modernizing the sector
The government has played an important role in the development of the sector over the last quarter-century, building a strong infrastructure to promote capital investment in the form of mechanization, cold storage and canning facilities, fish collection, boat building and fuel distribution. “Modernization started around 1972,” says Hussain. “Firstly with the collection of fish directly from the fisherman, then we started to mechanize our fishing fleet. Before that, all the boats were sailing vessels.”

The fishing industry had some financial input from the World Bank and from Japan in the late 1970’s, but it took the establishment of Gayoom’s administration to bring substantial government investment in the sector. Since exports began, the industry has been controlled by the state-owned Maldives Industrial Fisheries Company (MIFCO).

The industry has advanced in the last decade with the introduction of larger-hulled fishing boats which can carry bigger engines and thus venture further out to sea. The new challenge is for on-board processing to catch up with the larger catches, and for MIFCO and private buyers to keep pace with the greater harvesting capacity.

In an effort to expand and diversify the sector, the government has recently lifted MIFCO’s monopoly on frozen and canned fish, canned tuna fish and frozen skipjack for export. Dividing the fishing areas into four zones, it has reserved two for itself and marketed the other two to private enterprise. So far, two Maldivian companies have been allowed contracts to purchase, process and export the catch of the local skipjack fishery, but cannot engage in harvesting. “One of our objectives,” says Hussain, “has been to have control over the fisheries sector in the hand of the Maldivian people, because it is so much connected with the lives of the rural areas.”

Omar Maniku, Managing Director of Island Entreprises, one of the two private firms that have been awarded the license, says that the government has invested heavily in the industry through MIFCO, hence the cautious approach. “This new privatization program will have some impact on these investments,” he says.

The new arrangement means that now there are two types of fishing, one done by the local fishermen inside a 75-mile coastal zone, and the other by local and foreign vessels outside that zone and up to a 200-mile offshore limit, known as the Exclusive Economic Zone. “Then,” says Hussain, “marketing is done by the private sector – private merchants, private carriers, etc. They are exporting dried fish to Sri Lanka, and reef-fish to markets in the East, Hong Kong, Singapore.”

Dr. Hameed warns that although there is much interest on the part of foreign companies in investing in the sector, primarily in the harvesting side, “we are talking about highly migratory species, so any industrial level of activity will have impacts on our semi-industrial fishing fleet.”

Private enterprise
Since last October two private companies have stepped in where MIFCO has given up its monopoly on the buying and export of skipjack tuna: Island Enterprises and Jausa Fisheries Link. Their licensing is the nation’s first experiment in private sector involvement in this area. Both have won a 25-year license and will be working in the first privatized zone, one that produces on average 17 percent of the Maldives' skipjack tuna.

Omnar Maniku of Island Enterprises says that the company plans to invest 13.25 million dollars in its share of the skipjack industry. The first domestically-owned company to work in the fisheries industry in the 1980’s, it is now returning with renewed resolve. “With our knowledge we have a very good chance to conduct this operation better than before,” Maniku says. “Today's fishermen are more educated and more adventurous, and have the ability to use better, more modern technology in their fishing.”

At first Island Enterprises aims to launch six collection vessels (which transport the catch from the fishermen’s small boats to the processing facilities), a number which it says will increase to ten over time. It also plans a cold storage facility with a capacity of 1,000 metric tones. All production will take place on an island leased to the company by the government within the zone.

Island Enterprises’ Chairman, Qasim Ibrahim, is the owner of one of the largest private business establishment in the Maldives, the Villa Group of Companies, whose activities range from shipping to general trade and tourism. He says that the company is prepared for the potential vicissitudes of the industry (price fluctuations and high operational costs). “I am committed to this initiative and I want it to move ahead.”

Qasim says a priority for the company is to encourage more people to become fishermen. “We have to create awareness. If the business is profitable we plan to provide loans to build more boats and support the fishermen in many ways.” He adds that providing ice for the boats will also improve quality.

Under the arrangement, the private parties will pay the government a five percent royalty on the total value of their exports. There is also a floating benchmark price to pay for the catch. “It is a good policy,” Qasim says; “we provide revenue to the government and we ensure the fishermen’s revenue as well.”

Qasim also owns Villa Fishing, a company that as of this year operates six tuna long-liner vessels in the Maldivian Exclusive Economic Zone, providing premium quality tuna mainly for the Japanese sashimi market.

The government is concerned, as privatization continues, about protecting fishermen from market fluctuations and instability. “About 18 to 20 percent of the local labor force goes into fishing,” says Dr. Hameed, “which is more than tourism. And that is only in harvesting activities – we are not counting people involved in fish processing.” She explains that any displacement of the fishermen thanks to a downturn in prices would also have impact on the fish processing industry.

Compatibility with tourism
The government’s other balancing act relates to making sure that tourism coexists peacefully with the fisheries sector. “Before tourism came, there were reef-fisheries,” says Hussain. “Eventually, when it came, it expanded into the marine areas for entertainment, sightseeing, and all sorts of things.” But he says that the two industries play well together in the same space: “There are times when some fisherman might go to a reef off a resort to obtain baitfish, but there have not been any serious cases of conflict. Tourism and fisheries coexist together.”

Regulation has also become an issue as the Ministry tries to increase private investment in fisheries, while at the same time safeguarding Maldivian fishermen’s interests and ensuring sustainable development that does not damage the environment. “We help the tourism industry and also the fisheries sector by declaring some protected areas,” explains Hussain. “We have some protected species of fish; and there are some marine species which are prohibited.”

Another dilemma presented by the burgeoning tourism industry is that many young people from the islands choose to pursue careers there instead of fishing. Minister Hussain says that the state’s response has been to create incentives for fishermen: “We try to give better prices, better training and some credit facilities as incentives for them to stay.” He recognizes that modernization of the sector will also help young people experience fishing as a career rather than a fallback. “We need to attract young people and provide competitive employment to the future generation.”

The future of the Maldives’ fishing industry undoubtedly lies in technological and economic inventiveness. Achieving a balance between public and private enterprise is the present challenge, but the participation of new businesses and the reinvention of ancient practices offer the chance to complete the sector’s transformation into a symbol of the Maldives’ success, bringing tradition and profit together for the benefit of all.