(Temporary?) Decoupling of Bad Subsidies as An Alternative to Support Mexican Fishers during the COVID-19 Pandemic

17 Pages Posted: 4 May 2020

See all articles by Adan L. Martinez-Cruz

Adan L. Martinez-Cruz

Department of Forest Economics, SLU; CERE; ETH Zürich - Centre for Energy Policy and Economics (CEPE)

Date Written: May 4, 2020

Abstract

As of April 21, 2020, the Mexican Federal administration has committed a one-time transfer of MXP 7,200 (USD 374) to 193,200 fishers to support them during the COVID-19 pandemic. This amount affords a 4-member rural household’s basic basket of goods during a month and a half. Fishers, however, most likely will need support for a longer period. In this document, we suggest that a decoupling of bad fisheries subsidies represents an alternative to efficiently redirect public funds towards relief support. If, for instance, only fuel subsidies were going to be decoupled, the one-time transfer committed by Federal authorities can be increased to afford a basic basket of goods during two additional weeks. Alternatively, the decoupled subsidy can reach 79,178 additional fishers. We highlight that a decoupling policy addresses suggestions made by international institutions to face economic impacts from COVID-19 without deviating from Sustainable Development Goals. This recommendation is particularly relevant for developing economies as sustainability is a criterion when accessing loans from international institutions. While this document focuses on the Mexican case, its insights are relevant for developing countries that are searching for alternatives to support their populations in facing COVID-19.

Keywords: Q22, Q28

JEL Classification: COVID-19, Decoupling Fisheries Subsidies, SDG 14.6, Mexico

Suggested Citation

Martinez-Cruz, Adan L., (Temporary?) Decoupling of Bad Subsidies as An Alternative to Support Mexican Fishers during the COVID-19 Pandemic (May 4, 2020). Available at SSRN: https://ssrn.com/abstract=3592483 or http://dx.doi.org/10.2139/ssrn.3592483

Adan L. Martinez-Cruz (Contact Author)

Department of Forest Economics, SLU ( email )

S-901 83 Umea
Sweden

HOME PAGE: http://https://www.researchgate.net/profile/Adan_Martinez-Cruz

CERE ( email )

Almas Allé 10
Umeå, 750 07
Sweden

ETH Zürich - Centre for Energy Policy and Economics (CEPE) ( email )

8092 Zurich
Switzerland
+41 44 633 80 97 (Phone)

HOME PAGE: http://www.eepe.ethz.ch/people/madan

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