Financing the Peruvian Artisanal Small-Scale Fisheries Sector: an Analysis of Supply and Demand CONTENTS LIST of FIGURES

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Financing the Peruvian Artisanal Small-Scale Fisheries Sector: an Analysis of Supply and Demand CONTENTS LIST of FIGURES Financing the Peruvian Artisanal Small-Scale Fisheries Sector: an Analysis of Supply and Demand CONTENTS LIST OF FIGURES Contents List of figures List of figures 3 Figure 1: Data sources used for the demand analysis 10 Acronyms and Abbreviations 4 Figure 2: Data sources used for the supply analysis 11 I. Project objectives and data collection methodology 6 Figure 3: Environmental and human capital problems of the 15 artisanal and small-scale fisheries sector II. The problems of the artisanal and small-scale fisheries 12 sector in Peru Figure 4: Intermediation and financing dynamics by informal 18 sources III. Evaluation framework 24 Figure 5: Persistent informality in the artisanal fisheries 19 IV. Selected regions: Why was the analysis focused on Ancash, 29 sector. Arequipa and Piura? Figure 6: Institutional instability and poor governance in the 20 V. Demand analysis: Investment and/or training opportunities 32 fisheries sector for the artisanal and small-scale fisheries sector Figure 7: Better performing and worst performing fisheries: 22 VI. Supply analysis: Current available funding sources (private 39 main input and output metrics in the FPI and public) for the artisanal and small-scale fisheries sector methodology VII. Barriers and limitations identified 46 Figure 8: Selected dimensions to assess the sustainability 26 of the artisanal and small-scale fisheries sector VIII. Concluding remarks and recommendations: 50 breaking the barriers Figure 9: Selected regions 31 References 55 Figure 10: Barriers and limitations identified by the fishers 49 and main stakeholders of the sector during the Acknowledgments 62 interviews 2 Peru: Coastal Fisheries Initiative - Challenge Fund (Peru CFI-CF) Peru: Coastal Fisheries Initiative - Challenge Fund (Peru CFI-CF) 2 3 ACRONYMS AND ABBREVIATIONS FINANCING THE PERUVIAN ARTISANAL SMALL-SCALE FISHERIES SECTOR: AN ANALYSIS OF SUPPLY AND DEMAND Acronyms and abbreviations AE Associated Entity FONDEPES National Fisheries PE Proposing Entity SUNARP National Development Fund Superintendence of CE Collaborating Entity PNIPA National Program of Public Registries FPI Fishery Performance Innovation in Fisheries CENPAR National Artisanal Indicators and Aquaculture SUNAT National Fisheries Census Superintendence of GORE Regional Government PROCOMPITE Productive Customs and Tax CMAC Municipal Savings and Competitiveness Administration Credit Bank GPS Global Positioning Support Initiative System TASA Tecnológica de CRAC Rural Savings and PRODUCE Ministry of Production Alimentos S.A. Credit Bank ID Identification Document RUC Peruvian Tax DHC Direct Human INEI National Statistic and Identification Document Consumption Informatics Institute SA Strategic Alliance DICAPI General Directorate of IHC Indirect Human Captaincy and Coast Consumption SANIPES National Fisheries Guard Sanitation Agency IMARPE Peruvian Sea Institute EDPYME SME financial SBS Superintendence of development company Innóvate National Innovation Banking, Insurance and Perú Program for AFP of Peru ENEPA-III Structural Artisanal Competitiveness and Fisheries Survey Productivity SFT Sustainable Fishery Trade FEPCMAC Peruvian Federation of Illegal, Unreported or Municipal Savings and IUU Unregulated SME Small and Medium Credit Banks Enterprise Non-Governmental FIP Fishery Improvement NGO Organization SNP National Fishery Project Society Artisanal Fisheries FMR Fishery Management OSPA Social Organization SOPA Mandatory Fisher’s Regulation Insurance 4 Peru: Coastal Fisheries Initiative - Challenge Fund (Peru CFI-CF) Peru: Coastal Fisheries Initiative - Challenge Fund (Peru CFI-CF) 5 FINANCING THE PERUVIAN ARTISANAL SMALL-SCALE FISHERIES SECTOR: AN ANALYSIS OF SUPPLY AND DEMAND I. Project objectives and data collection methodology 6 Peru: Coastal Fisheries Initiative - Challenge Fund (Peru CFI-CF) Peru: Coastal Fisheries Initiative - Challenge Fund (Peru CFI-CF) 7 PROJECT OBJECTIVES AND DATA COLLECTION METHODOLOGY FINANCING THE PERUVIAN ARTISANAL SMALL-SCALE FISHERIES SECTOR: AN ANALYSIS OF SUPPLY AND DEMAND The fisheries sector in Peru is polarized, with a specialized industrial fishery that is relatively sustainable and efficient on the one hand, and various small-scale and This report includes quantitative and qualitative information from a large number artisanal coastal fisheries that are underproductive and overexploited on the other. of sources. To analyze demand, we used the 2012 National Artisanal Fisheries Census Widespread informality, insufficient use of technology, vulnerability to weather events, (CENPAR)2 and the 2015 Structural Artisanal Fisheries Survey (ENEPA-III). However, lack of long-term vision among fishers and boat owners, low levels of entrepreneurship, these databases do not analyze the social and economic characteristics of the small-scale and deficient supervision, control and monitoring systems all count as formidable fisheries sector, and nor do they truly reflect the status of the artisanal fisheries sector barriers to the development of the industry. One possible measure that could ensure the (due to limited coverage and because much of the data is now outdated). Therefore, sustainability of artisanal and small-scale fisheries in Peru is to promote access to formal we complemented this data through workshops and interviews with the relevant agents sources of capital for investment in strengthening fisheries management and the supply (fishers, boat owners, processors, enterprises and organizations) in Ancash, Arequipa chain. However, the above-mentioned barriers and risks mean that financing is currently and Piura (see Figure 1). beyond the reach of most enterprises and associations involved in fishing. As part of the fieldwork, in April and May 2019 we conducted in-depth interviews As such, the objective of the Peru: Coastal Fisheries Initiative - Challenge Fund with 39 representatives of enterprises and associations involved in artisanal or (Peru CFI-CF) is to find new options for improving the sustainable usage and small-scale fisheries in 20 communities across the selected regions. In the region of management of coastal fisheries in Peru through the search for formal financing Piura, we interviewed nine boat owners and four businesspersons across nine fisheries routes. To this end, the initiative aims to strengthen the capabilities of government communities (four in the province of Talara, three in the province of Paita and two in authorities, the private sector and local fisheries communities with a view to establishing the province of Sechura). In the region of Ancash, we interviewed eleven boat owners, a sustainable and responsible investment portfolio that generates returns for certain four businesspersons and one project manager3 across six fisheries communities selected coastal fisheries. Moreover, the initiative aims to support those fisher (three in the province of Santa, one in Huarmey and two in Casma). Finally, in Arequipa organizations with an interest in accessing capital for the preparation of comprehensive region, we interviewed nine fishers and one leader of an artisanal fishers’ association investment readiness assessments. Finally, it seeks to identify the barriers and across five fisheries communities (three in Caraveli province, one in Camaná and one limitations associated with drafting comprehensive investment readiness assessments, in Islay). In addition, we interviewed officials from some of the authorities responsible and to propose solutions based on policy recommendations. It should be noted that the for the industry: PRODUCE, FONDEPES, the national government program “A Comer initiative will not support the financing of investment opportunities that promote illegal, Pescado” and IMARPE. We sought to understand the viewpoints of these officials unreported or unregulated (IUU) fisheries, or an increase in fishing fort.ef about the opportunities, barriers and limitations to promoting better access for industry associations to formal sources of capital. To identify investment opportunities for fishers, as well as barriers and limitations to the access of capital, this report assesses the supply and demand of capital to the artisanal and small-scale fisheries sector in Peru1. Moreover, it is hoped that the assessment can inform policy options or recommendations to mitigate these risks and overcome the barriers that prevent public and private entities from financing this industry in a sustainable manner. The scope of this study is to analyze the supply and demand related 1This is the short-version (translated in English) from a longer study (made in Spanish) named: “Diagnóstico de la oferta y la to financing in three of Peru’s ten coastal regions: Piura, on the northern coast, Ancash, in demanda de financiamiento al sector de pesca artesanal y de menor escala en las regiones peruanas de Áncash, Arequipa y the center; and Arequipa, in the south. Together, these regions allow for a comprehensive Piura”. 2Instituto Nacional de Estadística e Informática (2012). Primer Censo Nacional de la Pesca Artesanal 2012 (I-CENPAR 2012). insight into the realities of the artisanal and small-scale fisheries sector in Peru. In addition, Given that there is no latter census, we refer to this document as CENPAR. these three regions host the businesses, organizations and entrepreneurs best suited to 3Project managers are representatives of a public (for example, PRODUCE) or private entity (for example, an employee of Tecnológica de Alimentos S.A. – TASA) in charge of formulating and developing an investment
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