MINISTRY OF AGRICULTURE,
AND RURAL DEVELOPMENT
Sustainable Management of Marine Fishery
Ref. No: EuropeAid/128947/C/SER/ME
Report 34
Fishery Sector Study for the IPARD Programme
October, 2011
Ian Scott
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Team Leader
An EU-funded project managed by the European Union Delegation to Montenegro
Project Ref. No. EuropeAid/128947/C/SER/ME
1. Project Title
Sustainable Management of Marine Fishery
2. Details
Sector
Fisheries
Beneficiaries
Europeaid/128947/C/SER/ME
Project No.
Signature of project contract
Effective start of activities
End of activities
Contract value:
11th August 2010
13th September 2010
12th March 2012
Ministry of Agriculture,
Forestry
and
Water
Management
Institute of Marine Biology
€558,930
Disclaimer
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The opinions expressed in this report are those of the authors and do not necessarily reflect the opinions of the
European Delegation in Montenegro or any other organisation mentioned in the report.
An EU-funded project managed by the European Union Delegation to Montenegro
Project Synopsis
Project Title
Publication Ref. No.
Contracting Authority
Beneficiary
Organisations
Country
Contractor
Project Duration
Overall Objective
Project Purpose
Project Components
Project Director
Key Expert Team
Working Days
Page
III
Budget
Sustainable Management of Marine Fishery
EuropeAid/128947/C/SER/ME
European Union Delegation to Montenegro
Ministry of Agriculture, Forestry & Water Management
Institute of Marine Biology
Republic of Montenegro
Agrotec SpA in association with Tragsatec
September 13, 2010 – March 12, 2012
To promote sustainable management of the Montenegrin marine fishery
sector in the context of the Acquis Communautaire.
The strengthening of Montenegrin capacity to effectively manage the
harvest of marine fishery resources within the context of the Common
Fisheries Policy and full stakeholder participation.
Component 1. To strengthen the capacity of the FSU to administer and
manage Montenegrin marine fisheries according to the CFP.
Component 2. To strengthen the capacity of the Fisheries Inspectorate
to monitor and control marine fishing activity and enforce the Fishery
Law (2009) and related regulations.
Component 3. To strengthen the capacity of IMB to provide scientific
advice on the status of marine fishery resources in Montenegrin waters
on an on-going basis.
Component 4. To strengthen the participation of fishermen in fisheries
administration and management.
Component 5. Visibility activities and procedures to ensure effective
and efficient implementation of the project.
Marco Girelli, Agrotec
KE1 Team Leader
Ian Scott
KE2 MCS Expert
Richard Thomasson
KE3 Resource Expert
Francesco Colloca
Key experts: 300
Senior Non-Key Experts: 220
Junior Non-Key Experts: 50
Total: 570
€558,930
An EU-funded project managed by the European Union Delegation to Montenegro
Community Assistance for Reconstruction, Development & Stabilisation
CFP
Common Fisheries Policy
EC
European Commission
EFF
European Fisheries Fund
EU
European Union
FIS
Fisheries Information System
FMP
Fisheries Management Plan
FSU
Fishery Sector Unit
GFCM
General Fisheries Commission for the Mediterranean
ICCAT
International Commission for the Conservation of Atlantic Tunas
IE
Incidental Expenses
IMB
Institute of Marine Biology
IPA
Instrument for Pre-accession Assistance
IPARD
Instrument for Pre-accession Assistance Rural Development
IT
Information Technology
IUU
Illegal, Unregulated and Unreported
JSTTE
Junior Short Term Technical Expert
KE
Key Expert
MAFWM
Ministry of Agriculture, Forestry and Water Management
MCS
Monitoring, Control & Surveillance
MFDS
Montenegrin Fisheries Development Strategy
MOU
Memorandum of Understanding
NSS
National Sector Study
NMFMC
National Marine Fishery & Mariculture Council
PMG
Project Management Group
PO
Producer Organisation
PSC
Project Steering Committee
SAA
Stabilisation & Association Agreement
SME
Small and Medium Enterprises
SOP
Standard Operating Procedures
SSTTE
Senior Short Term Technical Expert
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CARDS
iv
List of Abbreviations Used by the Project
An EU-funded project managed by the European Union Delegation to Montenegro
Technical Assistance
TAC
Total Allowable Catch
TL
Team Leader
ToR
Terms of Reference
VMS
Vessel Monitoring System
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TA
An EU-funded project managed by the European Union Delegation to Montenegro
Table of Contents
EXECUTIVE SUMMARY / IZVRŠNI REZIME.............................................................................. I
1
INTRODUCTION......................................................................................................................... 1
2
BACKGROUND ........................................................................................................................... 2
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
FISH PRODUCTION ................................................................................................................. 13
3.1
3.2
3.3
3.4
3.5
THE FISH PROCESSING SECTOR ....................................................................................... 40
4.1
4.2
4.3
5
GOVERNMENT POLICY......................................................................................................... 43
5.1
5.2
5.3
5.4
5.5
5.6
5.7
5.8
5.9
5.10
5.11
5.12
5.13
5.14
6
OVERVIEW............................................................................................................................. 40
STRUCTURE ........................................................................................................................... 41
IMPORTANT CONSTRAINTS AND AREAS FOR INTERVENTIONS ............................................. 42
OVERVIEW............................................................................................................................. 43
GOVERNMENT FINANCIAL ASSISTANCE ............................................................................... 44
FISHING STRATEGY: 2009 - 2013 .......................................................................................... 44
FISHING AREAS ..................................................................................................................... 45
FRESHWATER FISHERIES ....................................................................................................... 46
RECREATIONAL FISHERIES .................................................................................................... 46
AQUACULTURE ..................................................................................................................... 47
MARICULTURE ...................................................................................................................... 47
FISH MARKETING & PROCESSING ......................................................................................... 48
PRODUCER ORGANISATIONS ................................................................................................. 48
ENVIRONMENT ...................................................................................................................... 49
GOVERNANCE ....................................................................................................................... 49
FOOD SAFETY ........................................................................................................................ 50
STAKEHOLDER PARTICIPATION ............................................................................................ 50
THE MARKET FOR FISH AND FISH PRODUCTS............................................................. 50
vi
4
MARINE ................................................................................................................................. 13
LAKE ..................................................................................................................................... 25
RECREATIONAL ..................................................................................................................... 29
AQUACULTURE ..................................................................................................................... 31
MARICULTURE ...................................................................................................................... 35
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MARINE FISHING AREA ........................................................................................................... 2
USE OF MARINE AREAS .......................................................................................................... 5
INLAND FISHING AREA ........................................................................................................... 6
POPULATION ............................................................................................................................ 7
TOURISM ................................................................................................................................. 8
MACRO-ECONOMY .................................................................................................................. 9
GENERAL FEATURES OF THE FISHERIES SECTOR ................................................................. 10
OVERVIEW OF FISHERIES PRODUCTION AND PROCESSING ................................................... 11
An EU-funded project managed by the European Union Delegation to Montenegro
6.1
6.2
6.3
6.4
6.5
7
LEVEL OF ATTAINMENT OF RELEVANT EU STANDARDS ........................................ 58
7.1
7.2
7.3
7.4
7.5
8
POLICY ON FLEET .................................................................................................................. 58
FOOD SAFETY STANDARDS ................................................................................................... 59
ENVIRONMENTAL ASPECTS .................................................................................................. 62
IUU FISHING ......................................................................................................................... 62
OCCUPATIONAL SAFETY ....................................................................................................... 63
PAST TRENDS AND FUTURE DEVELOPMENTS IN TERMS OF INVESTMENTS..... 63
8.1
8.2
8.3
8.4
9
SUPPLIES ............................................................................................................................... 50
CONSUMPTION ...................................................................................................................... 53
DISTRIBUTION ....................................................................................................................... 54
MARKET OUTLETS ................................................................................................................ 56
PRICES ................................................................................................................................... 58
FISH CATCHING ..................................................................................................................... 63
RECREATIONAL FISHING ....................................................................................................... 64
AQUACULTURE & MARICULTURE......................................................................................... 65
PROCESSING & MARKETING ................................................................................................. 65
IDENTIFICATION OF POTENTIALS AND NEEDS OF THE SECTOR .......................... 66
9.1
9.2
9.3
9.4
9.5
9.6
9.7
9.8
SWOT ANALYSIS: COMMERCIAL MARINE FISH CATCHING ................................................ 66
SWOT ANALYSIS: SMALL SCALE MARINE FISHERIES ......................................................... 67
SWOT ANALYSIS: COMMERCIAL FRESHWATER FISHERIES ................................................. 68
SWOT ANALYSIS: RECREATIONAL FISHERIES ..................................................................... 69
SWOT ANALYSIS: MARICULTURE ........................................................................................ 69
SWOT ANALYSIS: AQUACULTURE ....................................................................................... 70
SWOT ANALYSIS: FISH PROCESSING ................................................................................... 70
SWOT ANALYSIS: FISH MARKETING ................................................................................... 71
10 IDENTIFICATION OF TRAINING NEEDS IN THE SECTOR .......................................... 72
10.1
10.2
10.3
10.4
TRAINING NEEDS FOR FISHERS ............................................................................................. 72
AQUACULTURE ..................................................................................................................... 73
MARKETING .......................................................................................................................... 73
CONSUMERS .......................................................................................................................... 73
11 OUTCOME ................................................................................................................................. 73
vii
GENERAL RECOMMENDATIONS FOR DEVELOPMENT OF THE FISHERIES SECTOR................. 73
RECOMMENDATIONS FOR THE PREPARATION AND IMPLEMENTATION OF IPARD ............... 80
PROPOSED MEASURES UNDER IPARD AXIS ONE ................................................................. 82
PROPOSED MEASURES UNDER IPARD AXIS THREE ............................................................. 84
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11.1
11.2
11.3
11.4
An EU-funded project managed by the European Union Delegation to Montenegro
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EXECUTIVE SUMMARY / IZVRŠNI REZIME
An EU-funded project managed by the European Union Delegation to Montenegro
1
INTRODUCTION
As a candidate country, Montenegro may benefit from the “Instrument for Pre-accession for Rural
Development” (IPARD). This is Component 5 of the European Union’s (EU) Instrument of Preaccession (IPA), the overall aim of which is to increase the “efficiency and coherence of aid through a
single framework, thereby strengthening institutional capacity, cross-border cooperation, economic
and social development and rural development”.1
This sector study presents findings and recommendations on the use of IPARD funds to strengthen
the competitiveness of the Montenegrin fishery sector under the three pre-defined axes (Axis 1:
restructuring and modernisation of the catching fleet and fish farms; producer organisations;
development of processing sector related to the processing of fish and fish products; Axis 2: the
environment and support to local rural development strategies; Axis 3: fisheries infrastructure,
diversification of rural economic activities; training; and technical assistance).
For the purposes of this report, the term “fishery sector” covers a number of production sub-sectors
(marine capture fisheries, fresh water capture fisheries, aquaculture, mariculture and recreational
fishing) together with distribution, marketing and processing of domestic production and imported
fish. Other areas of interest are support infrastructure, supply and services, and representative
organisations. Where appropriate, cross cutting issues with other sectors are identified.
The fish catching sector and aquaculture make a relatively small contribution to Montenegrin Gross
National Product (GNP). However, in common with the fishing sectors in EU member states, the
economic benefits of all fisheries’ related activities are significant in a local context and, if developed
correctly, have the capacity to generate substantial multiplier benefits.
As domestic fish landings will never be enough to meet national demand (from Montenegrin
consumers and tourists) the supply gap has to be reduced by increased aquaculture production and/or
imports. The growing importance of aquaculture is recognised internationally as the catch from many
wild stocks has diminished due to decades of over fishing while the demand for seafood has continued
to increase. If international trade is used to fill the supply gap, the appropriate business model is one
that maximises benefits to Montenegro with the development of domestic secondary processing
capacity based on the import of frozen raw material directly from the catching country.
Historically, the fishery sector of Montenegro when it was part of Yugoslavia had little priority, with
emphasis given to the potential in Serbia, Croatia and Bosnia Herzegovina. Currently, as an
independent country that is applying for membership of the EU, the Government of Montenegro is
confronted by two related issues: firstly, how to develop the potential of the Montenegrin fishery
sector in order to maximise its benefit to the national economy; and secondly, the nature of the
development of a sector that in the near future will have to compete with production from other
member states in both domestic and export markets. Montenegro is a young country and significant
work remains to be done in both the public and private sector; however, at this stage of the process, it
is considered that IPARD funds could be used effectively to increase the size and efficiency of
production units and improve the quality of the outputs.
This report has been prepared by the EU financed IPA project “Sustainable Management of Marine
Fishery”. It was completed in conjunction with a socio-economic study that aimed to: (i) improve
Ministry of Agriculture & Rural Development (MARD) understanding of the fishery sector; (ii)
provide baseline information for the development of strategies to assist stakeholders; and (iii)
establish a basis to measure and evaluate the impact of those strategies. The work programme from
January to September 2011 covered: desk research of existing literature and policy documents; the
design of questionnaires, including test interviews to refine prepared templates; the completion of 308
1
http://europa.eu/legislation_summaries/agriculture/enlargement/e50020_en.htm
An EU-funded project managed by the European Union Delegation to Montenegro
questionnaires; the tabulation and analysis of the data and information covering the various subsectors (table 1); and the preparation of this report.
Table 1: Respondents to the socio-economic survey by sub-sector
Fishing vessels - large scale
Fishing vessels - small scale
Aquaculture
Processors
Wholesalers
Retailers
Restaurants /hotels
Angling Clubs
Anglers
Marine
23
16
13
Inland
16
12
1
6
5
18
38
101
142
172
Both
1
1
5
11
18
Total
23
32
25
2
7
10
11
18
180
308
The results of the IPARD Sector Study are the identification and prioritisation of key areas for
potential intervention. Such interventions will: (i) contribute to the up-grade of the sector to EU
standards; (ii) strengthen the overall competitiveness and performance of the sector; and (iii)
contribute to the sustainable development of the sector.
2
2.1
BACKGROUND
Marine Fishing Area
Montenegro is situated on the eastern coast of the Adriatic Sea which opens to the Mediterranean Sea
in the south. The country’s coast is about 200 km from the closest point in Italy. Many of the fish
stocks in the Adriatic are shared by the coastal countries meaning that effective fisheries management
requires a regional approach as the fishing effort by the fleets of other nations affects the potential
sustainable catch of Montenegro.
In general, access to fisheries in the Adriatic is exclusive to the coastal state out to 12 nautical miles
from base lines; outside 12 nautical miles there are international waters.1 The national waters of
Montenegro are shown in Figure 1.
While the northern part of the Adriatic is a relatively shallow shelf that rarely exceeds 46 m. in depth,
off Montenegro the South Adriatic Pit has depths of up to 1,200 m. (figure 2). This affects the nature
and type of Montenegrin marine capture fisheries, and has led relatively small and unsophisticated
Montenegrin vessels with limited autonomy to concentrate fishing effort in a fairly small coastal area.
In turn, this has added to the pressure on the stocks found in that area. It is recognised that
Montenegro needs to develop catching capacity to benefit from the harvest of resources found in
deeper waters, while relieving the pressure on in-shore stocks.
1
An EU-funded project managed by the European Union Delegation to Montenegro
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2
In October 2003, Croatia declared an 'Ecological and Fisheries Protection Zone' in the Adriatic Sea. However,
in June 2004 Croatia decided to delay the implementation of that Zone to European Union member states. Then,
in December 2006, it decided to fully implement the Zone from 1 January 2008 – while eventually, on 13 March
2008, to again postpone the implementation on EU countries See http://www.fni.no/publ%5Cmarine.html
Figure 1: Montenegro’s coastal & marine fishing zones
An EU-funded project managed by the European Union Delegation to Montenegro
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Source: IMB
Figure 2: Depths in the Adriatic
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Source:
http://www.google.com/imgres?imgurl=http://mseas.mit.edu/archive/DART05/index_files/AdriaticMap.jpg&im
grefurl=http://mseas.mit.edu/archive/DART05/&h=694&w=600&sz=62&tbnid=1V8uQ0wZjSY7IM:&tbnh=24
1&tbnw=209&prev=/images%3Fq%3Dadriatic%2Bmap&zoom=1&q=adriatic+map&usg=__t1mqlYKiFfeqW
QTLs3RwlTmp7mY=&sa=X&ei=ufEqTbftKc-p8AO595WiCw&ved=0CBYQ9QEwAA
A large part of the Montenegro’s 294 km coastline is comprised of precipitous rocky cliffs
interspersed with a few small beaches that become more prevalent to the south, culminating in a
relatively long stretch of sandy beach (12 km) extending to the Albanian border at the mouth of the
Bojana River. The rugged coastline limits the number of landing sites for fishing vessels. An
exception is Boka Kotor (the most southerly fjord in Europe located to the north west of Montenegro)
that provides shelter for commercial and small scale fishing boats.1 The ports of Herceg Novi and
Tivat are located towards the mouth of the fjord and at its base lies Kotor. None of these have
dedicated fish landing facility.2
2.2
Use of Marine Areas
A review3 of Marine Spatial Planning (MSP) in Mediterranean countries funded by the EU notes that
sea fisheries are a minor activity and that the national priority is tourism. At present, the needs of the
local fishing industry in terms of berthing, storage and catch landing facilities have not been assessed,
nor the potential of a local working fishing industry as a tourist attraction.
Coastal zone matters in Montenegro are the responsibility of Morsko Dobro. Established in 1992,4
this enterprise holds responsibility for a range of issues from the enforcement of the terrestrial spatial
plan for property development to the quality of bathing water.
The “Spatial Plan for Special Purpose Coastal Zone”5 was adopted in 2007.6 7 Inter alia the Institute
of Marine Biology (IMB) reports that the Bay of Kotor and other coastal areas have suitable
conditions for mariculture by rope culture (mussels and oysters) and cages (fin fish). The capacity for
mussel cultivation is estimated at 300 mt a year, for lagoon fish breeding 3,000 mt and cage breeding
2,000 mt a year.8
Presently, there are no designated Marine Protected Areas (MPAs) in Montenegrin waters although
one is proposed for an area north of Bar.9
1
An EU-funded project managed by the European Union Delegation to Montenegro
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For the purposes of this study, commercial fishing boats are defined as those of 12 m + length; small scale
boats are those of less than 12 m.
2
The Association of Professional Fishermen, South Adriatic is reported in in the process of gaining planning
permission for a fishery harbour to be located to the south west of Igalo.
3
PRC, 2011. “Exploring the Potential of Maritime Spatial Planning in the Mediterranean Sea” Framework
contract FISH/2007/04. Specific contract No 6, Policy Research Corporation report to DG MARE, February
2011, 129p and annexes.
4
http://www.morskodobro.com/
5
“A Spatial Plan for the coastal zone / Public Maritime Domain as a Special Purpose Area was adopted by the
Parliament of Montenegro in 2007. It was the first step Montenegro took towards an integrated view of the
zone, encompassing both the land and the sea area of the entire region: a marine part: the area of the territorial
sea; and a land part: a narrow coastal strip that makes a functional unit with the sea”. See European Study at
http://ec.europa.eu/maritimeaffairs/studies/msp_med/montenegro_en.pdf
6
“Public Maritime Domain as a Special Purpose Area”
7
http://ec.europa.eu/maritimeaffairs/studies/msp_med/montenegro_en.pdf
8
It is not clear what is meant by the term lagoon,
9
See Ministry of Spatial Planning and Environment 2010. Management Plan Pilot Marine Protected Area
Montenegro. PART II – MPA: Management Recommendations, Goals, Objectives and Targets, MPA Zoning,
MPA Management Structure, Start Up Programme. (Draft).
2.3
Inland Fishing Area
Montenegro has land borders with Bosnia and Herzegovina, Serbia and Kosovo.1 Away from the
narrow coastal strip that almost disappears in the area of the Bay of Kotor, the geography is
mountainous apart from two plains that are the location of the two main cities (Figure 3).
Figure 3: Montenegro: Main settlements and neighbouring countries
Source: http://upload.wikimedia.org/wikipedia/commons/f/f1/Montenegro_Map.png
While the total area of lakes is 376 km², 99 % of this is accounted for by Skadar Lake, which is the
largest in the Balkans and shared between Montenegro (60 %) and Albania (40 %). The lake is an
ecosystem of international importance for numerous species of unique fauna and flora, particularly
birds. However, a recent report finds it under tremendous pressure from pollution and uncontrolled
6
Known as the Autonomous Province of Kosovo and Metohija in the 2006 Constitution of Serbia
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fisheries.1 The World Bank is currently funding a joint Albania-Montenegro Ecosystem Management
Project2 for the lake3 coordinated in Montenegro by the Ministry of Spatial Planning and
Environment4.
There is commercial fishing on Skadar Lake, while some is reported on the small Sasko Jezero close
to the border with Albania. There are also a number of reservoirs of which Pivsjo Jezero close to
Plužine is the largest at 112.5 km². In addition, there are 26 rivers.5 There is recreational fishing on
these water bodies. although some of the catch may be sold informally to restaurants, retailers and
consumers (see below).
There is a strong potential for freshwater aquaculture with a plentiful supply of fresh, clean, water
allied with favourable climatic conditions. However, there are issues with fish farms located adjacent
to rivers due to seasonal low flows.
2.4
Population
In 2008, the total population of Montenegro the country’s 13,812 km² was 622,344 (46.3 per km²).6 7
The population breakdown between urban and rural areas was approximately 60:40. The country is
divided into 21 municipalities. While the six coastal municipalities occupy 2.8 % of the area, they
account for 24.2 % of the population. Figure 4 shows population density. The 2003 census reports
inter alia: (i) 78 urban settlements had a population >200 of which 63 had >1,000 inhabitants; and (ii)
10 settlements had >10,000 inhabitants with six8 located inland and four9 on the coast. The low
concentration of population in a large part of the country has implications for the distribution of fish
especially when it is fresh.
Over the past two decades, people have migrated from the north of the country and rural areas to the
cities and the coast in search of jobs and higher incomes. Between 1991 and 2003, populations
decreased in all inland municipalities with the exception of Danilovgrad, Pljevlja, Niksic and
Podgorica, but on the coast the only decline was in Ulcinj.
1
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Ramsar, 2010. Assessment on current situation of Skodra/ Skadar Lake Ramsar Site. Regional Environmental
Center, Albania report, 52p.
2
This will consist of three key components: fisheries assessment; development of a five-year Management
Strategy; and National Fishery Management Plans.
3
Lake Skadar-Shkoder Integrated Ecosystem Management Project (LSIEMP) has three components 1. Capacity
Building for Improved Understanding and Joint Management of the Lake, 2. Promoting sustainable use of the
lake, and 3. Catalyze water pollution investments
4
See http://www.mse.gov.me/en/sections/lake-skadar-ecosystem-management-project
5
http://en.wikipedia.org/wiki/List_of_rivers_of_Montenegro
6
http://www.tradingeconomics.com/montenegro/population-density-people-per-sq-km-wb-data.html
7
This compares to 83.5 per km² in Croatia, 111 per km² in Albania and 200 km² in Italy.
8
Podgorica (136,473), Niksic (58,212), Pljelva (21,337), Bijelo Polje (15,833), Cetinje (15,137) and Berana
(11,776).
9
Bar (13,719), Herceg Novi (12,739), Budva (10,918) and Ulcinj (10,828).
Figure 4: Montenegro: Population density
Source: http://www.stockmapagency.com/Population_Map_Montenegro_C-Mont-2007-Pop.php
2.5
Tourism
Montenegro’s is popular with tourists with 1.2 million of them spending 7.6 million nights (96 % on
the coast) on vacation in 2009. This compares to the 9 million nights of 1990. The peak tourist months
are from May through September. The number of visitor nights is expected to grow with a strategy
based on a tripling in the number of beds to 100,000 (compared to 2006),1 the targeting of higher
income earners, and the promotion of tourism in inland areas. By 2020 the aim is for the sector to
account for 22.5 % of GDP.
There are a number of cross cutting issues between the tourist and fishing sectors due to: the seasonal
high demand for seafood especially fresh product; competition for available space both on-shore and
8
http://www.ens-newswire.com/ens/jun2006/2006-06-28-05.html
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off-shore; competition for workers; the risk of pollution especially in the Bay of Kotor and the
potential and perspectives for an increase in recreational fishing.
2.6
2.6.1
Macro-economy
GDP
In 2010, GDP was about €3.03 billion, or €4,797 per capita, with an annual growth rate of 0.5%.
Compared to neighbouring countries, the per capita figure is about the same as Bosnia Herzegovina,
significantly more the Albania but less than both Croatia and Serbia.
In official statistics, fishing and aquaculture, together with hunting, beekeeping and water
management are considered under agriculture which accounts for about 10 % of GDP. No
disaggregated data are available for fishery related GDP. Despite the relatively small contribution to
GDP, the fishery sector contributes significantly to the diversified earning strategy of many
Montenegrins.
2.6.2
Employment
In 2009, total employment in Montenegro was 174,152, with 13.8 % engaged in agriculture, forestry
and fishing. In May, 2011 unemployment was 11.6 % (table 2).1 This does not take account of under
employment and data are not available on any regional variations. It is perceived that unemployment
is very much higher in the northern towns and inland rural areas compared to the major cities and the
coastal belt and this very much affects household incomes and spending patterns (see below). At the
same time, tourist dependent employment will have a strong seasonal bias.
According to official figures, between 2006 and 2009, employment in marine capture fisheries was
stable at 120 FTE,2 with 65 full-time and 97 casual jobs in marine fisheries, with respective numbers
for freshwater fisheries of 103 and 25.3 It is not clear if these figures include mariculture and how
they account for seasonal employment. Overall, fisheries and aquaculture production provides about
10% of total employment in the agriculture sector.
However, taking into account the number of vessels operating in marine and fresh water, together
with mariculture and aquaculture, it seems highly likely that the numbers are considerably
understated. Moreover, official figures do not reflect the real importance of fisheries to the national
economy as they do not take into account activity in the “black” economy with the sale of fish by a
small scale and “recreational” fishermen who gain some or part of their income from fishing. In
addition, it is probable that the catch of fish for home consumption makes a significant but unreported
contribution to the household economy.
Finally, in considering the importance of a particular sector to a nation’s economy, account has to be
taken of related on-shore employment in up-stream and down- stream activities. While it may be
concluded that due to the nature of the sector, the multiplier benefits from the production phases
(catching and farming) are not high in the overall context of the Montenegrin economy, with better
planning and implementation of a considered strategy they could be significantly increased.
1
Montenegro Employment Bureau. http://www.balkans.com/open-news.php?uniquenumber=107789
Full time equivalent.
3
MONSTAT, 2010. Montenegro Statistical Office. 2010 Statistical Yearbook, Podgorica, 345 pp. from
www.monstat.org/ userfiles/file/publikacije/Statisticki godišnjak CG.-2010, za WEB.pdf
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2
Table 2: Montenegro: Employment by sector 2006 – 2009
Sector
Agriculture, Forestry and Water Management
Fishing
Mining
Manufacturing Industry
Electricity
Construction
Wholesale and retail trade, repair
Hotels and restaurants
Transport, storage and communication
Financial intermediation
Activities related to real estate
Public Administration and social Insurance
Education
Health and Social Security
Other community, society and personal services
Total
2006
2,607
115
4,159
26,065
5,627
6,853
29,602
10,928
12,133
3,114
5,905
10,345
12,846
12,012
8,489
150,800
2007
2,586
112
3,753
25,697
5,594
6,647
30,750
11,307
11,358
3,143
5,354
17,575
12,687
12,004
7,481
156,408
2008
2,651
129
3,721
24,335
6,042
8,831
31,854
14,641
12,798
3,476
5,631
18,643
12,892
12,356
8,221
166,221
2009
2,700
119
3,178
21,824
5,456
9,997
36,117
16,678
13,858
3,748
7,356
18,860
12,992
12,238
9,031
174,152
Source: Monstat (2010)
2.6.3
Income & Expenditure
MONSTAT data (2009) shows: (i) average income in Montenegro was €643 compared to €213 for the
fisheries sector; (ii) the average number of persons per household in Montenegro was 3.43; and (iii)
there is a strong variance in average household incomes between rural and urban areas. The inequality
between household incomes leads to a Gini coefficient1 of 0.36. This led one author to conclude2 that
“Montenegro is among the most unequal countries in the western Balkans, and there are indications
that the large gap between rich and poor may be widening”.
Limited income affects the demand for fish and fish products and emphasises the importance of
supplying cost competitive products in the retail market. Further, away from the touristic areas,
limited household incomes restricts the money available for restaurant dining and this is a factor when
considering the potential to target that market segment.
2.7
General Features of the Fisheries Sector
The fisheries sector consists of a number of production sub-sectors: marine capture fisheries;
freshwater capture fisheries; aquaculture; mariculture; and recreational fishing. In turn each sub-sector
can be further divided, for example into industrial and small scale fishing. Individual sectors present
different characteristics including production systems, investment needs, marketing and required
infrastructural support.
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The Gini coefficient is a measure of the inequality of a distribution, a value of 0 expressing total equality and a
value of 1 maximal inequality
2
http://www.bertelsmann-transformation-index.de/1399.0.html?L=1
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1
There are, however, some common points. Firstly, all the sectors can be characterised by their small
scale nature and the limited size of the enterprises. Secondly, there is a large degree of informality in
each sector and that makes it difficult to gain reliable statistics. Such informality includes the black
economy with many of the smaller operators working outside any form of governmental control
including the implementation of hygiene and quality standards. Recreational fishermen will often sell
their catch, while a large part of all sales are through informal channels. Illegal fishing practises (e.g.
the use of dynamite and electricity) continue. Thirdly, the income from fisheries is in many cases
additional to other income generating activities. Fourthly, there is limited capital available for new
investment and this leads to technical inadequacy. Boats, engines and gear are old, and inefficiency is
especially of concern when fuel costs are high. There are only limited examples of technical
innovation. Fifthly, there is a lack of trained personnel, which goes some way (along with lack of
capital) to explain the lack of technical innovation. Sixthly, while there are representative
associations, analysis indicates that while there are exceptions these have limited objectives and
activities and the main driver for change is companies and individuals that represent their own
interests. Finally, a large part of the industry appears to lack respect for the rules and regulations
promulgated to provide a firm basis for their own development.
In summary, the structure and competitiveness of the fishery sector may be characterised as weak.
Moreover, there is a strong potential for informal activities (e.g. non-application of food safety
standards and overfishing) to threaten the livelihoods of those associated with formal enterprises that
have the most to lose from any deterioration in business conditions.
A more formal approach to sector planning and development that reduces uncertainty and risk could
lead to robust growth and stronger economic benefits. While the potential for higher landings from the
marine fishery in areas currently being harvested are limited, a policy aimed at sustainable
management would provide the basis for long term health of the sector, without reducing the potential
for growth in currently under-exploited fisheries. At the same time, it is clear that not only in
Montenegro but worldwide, increased production from aquaculture will be the source of increased
supply of fish. Montenegro has substantial water resources that could form the basis for significant
development if production is more efficient; unit costs are reduced and sales price are competitive.
In addition, a healthy fish production sector is the root for multiplier benefits in reacted economic
activities. The potential for this could be enhanced if consideration was given to cluster development
based on such as dedicated landing sites for the fishing fleet.
2.8
Overview of Fisheries Production and Processing
The Montenegrin market for fish and fish products is supplied from national production (marine
fisheries, freshwater fisheries, aquaculture, mariculture and “recreational” fisheries) and imports.As
described in greater detail below:
11
Marine fisheries consist of two main sectors: (i) the commercial fleet comprises of 23 vessels (by
end-June 2011, 18 were licensed to operate in 2011) greater than 12 m overall length (LOA),
which in turn can be sub-divided into trawlers targeting demersal (bottom swimmers such as
hake, red mullet) species, and the two vessels geared to harvest small pelagic species such as
anchovy and sardine. The autonomy of the vessels is limited due to their age and the size of the
engines; (ii) the small boat fleet of 100 to 150 (many of the boats are not licensed) open decked
boats usually powered by small outboard motors. This fleet segment uses a variety of gears,
mainly set nets, to catch a range of species.
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In addition there is some fishing for shellfish while beach seining targets small pelagic fish that
shoal close to shore.
Freshwater commercial fishing is by-and-large restricted to the effort of 175 to 200 small boats
working Lake Skadar. In addition, the fish processing company, Ribartsvo, has fishing rights for
bleak using gear deployed from fixed fishing stations.
It is widely reported that illegal methods, dynamite and electricity, are used to catch marine and
lake fish.
Almost 8,000 people are licensed for recreational fishing in the sea, lakes, reservoirs and rivers.
Again, it is widely reported that a part of the catch is sold directly to consumers or to restaurants
and some commercial fishermen take out a recreational license that is cheaper than a commercial
license.
There is freshwater aquaculture for rainbow trout. The 13 licensed production units are small.
National annual production of 300 mt to 450 mt compares to the reported output of one Bosnian
farm in excess of 1,000 mt.
Mariculture is restricted to the Bay of Kotor. Here, mussels (120 mt – 180 mt per year produced
by 12 licensed producers), oysters (two pilot projects) and sea bass and sea bream (about 70 mt
per year produced by one company) are farmed. While cage mariculture in the 1open sea is
technically feasible, investment costs are prohibitive.
The value added chain for national production is short with most sales made directly between the
vessels and farms to restaurants, retail outlets and consumers with no value added. There is a high first
hand sales price for fresh marine fish as restaurants are prepared to pay a high price for top quality
fresh product. Accordingly, the pricing point of fresh marine fish and farmed sea bass and sea bream
is beyond the reach of the majority of national consumers. There are no auction or wholesale markets.
There are limited fish retail outlets; indeed away from the coast and the two main cities the socioeconomic survey identified a single retail outlet selling fresh marine fish. It is interesting to note that
the major part of the limited sales at this shop was cooked fish as it was said consumers did not know
how to prepare fish dishes. The number of retail outlets selling fresh trout is higher, especially in
population centres close to farms.
Two companies process fish for sale in the domestic and export markets. Ribartsvo is a canning and
smoking factory located in Rijeka Crnojevica on Lake Skadar. Its primary material is lake fish plus
trout from the company’s own trout farm, although in the past consideration was given to processing
imported product such as sardine from Morocco. Ahileas is a newly constructed smoking facility near
Podgorica airport that sources its raw material of trout and carp from Bosnia and Serbia.
Some fishermen may freeze their catch if demand is weak but this is done in household freezers and
the quality is poor.
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Imported fish and shellfish in a variety of presentations is the major source of supply for domestic
consumption with sales in restaurants, supermarkets and other retail outlets throughout the country.
There may be some repacking from wholesale to retail packs. However, a significant part of imports
is of retail packs including convenience products (fish sticks, fish cakes etc) and canned fish and
paste. This sector of the market is competitive with about eight main importing companies. As
described below, some of these have made significant investments and are interested in further
expanding their businesses, including the secondary processing of frozen raw material imported
directly from the harvesting country.
3
FISH PRODUCTION
3.1
Marine
3.1.1
Overview
Marine fisheries off Montenegro take place in three distinct areas: (i) “inshore” out to 3 nautical miles
(nm) from base lines; (ii) “off-shore” waters extending from 3 nm to the limit of territorial waters at
12 nm;1 and (iii) international waters outside the 12 nm zone. “Large-scale fishing” is not allowed in
“inshore” waters or within the baseline, including the Bay of Kotor. More than half of the territorial
waters have a depth > 100m. Due to the characteristics of the vessels, the Montenegrin fleet is unable
to fish for demersal fish and shellfish in deeper waters.
A summary of marine resources available to Montenegrin fishermen is:


Demersal fish and shellfish. The most important species are hake (Merluccius merluccius), striped
mullet (Mullus barbatus), monkfish (Lophius budegassa), picarel (Spicara flexuosa), cephalopods
(species of squid, octopus and cuttlefish the most important of which are Illex coindetii,
Todaropsis eblanae, Octopus vulgaris, Loligo vulgaris and Sepia officinalis), prawns (Nephrops
norvegicus) and deep water rose shrimp (Parapaeneus longisrostris). IMB analysis, currently in
the process of being up-dated, points to an annual maximum sustainable yield (MSY) of 606 mt 2
for these species.
Pelagic species. The most important species are anchovies (Engraulis engrasicolus), and sardines
(Sardina pilchardus). Resource assessments indicate a potential annual catch of up to 3,000 mt.
To-date this potential has not been realised due to the limited catching capacity for pelagic fish.
Factors such as limited experience in purse seine fishing and the lack of on-shore facilities to
handle large volume fisheries combine to increase the risk of any new investment.
AdriaMed surveys have indicated the presence of a variety of commercial species at depths of 200 m.
to 500 m.,
The official estimated total marine catch in 2009 was 773 mt, a reduction of 65 mt compared to the
previous year. This was split 26 % pelagics, 38 % demersals and 36 % shellfish (table 3). On the face
of it this indicates that a further 74 mt of demersal fish and 2,800 mt, with an estimated landing value
of about €4 million, could be available for harvest. However, given the lack of log books and official
1
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Territorial waters are defined by the 1982 United Nations Convention on the Law of the Sea is a belt of coastal
waters extending at most 12 nm from the baseline. The baseline may be measured from the low-water line along
the coast but usually consider straight lines that encompass within baselines fringing islands, the mouths of
rivers, or the mouths of bays, where the line across the entrance to the Bay is no longer than 24 nm.
2
IBM, 2010. Report to MAFWM on national monitoring of demersal resources on the continental shelf in the
territorial waters, the assessment of pelagic resources of anchovy (Engraulis encrasicolus), using daily
production of eggs and larvae (DEP) and collection on biological data of the catch of small coastal fisheries on
Montenegrin coast 2010, 44p.
catch records, together with the informal nature of fishing and uncertainty about the number of active
boats and related fishing effort, this data must be treated with caution.
Table 3 : Seafish Catch (mt) by Species, 2008 and 2009
Species
Pelagic species
Sardine
Sprat
Anchovy
Atlantic mackerel
Scad
Horse mackerel
Tuna
Other pelagic fish
Total Blue fish
Demersal species
Hake
Red mullet
Dentex
Grey mullet
European eel
Picarel
Bogue
Salpa
Dogfish
Catfish, shark
Ray
Other fish species
Total Other fish
Cephalopod species
Squid
Cuttlefish
Octopus
Horned octopus
Total Cephalopods
Total Shellfish
TOTAL
2008
2009
Sardela
Papalina
Inćun
Skuša
Plavica
Šnjur
Tuna
Ostala plava riba
Plava riba
32
48
15
12
21
17
9
87
241
30
38
19
10
12
13
14
63
199
Oslić
Trlja
Zubatac
Cipal
Jegulja
Gira
Bukva
Salpa
Pas
Mačka
Raža
Ostale vrste ribe
Ostale ribe
34
21
10
39
1
16
27
11
7
10
13
84
273
24
14
4
34
1
15
30
7
5
5
9
143
291
Lignja
Sipa
Hobotnica
Muzgavac
Glavonošci
Školjke
UKUPNO
19
15
23
21
78
205
838
10
7
15
15
47
215
773
Source: Monstat 2011
3.1.2
Regional Distribution
As previously noted, with the exception of the Bay of Kotor the configuration of the Montenegrin
coast line limits locations for the safe berthing of large vessels. The major fishing port is Bar. While
large fishing boats currently uses the outer basin of the marina, there are strong concerns that these
will be displaced to increase the area available for leisure craft. While there are outline plans to
develop a fishery specific area in the adjacent harbour, to- date this has not received any official
support and there are no plans with related cost estimates.
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In Herceg Novi and the Bay of Kotor there is no specific landing place, and boats have to make do
with available facilities. The potential to increase the multiplier benefits stemming from fish catching
is limited as activity is spread along the coast. A dedicated landing site could provide a basis for a
business cluster that would group together related activities (e.g. ship building, repair, sales and
service, marketing, storage) while facilitating monitoring of landings and enforcement of regulations.
There are outline plans for a designated fish landing close to Herceg Novi, but as with Bar these have
not received Government approval and, as far as the consultant is aware, there are no detailed plans
and related costs.
Due to their less specific requirements (the major need is for shelter in poor weather), small vessels
operate from a number of locations along the coast. Apart from around the Bay of Kotor, other places
are the mouth of the Boja river south of Ulcinje, Ulcinje, Dobra Voda, Bar, Sutomore, Canj, Petrovac,
Przno, Becici and Budva. However, fishery specific investment on landing infrastructure is limited to
small harbours at Ulcinje and Petrovac.
3.1.3
Structure
Commercial Fleet
As noted above, the commercial fleet > 12 m LOA is comprised of about 23 vessels of which by endJune 2011, 18 were licensed to fish in 2011. The overall picture is not clear as vessels were not
licensed in 2009 and 2010. Inactive vessels do not take out a license.
Most vessels are trawlers that target demersal fish and shellfish. It would be possible to use nontraditional gears such as long line and gill nets, but the potential is currently limited due to lack of
expertise and the investment required. However, given the high cost of fuel there is some interest in
diversifying operations with static gear such as gill nets. Long lining is used to target higher valued
species such as tunas and billfish. The choice of gear depends on a range of factors such as target
species, ocean conditions and fishing area, allied with the skill and knowledge of the vessel skipper.
Two vessels are geared to harvest small pelagic species such as anchovy and sardine.
The main characteristics of the 18 vessels sampled (not all responded to all questions) (table 4) are a
mean average LOA of 18.4 and a mean average age of 28 years (although most were bought used by
their current owners over the past decade). Reflecting their age, the majority are constructed from
wood. The mean average current value of the vessels (as estimated by the owners) is €104,000 and the
average replacement value is €271,000.
The same basic characteristics hold true for the engines. During the life time of a vessel the engine
may be replaced several times. As shown by table 5, survey results show that larger boats fleet have
engines with an average age of 19 and a mean average size of 346 hp (the latter figure is influenced
by the size of the engines of two larger vessels and the median average is lower). The mean average
current value of the engines (as estimated by the owners) is €42,000 while the replacement value is a
mean average of €65,000.
These characteristics limit the autonomy of vessels to fish in poor weather conditions and they do not
have the power to harvest deeper waters. Accordingly, the estimated replacement values may be too
low if the fleet is to be up-graded to have the capacity to fish deeper waters; larger vessels with more
powerful engines would be required and this would increase investment costs.
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Under normal conditions, fishing gear does not last long not only due to usage but it is lost once or
twice a year due to bad weather or snagging on rocks or other objects on the sea floor. Gear
replacement and maintenance is usually considered as an operating cost. The mean value of gear was
€10,400 with a mean average replacement value of €33,000 (table 6). In the past it has been
commented that Montenegrin vessels do not use modern gear technology and this has the twin effects
of reducing catch efficiency and increasing fuel costs due to “drag”.
Table 4: Characteristics of surveyed vessels
Vessels > 12 m
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Vessels < 12 m
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Table 5. Characteristics of the engines of surveyed vessels
Vessels > 12 m
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Vessels < 12 m
Table 6: Value of Gear of the surveyed vessels
Vessels > 12m.
Vessels < 12 m
The survey found that the majority of vessels are limited to day-trips to fishing grounds within 12 nm
of the coast with fishing time of 6 to 12 hours. In 2010, the number of fishing days ranged between 50
and 230 days, with a median of 83 days. Small-scale vessels use a combination of non-trawling gear
(gillnets, long-lines, trammel nets, seines, traps). Monthly days-at-sea are lowest from October to
March and higher in the remaining months with a peak in June and July; reflecting both weather and
market demand. Annual catches could increase if vessels had greater autonomy to be at-sea in poorer
weather and venture further from shore to fish in deeper waters and if market demand was to improve.
This is a circular argument: market demand will increase if the price is reduced; the price will only
reduce if the vessels become more efficient and catch more fish. The caveat is that effective fisheries
management is needed to ensure that vessels with greater fishing power operate outside 12 miles and
do not overfish resources closer to shore. The strategic aim should be to replace and not add to the
existing fleet, and maintain in-shore stocks at a healthy sustainable level and available to a fleet of
smaller boats that are also subject to rigorous and effective management. .
From 2006, two associations, one based in Herceg Novi and the other in Bar, represented the interests
of the majority of the owners, including those of some small boats. Recently new associations have
been formed in Herceg Novi and Bar.
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The survey indicates that average employment per vessel is 3.9; implying total employment in this
part of the catching sector of about 70. Given the low number of days-at-sea, few will be employed
full time. There is no information on other sources of employment and income for the crews. The
crew may include some owners who also skipper their vessels. Most owners have one boat, although a
one enterprise owns two.
Small Boat Fleet
The small boat vessels are usually powered by small outboard motors and use a variety of gears,
mainly set nets, to catch a range of species. There is limited knowledge of the activities of the small
boat fleet, and in the past limited attention has been paid to them by MARD. It may be the case that
their catch and associated employment and income is equal to if not greater than the commercial fleet.
The small vessels have limited autonomy. Many will fish part time and effort may be opportunistic
according to weather, demand and alternative work options. Not all the vessels are licensed, so the 82
that are (until end June, 2011) can only be taken as an indicative number of the active fleet, and it is
thought that between 100 and 150 may work within the year.
The survey found that small boats fish within 20 nm of the coast and most inside 5nm on day trips.
Fishing days are slightly higher in the small-scale fleet, between 30 and 260 days in 2010 (median
110 days), but the fishing hours are likely to be less. Static gear such as gill nets is set and left with
the fishermen returning to check for catch. Activity is restricted by the weather and the market.
One of the new associations recently formed represents the interests of small scale fishermen.
Depending on their size, target fishery and length of trip, small boats will be manned by one or two
people. If it is assumed that there are 120 small boats and the average crew is 1.5 this would indicate
total employment of 180. However, for the majority this would not be full time employment and it is
seasonal, although such as retired people may largely depend on fishing for income.
Other Marine Fishing Activities
There are currently four shellfish collection licences (Kotor – 2, Bar - 1, Tivat – 1). In addition, beach
seining targets small pelagic fish that shoal close to shore. As mentioned previously, it is reported that
there is the illegal use of dynamite to harvest fish.
3.1.4
Production Systems & Technology
See above.
3.1.5
Input Supply and Services
Commercial Fleet
To operate effectively, large fishing vessels require landing facilities that allow: (i) the effective
discharge of the catch; (ii) ease in the supply of services such as fuel, ice and victualing; and (iii) safe
berthing. While facilities are available to the Montenegrin > 12 m fleet, these are far from satisfactory.
In the case of Bar, since its privatization the long term availability of one basin in the marina for the
use of fishing vessels at an economic rent is unsure and this adds uncertainty to the sector. Elsewhere,
larger vessels discharge and berth at various points in the Bay of Kotor. This is unsatisfactory from a
number of viewpoints including cost, insecurity and the limitations associated with lack of a focus for
cluster development that could reduce costs while increasing the benefits of the catching sector to the
Montenegrin economy.
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Vessels need a number of services. To reduce costs, vessel owners may undertake their own
maintenance work but on occasions specialist tradesmen will be contracted to repair and maintain
vessels, gear and electronic equipment. New nets and fish boxes are imported from Italy. There are
local suppliers of fuel, oil, ice, provisions, insurance and administration.
Small Boat Fleet
Small boats have limited on-shore needs apart from safe berthing and a place to land. In many parts of
the world small vessels are left on the beach, but this can lead to damage to the hull and may not be an
option in Montenegro with pebbly beaches and competing use by tourists. The vessels tend to be
powered by simple two-stroke engines.
3.1.6
Costs and Earnings
Commercial Fleet
Given the lack of data and the wide variation in the size and type of vessel, it is difficult to develop
reliable costs and earnings (C&E) data for this size of vessel. Indicative figures are contained in table
7, using data provided in the survey and a number of simplifying assumptions.
Average annual earnings per vessel are €77,980. It should be noted that typically fishermen in any
country will understate earnings. Fuel is the major spend, averaging 49 % of average operating costs
and 27 % of earnings. Other main operating costs are fishing gear, engine repairs and harbour dues.
Clearly, if vessels have newer, more efficient engines, considerable savings could be made on the fuel
costs. Overhead costs total €3,505 with the main items being insurance, cost of fish sales and the
fishing license.
In Montenegro, the normal practise is to pay crew either by: (i) a share (after deducting vessel
operating costs for earnings, the remainder is divided between the crew (with a higher amount for the
skipper) and the boat according to agreed proportion, with the vessel share used to pay overhead costs
and allow for profit); or (ii) a daily wage. The average number of crew per vessel (including the
skipper who may also be the owner) is 3.9 – and the indicated average annual income from fishing is
€3,000. It is anticipated that this amount will be supplemented by other employment generating
activities.
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Earnings before interest, tax and depreciation (EBITD) are €19,785. However, as in other countries
averaged fishing vessel C&E mask a wide variation in performance and it is likely that many of the
vessels have a limited return on capital employed. Limited profitability reflects a low number of daysat-sea and high operating costs. Accordingly, vessels need to increase their fishing effort and this will
only be possible by introducing new (or second hand) vessels to the fleet with greater autonomy and
the ability to fish deeper waters beyond 12 nm from the coast. It is important to consider ways of
reducing the fuel costs, through either investment in more efficient engines or shifting effort from
static to mobile gear. At the same time, as noted previously it is vital not to over invest in the fleet so
that the catches required to meet financial targets are not above the sustainable harvest of what is a
renewable natural resource. Also, increased days-at-sea would imply greater effort in the winter
months and this has implications for marketing and on-shore facilities
Table 7: Pro-forma costs and earnings of the surveyed vessels
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Vessels > 12 m
Vessels < 12 m
Small Boat Fleet
As may be expected, the financial picture for smaller boats is considerably different. Using
information gained from the survey together with a number of simplifying assumptions, it is possible
to construct some pro-forma C&E (table 7).
Average earnings are €5,666 while the main spend is on fuel at €2,300 (41 % of earnings and 79 % of
operating costs). Other operating costs are limited, leaving an operating profit of €2,751. After taking
into account overhead costs of €689 (mainly the license and insurance), this leaves EBITD €2,062 that
covers payment to crew, although in many cases the owner will fish by himself.
As with the larger boats, there will be a wide variation in the performance of boats, to a large part
reflecting the level of activity. Given the relatively low investment cost, the barriers to entry to the
sector are low. However, if fishing is not profitable then it is not sustainable – the owners have to earn
enough to pay for the fuel.
3.1.7
Important Constraints and Areas for Intervention
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The fishing catching sector in Montenegro faces many practical and institutional challenges as the
country progresses towards EU accession.
The important constraints identified are:
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
24
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One of the biggest threats to the long-term economic viability of the fleet is the low profitability
of fishing enterprises that restricts investment opportunities and reduces the sub-sector’s
competitive position. The use of obsolete boats and engines that need continual maintenance
while lacking autonomy to fish in poor weather and deeper waters are the main factors limiting
the annual number of days-at-sea that results in low annual catches. The position has worsened in
recent years with a substantial increase in the real price of fuel used by old and inefficient
engines. It is justifiable to conclude that a large part of the existing fleet is not fit-for-purpose.
Accordingly, a key part of any strategy must be a renewal and restructuring of the fleet that will
allow boats to increase the number of days-at-sea, harvest deeper waters and reduce running costs.
An initiative that could increase the profitability of the commercial fleet could be diversification
of the type of gear used, with investigation of the potential for less fuel intensive techniques such
as offshore gill and tangle netting, lining and trolling. If it was concluded that these gears could be
usefully introduced, there would need to be analysis of
the costs of any new gear and
modifications to vessel, together with the needs for any training.
There is strong concern about the limited on-shore infrastructure supporting the catching sector,
especially the larger vessels operating from Bar and the Bay of Kotor including Herceg Novi.
While detailed planning including options analysis and cost benefit analysis have not been
completed, there would appear to be strong arguments to develop two fishery specific landing
places. The main objectives of any new investment would be to reduce the operating cost of the
fleet, provide for cluster development including better handling and marketing facilities, and
allow for better enforcement.
It is clear that the small boat fleet makes a significant contribution to the Montenegrin economy;
giving income and food for a large number of households while supplying high quality fresh fish.
At the same time, it may have strong sustainability credentials. In a cash business with no formal
(e.g. banks) or informal (e.g. buyers) credits, when the value of the catch is insufficient to cover
running costs (i.e. fuel) the boats will be unable to fish. In addition, small boats are unable to
operate in poor weather. However, with low barriers to entry (low investment costs) there is the
temptation to regard fisheries as an employer of the last resort with small boats allowed to operate
without regulation. This approach is mistaken. The operation of too many small boats will lead to
over fishing and fishermen will not be able to achieve a reasonable income. This emphasises that
the small boat fleet must be effectively managed with effort by unlicensed boats prevented..
There may be room to improve working practises on-board fishing vessels, with the introduction
of HACCP to bring about quality improvements. The initial approach would be to assess fish
handling practices on-board and provide advice on how to improve quality.
Any increase in total catch supply throughout the year requires market development, especially
for pelagic species such as sardines and anchovy. Consideration should be given to: (i) a
promotional campaign to increase consumption of fish, especially in the north of the country; and
(ii) support in developing the distribution chain to the final consumer. There is a caveat. Any
marketing programme has to be carefully designed and only implemented when there are sure
prospects for increased domestic landings, otherwise the impact could be to simply increase
imports that at the moment bring limited benefit to the Montenegrin economy in terms of value
added (see below).
The qualification about the potential for fleet modernization and restructuring is that the options
must be considered within the context of sustainable yields with the risk of overfishing reduced
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by improved and effective fisheries management. Improved fisheries management requires
considerable strengthening of the institutional capacity to manage the fisheries, enforce
regulations and complete the resource assessments needed as a basis for rigorous scientific advice
that lies at the basis of fishery management planning. Given the nature of fish stocks, with many
of them being trans-boundary, there is the related need for on-going cross border cooperation to
develop stock assessments and a regional fishing plan for Adriatic fisheries.
Another issue is the availability of skippers and crew for larger vessels, especially those using
new gear and new fishing techniques. This concern has arisen in finding crew for vessels targeting
small pelagic fish. This problem is common to many EU member states, with people unwilling to
fish due to the danger, work conditions and unsocial hours, especially if more attractive options
are available on-shore. In turn, the lack of available trained manpower may act as a further
disincentive for the modernisation of the fleet. On that basis there should be an assessment of how
to provide a training programme in fisheries.
Given the age of the vessels and their sea worthiness, there is concern that the safety equipment
should be of the standard required; if it needs to be improved then financial assistance would be
required.
While it had been hoped that fishermen’s representation would be concentrated in a single body
that could provide the basis for a functioning producer’s organisation, the recent trend is for
fragmentation with the formation of two new associations. While the EU project is attempting to
strengthen stakeholder participation in the fisheries management process with the establishment
of the National Marine Fishing and Mariculture Council, it has concluded that the conditions are
not appropriate for development of a producer’s organisation. It would be useful if additional
support could be given to strengthening sectoral organisations.
3.2
3.2.1
Lake
Overview
Lake Skadar has important commercial fisheries, particularly for bleak (Alburnus arborella) and carp
(Cyprinus carpio). Freshwater commercial fishing is by-and-large restricted to the effort of small
boats, although the fish processing company Ribarstsvo does have rights to fish bleak from fixed
fishing stations. There is no representative association for fishermen.
Lake Skadar “despite its shallowness … has a number of crypto-depressions (up to 63 m in depth)
which … yield almost one-half of the lakes' commercial fish harvest, even though they occupy only 1
% of its area”.1 Potential annual lake production has been estimated at some 50 kg/ha of fish,2
including vulnerable and threatened species of sturgeon, eel, lamprey, guppy and flounder. Assuming
a total minimum area of 350km2,3 this would imply potential annual fish catches of 1,750 mt with
60% available to Montenegro and the remainder to Albania. However, available information suggests
that Montenegrin catches are substantially less than historic levels of more than 1,000 mt. While there
1
http://www.fao.org/docrep/009/t0798e/T0798E01.htm
World Bank, 2007. Project brief on a proposed grant from the Global Environment Facility Trust Fund in the
amount of US$ 4.55 million to the Government of Albania and the Government of Montenegro for a Lake
Skadar-Shkoder Integrated Ecosystem Management project, WB Sustainable Development Unit Europe and
Central Asia Region (ECSSD) Report, 99p. and annexes 111p.
3
This is in summer. In winter the area may be almost double at 690 km².
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2
are no reliable official catch statistics (MONSTAT reports 887 mt in 2009), current annual catches are
estimated at between 100 mt – 500 mt. 1
Ribartsvo reports 2010 inputs of 30 mt of bleak, 20 mt of common carp, 15 mt of “Chinese carp”, 2.5
mt of perch (Perca fluviatilis) and 2 mt of roach (Rutilus sp. and Rutilio sp.) On the basis of survey
results, the project suggests (assuming a fleet of 175 vessels) a total estimated vessel catch of 222 mt
valued at €732,000 (Table 9), with a weighted average value of €3.30 / kg. This would indicate a total
catch of about 250 mt (assuming Ribarstvo only catches bleak on its own account).
Whatever its scale, the reasons for the undoubted decline in availability of fish stocks are not
understood. There is likely to be an interplay of factors including overfishing, illegal fishing (small
nets and electricity), climate change and the introduction of non-native species of Chinese carp that
compete for food with native species.
The figures suggest that inadequate management and subsequent over fishing together with other
factors have led to foregone earnings compared to possible annual maximum sustainable yield (see
above) of €2.6 million. This “loss” has strong implications for employment and income, not only in
fish catching but also related fish processing. The potential level of rewards from a healthy fishery are
sufficient to suggest that an annual spend of about €160,000 (5 % of potential earnings) would be
justified to respond to the urgent need for implementation of strong management of the lake fishery,
that includes (i) cross border cooperation with Albania; (ii) rigorous scientific assessment of the
resource base and calculation of the annual MSY; and (iii) effective monitoring and enforcement.
3.2.2
Regional Distribution
The Lake Skadar National Park includes parts of the territories of three municipalities in the Central
and Coastal regions (Podgorica, Bar and Cetinje). In 2007, an estimated 12,500 people lived in 40
settlements inside or at the edge of the National Park. Rijeka Crnojevica and Virpazar (with estimated
populations of about 500 and 350 respectively) are the largest urban areas on the Montenegrin side.
There are fish landing points around Lake Skadar, although options are limited due to the
topographical nature of the surrounding area with the road only approaching the water at a limited
number of points. There is no on-shore infrastructure providing landing facilities with services such as
water and fuel supply, gear stores, fish stores and marketing support. Some fishermen who live by the
lake have facilities to keep their boat, engines and gear.
3.2.3
Structure
Vessels are licenced by the National Park and registered at the Port Authority office in Virpazar.
While the final results of the 2011 annual licensing round were not available at the time of the socioeconomic survey it would appear that there are a minimum of licensed 175 fishing vessels.
The sampled vessels have a length varying between 4.5 m and 7.5 m, with an average of 6.75 m.
(table 8). In the sample, the age of the vessels ranged between 1 and 15 years, with an average of 8
years. Most were bought new, although some were purchased second hand. The estimated average
As reported in the strategy “A. Raznatovic, Senior Fishery Advisor, National Parks reports that catches could
be as low as 100 mt. The University of Podgorica estimates that catches have fallen from an historic 1,000 mt to
500 mt”
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current value of the vessels was €450 with an average replacement value of €860. Assuming a total
fleet of 175 vessels, respective total values are €78,750 and €150,500.
Table 8: Lake Skadar: Vessel characteristics of the vessels
Vessel characteristics
Vessels surveyed
LOA (m)
Engine power hp
Skadar Lake
18
6.75
4.0
Vessel age (years)
Hull material
Main gears
8
Wood, plastic
Nets, lines
The engines used are small, usually about 4 hp, although some boats have larger ones. Conditions on
the lake conditions do not require large engines to operate and speed to arrive to and return from the
fishing area does not appear to a major factor. This decision is probably influenced by the cost of fuel.
Curiously, the engines are older than the vessels, possibly reflecting that they are more expensive.
Individual fishermen may own several engines, perhaps showing that the work is full time and they
cannot afford the down time resulting from an engine under repair. The estimated average current
value of the engines was €580 with an average replacement value of €1,290. The previously favoured
Tomas outboard motor is no longer available. Assuming a total of 250 engines, respective total values
are €145,000 and €322,500.
While there are exceptions if another family member is available, most boats are operated by a single
person. This would indicate total direct employment of up to 200.
Fishermen use a range of gear, with the main ones being set gill nets and lines. The survey indicated
an estimated average current value for the gear of €1,260 with an average replacement value of
€1,570. Gear may be relatively new; indeed fishermen report that they have to buy their gear back
from thieves, or buy new, up to 5 times per year. Assuming gear for 175 vessels, respective total
values are €220,500 and €274,750.
The indicative total investment in the fleet at current values is about €450,000 with a replacement
value of €750,000.
Fishing trips last between 6 hours and 10 hours, with vessels operating from 10 km to 25 km from
their base. The number of fishing days per year ranges between 75 and 280, with a median of 175.
This indicates that in contrast to marine fishing, activity on the lake is a mainly a full time occupation.
There is however a two month closed season in April and May.
Fish are most often sold live. No ice is used.
3.2.4
Production Systems & Technology
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See above.
3.2.5
Costs and Earnings
Available figures suggest that fishing on the Lake is profitable (table 9). There is some scepticism
about the first hand sales values reported in the survey that indicate average gross annual earnings of
€2,750 (other data shown above indicates an annual average catch per boat of 1.26 mt which at an
average value of €3.30 would provide an average gross income of €4,186). With total expenses of
€1,200 the average annual income is about €1,500 once low overhead costs are taken into account.
While fuel is the major cost, profitability reflects the low use of fuel (< €5 per day). Fishing gear is
the second most significant cost. At the same time, while the vessels are profitable, incomes are low
and this emphasises the importance of strengthening the resource availability to provide higher
catches.
Table 9: Lake Skadar: Total estimated fish catch & earnings from survey results
Species
Carp
Grass carp
Grey mullet
Bleak
Eel
Other fish
Totals
3.2.6
2010
Factory
MT
20
15
0
30
0
4.5
70
175 *
FV
MT
116
61
18
11
16
0
222
2010
€/kg
3.13
0.50
3.52
1.67
7.69
3.00
3.30
100 *
FV
‘000 €
426
38
63
68
123
14
732
Important Constraints and Areas for Intervention
A healthy Lake ecosystem presents an extraordinary opportunity to Montenegro on a number of
levels.
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1
http://mediterranean.panda.org/about/med_freshwater/skadar/
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Recovery of the stocks will improve incomes and potential employment. This would not be in
fishing, where a higher catch per unit effort would benefit existing fishermen, but indirectly
particularly through value added at the fish canning factory and other forms of related on-shore
employment.
An increase in the national supply may allow for substitution of imports. For example, canned
bleak is similar to canned sardine (although pricing needs to be taken into consideration).
Improved stocks would benefit tourism: an active fishing fleet is an attraction; the availability of
locally caught fresh fish is a strong marketing tool for restaurants; and a healthy ecosystem will
encourage environmental and ornithological tourism. As described in the WWF web site,1 “Lake
Skadar is a critical wintering and staging site for migratory birds and European waterfowl and
the western most nesting site for the rare and elegant curly or Dalmatian pelican; in all, more
than 280 species of birds have been recorded here” and “The Montenegrin part of Skadar and its
surrounding area were declared a National Park in 1983, got the Important Bird Area status in
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1989 and in 1996 it was included in the Ramsar1 list of wetlands of global importance”.
Expressed simply, the fewer the fish the lower will be the number of birds.
It is important to establish joint projects between Montenegro and Albania aimed at delivering a
robust scientific assessment of fish resources and related management measures. In 2008, the World
Bank approved a $4.55 million Global Environment Facility grant ($1.99 million for Albania, and
$2.56 million for Montenegro) for the joint Albania-Montenegro Lake Skadar-Shkodra Integrated
Ecosystem Management Project. In October, 2010, the Ministry of Sustainable Development and
Tourism sought expressions of interest in three projects relating to development of a data base, a
resource assessment and a fishery management plan.
Support is needed to add to the competitiveness of the fisheries, most notably with on-shore
infrastructure (services and storage facilities for live fish) and improved capacity for direct marketing
to limit the length of the distribution chain. Preferably, marketing should be undertaken by the
fishermen and their families in order to maintain as much of the sales value as possible within the
fishing households and communities.
Given the nature of lake fisheries it would be interesting to establish the potential to restock the Lake
with native species. As was noted above, the Albanians are reported to have introduced the non-native
Chinese carp in the nineteen-seventies and this may have contributed to the current status of the
ecosystem; any new attempts to restock the lake must consider the implications of any initiative. If
successful, restocking would benefit commercial fishers, recreational fishers and the bird life.
3.3
3.3.1
Recreational
Overview
A large number people fish the sea, lakes, reservoirs and rivers using rod and line. While this is
supposedly a recreational pastime, it is likely that a significant part of the catch is sold informally to
restaurants and consumers, or used for home consumption.
Recreational fishermen are organised into clubs and associations. This reflects the experience in other
countries where sports fishermen are proactive in influencing policy and supporting their interests
through strong representative organsaitions..
There are two active angling national federations, corresponding to four groups at national level; the
Federation of Sea Angling of Montenegro, that brings together sea angling and casting competitions;
and the National Association of Freshwater Anglers for coarse fishers and fly fishers. The
Associations are well organised, with annual general meetings, regular networking activities between
local associations and international events.
The national associations and clubs are registered with the Sports Ministry. A club needs a minimum
of 5 members to be registered. MARD issues angling licences and fixes the annual fee, including a
part that the club has to pay to the Ministry.
“The Convention on Wetlands (Ramsar, Iran, 1971) -- called the "Ramsar Convention" -- is an
intergovernmental treaty that embodies the commitments of its member countries to maintain the ecological
character of their Wetlands of International Importance and to plan for the "wise use", or sustainable use, of all
of the wetlands in their territories”. See http://www.ramsar.org/cda/en/ramsar-about/main/ramsar/136_4000_0__
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3.3.2
Regional Distribution
The survey covered fishermen from 19 municipalities who fished a wide range of water bodies – the
sea, lakes, reservoirs and rivers.
In 2010, 2,881 sea anglers were registered in 19 sea angling clubs covering the entire coast including
the Bay of Kotor. The national federation organises national and international championships. In 2009
it hosted the shore angling world championship which attracted 230 international competitors. In
addition, there will be some marine sport fishing by international tourists but no data is available on
the extent and nature of this activity.
A total of 25 clubs represent around 5,000 anglers in fresh waters. In addition to cooperative activities
of networking and competitions, freshwaters angling clubs are active in environmental management
while some clubs contribute to local school awareness and education campaigns. The bigger clubs
hire wardens, which are partly paid by the Ministry, who report pollution, help control poaching and
organise re-stocking and ecological management of their local water bodies.
3.3.3
Structure
The 24 clubs that contributed to the survey had more than 2,400 members in 2010. About 80% of
these paid a membership and licence fee between €10 and €60, providing an annual income of more
than €50,000. All club officials work on a voluntary basis.
The typical recreational fisher is male and aged between 30 and 60. Most fish between 50 and 100
days per year, although a surprising number are active for more than 250 days. The level of activity
depends on work commitments and available budget. Given the opportunity, most would fish more
days.
In fresh waters, fishers target trout and a range of “coarse” fish while in marine waters a variety of
species are pursued.
3.3.4
Production Systems & Technology
Recreational and sport fishing describe fishing primarily for pleasure or competition. Recreational
fishing has conventions, rules, licensing restrictions and laws that limit the way in which fish may be
caught; typically, these prohibit the use of nets and the catching of fish with hooks not in the mouth.
The most common form of recreational fishing is done with a rod, reel, line, hooks and any one of a
wide range of baits or lures such as artificial flies. The practice of catching or attempting to catch fish
with a hook is generally known as angling. In angling, it is sometimes expected or required that fish
be returned to the water (catch and release). Recreational or sport fishermen may log their catches or
participate in fishing competitions.
3.3.5
Economics of the Sub-sector
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In the past decade the contribution of recreational fishing to national and local economies has been
increasingly recognised in member states of the EU. Indeed, in some cases it has been concluded that
this sector can contribute more to the economy than commercial fishing without risking the
sustainability of the stocks and this is increasingly reflected in fishery management planning for
specific species. There is a clear potential to develop both sea and freshwater (rivers and lakes)
angling activities in Montenegro, through links with sports and rural tourism and local environmental
management initiatives.
As noted previously, anglers often take some fish home and this can make an important contribution
to the household economy. Fishermen make expenditures on licences, competition fees, fishing tackle
and equipment (either locally or internationally via the internet), food and transport. Altogether of
people surveyed the annual median spend was €300 per person, varying between nil and several
thousand Euros. If the median spend applied to all 8,000 anglers, the annual angling spend would be
€2.4 million.
3.3.6
Important Constraints and Areas for Intervention
The main issues identified by surveyed clubs were the lack of adequate enforcement to reduce
poaching and illegal fishing, the risk of contamination and pollution and the need to restock.
Given the potential benefits to tourism, it seems incumbent on the authorities to implement a strategy
to use recreational fishing to increase the offer of leisure activities for national and international
visitors. This could be of particular significance in inland areas, especially where the current tourist
season is limited to the winter months. Lakes well stocked with native species such as brown trout
could prove to be of strong interest. Increased numbers of visiting recreational fishermen benefit local
economies with expenditure on accommodation and food.
Many fishermen spoke of the need to import their fishing gear, with purchases made on the internet.
The project does not have the resources to review the number and location of retail outlets for
recreational fishing equipment, but it may be the case that financial support could be provided to
develop this activity and increase the benefit to Montenegro from any value added.
Strong consideration should be given to including recreational fishing in any fishery management
plans prepared for the marine and Lake Skadar fisheries. This would reflect the importance of
recreational fisheries to the national economy and reduce the risk that over fishing limits the resources
available to sports fishermen. Also, account must be taken of the recreational catch when assessing
the status of the resources. While data is not available, 2,881 recreational fishermen fishing an
average of 80 days per year with an average daily take of 1 kg amounts to 230 mt of marine fish per
year. This is significant when compared to official landings of 500 mt of demersal and pelagic
fisheries.
It is reported that many recreational fishermen sell their catch. However, there should be a clear
separation between recreational and commercial fishermen and recreational fishermen fishing for
commercial gain should be subject to appropriate licensing with an adequate catch reporting system.
This is not only to strengthen management of the fisheries, but also to ensure the traceability of fish
offered for sale in retail outlets and restaurants. Bona fide recreational fishermen should implement
“bag limits” and in some areas of water, particularly inland, a policy of “catch-and-release”. This is
particularly important when there is limited understanding of the resource status and there is no
restocking, with the required approach being to limit-the-kill rather than kill-the-limit.
3.4
3.4.1
Aquaculture
Overview
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In Montenegro, fresh water aquaculture has a long history and is based on the rearing of rainbow trout
(Oncorhynchus mykiss), an introduced species more suited to farming that the native brown trout
(Salmo trutta morpha fario). In the past there was some production of carp (Cyprinus carpio) at a
farm close to Podgorica but this is now closed. In addition, there has been some interest in the farming
of other species, including sturgeon, arctic char (Salvelinus alpinus) and hybrid “baster” (Acipenser
ruthenus and Huso huso) but no investments have been made.
Articles 22 to 26 of the “Law on Freshwater Fisheries” regulate the establishment of fish farms in
fresh waters. Article 25 of the “Law on National Parks defines the terms of developing commercial
activities in national parks. There is one fish farm on Lake Skadar and it would appear to be
significant potential for more.
3.4.2
Regional Distribution
As shown by table 10, trout farms are distributed throughout the mountainous area, where conditions
provide a supply of clean water while space is available close to the river to allow construction of the
raceways. The issue is seasonal shortage of water. It is assumed that there are many suitable sites in
Montenegro; what is not known is the potential to increase the capacity of the farms currently
operating. Lakes and reservoirs present an option for appropriately located cage operations that would
not have issues with continuous water supply.
Table 10: Montenegro: Trout Farms
Name of farm
Location
Area (m2)
Production (mt/year)
Capacity
Podgorica
Podgorica
Podgorica
Nikšić
Nikšić
Plužine
Nikšić
Šavnik
Bijelo Polje
Berane
Kolašin
Bijelo Polje
Podgorica
Danilovgrad
Mojkovac
Žabljak
Cetinje
Mojkovac
Pljevlja
Mojkovac
Andrijevica
4,000
400
550
1,000 (22 cages)
1,000 (14 cages)
550
6,000
600
500
1,000
100
10
15-20
50
15-20
250
50
10
20
200
30
20
25-30
100
10
10
130
25-30
15
40
10
15
15
Opasanica
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Mareza
Veruša
Veruša
Rastovac
Vir
Aqua d’Or
Krupac
Šavnik
Bistrica
Buče
Trebaljevo
Bistrica
Vrela Ribnička
Grujičić (Owner)
Radenko (Owner)
Marić (Owner)
Crmnica
Novaković (Owner)
Vukojičić (Owner)
Rabrenović (Owner)
Rabrenović (Owner)
Marković (Owner)
Milinčić (Owner)
Actual
3.4.3
Structure
There are two types of trout farm in Montenegro. The majority are small, family run, companies with
limited investment and low production capacity. In addition, there are two large multi-site vertically
integrated companies with total production capacities of 250 mt and 200 mt. This compares to one
farm in Bosnia with a reported annual output in excess of 1,000 mt (in a country with 4,000 mt annual
production of trout and about 2,300 mt of carp). Most are raceways sites, some with hatcheries, and
there are 2 cage sites, one on Lake Krupac near Niksic, and one on Lake Pivsko near Pluzine.
There is a licensing scheme for trout farms. While the socio-economic survey was completed before
the end of the 2011 process, until end June 2011 there had been 23 licence applications (table 9).
However, field visits and survey interviews indicate that 30 enterprises are operating.
10 companies responded to the socio- economic survey, including one with two production units (one
raceway and one cage, and a hatchery). Respondents provided a number of details including the area
of the production site size, production capacity and actual production.
In the survey, 8 farms reported annual production of between 1mt and 50 mt, one with between 50 mt
and 100 mt and one with between 100 mt and 150 mt, leading to a total of 372 mt. More than half of
the sites produce between 10 and 15mt. Overall capacity utilisation was 51 %. This would imply that
total annual production in Montenegro (assuming the non-responding farms are small scale) is about
600 mt, with a total capacity of about 1,200 mt.
Smaller farms only employ one or two people. The largest farms employ 8 to 10 people. From the
survey responses it is not clear if this includes the owner. The data implies that total direct
employment in the sector is less than 100.
3.4.4
Production Systems & Technology
Trout grow best within a temperature range of 10º c to 21º c. The most commonly used method for
trout farming is a series of concrete raceways that have different design and characteristics depending
on the area and topography of the land and the owner’s requirements. Typically they are 1 m. deep,
1.5 m to 6 m wide and 15 m to 30 m long. These dimensions can vary widely, depending on the size
and shape of the area the farmer has available.
Trout farms require a continuous supply of flowing water that is pumped into one end of the raceway,
where it flows down to exit at the outlet either by gravity or pump. Water passing through the farm is
contaminated by waste and should be cleaned before re-entering the river.
The capacity of the farm is based on the volume of the raceways (m³ of water) and the density of
stocking. Full cycle production involves the growth from roe to consumption size fish, and the
production area is divided between fingerlings, juveniles, grow-out and brood stock. Most farms in
Montenegro are limited to the grow-out of trout to a marketable size. Other factors that affect actual
production are the market, finance and the availability of brood stock and juveniles.
An alternative to race ways is cage farming with net cages located in freshwater lakes.
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Typically trout need 8 months to grow from fingerlings to a market size of 300 g – 400 g. (although
larger fish are now being sold in the Montenegrin market).
Trout are highly susceptible to diseases and this leads to the application of medicinal products that
most often are mixed with the feed. Stocking at too high a density increases the risk of diseases. One
finding of the EU fisheries project (2007 to 2008) was that there was insufficient understanding of the
correct doses of medicine to apply and this led to concern that marketed trout could be harmful to
consumers.
Farmed trout are fed a pelletized commercial feed which is high in protein and fat. Mechanical feeders
are preferred because the fish should be fed small amounts many times a day rather than a large
amount once or twice a day. This maximises feed conversion rates (FCR) and reduces waste. Most
farms import their feed from Italy, either directly or indirectly through a bigger farm, while two trout
farms import some from Serbia.
The majority of the trout farms in Montenegro can be characterised as low technology. If
competitiveness is to improve (reducing the average first hand sales price from about €3.80 / kg
towards the €2.25 reported in Bosnia) the size of farms has to increase with more effective utilisation
of productive capacity. Modern technology with such as feeders and aeration could improve the
product while reducing costs by ensuring a more effective FCR (i.e. less food required to increase the
weight of fish by 100 g). Also important is to increase market demand, either through wider
distribution of fresh product or increasing the range of products e.g. smoked trout, canned trout,
frozen fillets etc. It may be the case that the national taste for smoked pork products and smoked bleak
indicates a potentially strong market for smoked trout, although much would depend on the pricing
point.
Briefly, the technology used in carp farms is more extensive than intensive, with ponds constructed
with earth walls and a suitable system for pumping water. If juveniles are available carp farming is
suitable for small scale operation, and in some countries may be integrated with the rearing of
livestock.
3.4.5
Costs and Earnings
The average investment cost for the 8 small sized trout farms reporting in the survey was €218,125, or
about €20.5 / m². Only one company, which has two grow-out systems and a hatchery, reported
substantially higher investment costs.
Analysis of the available data, which is somewhat restricted, shows average annual sales of about
€57,500, with total costs of €37,000, leaving EBTD of about €15,000 after deducting overheads that
mainly comprise of financial costs.
Feed (33%) is the highest cost for trout farms followed by labour (20 %) and transport (6 %) (for
supplies and product delivery). The cost of feed has increased dramatically over recent years, largely
due to higher demand from China that have pushed up the commodity price of fish meal that is the
main ingredient of fish meal. Fuel costs have also increased. Such cost increments in farming
operations with limited production both reduce profitability and further limit the capacity to compete
in the national and regional markets. While labour inputs are minimal, the need for qualified staff may
increase their unit cost.
3.4.6
Important Constraints and Areas for Intervention
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The major constraints to development are: the high unit costs of production that limit the ability of
local companies to compete with producers in neighbouring countries; a small national market (in
part because of the high sales cost); and lack of investment capital to increase production capacity.
The apparent per capita consumption of trout in Montenegro is less than 1 kg per person. Market
opportunities are limited due to sparse populations close to production units and the high cost of
transport to the major cities and the coast. The only trout processor (smoked product) uses lower
priced Bosnian fish with more consistent quality as raw material (see below)
The EU fisheries project (2007 – 2008) identified a range of other limiting factors such as the lack of
trained personnel, variable quality with high mortality, old brood stock, insufficient water at certain
times of the year and the non-application of HACCP standards that would reduce the risk of, for
example, overuse of medical products.
This leads to the conclusion that there is the opportunity for intervention in a number of areas.
A major need is financial support to allow efficient farms to increase production and reduce costs.
Respondents to the survey noted; (i) the lack of financial resources and government support; (ii) their
interest in increasing production capacity; (iii) improved capacity for each farm to produce eggs and
fingerlings; and (iv) interest in developing value added processing.
Respondents to the survey did not mention the need to improve national capacity to promote
sustainable and healthy aquaculture production for domestic consumption and trade. It may be lack of
experience and/or technical expertise that leads farmers not to consider issues related to policy and
national aquatic animal health (AAH) strategy, marketing including AAH requirements, risk analysis
in aquaculture, product safety and quality assurance, and diagnostics, surveillance and reporting of
aquatic animal diseases. A national AAH management strategy would consider such issues as a
national reference laboratory, a disease diagnostic manual for workers and a veterinary inspector’s
checklist for aquaculture farms and related processing facilities. The objective would be to improve
food safety and to develop productive capacity based on a market strategy that encompassed targeting
of specific export markets.
As with other sub-sectors, one issue is the lack of a functioning association that represents members’
interests. There is also a need to identify how technical expertise needs to be strengthened in order to
provide the basis for sustainable development of the sector.
3.5
3.5.1
Mariculture
Overview
Articles 68, 69 & 70 of the Fisheries Law (2009) define administrative responsibilities, eligible
companies and the licensing procedure for mariculture operations.
A number of conditions are used to indicate the suitability of an area for mariculture including the risk
of contaminants, hydro-dynamics, the presence of eutrophic1 areas with risks for mucilage
phenomenon,2 the intensity of marine traffic, the location of special protected areas, areas reserved for
tourism and recreational activities, and special-purpose areas (e.g. military areas and archaeological
sites). This has led to the classification of the Montenegrin coast into three categories: category 1 for
Eutrophication is “the process by which a body of water acquires a high concentration of nutrients, especially
phosphates and nitrates. These typically promote excessive growth of algae. As the algae die and decompose,
high levels of organic matter and the decomposing organisms deplete the water of available oxygen, causing the
death of other organisms, such as fish”. See http://toxics.usgs.gov/definitions/eutrophication.html
2
Surface mats of mucus
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1
mariculture and complementary activities; category 2 for mariculture and other business activities that
do not have a negative impact on mariculture; and category 3 where mariculture is not allowed. The
areas are well defined by location.
3.5.2
Regional Distribution
Mariculture is currently restricted to the Bay of Kotor which is sheltered and suitable for small scale
developments.
3.5.3
Structure
Activity is currently restricted to the farming of mussels (Mytilus galloprovincialis) sea bass
(Dicentrarchus labrax) and sea bream (Sparus aurata). Two sites are licensed to produce oyster
(Ostrea edulis) with a combined capacity to produce 130,000 oysters/year. While the first test
production of oysters was in October, 2011, there is currently no commercial production.
Historically, the open nature of the Montenegrin sea that by-and-large lacks shelter from islands, bays
and inlets, has precluded consideration of mariculture operations. However, recent technological
advances make open sea mariculture an option, albeit at a high capital cost due to the infrastructure
and support services required.
Mussel cultivation in Montenegro has a history of about two decades during which time small scale
operations have been developed in suitable locations around the Bay of Kotor around the Bay of
Kotor, usually but not exclusively close to the owner’s place of residence or business. Thirteen sites
are currently licensed for shellfish farming with 12 in production (Table 11). Of these, one is a mixed
fish and mussels site with the remainder for mussels. There is a substantial variation in the enterprises
in terms of investment, area and productivity. None, however, match the scale of competitors in
neighbouring Croatia (2,000 mt of mussel production in 2009).
Data show that the annual production capacity for mussels is about 400 mt, but actual production is
about 110 mt, or about 28 %. The largest farm could produce up to 100 mt per year, but is currently
doing about 20 mt. Only one company reports producing to its capacity.
In addition, the limitations of supervisory institutions has allowed the establishment of a number of
small grow-out locations dotted along the Bay, the annual production of which is expected to be
limited to a few kilos. This gives rise to the concern that the lack of phyto-sanitary controls will
increase the risk of contamination and the subsequent intoxication of consumers. While progress is
being made in developing a depuration centre, it is important that in the future all mussels sold are
certified as being treated there or that they come from farming in Class A waters with effective
monitoring systems.
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A single company produces sea bass and sea bream for which the initial investment cost in cages is
relatively high, as are the operating costs especially for brood stock and feed that are imported.
Production is 70 % utilised with annual production of 35 mt for both species.
Table 11: Mariculture Farms
Location
Size
(ha)
Annual
Production
Capacity
(mt)1
Actual
Production
per year
(mt)
Uzgajalište Svetlane Šupice
Donja Jošica, Herceg Novi
1
70-100
20
Uzgalište Gorana Bige
Lipci, Kotor
0,5
15
8
Uzgajalište Miloša Grubačevića
Dražin Vrt b.b. Kotor
0,02
10
7
Uzgalište Slava Svilanovića
Donja Jošica, Herceg Novi
1
10-12
4
Uzgajalište Sretena Krivokapića
Orahovac, Kotor
0,8
15
10-12
Uzgajalište Vasa Dubravčevića
Đuraševića obala, Tivat
1,5
20-22
10-12
Uzgajališe Gojka Živkovica„Ljuta“
Ljuta b.b. Kotor
0,6
30
7
Uzgajalište Radević i Vukasović
Dražin vrt b.b. Kotor
0,9
50
30
Uzgajalište Nevresa Đerića
„Školjke Boke“
Orahovac, Kotor
0,5
80
?
Uzgajalište Sloba Vujovića
Kukoljina b.b. Tivat
2,1
100
5
Uzgajalište Duška Vlahovića
„Ostrvo cvijeća“
Brda, Tivat
3,0
30
30
Uzgajalište „COGI“
Brbat, Kotor
1
(incl.
Oysters)
30
14
50 000
pieces
Oysters
?
50 sea bass
35
50 sea
bream
35
Name of farm
1.5
The major constraint is the size of the domestic market and much higher production prices that Greece
and Turkey that supply export markets throughout Europe. In 2008, the Greeks sector produced 450
million juveniles in 2008 and 120,000 mt of sea bream and sea bass (about 47% of total European
product), with 106 companies employing 10,000 people.1 directly or indirectly. Three- quarters of the
production is exported.
1
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http://www.aquark.gr/index.php?option=com_content&view=article&id=157:article-on-greek-mariculture2011-in-aquaculture-europe-vol-36-2-june-2011&catid=71:sector&Itemid=276
Most of the mussel farmers belong to the Association; however they characterize this as being weak
with limited function. From observation, it is known that the President of the Association is active, but
there is limited on-going input from members.
One oft mentioned possibility for new investment Montenegro is in the ranching of blue fin tuna
(Thynnus thynnus) with small bluefin tuna captured in the Adriatic and Mediterranean, transported
live to cages and grown-on until market size for subsequent slaughter and sale for the Japanese
market. On-growing facilities have been developed in a number of countries, such as Turkey, Croatia
and Malta. However, initial investment needs are extremely high while demand from this lucrative
has led to the overfishing of the resource to the point where the species may be declared in danger of
extinction. New investment is not recommended.
The survey indicates staffing at farms of between one and 9 people. Average employment is 2.9 per
farm (excluding the owner) and there is limited part time and casual work. Making assumptions about
the size of farms, this would indicate employment of about 40 people.
3.5.4
Production Systems & Technology
The system of culture (long line) used in Montenegro is common to all individual operations which
share the same oceanographic, bathymetric and biological conditions. Essentially mussel spat are
attached to a rope and covered by a mesh, and the ropes are suspended between plastic floats. They
use no more than 3 m of the water column in costal zones and are at a maximum depth of
approximately 25 m. to 35 m. The growing period is between 15 to 18 months. There is limited
mechanization with almost all the procedures are carried out manually. Small variations in technique
reflect individual preferences or trials being carried out in individual farms. However, such variations
do not explain significant differences in productivity between farms. Studies have demonstrated that
between 74 % and 86 % of the variance in productivity between different culture zones reflects
environmental conditions. The most favourable areas have good food availability and strong currents,
where mariculture can take place in harmony with other activities such as fishing, marine traffic,
recreation and tourism.
In intensive production of sea bass and sea bream, on-growing units are supplied with fry from
hatcheries and controlled diet is provided. Juveniles are bought at a size of 1.5-2.5 g and reach a
marketable size of 400-450 g in 18 to 24 months. On-growing can take place in tanks or in cage
systems; the latter technique is used in Montenegro. While cages can be of different designs they
work on the same principle with the natural exchange of water through the pens. The quality of a site
for on-growing depends on local conditions such as tide and current. In Montenegro, cages are
circular and made of plastic.
Most farms report interest in widening the area of their present facility. While on the face of it this
would not appear to be rational in the context of low use of actual capacity, this issue is likely related
to the seasonality of market demand (tourists) and the wish to increase production in those peak
months.
3.5.5
Costs and Earnings
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Some data on the costs and earnings of mussel farms were provided by the survey respondents;
however the information is of variable quality and only allows broad conclusions to be reached.
The total investment in dedicated mussel farms is €570,000, or an average of €52,000 per ha and
€47,500 per farm. Indicative average annual earnings are €17,000 (variation between €6,000 and
€41,000) compared to operating costs of €10,400. In the survey, three respondents reported that the
farm was their only source of income. The major cost was wages (56 %), followed by repairs and
maintenance (14 %) and transport (11 %).
In 2010, feed and juveniles (including transport from Italy) were the major operating costs (64% and
29% respectively) for sea bass and sea bream. Other costs are marketing and delivery (4%) and labour
(2%). The low level of production and high unit costs restrict market potential in the face of the
competition from Greece and Turkey, especially given the nature of the national market. If investment
capital was available the private sector could consider diversification to open sea mariculture and
other species,1 however this is expensive and there are many issues concerning the development of
farming of new species.
3.5.6
Important Constraints and Areas for Intervention
Respondents to the survey identified a number of issues. They point to the environmental conditions
and high product quality as strengths. Weaknesses include inadequate equipment, predation (by sea
bream) on mussel seeds reducing productivity, poor marketing, an ineffective association and limited
space for growth in existing locations. There is a strong opportunity for greater involvement if the
public sector, including administrators and inspectors, and for the expansion of the species and
product range. Identified threats include the discharge of waste from cruise ships with the Bay of
Kotor and illegal imports of mussels from Croatia, in addition to lower sales due to the weak
economy. They anticipate the need for public sector input in strengthening regulations and their
subsequent enforcement, providing financial assistance, technical assistance and support in
strengthening the association.
While the area allocated to mussel farming in the Bay of Kotor is considered sufficient to significantly
increase production, individuals lack the capital. Moreover, interest in expansion is largely limited to
expanding the production area in the existing locations rather than developing new sites that have a
higher investment cost or introducing improved techniques designed to increase productivity per
hectare.
While mussels are usually consumed in the cooked form, so reducing the risk of bacteria affecting
consumer health, other shellfish, such as oysters and some types of clam, are consumed fresh. There is
a need to establish and apply norms to regulate the quality and safety of bivalve molluscs and provide
the facilities to purify the production of all bi-valves and reduce the potential for food poisoning; an
event that if leading to a fatality could prove catastrophic for the tourist industry. Since 2008, with the
aid of MARD financial assistance amounting to about €140,000, a depurification unit has been in
construction and is now close to completion. It will be important that restaurants offering bi-valves for
sale are required to only buy product that has been treated or has been produced in Category A water.
This will require cooperative action by the Association and rigorous control by the authorities. The
operation of unlicensed mussel farms must be stopped.
1
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Possibilities would include Red porgy (Pagrus pagrus), Sharpsnout sea bream (Puntazzo puntazzo), Red
pandora (Pagellus erythrinus), White sea bream (Diplodus sargus), Sole (Solea solea, Solea senegalensis),
Mullet (Mugil cephalus), Common dentex (Dentex dentex) and Brown meagre (Sciaena umbra).
However, it is important to note that marine bio-toxins are not eliminated by depurification and a
competent authority must realise controls to prevent harvests when toxic phyto-planktons is present in
production areas.
The costs of purification will add to the uncompetitive position of the small producers, implying the
need to increase production and reduce unit costs; in turn this would require market development. To
a certain extent this is a vicious circle – limited and seasonal market demand reduces capacity
utilisation and increases the unit cost of production, increasing sales price and limiting market
potential.
Low capacity utilisation results in high unit production costs and the price of the mussels is too high
to compete in export markets or to be used as a raw material for added value processing e.g. frozen,
canned and smoked product. It is interesting to note that while frozen product is available in
Montenegrin supermarkets and frozen mussels are used as an ingredient is such as seafood pizzas and
pasta, this product is imported. In addition, lack of price competitiveness leads to the reported illegal
import of mussels from Croatia.
In 2008, the EU CARDS project looked to improve productivity per m² of operations or by m of cord
by reviewing the potential to apply methods used in Galicia. This would increase benefits from the
water column, with higher production at a profitable level encouraging new investment while higher
production per m² would allow for the mechanization of the process. As far as can be ascertained, the
results of two pilot projects are not known and there has been no new investment.
Clearly, if mussel production and the range of species produce by farms are to increase, considerable
emphasis has to be placed on marketing to ensure that the output can be sold profitably throughout the
year. Only then will investment in farms increase with production growing from current levels to
those believed attainable in the area available for cultivation.
Improved training and information with stronger awareness on the part of the sector, both individually
and as a whole, are basic to the creation of a strong, organized and competitive domestic mussel
growing activity. The strengthening of the sectoral organization, which represents its members and
informs them of, for example, new legislation will help to achieve these aims. Also important is to
present a strong, common voice to public institutions in order to ensure that the interests of the
members are well presented.
4
4.1
THE FISH PROCESSING SECTOR
Overview
In line with Commission Recommendation 2003/361/EC1 that defines small and medium scale
enterprises in the Montenegrin fish processing sector there is one small enterprise (Ribartsvo) and
1
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The category of micro, small and medium-sized enterprises (SMEs) is made up of enterprises which employ
fewerthan 250 persons and which have an annual turnover not exceeding EUR 50 million, and/or an annual
balance sheet total not exceeding EUR 43 million. Within the SME category, a small enterprise is defined as an
enterprise which employs fewer than 50 persons and whose annual turnover and/or annual balance sheet total
does not exceed EUR 10 million. Within the SME category, a microenterprise is defined as an enterprise which
employs fewer than 10 persons and whose annual turnover and/or annual balance sheet total does not exceed
EUR 2 million.
three micro enterprises (Ahileas, Montefish, Montepesca, Rozafa and Cogi) (table 12). None of the
companies provided financial data.
Table 12: Montenegro: Fish Processors
Name of firm
Rijeka Crnojevica
Ahilies
Montefish
Montepesca
Rozafa
Cogi
Address
Rijeka Crnojevića
Golubovci b.b
Trg magnolija Tivat
Luka Bar
Luka Bar
Kotor
Name of owner
Petar Ražnatovic
Ljuba
Dejan Krstović
Danilo Lakić
Ljubo Djokaj
Type of processing
Canning & Smoked
Smoked
Fillets and repackaging
Frozen fish
Marinated
Repackaging
It is understood that Rozafa is not working.
Note that the distinction between importers, wholesalers and processors is hazy as some enterprises
may freeze products, while others repack bulk shipments into packs for retail or use in restaurants,
mostly usually mixed packs of shellfish as an ingredient for pasta dishes or pizza.
A large part of processed fish (frozen, value added, canned and pastes) on sale throughout
Montenegro is imported after value has been added in an intermediary importing country, most
usually in the Balkans.
4.2
Structure
Ribartsvo is a canning factory established at the northern edge of Skadar Lake, in Rijeka Crnojevica,
with a fishing concession for bleak in Lake Skadar. Its annual input from the Lake used to be well in
excess of 1,000 mt but this has now substantially reduced to about 100 mt. The company fishes bleak
from three points on the Lake (with set nets that catch the fish which is then pumped into carrying
vessels); in former times it had up to 18 fishing points. Also, the company has a trout farm. The
investment value of the company is €3.7 million.
On the basis of 208 working days per year with one shift and a daily capacity of 32,000 to 40,000
cans (dependent on the need to prepare raw material), annual production capacity is 7.8 million to
11.8 million cans. This could be increased with a second shift of workers. Potential production is
based on canned smoked lake fish (950,000 cans), with the remainder composed of imported fish such
as sardine, mackerel and tuna. There is interest in developing a carp farm.
As current production is limited to canned smoked lake fish (carp and bleak) and trout, capacity
utilisation is low and this affects the financial performance of the enterprise.
Ribartsvo identifies the following issues:

41

The need to increase domestic production of small pelagic species such as sardine, mackerel and
anchovy to make full use of potential production possibilities from Montenegrin waters.
The need to assess Lake Skadar resources to determine the status of the stocks and introduce
fisheries management planning to achieve recovery towards a maximum sustainable yield that
would allow the factory to annually source 300 mt – 400 mt of bleak, carp and other fish.
Make better use of installed capacity with target production of 13 million cans, increasing
competitiveness and reducing the sales price. About 10 % of this production would be for the
national market with the remainder exported.
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

Extension of the product range to: pates of different marine and lake species; salting and
marinating of anchovy; and vacuum packing of smoked lake fish.
To achieve these targets the company would require financial assistance to provide working
capital.
Ahileas is a recently established carp and trout smoking facility near Podgorica that is well designed
and meets HACCP standards. Total investment is about €500,000. Due to costs, trout is imported
from Bosnia where the farm gate price is about two-thirds of that in Montenegro. The main issue is to
increase capacity utilisation to reduce unit costs and make the final product more price competitive in
the market; down from the €8 per kg for trout and €7.20 per kg for carp. Sales are made through a
number of national retail outlets while exports are planned to Russia. A limiting factor is the size of
the local market. There are prospects of expanding the product line to produce smoked salmon from
imported whole fish.
Montefish in Tivat repacks some of the seafood it imports (total 70 mt – 100 mt per year) and
processes some locally caught fish. The company has a modern high standard retail outlet to
international standards. Investment to date is about €350,000. The company’s premises are too small
for a viable fish processing operation, but it does have plans for a new facility close to Tivat airport
that would allow for value added production. The estimated investment cost is about €1 million. The
main issues facing the company are lack of capital, the poor quality of local fish, lack of continuity of
supply and limited quantities.
Cogi near Kotor is a horizontally and vertically integrated company with fish farming, fish importing,
repacking and retail outlets not only in its own premises but also in the green market in Kotor and instore of a major supermarket in Podgorica.
Other companies that are contemplating investment in cold storage or packing facilities are
Mesopromat, Bonesa, Legisystem and Pima.
Given lack of supply, employment in the sector is small. A fully operating Ribartsvo could provide
full time employment to more than a 100 people, mainly females from Podgorica and Cetinje. It is
estimated that current employment in processing is less than 20.
4.3
Important Constraints and Areas for Interventions
The major issue is supply and the first hand sales price off fish. If the fishery sector in Montenegro is
to develop with the creation of on-shore income and employment based on locally supplied raw
material, the local supply industry, whether from catch or farming, must become more price
competitive and seafood has to be available continuously and be of a consistent quality. In the two
processing establishments with the most investment, actual capacity utilisation is low and this reduces
market competitiveness.
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While Montenegro is a small country and despite the limitations imposed on the foodstuffs budget due
to low household incomes allied with low per capita consumption of fish, as shown by trade data there
is a meaningful demand for fish with a range of value added frozen and canned fish. To a large part
these products are manufactured in third countries using raw material imported from a range of
42
Another major factor is the small size of the domestic market. To benefit from economies of scale,
processing companies have to target export markets and this means they must compete with producers
in neighbouring countries. In turn, this requires modern production facilities that meet the exacting
quality standards of importers in other countries.
catching countries. This presents an opportunity for investment in Montenegro and could provide the
basis for capacity utilisation that would contribute to international competitiveness. Under the right
conditions, frozen fish could be imported from producing countries as raw material for value added
production. The strategic approach would be to add to the competitiveness of existing companies with
interest in new investment, rather than attract new entrants into the sector.
5
5.1
GOVERNMENT POLICY
Overview
In the past six years, two policy documents1 prepared by EU projects have been adopted by the
Government of Montenegro.
In the foreword to the 2006 document, the Minister wrote:










Fisheries are of particular importance for economic development of coastal countries including
Montenegro, which has valuable but under-utilized resources in the sector.
It is necessary to establish and enforce the principles of responsible fisheries and fishing efforts,
taking care of all important aspects: biological, ecological, technological, economic and social.
Illegal and unregulated fishing, jeopardizing the efficient enforcement of measures in
management and protection of fish resources, must be controlled.
The resources require proper management.
The biodiversity and integrity of marine ecosystems must be protected.
Montenegro needs to harmonize and improve its legislation, and improve the monitoring system
through collecting of data in compliance with international standards.
Administrative capacities must be strengthened.
There should be a focus on improvement of the product traceability and quality and consumer
protection with strong food safety legislation as well as upgrading of laboratory facilities for
analyses.
An important objective is to establish an investment environment favourable for renewal of the
national fishing fleet.
Research and scientific assessment of fish stocks needs to be improved.
As pointed out in the 2008 document, the previously prepared Strategy focussed on Montenegro
meeting EU requirements in terms of the acquis communataire rather than being a policy document
that incorporated, but was not restricted to, elements related to possible future EU accession.
The 2008 document presented a comprehensive analysis of the situation in the fisheries sector and
identified potential areas for development. However, it only covered the first two parts of a three-step
process. It defined a National Fisheries Policy (NFP) and the related National Strategic Plan (NSP).
However, it lacked the final step which was a National Operating Plan (NOP) that would identify
application procedures, projects, costs and possible sources of finance with a prioritised approach to
required actions by axes. At the time it was acknowledged that it was difficult to develop an
operational plan as there was no funding available to finance the estimated cost of €17 million
(excluding funds for the construction of dedicated fishing landing facilities in Bar and Herceg Novi).
MAFWM 2006 “ National Fisheries Strategy”; MAFWM 2008 “ Development of the National Fisheries Sector
2009 – 13”
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1
In 2008, MAFWM made a small amount of funds available to finance small projects for stakeholders,
and each year since there has been a small budget.
5.2
Government Financial Assistance
Historically, limited financial support has been provided to the fish catching sector with a fuel subsidy
available for 20 boats, each with an allowance of €0.27 for 20,000 litres. As none of the fishing
vessels licensed in 2009 and 2010 this scheme was discontinued. No assistance was provided to the
small boat fleet. If the aim is to maximise the economic benefit from fisheries, economic theory
indicates that fuel subsidies are inefficient as they lead to a higher level of effort while they reduce the
incentive to invest in more fuel efficient investments (new engines) and fishing methods that use less
fuel (i.e. static gear as opposed to mobile gear).
From 2008, the Ministry provided financial assistance to help sector development, while at the same
time proving the approach for project identification, design, monitoring and evaluation. In the first
year, three projects were assisted with varying degrees of success.
In Bar, assistance was provided to the fisheries association to refrigerate the holds of a number of
vessels and to build a small cold store and ice maker. This project was fully implemented although the
results have not been evaluated.
In the Bay of Kotor, assistance was provided to the mussel association to construct a depurification
unit. Further amounts were provided in 2009 and 2010 but the project is incomplete although new
Government assistance in 2011 will allow it to be finished. However, regulations are not in place to
require bi-valves offered for sale are purified,
In Herceg Novi assistance was provided to the fisheries association for a refrigerated van and a chill
store. The van was purchased and is in use, although its help to the intended beneficiaries has not been
evaluated. It is understood that while the cold store was purchased it has not been constructed.
The 2011 MARD budget provides assistance for the fish catching fleet with the objective of aiding its
modernisation over a period of 5 years. Potential beneficiaries are owners of commercial fishing
vessels > 15 m<24 m, fitting with the concept of improving the autonomy to fish in deeper waters and
relieve the perceived pressure on stocks within Montenegrin national waters. The proposed terms
were 50 % of eligible costs per vessel up to a maximum of €75,000 per boat with a budget of
€150,000. However, due to budgetary constraints the total budget is €80,000.
The assessment above highlights two areas of concern. Firstly, the capacity of MARD to effectively
monitor and evaluate projects and ensure that beneficiaries meet with financing conditions. Secondly,
low levels of financial assistance are unlikely to be a driver for the required developments.
5.3
5.3.1
Fishing Strategy: 2009 - 2013
Marine Fisheries
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The vision for marine fisheries was a modern and profitable fish catching sector harvesting resources
on a sustainable basis to land top quality fish for direct consumption, export and value added
processing. Projects would be based on rigorous resource assessments, effective fisheries management
and financial support for investment in new vessels in the context of sustainable use of available
national resources. This would result in the harvesting of deeper waters, reduced pressure on inshore
stocks, continuity of supply in the domestic market and higher fisher incomes.
Modernisation of vessels that would not be replaced by more powerful boats would be aimed at
making them more competitive by lowering repair and maintenance costs and improving fuel
efficiency, product hygiene and working conditions and safety.
Given the uncertainties of the pelagic resource, allied with a short season and the GFCM policy of not
adding to catching capacity for small pelagics in the Adriatic, it was proposed that the best approach
to increase Montenegro’s benefit from these resources would be to encourage joint ventures with
catches landed into Montenegro and creating jobs on-shore.
Over recent years it has become clear that the small boat fleet makes a valuable contribution to local
economies, providing employment and income while maximising the value of the catch by supplying
high quality product to restaurants. In 2008, the strategy focussed on the protection of resources
harvested by these vessels, with strict enforcement of the fishing zones excluding larger vessels from
within the 3 nm limit. Also identified was the need to strictly differentiate between small scale
commercial fishing boats and licenses for recreational fishermen that have been taken out by
fishermen catching to provide an income due to their lower cost.
The 2008 report listed a number of expected results of the strategy to be achieved by 2013.
Although work is still required, with the support of the IPA project (2010 – 2012), it is expected that
in 2011 an assessment of the fish resource available to the Montenegrin fleet will be sufficient to form
a basis for a fisheries management plan. However, target and limit reference points needed to
implement and guide management strategy are likely to be based on effort (e.g. number of boats,
number of fishing days) rather than stock biomasses.
With the expected inauguration of the National Marine Fisheries and Mariculture Council (NMFMC)
in late 2011 the membership of commercial fishermen will provide a formal basis for stakeholder
input into the fisheries management process. This includes inputs into a draft FMP to be prepared by
early 2012.
While there is a delay in the supply of equipment to support effective and efficient MCS of fishing
activity in Montenegrin waters, this should be fully implemented by mid-2012. It is planned to have
VMS on all vessels > 12 m and an effective log book system, supported by a trained and equipped
fishery inspectorate and the coast guard, complete with a fishery monitoring centre.
Due to lack of finance, Montenegrin vessels have not been modernised. It is reported that there has
been interest by foreign vessels to reflag and fish off Montenegro.
5.4
Fishing Areas
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Connected to the fish catching sector is the concept of cluster development at a selected location or
locations to increase the economic benefits from the harvesting sector while reducing fishing costs.
MAFWM policy was to support cluster developments at two locations – Bar and Herceg Novi - to
provide the fishing fleet with dedicated landing and berthing facilities at low user costs, with
additional support for fishery related businesses in the cluster - up-stream (e.g. vessel repair, gear, ice
and electronics) and down-stream (marketing, processing and distribution). At the same time as
improving the competiveness of the catching sector, this approach would increase on-shore income
and employment while supporting efficient administration of the sector including the implementation
of EU market regulations for larger vessels.
The strategy recognised that given the high cost of capital investment it was unlikely that much
progress would be made by 2013. It was anticipated, however, that outline plans would be developed
for the location and design of the two fishing harbours with pro forma costs for submission to
interested financing agencies.
At the moment there are proposals for a specific landing place in Bar but the options have not been
fully assessed, while the Fisherman’s Association in Herceg Novi is reported to have developed basic
plans and received outline permission for development.
5.5
Freshwater Fisheries
The vision for Lake Skadar fisheries was that the annual commercial harvest of fish be based on a
thorough understanding of its long term productive capacity. This would require research to assess the
sustainable level of catch by species and an FMP for the Lake that would be developed in cooperation
with Albania. In the meantime, fishery management on the Lake would be based on the precautionary
principal. As in marine fisheries, all vessels fishing on a commercial basis would be licensed with the
product traceable back to capture. Improvements in fish handling would be needed to guarantee
quality and food standards.
It appears that no consideration has been given to the recommendation of successive EU projects that
IMB take responsibility for the stock assessments, thus maximising the benefits of the investments
made to strengthen that institution. This recommendation does not imply that existing freshwater
specialists based elsewhere in the University of Montenegro would be replaced, rather they work
under the aegis of IMB. In this way, the country would make best use of the limited financial
resources available for fisheries research.
As previously mentioned, the World Bank Global Environment Facility is looking to improve fishery
management on the lake. It is understood that there has been no progress in implementing the three
projects. If that is the case, it is unlikely that the expected results (a resource assessment and an FMP)
will be delivered by 2013.
There is no indication that there are any plans for restocking the Lake as included in the strategy.
Improved enforcement is part of the activities of the EU IPA project.
5.6
Recreational Fisheries
The 2008 document’s vision for recreational fishing centred on a strategic approach to attract
international tourists and provide for the leisure activities of Montenegrins with the fishing of
autochthonous species. It was emphasised that recreational activities must respect the licensed
activities of commercial fishers and not compete in the market. It was also recognised that
recreational fisheries account for a significant proportion of the catch in marine and fresh waters.
Ministry budget is available to support the Faculty of Mathematics and Science at the University of
Podgorica to develop a fishery master plan, and recreational fishing clubs to restock and improved
enforcement.
Financial assistance has not, however, been directed to support infrastructure with identified
investment supportable under the Ministry financial aid programme.
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In marine fisheries, assistance has not been provided to convert existing fishing vessels to support
recreational fisheries. Fishery regulations have not been implemented on bag limits, catch-and-return
and a prohibition on the sale of retained fish in the recreational fishery.
While the Fisheries Law (2009) did not provide for formal representation of the recreational sector on
the NMFMC it is contemplated that they will be involved with participation in sub-committees.
5.7
Aquaculture
The vision for aquaculture was a technologically modern and environmentally friendly fish farming
sector, in both fresh and salt water, with new developments based on the farming of autochthonous
species. The objective was for total annual freshwater production of 1,000 mt to supply the domestic
market, export to neighbouring countries and provide raw material for added value production.
Success in this area depended on the availability of finance, the extension of cage culture, renewed
brood stock, better production planning, a more efficient FCR, continuous availability of water at
raceway sites, improved environmental protection measures with all new investments requiring an
environmental impact analysis, a training programme and added value production.
To improve marketing and food safety, it was proposed that trout, similar to other fish and fish
products, be fully traceable. Trout producers needed to implement codes of practice to improve food
safety and fully document source of fish fry, feed and the use of medicines.
A key part of the policy was to improve market competitiveness by reducing the cost of production to
a level which approximates to that in neighbouring countries. While the scale of production affects
unit costs, other issues are reduced mortality, shorter production times and improved FCR.
Finally support was to be provided to extending the species range with particular interest in the
potential for Arctic Char.
Little appears to have been done to implement this strategy. The monitoring programme (water
quality, medicines, feed and the distribution chain) has not been improved. The income of fish
farmers has not been augmented by the extension of their activities into tourism.
Financial support will be needed to implement other elements of the strategy: reduced unit costs,
water treatment, modernisation of farms and increase in production.
5.8
Mariculture
A key factor for mariculture development is spatial planning in Kotor Bay, with the definition of areas
set-aside for mariculture. Another is the licensing of all growing facilities and the implementation of
all regulations.
The stated aim was to increase annual mussel production to 2,500 mt, and to reduce unit costs and
improve competitiveness. It was planned to designate 50 hectares within the Boka Kotor Bay for
mussel growing, with licenses in one hectare lots. Preference would be given to existing licensed
mussel growers and new entrants with annual production greater than 10mt. Increased
competitiveness would result from lower transaction costs (e.g. by simplifying the licensing
structure), technical assistance to increase productivity, and support for the Association. The Ministry
looked to strengthen the Association while improving food safety by providing financial assistance to
construct the depurification centre. But this is not yet working and the indications are that the
Association remains weak. Traceability, to restrict sales by unlicensed farms, has not been introduced.
There has been no promotion of mussels in the domestic market.
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Given the costs of producing sea bass and sea bream in Montenegro which lacks critical mass to
benefit from economies of scale, and the size of competing Greek and Turkish industries, the potential
for growth was considered limited. This led to the conclusion that producers should look to reduce
their costs and sales price while concentrating on the domestic markets with the freshness of local
production commanding a premium price. Identified priorities were to reduce FCR to the level
achieved in other producing countries (2:1), to increase labour productivity to between 18 mt and 19
mt per full time employee, reduce mortality and shorten the grow out period to 15 months.
5.9
Fish Marketing & Processing
The strategy was to increase annual per capita consumption to 8 kg. This would imply total market
supply of about 5,000 mt plus the amount consumed by tourists – a potential total of 7,000 mt to
8,000 mt. The market would be supported by a modern post-harvest sector with the required
infrastructure (cold chain, chill chain and processing facilities).
A major focus of the strategy was to enable exports of Montenegrin fish and fish products by ensuring
that their sanitary and health condition is in accordance with EU and international market
requirements.
To maximise the benefit of the fishing sector to the national economy, it was recognised that on-shore
activity should develop, with the main opportunity identified being the manufacture of value added
products, in part resulting from the competitiveness of Montenegro’s relatively low wages.
Quality issues figured in the strategy, with improved product freshness with investment in ice
machines (on-board vessels, at landing places, on fish farms and in markets), refrigerated transport
and modern retail outlets including specialist stalls in green markets.
Little progress has been made in meeting these strategic objectives. Fish has not been promoted, the
food safety regulations are not enforced, and there is not a fully developed chill chain from catch
through to consumption, mainly because of the lack of facilities in the catching sector. There is a new
retail market in Podgorica (part of an overall recent development), while most of the larger
supermarkets opened in recent years have a fresh fish counter. There is more value added production
and considerable private sector interest in expanding the possibilities.
5.10 Producer Organisations
The 2009–13 strategy foresaw the development of financially viable national and local representative
organisations for fishery sector stakeholders to allow full implementation of EU regulations, provide
the basis for a public – private partnership and reduce the cost to the public sector in implementing
management measures. The Ministry would provide financial support, with the focus being on the
creation of a single PO to reflect the size of the country and reduce the overhead costs of membership.
To-date no progress has been made in establishing a PO and there is no national enabling regulation.
A recent report1 by the IPA project found that “providing price support intervention, market
stabilisation, and co-management of fishery resources were the main rationales for establishing POs
in other countries. Evidence collected suggests that there is no demand from the fishery sector in
Montenegro to stabilise market prices either through direct price intervention or through the
matching of supply to demand. The study finds that due to the absence of a quota (or effort)
1
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Assessing the Potential to Develop a Producer Organisation (PO) within the Montenegrin Fish Catching and
Aquaculture sectors.
management regime in Montenegro, currently there is no role for a potential PO to play in the comanagement of fisheries. The study also finds that the representational role of the existing fishery
associations would not be enhanced through the formation of a PO”.
As matters now stand it is unlikely that there will be a functioning PO by 2013.
5.11
Environment
The 2009 strategy emphasised the importance for any development to take into account their potential
impact on the environment. It was proposed that all investments in the fish sector should include an
EIA, with those related to investments > €100,000 to be completed by an approved environmental
expert. The Ministry would only provide licenses for the operation of aquaculture and mariculture
facilities that meet environmental and other regulations.
5.12
Governance
The 2008 strategy emphasised the need for a public sector with the capacity to enable, administer and
monitor activities in the private sector through legislation, government departments, laboratories,
fisheries research and enforcement.
The legal framework (laws and regulations) would provide the basis for sustainable marine and
freshwater, capture and farming, fisheries while applying EU and international standards. However,
since the passing of the Fisheries Law in 2009 there has been continued delay in bringing in the
necessary secondary legislation and at the moment about 39 regulations remain to be promulgated
after the passing of an initial 10 in early 2011. The lack of regulations makes it difficult to effectively
manage the sector and implement any strategy.
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Institutional weakness is visible at most levels, with lack of human and financial resources affecting
the performance of the administrators, fish inspectors and IMB. In the recent World Bank MIDAS
project inspired restructuring of MARD, the Fisheries Directorate identified in the 2008 document
was not created; indeed the organisation of the fishery related public sector offices was potentially
made more complicated by the separation of functions between different divisions, complicating the
chain of responsibility and effective decision taking with related man management. Further, it now
appears that the fisheries inspectorate will be taken from the Ministry and incorporated into a General
Inspectorate. It is not clear what work was completed in the Ministry in the two-year period between
the closing of the EU CARDS project and the start of the EU IPA project. As examples, contrary to
the specific areas of administrative activity defined in the 2008 document, no vessels were licensed,
the Fishery Information System was not populated and regulations requiring the provision of certain
data had not been enacted, fishery regulations had not been implemented, the small projects financed
by the Ministry had not been adequately monitored and the fisheries inspectorate continued to be
ineffective in enforcing regulations. In short, there appears to have been little consideration of the
need to develop and implement policy. Instead emphasis appears to have been place on reacting to
issues rather than proactively developing management of the sector. Similarly, there appears to have
been no change in the working of the IMB, to large part due to continued lack of adequate finance.
Improvements to the IMB buildings and equipment to be financed by the World Bank and the EU
have yet to be started; and equipment to be supplied under the IPA project is unlikely to be delivered
before April 2012. The situation is similar for equipment needed to strengthen enforcement capacity
and the collection of data.
5.13 Food Safety
The 2008 strategy recognises the importance of food safety issues while that for 2006 presented a
detailed analysis of the steps that would need to be taken to meet the acquis communautaire. A large
part of the resources of both previous EU projects were dedicated to food safety issues including
HACCP and the strengthening of the capacity of veterinary and other laboratories in diagnostics and
monitoring. IMB is the competent authority for water quality, but its work programme has been
affected because they do not have a boat; it is proposed to provide one under the EU IPA supply
contract. There has been no activity related to improved microbiological monitoring by industry and
regulators, the monitoring of bivalves for the presence of algal bio-toxins, improved capacity to detect
and diagnose fish disease, the provision of advanced fish disease diagnosis facilities, notably
molecular biological techniques to identification and serotyping of viruses and bacteria, the
designation of official veterinarians to control establishments, food inspectors controlling the safety of
foodstuffs in the market, the ability to undertake microbiological and chemical analysis of fish and
fish products, a comprehensive residue control programme and surveillance and monitoring
programmes. The concept was food operators to ensure food safety with the Veterinary Inspectorate
adapting its role of auditing and advising on food safety rather than carrying out direct checks.
5.14 Stakeholder Participation
The 2008 document identified a cornerstone of the long term development strategy as the formation of
a public sector private sector partnership. This includes fisheries ‘co-management’ between
government, local resource users (fishers), and other fisheries and coastal resource stakeholders
(NGOs, boat owners, fish traders, tourism establishments, etc.). The vehicle for this was a Fishery
Management Council (FMC), supported by advisory groups, comprising members with appropriate
backgrounds and expertise. A complementary approach was the organisation of fishers into
representative groups (e.g. POs).
The process is underway to form the National Marine Fishery and Mariculture Council allowed for by
the Fisheries Law (2009). In retrospect it would have been better to develop a National Fisheries
Council, but this would be difficult given the division in management and responsibilities between
marine and fresh water fisheries.
6
THE MARKET FOR FISH AND FISH PRODUCTS
6.1
6.1.1
Supplies
Domestic Supplies
Given uncertainty about the reliability of the data it is difficult to put a figure on the total supply of
fish from the various catching and farming operations. A guestimate is 1,680 mt (marine commercial
600 mt; recreational: 300 mt; trout farming 600 mt; mussels 110 mt and sea bass / sea bream 70 mt).
6.1.2
International Trade
Trade Balance: 2007 - 10
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As shown in table 13 Montenegro has a substantial deficit trade balance in fish and fish products,
averaging over 3,000 mt per year valued at €9 million in the period 2007 to 2010. In 2010, total
imports were 3,122 mt (product weight) and have been more or less stable over recent years,
presumably due to the prevailing economic conditions that have affected tourist numbers while
restricting household expenditures.
Exports: 2009
In 2010, only 13 items were exported by Montenegro (table 14). While the amounts are not large, care
must be taken in the interpretation of the data as some may be re-exports of previously imported
product.
Table 13: Montenegro: International Trade in Fish and Fish Products 2007 - 10
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Table 14: Montenegro: Exports of Fish & Fish Products 2009
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Table 15: Montenegro: Imports of Fish & Fish Products 2009
Imports: 2009
In weight terms the most significant import items were frozen whole fish with the main species being
sardine (372 mt) and hake (359 mt), frozen fillets (with hake (188 mt) the most important species),
molluscs (with the major item being frozen squid (354 mt)) and canned tuna (607 mt) and canned
sardine (213 mt) (table 15). Detailed trade data shows that a wide range of species and product
presentations are imported.
Conclusions to be drawn from this data are:

While there are exceptions, it is largely a low value market with hake, the most popular species,
having an average CIF price of €1.42 / kg whole and €2.19 /kg for filleted. This reflects the
perception that frozen fish for consumption by Montenegrins has a maximum retail pricing point
of about €5 / kg.
The import of small pelagics such as sardines and mackerel shows that there is a domestic market
for oily fish and this could be targeted by the national fleet if it could catch these types of fish and
there was the on-shore infrastructure to handle these types of landing.
There is a large amount of live trout imported but it is not known if this is for consumption or to
supply farms with fingerlings.


While the data does not indicate the country of origin, observation shows that significant quantities of
fish on sale in the Montenegrin market are produced in other Balkan countries that add value to bulk
frozen product imported from such countries as Argentine and Vietnam. This is a potential business
opportunity in Montenegro, with fish imported directly from the producing country for secondary
processing.
It is understood that Ribartsvo assessed the potential to import frozen sardines for local canning that
would make better use of the installed capacity.
6.1.3
Total Supplies
On the basis of the above figures, the net supply (product weight) of fish and fish products to the
Montenegrin market is estimated at about 4,680 mt.
6.2
6.2.1
Consumption
Per capita Consumption
In 2009, the European average per capita annual seafood consumption was 23.5kg (live weight
equivalent).
FAO1 reports that in the period 2004–2006 the apparent consumption of aquatic products in
Montenegro was 9,888 mt with a yearly average of 3,296 mt, implying average per capita
consumption of fish and fish product of 3.75kg. Average annual imports in the same three year period
were 1,660 mt, while exports averaged 153 mt.
A more realistic estimate of national per capita consumption should take into account all sources of
supply and demand from tourists.
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http://www.fao.org/fishery/countrysector/naso_montenegro/en
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The most recent data available indicates a net annual supply to the Montenegrin market of about 4,680
mt (product weight), implying annual per caput consumption of about 7.4 kg (product weight). While
data on consumption by tourists is not available, if one considers a scenario that on average each one
has two fish meals during a stay (a reasonable assumption given that 95 % of international tourists are
to the coast) and the average serving is 300 g. product weight, annual consumption by tourists is about
720 mt.
Under this scenario, annual per capita consumption in Montenegro is 6.3 kg. This is higher than
previous estimates as it takes into account the catch from recreational fisheries.
6.2.2
Consumer Preferences & Seasonality
Generally speaking, Montenegrins prefer meat, particularly lamb and beef although a lot of cured
pork is also consumed. The main factors dictating consumer demand for fish are price and familiarity
with how to prepare and cook it. While restaurants serve a wide variety of high priced fish dishes, and
the fish counters in the large modern supermarkets have a range of fresh fish on display, by-and-large
domestic consumer demand reflects the economic reality of low disposable incomes.
Given the lack of a fish eating tradition, it seems that many housewives are not familiar with how to
prepare and cook fish and this increases the preference for frozen fillets and a range of value added
dishes. The retail outlet in Pljevlja reported that the majority of his customers bought cooked fish.
6.2.3
Seasonality
All importers of marine fish supply the tourist trade and report monthly demand between June and
September being up to four times higher that between October and May.
6.2.4
Regional Variations
As may be expected fish consumption is higher on the coast where historically there has been ease of
access to marine species. It is anticipated that Montenegrins who live away from the coast consume
fish on vacation and weekend visits. Consumption is also affected by availability. Apart from trout,
access to fresh fish is limited to none existent in many inland areas with the market dependent on
frozen and canned product. In addition, there are less hotels and restaurants in the interior except at
tourist centres. Distribution to inland urban centres adds to the cost of fresh product in a price
sensitive market.
Although supporting data is not available it is highly likely that coastal residents consume
significantly more fish than those from the interior.
6.3
6.3.1
Distribution
Marine Fisheries
Commercial Fleet
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There is little or no value added to seafood landings. There is no auction or organised fish selling
facilities. The main market segments are: fresh sales to restaurants; fish stalls in the green markets
located on the coast and in some cities; and directly to consumers. Part is sold to wholesalers for
subsequent retail sale. This summary is supported by the survey findings. The most prevalent strategy
of commercial vessels is to sell through one or several fresh fish markets, although individual boats
sell 30% to 80% of their landings to hotels and restaurants. About half of the vessel owners negotiate
an annual contract price with buyers, the rest negotiate daily to adjust price according to demand.
In the past some exports of fresh fish have been made to Italy using the ferry from Bar to Bari, but
this trade is intermittent. In addition, given EC Regulation No 1005/2008 on illegal, unreported and
unregulated (IUU) fishing that came into force on 1 January, 2010 it is difficult to see how
Montenegro can export fish to a European member state when there is no product traceability, no log
books and, until mid-2011, no vessel licensing.
Small Boat Fleet
In common with the commercial fleet, and as confirmed by the survey, the distribution chain is short
with the main outlets for the catch of small boats, apart from own consumption, being sales to green
markets (80 %) and restaurants and direct to consumers (20 %). Small-scale vessel owners lament the
lack of formal selling facilities that would provide hygienic, refrigerated and safe fish storage. They
are also concerned about the market influence from unfair price competition from larger vessels, sales
by recreational anglers, illegal fishing and “undocumented” imports.
6.3.2
Lake
It is thought that about 80 % of the Lake catch is sold on the informal market. Carp is usually sold live
in green markets or along the side of the road. Bleak is canned; in addition there is a good demand for
smoked bleak but the survey only identified Ribarstvo as a producer.
Investment in market infrastructure is a bare minimum. Fishermen lack formally organised fish sales
and facilities to store fish and reduce market risk e.g. chill stores and market stalls.
6.3.3
Recreational
No data is available on the quantity of fish sold by the recreational sector or on the channels of
distribution. Recreational fishermen may sell some or all of their catch to restaurants and consumers,
while a certain amount will be for home consumption. It is reported that some commercial fishermen
take out a recreational license rather than a commercial one that is more expensive.
6.3.4
Aquaculture
Survey results show that the main markets for trout are retail shops (33 % with an average sales value
of €3.79 / kg); direct to consumers (30 % and €4.10 / kg); wholesalers (25 % and €3.59 / kg) and
restaurants (12 % and €4.06 / kg). None of the farms add value to the product and only two in the
survey reported ownership of chill rooms and refrigerated transport. Only one company had vertical
integration with a retail shop. There are no exports.
6.3.5
Mariculture
As reported by survey respondents, 41 % of sales are made to wholesalers, 28 % directly to
consumers, 22 % to restaurants and the remainder to retail outlets. All product is sold fresh; only three
companies reported ownership of equipment to maintain the chill chain (ice maker, chill cabinets and
refrigerated transport). One company exports limited quantities of mussels to Serbia.
6.3.6
Imports
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No information is available on all the companies involved in the trade of fish products, or the
quantities involved. It is sure that the import sector is competitive and in recent years long standing
companies have been confronted with new entrants.
In 2009, the Veterinary Office lists 55 companies (not counting IMB) registered to import fish and
shellfish, with data on location, types of products and countries of origin. Of these, 10 imported
aquaculture-related products, 9 of them exclusively. Of the remaining 46 companies, two are the
main processing companies described above and the rest are either wholesalers / distributors who may
repack some products. A list of the main importers of fish and fish products is in table 15.
Table 16: List of Importers
Company
Montefish
Pima
Ice Megan
Legasistem
Location
Tivat
Kotor
Tivat
Herceg Novi
Pamex
Olio Prom
Kotor
Bar
Bonesa
Tazex
Bar
Herceg Novi
Cogi
Kotor
The reported sales margin of importers was reported to be about 20 %.
Not all importing companies own their own cold storage space.
The most common foreign brands for frozen fish are ESVA, Ledo, Vici and Fratello. Each brand has
Montenegrin agents for distribution. One of these reported that foreign owned supermarket groups
may import frozen and canned fish on their own account. Typically, independent importers each bring
in between 75 mt and 250 mt of fish products per year.
6.4
6.4.1
Market Outlets
Roadside Sales
One of the main outlets for lake caught fish is informal sales by the road with live fish kept in buckets.
There are also some road side sales close to Herceg Novi, with fish sold off the back of vans with the
minimum of hygiene standards. One operator said that this was the only option due to the high cost of
stalls.
6.4.2
Green Markets
In each town there are green markets where farmers and others sell their produce, with specific market
days in the week. In Berane it was reported that fresh fish was available on Saturdays. In Podgorica,
Kotor and Bar there are dedicated areas for the sale of fresh fish with a number of sellers. In Bar the
meat, fish and cheese markets date from 2006 with construction financed by USAID. In Podgorica,
there is a new fish market that forms part of a totally new market / commercial centre. In Kotor there
are only two fish stalls, one belonging to one of the main importers / fish farmers (Cogi).
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The number of sellers increases at weekends, with fishermen or their representatives selling fresh fish
directly to consumers.
6.4.3
Retail Shops
Only two dedicated fish retail shops were identified in the survey; one in Herceg Novi and the other in
Pljelva.
6.4.4
Supermarkets
The Montenegrin supermarket sector is in a process of rationalisation, with new investment by a
number of non-local companies leading to concentration (table 16) of ownership.
Table 17: Supermarket Chains
Name
Local Head Office
Maxi
Albona
Podgorica
Podgorica
Novito
Merkator Mex
Voli
Roda
Podgorica
Podgorica
Podgorica
Podgorica
It is reported that there are plans for new investment by several more. 1 New large scale supermarkets
in Podgorica, Herceg Novi, Tivat and Bar that have dedicated fish counters with a wide range of high
quality fresh fish.
One supermarket reports having grown from 4 to 22 stores over recent years. The fish buyer noted
that consumers did not have the habit of buying fish in supermarkets. As the character of the retail
sector continues to change so may consumer buying habits.
Some supermarkets sell fresh trout and this is usually found on the cooked meat counter. The
quantities per store are low.
Away from the main urban centres, retailing in towns with up to 30,000 inhabitants is based on small
supermarkets and convenience stores. These lack the consumer demand and space for dedicated fish
counters, although all sell a range of frozen and canned products.
In some supermarkets, Montenegrin packed frozen product is on sale; usually hake but sometimes
sardine. In contrast to imported product that is well presented in printed retail vacuum packs that
contain all the required information, by-and-large Montenegrin product is of poor quality packed lose
in a plastic bag with little or no information on product name, production date etc.
6.4.5
Restaurants
The survey gained limited information on the demand for fish in restaurants, mainly because the
timing of the interviews (March, April) was out of season. Fish is included on the menus of many
restaurants. Where available, fresh marine fish is a high priced item; at least double the price of trout,
and with a premium over farmed sea bass and sea bream.
Interspar
&
LIDL
see
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Planning for opening in 2015 - BILLA, Kaufland,
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Fisheries inspectors report that they regularly find frozen sea fish and shellfish in restaurants without
delivery/ sales notes. This may represent significant quantities on the coast during the summer, but
was also picked up in the central (Danilovgrad) and northern (Berane) regions.
As supported by information from importers, the demand from restaurants declined from 2008 due to
the economic crisis.
In the limited survey coverage (8 restaurants), the reported sales margins on fresh fish varied between
30 % and 120 %, which was generally higher than meat. The proportion of sales accounted for by fish
varied between 10 % and 90 %. A main issue was price, price variability and continuity of supply of
fresh fish.
6.5
Prices
Historically, the preference of inland consumers for meat and meat products has limited the demand
for fish. In addition the spread of the inland population increases the costs of distribution, especially
of fresh products.
As previously noted, low household incomes impact the Montenegrin market for fish and fish
products. Many consumers do not have the disposable income to buy relatively high priced products
for home consumption, nor to eat at restaurants on a regular basis. The author of this report concludes
that low household incomes lead to a maximum retail pricing point for fish in the north of the country
of €5 per kg. This is to compete with chicken which is retailed at about €6.25 / kg for breasts and
€3.50 / kg whole. Frozen hake fillets may retail at about €3.65 / kg, while trout is usually at about
€4.80 / kg. Cooked product has a price premium e.g. cooked trout at €8 / kg and cooked whole
chicken at €5.00 / kg.
There is limited demand for fresh fish in restaurants unless they are located in tourist destinations.
Two findings are pivotal in any analysis of the fisheries sector. Firstly, demand from tourists sets the
first hand sales price for marine fish. Secondly, imported low value frozen fish supplies domestic
demand for low value protein. At the same time, the market for low cost protein highlights an
opportunity if the Montenegrin fleet can increase the catch of low valued pelagic fish such as anchovy
and sardine.
7
7.1
LEVEL OF ATTAINMENT OF RELEVANT EU STANDARDS
Policy on Fleet
While it is not a standard, EU policy on the fishing fleet has to be mentioned as it has a strong bearing
on the possibilities of IPARD support being used to restructure and modernise the existing fleet.
Presumably this would not prevent Montenegro using its own resources to achieve any fleet related
objective prior to accession.
In general, the fishing fleets of EU member states are much too big compared to the available fish
resources. This has led the EU introduce policies to reduce the pressure on fish stocks by limiting the
overall size of the fleet as well as the amount of time different segments of the fleet can spend fishing
(e.g. by limiting the number of days at sea).
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The main policy is the “entry/exit scheme” under which capacity, measured in vessel tonnage, is not
allowed to rise above the level of 1 January 2003 (or 1 May 2004, for countries that joined the EU on
that date). As reported1 “any new capacity entering a Member State’s fleet must be matched by the
withdrawal of capacity of at least the same amount. At the same time, as a general rule, capacity
leaving the fleet with public aid (i.e. decommissioning schemes) cannot be replaced. This ensures that
the capacity reductions brought about through decommissioning programmes are definitive.
However, it is permitted for Member States to rebuild 4 % of the tonnage that had been
decommissioned with public aid if the increase is designed to improve on-board safety, working
conditions, hygiene or product quality. Member States have to give priority to small-scale fishing
vessels when applying this derogation”.
7.2
Food Safety Standards
The main food safety standards for the fishery sector are contained in three main regulations.



Regulation (EC) No 852/2004 on the hygiene of foodstuffs in all stages of production, processing
and distribution. This includes the standards of moveable or temporary facilities such as mobile
sales vehicles. The primary responsibility for food safety rests with food business operators
(FBO) with the implementation of procedures based on HACCP principles together with the
application of good hygiene practices should reinforce FBO’s responsibility.
Regulation (EC) No 853/2004 lays down specific hygiene rules for food of animal origin. It
includes requirements for the production, harvesting and marketing of live bivalve molluscs such
as mussels and oysters. It also covers the needs for FBOs engaged in fish processing including
fishing vessels and forms of transport. The requirements for fishing boats are very specific and
aimed at reducing the risk that fresh fish can be contaminated after capture and on landing at the
dockside. Requirements are more comprehensive for vessels that preserve fresh fishery products
for more than 24 hours. Among the specifics are the maximum temperature at which fresh fish
must be stored (the melting point of ice). After capture, fish must be protected from the effects of
the sun and undergo chilling as soon as possible after landing. When part processing takes place
on-board, the product must be washed with potable water. The unloading of the fish must be such
as to maintain product quality and avoid contamination. The fish quay must be clean and free
from fumes (such as vehicle exhaust) and product must be placed as quickly as possible in a
protected environment. There must be lockable facilities for the refrigerated storage of unsold
fish. Animals should not have access to the areas where fish is handled. These areas must be well
lit to facilitate official controls. If chilling is not possible on-board landed product must be chilled
as soon as possible after landing.
Regulation (EC) No 854/2004 lays down specific rules for the organisation of official controls on
products of animal origin intended for human consumption.
Commission Decision No 2006/766/EC establishes provisional lists of third country establishments
from which EU Member States are authorized to import fishery products. Countries wishing to export
fish to the European Union have to be mentioned on these lists and each fishing vessel needs an
approval number designated by the Food and Veterinary office of DG Sanco.
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The 2007 Strategy document1 found that “core EC Food Safety Regulations (852/04, 853/04 and
854/04) have not… been fully implemented to all fishery and agriculture products. Specific
weaknesses also need to be removed in relation to other fishery related regulations.2 …These also
require support legislation to ensure that appropriate laboratory testing facilities are introduced.
Institutional changes required relate, first of all, to adoption of Standard Operating Procedures. In a
number of cases, where legislation exists (although not to appropriate levels which are compliant
with the EU standards), industry practices are not appropriate and there is insufficient awareness
within the sector of the need for self-monitoring, such as HACCP. Further education and training of
the Veterinary Inspectorate is necessary. Laboratories should be upgraded to be accredited for full
chemical and micro biological analysis. Support is necessary in introduction of the required changes
to domestic legislation covering food safety for fishery products .. and training in HACCP in respect
to satisfying quality and traceability issues for producers and processors… Despite the technical and
production inefficiencies within the aquaculture sector, there is considerable potential for expansion
in output, and it is not unreasonable to assume that improvements in farm practices, particularly in
the mussels sector, would result in the creation of a competitive industry”.
The 2006 Strategy identified a number of key food safety issues.
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In bivalve growing areas, there was a need for microbiological monitoring at least weekly
complete with a system to trigger closures or reclassification of shellfish waters as soon as they
are found to be out of compliance.
There was a need for regular water quality sampling to check for the presence of toxic algae.
Sampling for contaminants (notably heavy metals) is also needed.
There was a need to monitor bivalves (weekly or more often) for the presence of algal bio-toxins
and to take appropriate (where necessary pre-emptive) action to close or reclassify bivalve
growing or holding sites.
In trout farms, HACCP systems had to be applied. There was continued use of malachite which is
a prohibited substance under the EU Law.
In landing sites fish was kept whole or eviscerated, boxed in 5kg polystyrene boxes with ice, with
a plastic cover between fish and ice. Vessels do not have space for a packaging room. There is
limited access to ice.
Metabisulphite was applied to shrimp (no type of control is followed).
Storage rooms in the vessels had poor insulation (degraded in some cases) and surfaces are not
easily cleanable. In some cases the wooden deck where fish is handled after opening of the trawl
net, was in poor condition;
Chilling in some cases was deficient, with vessels not taking ice.
In landing sites there were no covered area; storage facilities were only adequate in some
establishments; animals were present in the surroundings; sanitary and hand washing facilities for
staff are not easily accessible; and there was no dedicated water supply for vessels.
Aquaculture products were not able to be exported to the EU market due to lack of Residue
Monitoring Programme for products of animal origin (Directive 96/23/EC) and of veterinary
1
ibid
Health conditions for the production and placing on the market of fishery products (268/15), The monitoring of
biotoxins in bivalve molluscs (L75/62, 2002), basic nitrogen (TVB) (L97/84, 2002), lead and cadmium (L77/14
2001), and dioxins and dioxin-like PCBs in foodstuffs (L321/45, 2004).
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2
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medicines in line with the Annexes to Council Regulation 2377/90, “laying down a Community
procedure for the establishment of maximum residue limits of veterinary medicinal products in
foodstuffs of animal origin”. This requirement applies to “aquaculture animals” but not other
fishery products.
Fish landing sites needed: a lockable facility for the inspectors; a covered area to avoid exposure
of the fish to direct sunlight; lockable facilities for the refrigerated storage of fishery products
detained or declared unfit for human consumption; supply of potable water or clean sea or fresh
water; adequate sanitary and hand washing facilities for staff; exclusion of animals; restricted
access to the areas where fish is handled or displayed; potable or clean water for washing fish.
For aquaculture and mariculture there was a need to implement a regulatory framework to ensure
compliance with EU requirements covering legislation, organization, monitoring plan,
implementation measures and results for submission to the European Commission for
consideration for the approval of residue monitoring plans submitted by third countries in
accordance with Council Directive 96/23/EC.
For mussel culture the competent authorities needed to organize a specific operational scheme for
the exports of bivalves and request approval from EU DG SANCO. This includes the designation,
classification, monitoring of production areas for bivalve molluscs (e.g. mussels) with associated
related controls.
Since that date little seems to have changed.


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
The nature of the commercial fishing vessels is such that it is difficult for the existing fleet to
meet the standards required by EU (Reg) No 852/2004. While all commercial vessels have
refrigerated holds and a small cold store have been introduced in Bar with Ministry support, the
state of the vessels and the lack of dedicated landing facilities precludes them from meeting the
overall standard. Ice is infrequently used on small vessels and that may be an issue given the high
ambient temperatures in summer. The chill chain between landing and consumer / sales outlet is
poorly developed.
The situation is the same in fish farming; as noted previously there is limited investment by trout
farms in facilities to maintain the chill chain between the farm and the retailer.
While no incidences have been reported, mussel growers continue to present potential hazard as
even after 3 years the depurification centre is not working, regulations requiring its use have not
been introduced and there is no regular monitoring of the parameters identified in the 2006
strategy.
Progress can be reported in the fish processors with Ribarstvo, Cogi, Montefish and Ahileas all
having developed HACCP systems. While some issues can be identified and it appears that the
competent authority does not revise HACCP plants and related procedures, certainly potential
food safety issues have been addressed and the companies have shown an awareness of the
responsibilities of FBOs.
As identified in the socio-economic survey, only one of the respondents in the aquaculture and
mariculture sectors reported implementing a HACCP plan. The limited number of restaurants
interviewed acknowledged HACCP standards but had limited understanding of the concepts.
Observation of a wide range of retail outlets emphasised their limited understanding of the need to
lower the risk of cross contamination of food products. In contrast modern retail outlets observed
in Tivat, Podgorica and Niksic are of a high standard.
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Another issue is labelling, especially of fish that is frozen or repacked in Montenegro, including
trout. Observation shows that in many retail outlets such product is presented in plastic bags,
sometimes not sealed, that may or may not have a small label. In contrast, imported frozen fish
has the required labelling and is well presented. The canned and smoked fish produced in
Montenegro has the required labelling and is well presented.
7.3
Environmental Aspects
A number of environmental issues relate to the fishing sector, from an ecosystem based approach to
fishery management planning, to the operation of farm units, to the discharge of waste from fish
processing.
The FMP that will be prepared in draft form by end February 2012 will take into account all relevant
environmental aspects, and the eco-system implications of the Montenegrin catch of fish.
In a GFCM meeting in 2010,1 IMB, which is the national laboratory reference for the monitoring of
water quality in fish and mussels farms, noted that there are two fish farms in Kotor Bay and it
considered that fish farms have a negative interaction with the marine environment. The
recommendation was that in the future this type of farming should be located at suitable localities i.e.
in the open part of the Montenegrin Sea in presence of currents. As noted above, this option is
technically feasible, but if any growth is expected in the open sea and in the absence of any subsidies.
In the trout farming sectors of member states of the EU, the driving forces behind the current changes
in production of are strict environmental legislations and the implementation of the EU Water
Framework Directive, which sets water quality standards. It aims to restore the biodiversity and
functioning of all surface freshwater bodies, including; lakes, streams, rivers, groundwaters,
groundwater dependant ecosystems, estuaries and coastal waters, out to one mile from low-water.
Member States must identify and analyse their waters and on the basis of individual river basin and
district they then must adopt management plans and programmes of measures adapted to each body of
water. Action on this is required in Montenegro. In March 2011 there was a workshop in Herceg Novi
held by MARD in cooperation with the SWG GTZ SEF Project: “Strengthening of the regional
cooperation and networking in the forestry and water management sector and sustainable
development in the river basins of the South-Eastern European countries” with a technical discussion
on EU Water Framework Directive.
7.4
IUU Fishing
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Council Regulation (EC) No. 1005/2008 of 29 September 2008 established a Community system to
prevent, deter and eliminate illegal, unreported and unregulated fishing. In order to ensure that no
products derived from IUU fishing appear on the Community market or on markets supplied from the
Community, the Regulation seeks to ensure full traceability of all marine fishery products traded with
the Community, by means of a catch certification scheme. The scope of the IUU Regulation to
prevent, deter and eliminate IUU fishing covers infringements to rules on management and
conservation of fisheries resources in national and international waters.
For processed products imported into the EU and obtained from imported raw materials, EU importers
have to submit a statement issued by the processing company of the exporting country providing
information establishing the link between the processed products and the fish used as raw material.
This raw material should be accompanied by the catch certificates validated by the flag state of the
fishing vessel. The number of the health certificates and the approval number of the processing plant
will be mentioned on the statement to ensure a link with the implementation of health legislation. S
yet Montenegro does not have a working system to monitor catches through log books and dock side
monitoring, while 2011 was the first time since 2008 that fishing vessels have been licensed. On that
basis therefore Montenegro is unable to export fish to the EU.
7.5
Occupational Safety
An EC report1 analyses the implementation of two Health and Safety Directives2 dealing with fishing
vessels and medical treatment on board. The report highlighted that: (i) Directive 93/103/EC does not
apply to vessels of less than 15m in length, but between 60 % and 90 % of the EU fleets is made up of
vessels that are less than 12m in length; and (ii) the high cost of safety equipment discouraged small
ship-owners from acquiring it. Similar problems existed for the implementation of Directive
92/29/EEC. The medicines required on board under the Directive were considered suitable on large
vessels, but posed a problem for medium-sized and small vessels.
The Commission concluded that Directive 93/103/EC posed the greatest problem requiring certain
changes in line with Member State and social partner’s suggestions:

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
8
8.1
More information on accidents and cases of disease particularly recording less serious accidents
and creating a list of frequent diseases and their causes;
The Commission wants the development of new systems for communicating particularly
communication at grassroots level;
The Commission concentrates on the need for better training, adapted to fishermen profiles and
possibilities and not just in the event of maritime disaster;
The Commission also calls on Member States to improve inspections. The Commission suggests
that national labour inspectorates could focus on the sector and cooperate with other inspectorates
In regards to small vessels the Commission felt that extending the scope of the Directive to bring
these vessels under the Directive might lead to an in increase costs for small vessels. The
Commission therefore suggests drawing up a practical, non-binding guide for vessels under 15m
in length at EU level.
PAST TRENDS AND FUTURE DEVELOPMENTS IN TERMS OF
INVESTMENTS
Fish Catching
As can be concluded from the analysis above, in recent years there has only been limited investment
in the fish catching sector. This has led to the catching sector in both marine and freshwaters to
become old and inefficient. In one instance there has been concentration of ownership in the marine
sector with one owner now having three vessels.
1
http://www.euissuetracker.com/en/focus/Pages/Fishing-Vessel-Safety.aspx
Council Directive 93/103/EC on safety requirements on board fishing vessels and Council Directive 92/29/EC
on safety requirements for medical treatment on board vessels
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2
From the outset, it is important is to emphasise that any new investment in the catching sector must be
in the context of an effective FMP that allows for the sustainable use of available resources. While the
FMP has not been defined, it is likely to recommend a substantially different approach to fisheries
management in Montenegro, with one potential objective of diversifying effort away from the
traditional inshore waters. The successful implementation of such a plan would require financial
support to allow new investment in vessels with capacity to fish in deeper waters and the
modernisation of vessels allowed to catch in areas closer to shore. This would be in addition to other
investment aimed at making the fishing operations more fuel efficient so reducing fishing costs. The
aim will be to have a viable fish catching sector in the long term that provides a fair income to the
participants with full and sustainable use of available catch opportunities.
The socio-economic survey found considerable interest on the part of boat owners in the potential for
new investment, with about three-quarters of the respondents in the commercial fishing survey
expressing an interest in acquiring new vessels and fishing gear, including new types of gear, or
modernising vessels.
Many variables dictate the price of a new vessel. Survey respondents’ estimates of required
investment ranged from €80,000 to €1.2 million, with a median average of between €150,000 and
€200,000. Similarly the cost of a new engine was put at between €20,000 and €250,000, with a
median average of between €20,000 and €30,000. For gear the range was €7,000 to €150,000, with a
median average of between €20,000 and €40,000
About one-half of the small scale fishermen who responded to the socio economic survey reported an
interest in new investment with eight planning to replace their vessel and engine within two years
while others wanted to increase the amount of gear. Investment in small boats is substantially less
than for the commercial vessels. New boats may cost between €5,000 and €30,000 (median €12,000
to €20,000), engines €1,300 to €14,000 (median €5,000 to €8,000) and gear €4,000 to €6,000.
Similarly about half of the lake fishermen were considering new investment in boats and engines, the
total cost of which is about €2,000. The gear used for lake fishing costs substantially less than in the
marine fishery; depending on type, replacement gear is said to cost between €150 and €2,000.
There is a need to improve fish finding equipment and vessel safety, while access to ice could be
improved with ice makers on-shore or on-board larger vessels.
Fishermen report two main problems in making new investments; absence of own capital and the lack
of land based collateral as a guarantee for bank loans. Fishermen are unwilling to use capital assets
such as houses as guarantees.
8.2
Recreational Fishing
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It is understood that the only investments in recreational fishing have been in restocking. There is no
indication of the extent of these nor the success. Nor are there any indicators of any new investment in
support services such as motor boats or gear supply shops. The socio economic survey mainly
identified the need for improved controls rather than new investment to develop the potential of the
sector, although some mention was made of restocking programmes.
8.3
Aquaculture & Mariculture
The most recent new investments are in the pilot projects to produce oysters. While one of these farms
provided an indication of the investment cost, given the ease of identifying the enterprise this
information must be treated as confidential.
There does not appear to have been any significant new investment in the production of mussels, sea
bass and sea bream over the past 5 years.
Ten of the twelve mariculturalists responding to the survey indicated an interest in undertaking new
investment to increase the area under production and to farm new species. To meet strategic targets
and reduce average production costs to compete in the market, new investment is needed in the
mussel sector to increase the area under production. The investment cost per hectare is put at between
€20,000 and €40,000.
As noted previously, it is technically feasible to develop an open-sea mariculture sector. However,
investment costs are high while there is limited technical capacity in Montenegro to develop
alternative species. Market demand and limited potential scale are major constraints to development
prospects especially when the bulk of supplies, including fingerlings and juveniles, have to be
imported.
Almost without exception, trout farmers interviewed commented on their financial problems. At the
same time there was an interest in new investment if funds were available for such as regulating water
flow, introducing brood stock, constructing spawning areas, producing juveniles, adding to grow-out
capacity, developing cage farming and diversifying market opportunities with value added production.
8.4
Processing & Marketing
In the past 3 years, Ribartsvo has invested substantial amounts to up-grade its facilities, with a
modernised production area, cold stores and canning lines together with safeguards to ensure the
treatment of waste water. The issue at the moment is not one of capacity, rather it is capacity
utilisation due to lack of raw material at a workable pricing point.
The main issue facing Achileas is market development.
A number of companies are planning new investment, with the construction of cold stores and
processing areas. With the prospect of increased landings of small pelagic fish, one company is
contemplating investment in a new freezer and cold storage capacity.
A range of investments have taken place at the retail level, with new facilities at Montepesca in Tivat
and new fish counters in large supermarkets being of high quality.
However, especially in the north of the country there is a lack of retail outlets and support in this area
could improve the distribution and consumption of fresh fish. The sale of fresh fish along the road on
the coast is a valid marketing strategy but more consideration has to be given to food safety
requirements. While no one had considered the potential, there may be an opportunity for fully
equipped mobile retail fish vans that could change location during the day and attend weekly markets
in a range of towns.
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Finally, there is potential investment in production facilities to add value to frozen fish consumed in
Montenegro as value added products. Currently, the benefit to Montenegro from this type of product
is limited.
9.1
IDENTIFICATION OF POTENTIALS AND NEEDS OF THE SECTOR
SWOT Analysis: Commercial Marine Fish Catching
Weaknesses
1. The fishing fleet can be characterised as old,
inefficient and to a large extent obsolete. Operating
expenses are high and potential days-at-sea are
reduced due to the recurrent need to repair old
vessels, engines and gear.
2. Fishing operations are restricted due to the limited
autonomy of vessels (in inclement weather and in
deeper waters) and this leads to lack of continuity
in supply.
3. The first hand sales price of landed fish is high and
demand falls outside the tourist system. This limits
the days-at-sea.
4. The sector is characterised by small enterprises
with limited finance to improve the fleet with the
introduction of modern technology e.g. multipurpose vessels (i.e. able to use a variety of gears),
better designed fishing gear (more effective
catching and greater fuel efficiency) and better
engines (greater fuel efficiency and ability to fish
deeper waters).
5. There is a lack of private sector liquidity and
limited access to credits on acceptable terms
(guarantees, term, grace period, leverage and
interest rate). Fishermen are unwilling to provide
guarantees based on on-shore assets such as houses.
6. The uncertainty about the quantity of fish available
for harvest on a sustainable basis increases the risk
and uncertainty related to any new investment.
7. There is limited organisation of the sector with no
producer organisation.
8. Stakeholders have a negative view of government
institutions and this is an obstacle to cooperation.
9. To-date there is limited stakeholder input into the
fisheries management process.
10. Many fishermen expect a paternalistic approach
from Government and fail to contribute
adequately to the effective management and
administration.
11. There is inadequate support infrastructure for the
commercial vessels and this increases costs while
reducing competitiveness. The main gaps are
specialised landing places and lack of a slipway to
carry out repairs and maintenance.
12. The cost of inputs such as berthing fees, slippage
and vessel repairs are high. Due to the lack of a
critical mass, a large part of the inputs to the
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Strengths
1. Existing fishermen have a strong interest in new
investment in the catching sector if provided
with adequate support.
2. In the context of overall opportunities for the
national catching sector, the fleet is not
overcapitalised and there is potential for
expansion into non-traditional waters. Such new
investment would reduce the pressure on inshore
stocks.
3. The fleet lands high quality fresh fish which is in
high demand.
4. The Government of Montenegro is in the process
of strengthening management controls and
reducing the opportunity for IUU fishing;
looking to reduce the risk of over fishing and
provide for sustainable use of the available
resources.
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13.
14.
15.
Opportunities
1. New investment in a different type of vessel
replacing existing vessels > 12 m, alleviating
fishing pressure on stocks found less than 12 nm
from shore while allowing Montenegro to benefit
from deep sea fisheries and pelagic fisheries.
2. With new technology, increase the number of
fishing days to add to the profitability of vessels
and reduce the average first hand price of fish
landings.
3. GoM has the opportunity to establish new
regulations and new patterns of activity. The
implementation of fisheries management plans
supported by rigorous scientific analysis, reduces
the risk of over exploitation of marine fisheries
and provides a stronger basis for new investment
in the sector. For trans-boundary stocks this
should be done in cooperation with other Adriatic
countries.
4. To make fuller use of its renewable resources to
generate
sustainable
opportunities
for
employment and income.
5. Support the development of on-shore handling
facilities to maintain product quality and meet EU
hygiene standards.
2.
3.
4.
5.
6.
SWOT Analysis: Small Scale Marine Fisheries
Weaknesses
1. The sector is characterised by individuals with
limited finance to improve the fleet (vessels, gear
and engines). The existing vessels and engines are
old.
2. Off season there is limited demand for the product
and this reduces the potential to improve earnings.
3. Fishermen have limited means to store unsold
fish, with no support infrastructure on-shore. The
market does not provide an outlet for sales
throughout the year.
4. Input costs (berthing (when in a marina), fuel and
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Strengths
1. Small scale fishing is appropriate for in-shore
waters off Montenegro.
2. By its nature, the potential number-of-days at sea
are limited and if correctly managed hold less
threat to the sustainability of natural resources
than larger vessels.
3. The small boat fleet has limited needs in terms of
investment on-shore support facilities.
4. Investment on vessels, engine and gear are
substantially less than for larger vessels and
running costs are lower.
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1.
sector have to be imported and this increases the
costs of operations.
Larger vessels require trained manpower. Local
fishermen do not have the experience to work on
large boats and there are no training facilities to
up-grade their skills.
There is a problem attracting new entrants into
marine fishing.
There is no market for fish all year round and no
on-shore facilities to allow for the production of
quality frozen products.
Threats
Some stocks may be overfished and management
does not recognise the need to limit the potential
for this. International practise increasingly
emphasises the need for sustainable use of natural
resources and where information is uncertain or
unavailable then the precautionary principle
should be implemented.
Limited knowledge of the resource base increases
the risk and uncertainty associated with any new
investment.
Entry to the EU will increase competition in the
domestic market and there is a need to ensure that
domestic producers may respond.
There is limited government support for the
sector.
The National Fishery Strategies have not been
implemented.
Competition from low priced product from the EU
and neighbouring countries.
5. The operating bases of small boats are close to the
main markets, especially local restaurants and 5.
markets.
6. There is a strong interest by current owners to
renew their investments if government support is 6.
forthcoming.
Opportunities
1. To renew the fleet with modern more fuel 1.
efficient GRP vessels, new engines and a wider 2.
range of better gear.
2. Support the development of on-shore handling 3.
facilities to maintain product quality and meet EU
hygiene standards.
4.
5.
6.
7.
9.3
license) are high.
Historically there has been no government support
for the small boat sector and until recently there
was no representative organisation.
There is a problem attracting new entrants into
marine fishing.
Threats
Some stocks may be overfished.
Illegal fishing activities and lack of traceability on
fish supplied in the market.
Limited knowledge of the resource base increases
the risk and uncertainty associated with any new
investment.
Entry to the EU will increase competition in the
domestic market and there is a need to ensure that
domestic producers may respond.
There is lack of government support for the sector.
The National Fishery Strategies have not been
implemented.
Competition from low priced product from the EU
and neighbouring countries.
SWOT Analysis: Commercial Freshwater Fisheries
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Strengths
Weaknesses
1. Lake Skadar has long established commercial 1. The sector is characterised by small enterprises
fishery.
with limited finance to improve the fleet with the
2. The local resource is mainly highly prized
introduction of modern technology (see above).
indigenous species such as carp and bleak for 2. Lack of knowledge of resource base and the
which there is a strong demand.
sustainable level of catch with a fishery
3. There is a strong interest by current owners to
management plan designed to recover stocks to
renew their investments if government support is
maximum sustainable yield.
forthcoming.
3. In the past non-native species (Chinese carp) have
been introduced into the lake and this has affected
the balance of the ecosystem.
4. Lack of adequate fishery management has led to a
reduction in the annual catch.
5. Lack of respect for regulations
6. Limited budget for monitoring activity
7. Fishing techniques have low species selectivity.
8. There is no on-shore support infrastructure (landing
places, stores, fish handling).
9. There is no restocking programme for the Lake
10. Limited market outlets.
Opportunities
Threats
1. Development of a lake fishery that is more cost 1. Overfishing associated with weak fisheries
effective and provides higher incomes to licensed
management.
participants.
2. Environmental degradation.
2. Improved fisheries management and related stock 3. Illegal fishing.
assessments in cross border cooperation with 4. The introduction of non-native species
Albania.
5. Local population migrating to more economically
3. Restocking of the lake with fingerlings able to
grow to harvestable size under natural conditions.
4. Improved marketing.
5. The integration of fishing as a tourist attraction in
locations such as Vizpazar.
6. To develop a Lake fisheries brand.
9.4
developed areas
6. Unregulated fish sales
7. Eutrophication and pollution (industrial and urban)
of Lake Skadar
SWOT Analysis: Recreational Fisheries
Strengths
1. Attractiveness of Montenegro as a destination for
high end tourists (recreational fisheries).
2. Benefits of recreational fisheries to the national
and local economies can be more than
commercial fishing.
Weaknesses
1. Lack of a strategy to develop the recreational
fishing sector with appeal to international tourists.
2. Lack of policing.
3. Lack of policy aimed at clear differentiation
between recreational and commercial fishing
activities.
Opportunities
Threats
1. Recreational fisheries developed as a market 1. Overfishing.
segment for development by the Montenegrin 2. Unregulated fishing.
tourist authorities.
2. Support infrastructure.
3. A targeted restocking programme.
2.
3.
4.
5.
6.
7.
8.
Strengths
Geography, climate and water quality favour
mariculture.
Good amount of surface & ground water.
Good potential sites to expand mariculture
Kotor Bay has high production of mussel spat.
Freedom from major diseases
Strong tourist demand for good quality local
products.
Potential growth in domestic demand for fish
Mussel growing can be a profitable occupation,
especially in the Bay of Kotor, and mussels can
play a part on the cleansing of the water in the
fjord.
Weaknesses
1. The mussel growing sector is rustic with low
levels of productivity and unit production.
2. Small unit production capacity of individual
farms.
3. Unlicensed operators present a risk to the long
term health of the formal producers.
4. The opportunities for growth in the culture of sea
bass and sea bream are limited due to the high
cost of inputs and the consequent problems of
competing with major market suppliers.
5. High production costs.
6. The need to import a large part of the required
inputs
7. Competition with other users.
8. Limited number of species.
9. Limited technical capacity. While training has
been undertaken on-the-job in the development
of existing operations, this does not provide a
strong basis for a widening of the species base.
10. None of the farms have an EIA.
11. Limited opportunity to diversify the market base
by targeting export markets.
12. Access to credit is limited.
13. Expensive inputs.
14. No common marketing strategy.
15. Weak representative organisation.
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1.
SWOT Analysis: Mariculture
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Opportunities
1. Global recognition that aquaculture is the only
way to fill the gap between supply and demand
for fish and fish products.
2. New production systems and species
3. Improved marketing.
4. Confirmation of the zonification of the coastal
zone to allow implementation of long term
strategy for development of mariculture.
5. EU membership will expand potential markets
6. The European market for mussels is
undersupplied.
7. Increased capacity to monitor water quality
8. Increasing demand from tourism
SWOT Analysis: Aquaculture
1.
2.
3.
4.
5.
6.
Strengths
Plenty of good water.
Good local market.
Low labour cost.
Almost no disease.
Growing domestic demand for fish
Family run farms.
1.
2.
3.
4.
Opportunities
Opportunities for cage culture.
Diversification of species.
Unique local market.
The potential to integrate with tourism.
9.7
Weaknesses
1. Limited recent investment in the trout growing
sector.
2. Lack of integrated farms adds to production costs.
3. Limited technical staff.
4. Inefficient FCR.
5. No production planning
6. A weak sector organisation
7. No training or expert assistance to support
innovations.
8. Lack of affordable finance.
9. Expensive inputs.
10. Limited application of HACCP.
Threats
1. The potential negative impact of trout farms on
the riverine environment, especially reducing
flows along the natural river course, especially in
the dry season , the entry of feeds and medicines
into the river system; and the escape of farmed
fish in the wild.
2. Competition from low priced product from the EU
and neighbouring countries.
3. Disease
SWOT Analysis: Fish Processing
1.
2.
Weaknesses
Small national population with low per capita
consumption of fish and fish products.
Low and discontinuous supply from domestic
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Strengths
1. Competitive cost of labour inputs
2. Strong interest in developing processing capacity.
3. Strong interest in HACCP procedures.
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16. Environmental considerations must include
visual aspects and any mariculture facilities must
fit in with the characteristics of the Bay of Kotor.
Threats
1. Mariculture may be threatened by the negative
impacts of other activities particularly where this
adds to pollution e.g. discharge from cruise ships
2. Conflicts in the use of the coastal zone with
competing claims on use of water areas.
3. High fish meal prices.
4. New laws on environmental controls.
5. Concern on future quality of water.
6. EU membership will increase competition
7. On-going development in tourism and housing
without proper sanitation.
8. Unlicensed farm sites.
9. Competition from low priced product from the
EU and neighbouring countries.
4. Short distribution chain.
5. Close proximity of major domestic markets to
coastal landing places
6. Close proximity to European markets for high
quality fish products, including land locked
countries with a market for marine fish.
7. Strong tourist demand for seafood.
8. Growing domestic demand for competitively
priced fish products.
Opportunities
1. Increased national manufacture of added value
fish products based on imported raw material.
2. Better utilisation of installed processing capacity
leading to increased competitiveness in the
market.
3. Processing capacity for increased national
landings of small pelagic species.
4. With lower first hand sales price, added value
production of trout (smoked / frozen / fillets) and
mussel products
5. Further development of the cold and chill chain
SWOT Analysis: Fish Marketing
Weaknesses
Low per capita consumption of fish and fish
products.
2. Supply gap between national fish production
and domestic demand.
3. Limited purchasing power.
4. High price of national product.
5. Limited retail outlets and opportunities to buy.
6. Small markets inland limiting opportunity for
development of larger supermarkets.
7. Lack of formal market outlets for lake fish.
8. Montenegrin housewives are not accustomed to
preparing fish.
9. Any promotional campaigns for fish could just
result in increased imports.
10. Increased urban population requires a renewal
of distribution networks.
11. While there are notable exceptions, some
domestic fish products are not of the required
standard.
1.
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Strengths
1. Short distribution chain for fresh fish between
landing and consumers.
2. Well developed distribution channels on the coast.
3. New larger supermarkets in major population
areas with fresh fish counters.
4. Modern market outlets in some cities.
5. Good quality competitively priced frozen fish
products from international suppliers
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landings.
High first hand sales price.
Limited investment in value added production.
Under-utilised existing processing capacity
(canned and smoked products)
6. Competition from established competitors in
other Balkan countries.
7. Problems in smaller processing operations to
meet EU quality standards with poor
implementation of health & sanitary regulations
and limited understanding of required
marketing standards.
8. Poor infrastructure for post harvest handling
9. Lack of facilities for first hand sales.
10. Limited promotion of fish products.
11. Lack of finance to fund investments.
Threats
1. Competition from imported products.
2. Ownership of supermarket chains by groups
based in third countries that source supply on
the international market.
3. Dependence on the supply of imported raw
materials.
4. More strict conditions to export to the EU
3.
4.
5.
Opportunities
1. Entry into the EU requires incorporation into
national law EU laws and regulations governing
food standards and inspection.
2. Strengthened institutional capacity for monitoring
and enforcement.
3. Increase in the number of retail outlets with
modern market stalls in green markets and mobile
retail shops.
4. Stronger consumer preferences for fish and fish
products as consumers become more aware of the
health benefits.
5. Growing population and increased number of
tourists adds to demand.
6. Improved roads improve the potential to penetrate
the domestic market with lower unit transport
costs.
7. Stronger associations and/or producer
organisations to strengthen the approach to
marketing.
8. A functioning depurification centre for bi-valves.
9. Improved on-shore infrastructure leads to
improved quality.
12. No traceability.
13. Lack of food inspection and enforcement of
regulations.
Threats
1. Poor application of food safety regulations
leads to fish based health issues that lead to
reduced market demand.
10 IDENTIFICATION OF TRAINING NEEDS IN THE SECTOR
10.1 Training Needs for Fishers
The general complaint by owners of commercial vessels relates to the lack of skilled and experienced
crew. In turn, this relates to: (i) a perceived unwillingness of Montenegrins to work on fishing boats,
with a preference for cleaner and safer work on-shore; and (ii) the lack of skills in non-traditional
fishing such as purse seining. If new gears are to be introduced into the fishery, this will have to be
supported by training in the required skills. The option is to bring in experienced fishermen from
elsewhere e.g. Turkish to man purse seine vessels. The specific needs for the sector will become more
clear with the introduction of a fisheries management plan that should confirm the status of the fleet in
the medium to long term. As pointed in the Strategy (2008), it would be impracticable for Montenegro
to establish a fisheries training school, and MARD must assess how to provide more formal training
to skippers and fishermen.
To improve product quality, there should be some training of fishermen in the application of HACCP
procedures on –board and on landing.
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To ensure that the correct approach is adopted to safety, some training will be needed. This should be
related to implementation of Directive 93/103/EC and the contents of any manual that is developed
for vessels < 15 m LOA.
10.2 Aquaculture
The potential for growth in aquaculture should not be limited by skill gaps. Specific training needs
will depend on the nature and extent of any expansion. For example, if there was to be renewed
interest in carp farming, the extension of trout production through cage systems, the scale of any
mussel farms and the whether or not it is considered feasible to develop mariculture in the open sea.
The availability of trained technicians will provide a platform for development of an aquaculture
sector that responds to all he needs to ensure access to the EU market. Under the CARDS project,
conversations were held on developing a post graduate aquaculture course at the University of
Montenegro, similar to the one at the University of Belgrade, but it appears that no steps have been
taken.
The scale of the existing farms makes it difficult; but the need is to provide training to stakeholders on
the application of the required standards, including HACCP and Good Operating Practices which is a
system made up of a collection of procedures that set out how to operate an FBO to produce safe and
suitable food.
10.3 Marketing
Under Regulation (EC) No 852 FBOs are to ensure:



that food handlers are supervised and instructed and/or trained in food hygiene matters
commensurate with their work activity;
that those responsible for the development and maintenance of the procedure referred to in Article
5(1) of this Regulation or for the operation of relevant guides have received adequate training in
the application of the HACCP principles; and
compliance with any requirements of national law concerning training programmes for persons
working in certain food sectors.
There appears to be specific needs in retail outlets and restaurants for training in the handling of fish
products. It is clear that newer businesses are embracing HACCP.
10.4 Consumers
A potential barrier to increased consumption is lack of consumer awareness in how to prepare
product. If domestic production increases, consideration may be given to a promotional campaign that
includes some form of training in how to prepare fish dishes.
11 OUTCOME
11.1 General Recommendations for Development of the Fisheries Sector
11.1.1 Introduction
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Section 5 reviews Government strategy in relation to the fisheries sector. Given the relatively short
period of time since the preparation of the most recent document there has been limited change in the
vision, policy and strategy. However, as previously noted the financial resources have not been
available to implement the related National Operating Plan. At that time it was estimated that a total
of €17 million would be required, excluding the cost of developing designated fish landing facilities.
At the same time, preparation of this document has led to a much better understanding of a number of
issues facing the sector as a whole, and there is now a wider appreciation of the role of small scale and
recreational fishing and the nature of the national market for fish.
Consideration of the potential to develop the fisheries sector must start with an understanding of a
number of basic issues:






No matter how well they are managed, capture fisheries will never supply sufficient fish to meet
national demand consisting of the combined consumption of Montenegrins and international
tourists;
While per capita consumption levels in Montenegro are not as low as previously estimated (due to
the importance of recreational fisheries), they are less than the majority of other European
countries and should, for health reasons, increase towards the EU average. Given the economic
conditions in Montenegro, such increase will only occur if fish is competitively priced.
One way to supply any increased demand from national sources is through augmenting
production from aquaculture. Such growth would reflect the global trend. FAO stresses the
increasingly important and complementary role of aquaculture and inland capture fisheries in fish
production for human nutrition and poverty alleviation in rural areas.1
The other way to meet demand is through imports. An option to the current model of importing
value added product is to support development of a domestic processing sector that allows the
national economy to benefit from the value added in the secondary processing of fish directly
imported from the harvesting country.
The competitive position of national industry will improve if it can source inputs more efficiently
and more cost effectively. There is also the need to contribute to development of the Montenegrin
economy by increasing the multiplier benefits from national production. One way of achieving
this for the fish catching sector is to promote cluster development around dedicated landing
places.
Whatever the initiatives taken to promote private sector development and promote its competitive
position in the context of future membership of the EU should be in the context of a capable and
efficient public sector that has the ability to fulfil its own role in partnership with the private
sector. Montenegro is a young country and many institutions require strengthening so that they
can meet this role. Given the scarcity of public sector finance, the roles of public institutions
should be rationalised wherever possible to avoid duplication of effort.
The proposed approach to IPARD funding should be consistent with EU policy for member states
with any assistance provided consistent with EU policy aims. This should allow for the IPARD
process to be considered a first step with further progress achieved in the future using new financial
instruments that may be available to Montenegro. For example, although it is not yet a member,
Croatia has prepared documentation for aid under the European Fisheries Fund (EFF).
The aim of the EFF (2007 – 13)2 is to improve the sector’s competitiveness and help it become
environmentally, economically and socially sustainable. To achieve this, it has a budget of €3.8
http://www.fao.org/focus/e/fisheries/sustaq.htm
See http://ec.europa.eu/fisheries/documentation/publications/cfp_factsheets/european_fisheries_fund_en.pdf
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billion (or € 4.3 billion in current prices) for the seven-year period 2007- 2013. Funding is available
for all sectors of the industry: sea and inland fishing, aquaculture, and processing and marketing of
fisheries products. It follows the previous the Financial Instrument for Fisheries Guidance (FIFG).
Compared to the FIFG, the EFF contains several innovations. These include assistance to fishermen to
move towards more selective fishing methods, increased emphasis on sustainable fishing and
measures of common interest, including pilot projects, finance for local development strategies and
support for aqua-environmental measures. No funding is available for the construction of new vessels
or to increase the size of the holds of existing vessels. In common with the other EU structural funds,
EU financing cannot be used alone, but only to complement national, regional or local expenditure.
The EFF targets five priority areas.





Adjustment of the fleet (axis 1). If a Member State decides to cut fishing opportunities, aid may
be available for vessels permanently or temporarily ceasing their activities. Aid can also be given
for a range of other operations: on-board safety and working improvements, more selective gear,
small-scale coastal fisheries, socio-economic measures including early retirement, and retraining.
Vessels in certain fleet segments may receive aid to replace their engines to make them more
energy efficient, but not more powerful.
Aquaculture, processing and marketing, inland fishing (axis 2). Aid is available for diversification
into new aquaculture species and species with good market prospects, environmentally-friendly
aquaculture, public and animal health measures, processing and marketing of fisheries and
aquaculture products, and lifelong learning. Special provisions exist for inland fishing, reflecting
its importance in central and Eastern Europe.
Measures of common interest (axis 3).These are activities not normally supported by the private
sector and whose overall importance goes beyond the commercial interests of individual
companies. They can include protection and development of aquatic fauna and flora, ports,
shelters and landing sites, development of new marketing and promotional campaigns, pilot
projects and other collective actions.
Sustainable development of fisheries areas (axis 4). Funding in this category is based on local
development strategies, reflecting a bottom-up approach. It aims to help local communities reduce
their economic dependency on fish catches. Coastal communities, and those near lakes and ponds
with a significant level of employment in the fisheries sector, are eligible for EU aid to strengthen
their general competitiveness, add value to fisheries products, develop tourism infrastructure and
services, protect the environment, and encourage interregional and transnational cooperation.
Technical assistance (axis 5). This category covers items such as studies, reports, information
activities and other actions relating to the implementation of the operational programmes.
11.1.2 Marine Fisheries
The weakest point of the supply chain for fresh fish is continuity of landings and the sustainability of
fish stocks. Another issue is fish quality while a third is infrastructure. This is in the context of an old
and technically inefficient fleet.
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The foundation of any new investment in the marine fish catching sector is the implementation of a
fisheries management plan based on a strong understanding of the fishery resources available on a
sustainable basis, with licensed fishing capacity and related effort linked to the medium to long term
harvest possibilities.
There should be no public financial support for new investment in the fish catching sector
unless it is in the context of an FMP that has been agreed and implemented by all stakeholders.
The effective implementation of an FMP will require continuing support for the four different entities
that have roles and responsibilities for marine fisheries management planning: MARD administrators
with duties as fishery managers; MARD fish inspectors charged with enforcement of the laws and
regulations; IMB to provide advice on stock status; and something like the National Marine Fishery
and Mariculture Council to represent stakeholder interests.
Current understanding indicates that inshore stocks of demersal and shellfish species targeted by
commercial and small scale vessels are close to or beyond their maximum sustainable yields
(although there may be exceptions that present new fishing opportunities e.g. clams (vongole)
(Veneridae)). The situation will be confirmed in late 2011. However, IMB findings must be regarded
as indicative and the Institute will have to continue its research for several years in order to establish
rigorous scientific assessments. In the meantime the precautionary approach must be taken to fishery
management.
If inshore stocks (i.e. stocks within 8 miles of the baseline) are overfished or close to the limit of their
annual maximum sustainable yield, it is advisable to diversify effort with the introduction of larger
boats that have the autonomy and capacity to fish deeper waters, including those outside the 12 nm
national limit. These should replace and not be in addition to existing commercial fishing vessels
and they should only be licensed to fish in waters outside a defined limit within the Montenegrin
fishing zone. The number of vessels required will depend on estimates of sustainable resource
availability in the context of competing efforts of neighbouring countries in international waters and
international policy on national fleet capacity. The FMP will advise on the possibilities taking into
account GFCM and EU policy.
Commercial fishing vessels that are not replaced by larger vessels should be more efficient in order to
reduce fishing costs and improve profitability. Old engines should be replaced by more fuel efficient
modern ones, while a modification in fishing methods with use of static as opposed to mobile gear
would lead to reduced use of fuel.
Any modernisation of the fleet should consider the resulting increase in fishing power i.e. modernised
and new boats have a greater harvesting capacity than the current fleet. Any changes that led to more
fishing days or more effective fishing in the same number of days would have to be reflected in the
fisheries management plan, with consideration of reducing the number of licensed vessels. The needs
for this and the mechanisms for doing so will be considered in the FMP (e.g. the leasing of fishing
rights providing fishermen with the option of fishing or selling their “quota”, with safeguards to
ensure concentration of fishing rights so as to limit the consequential social effects i.e. reduced
employment).
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New investment in the commercial fleet is also required to maintain product quality and ensure
compliance with EU regulations. In addition, there should be an examination of on-board safety and
investment needs related to Directive 93/103/EC.
The incomes of small scale boats are relatively low and may reduce once they have to compete in a
Montenegrin market that is fully open to imports from EU and EFTA countries. Earnings could be
increased by catching more fish e.g. with vessels working more gear. At the same time, it is important
to recognise that similar to larger boats the activity of small scale fishing boats must be regulated; it is
the same as commercial boats; too much effort by small boats can challenge the sustainability of the
resources. Appropriate management measures should be included in an FMP that would look to
restrict annual effort commensurate to sustainable yields.
Improved fuel efficiency could lead to higher net incomes and this may achieved by the introduction
of new engines.
To meet EU regulations a number of actions are required including the effective implementation of
VMS for larger vessels, the completion of log books etc.
Currently, there is uncertainty as to the future availability of the only area provided for landings by
the commercial fleet which is in Bar marina. Given the need to develop infrastructure for tourism it
appears to be only a matter of time before this space is unavailable or user fees are too high for the
fishing fleet. In the Bay of Kotor there are no dedicated landing facilities.
It is an understandable and legitimate aspiration of the fish catching sector to have modern landing
and berthing facilities, the creation of which would have the additional benefit of providing a base for
cluster development that would promote multiplier benefits accruing from the fish catching sector.
Commercial fishing vessels could operate more efficiently in dedicated fish landing sites which offer
required services while providing safe berth for vessels. Designated landing sites for commercial
vessels would also facilitate more effective management, with for example 100 % dockside
monitoring of landings. The facilities (e.g. lighting, fencing and cold stores) would allow fishing boats
to meet Regulation (EU) No. 853/2004.
Port design is based on a number of factors, the most important of which is the number and size of
vessels that may use the facilities. Required new investment may be relatively high and there must be
a clear identification of needs to minimise spend while maximising efficiency. Accordingly, in the
context of potential fleet restructuring, a major issue is the nature and characteristics of the any
facility(ies). The needs of any support infrastructure are uncertain; for example how many fish
landing places are needed in Montenegro, where should they be located, what is the most cost
effective solution to the identified problems, what is the length of quay required etc. This would
indicate that any decision on fish landing infrastructure should be based on a study to; (i) define a
strategy for fishery related infrastructure;(ii) identify options; (iii) provide outline costs; and (iv)
complete a techno-economic cost benefit analysis.
Fishery organisations remain weak and it is important that efforts continue to strengthen them.
11.1.3 Freshwater Fisheries
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The problems in the main freshwater fishery (Lake Skadar) are similar to those in the marine fishery
i.e. apparent past overfishing has led to a drastic reduction in the annual harvest. While the reasons for
declining catches are not clear, a priori reasoning would lead to identification of the main culprit
being too many boats harvesting too few fish, exacerbated by illegal fishing, lack of understanding of
the maximum sustainable yields in a well-managed fishery, poor enforcement of the law and
associated regulations, and no fishery management plan developed in cooperation with the Albanian
authorities.
No support for new investment in the fish catching sector should be considered unless it is in the
context of an FMP that is agreed between all stakeholders.
This FMP should be based on a strong understanding of the sustainable yields from the fishery. This
will require support for the different entities that have roles and responsibilities for Lake Skadar
fisheries; the National park, MARD, enforcement officers, the University of Montenegro to provide
advice on stock status and a body to represent stakeholder interests.
An FMP would define the level of fishing effort required and whether or not the number of active
boats is appropriate to the scale of fishing opportunities in the medium to long term.
Within the context of an FMP, the objective would be to support new investment to make the sector
more competitive and increase the incomes of fishermen. This may imply a reduction in the total
number of boats operating. Similar to the policy for the marine catching sector, fishery administrators
should recognise that the formal fish catching sector cannot be used as a proxy for welfare support to
the general population, using it to provide employment while allowing recreational fishermen to sell
fish commercially in order to supplement low incomes from other activities. While such a policy is
workable in the short term, as experience has shown in other parts of the world, the end result is over
fishing and reduced incomes.
In the assumption that total effort of the fleet is in line with the annual sustainable yield, a number of
areas may be considered for new investment. There is need for consideration of support for on-shore
infrastructure (stores for fish and gear), direct marketing and restocking, while there should be
investigation of how to improve security for nets to reduce the incidence of theft.
11.1.4 Recreational Fisheries
There are two main issues related to the recreational fisheries sector.
The first is to limit the maintained catch and reduce competition for commercial fishermen who work
in the sector as a means of livelihood. In effect this implies that license requirements and related
enforcement have to be strengthened and those that wish to sell their catch must take out a small
fisherman license. For marine fisheries, this will be covered in the up-coming fisheries management
plan. It is important that a similar approach is taken to the management of Lake Skadar fisheries.
The second issue is how to develop the offer of the recreational fishing sector to widen the range of
activities open to international tourists and further spread the benefits of such tourism away from the
coast.
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The major fishery related issues are enforcement and, for fresh waters, a restocking programme, with
preference for autochthonous fish species. Also related is the need to improve regulations and limit
the potential for poaching. It would be useful to assess the potential to increase the local supply of
imported inputs; one possibility is to assist clubs to import on the account of their members. One
feature of recreational fisheries is the strength of the representative organisations.
11.1.5 Aquaculture
It is widely accepted that the importance of aquaculture in supplying protein is growing and will
continue to do so in the coming decades. Recent data illustrates that the production of 1kg of finfish
protein requires less than 13.5 kg of grain, compared to 61.1kg of grain for beef protein and 38 kg for
pork protein. This is significant when taken in the context of the issues affecting the rest of the
Montenegrin agriculture sector and the need for food security.
There are substantial development prospects for freshwater fish farming in Montenegro if the sector
can develop to the stage where it will be able to compete in the medium to long term with producers
from neighbouring countries. Development needs have been well analysed. Firstly, to make the sector
more competitive the scale of operations will need to increase and better use has to be made of
production capacity. The initial aim should be to increase the current annual production from the
estimated 600 mt to 1,000 mt. This indicates the need to support farms that may develop vertical
integration providing facilities for broodstock, fingerling production and grow-out. Secondly, any new
investment in inland fish farming must be in areas where there is continuity of water supplies within
the context of a management plan as required by the EU Water Directive. This implies the
introduction of measures to maintain water quality and these would have to be respected by all farms.
Given the seasonal flows of riverine waters, intuitively this would infer concentration on cage culture
in lakes but the final decision on this would be dependent on the techno-economic study included in
any business plan prepared in support of investment proposals. Thirdly, there should an analysis of the
potential to expand the range of species. Fourthly, there should be new investment in increasing
productivity and improving the FCR. Lastly, there should be support for the adequate marketing of the
product, including consideration of the potential to extend the range of product beyond gutted fresh
fish. Any increase in the scale of the farms would require trained personnel.
Construction and modernization of fish and aquaculture farms includes:
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Re/construction of breeding basins and facilities;
Re/construction of and purchase of equipment for hatcheries;
Purchase of feeding equipment;
Purchase of specialized transport facilities;
Construction and modernization of facilities for primary processing – cleaning, cooling or
refrigerating of the fish/aquaculture produced by the farm;
Purchase and installation of treatment facilities for waste waters from the farm
Purchase and installation of equipment for monitoring and control of water quality for the farm
Construction and modernization of storage facilities.
Increased output should lead to price competitiveness of national aquaculture product, with lower
prices leading to increased consumption. At the same time, there would be an opportunity for added
value products such as smoked trout. Similar to other products, locally produced trout can be branded
as part of the marketing strategy. The price of local products is less affected by any increase in the
cost of transport.
There may be opportunities for developing the culture of species in warm waters, for example the
cage production of carp in Lake Skadar. However, any initiative in this sphere would require a full
feasibility study.
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Similar to the marine catching sector, the representative organisation has to be strengthened.
11.1.6 Mariculture
Despite efforts, development of mariculture in the past 5 years has been limited to test production of
oysters and work towards completing the depurification centre. Institutional support and monitoring
by the authorities have not improved. This provides a poor basis for any further development from
current estimated annual production of 110 mt of mussels towards the target of 2,500 mt. Simply put,
if mariculture is unable to become more competitive in terms of farm-gate price and guaranteed
quality, its future prospects are limited.
New cages for sea bass and sea bream have an investment cost of about €25,000, while each
additional tonne of mussels needs an investment of about €12,500. The investment cost for the
location of mariculture facilities in the open sea is substantially more and is not considered viable at
this stage.
The aim is to increase growing area for bivalve molluscs from the current approximate 15 hectares to
50 hectares, within the terms of a defined and approved marine spatial plan for the Bay of Kotor to
ensure long term stability of the enterprise. Given the limited financial means of the owners of current
farms, financial support must be provided; however this should only be given to those farms where
significant expansion is possible in the existing growing area. A pre-requisite of support for any new
investment is the establishment of the procedures needed to allow export of product to the EU.
Similar to the marine catching sector, the representative organisation has to be strengthened.
11.1.7 Fish Processing
As stated in the 2008 strategy, a main opportunity is the manufacture of value added products, in part
resulting from the competitiveness of Montenegro’s relatively low wage structure. The potential for
this has been emphasised after further analysis of trade data and recognition that a major part of fish
consumed in Montenegro is imported value added product manufactured by secondary processors
located in regional countries using fish caught in other countries. Support should be provided to
enterprises that wish to invest in added value production in Montenegro. This would provide
processing capacity for fish caught by the domestic fleet outside the tourist season and add to the
potential for developing the harvest of small pelagic species.
Some of the locally produced and packed frozen fish currently on sale in retail outlets is not of the
required quality and is not packed and labelled according to standards.
11.1.8 Fish Marketing
While recent years have seen strong progress in improving facilities available for fish marketing
(dedicated fish markets in Bar and Podgorica, a modern fish retail outlet in Tivat and fresh fish
counters in the newly introduced large supermarkets), substantial work remains to be done to: (i)
improve access to fish; and (ii) improve food safety. The potential for improved market access could
be explored though a number of mechanisms: (i) assistance to municipalities to provide dedicated fish
stalls at existing green markets; (ii) support to enterprises who want to develop their own retail outlet;
and (iii) support for the introduction of mobile retail shops that would serve a number of markets.
11.2 Recommendations for the Preparation and Implementation of IPARD
11.2.1 Introduction
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Support for the fisheries sector from IPARD funding can be considered under three axes:
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Axis 1
o Assist the production sector to restructure and to upgrade to Community standards.
o Setting-up of producer groups.
o Support the food industry to restructure and to upgrade to Community standards.
Axis 2
o Actions to improve the environment and the countryside.
o Support of local rural development strategies.
Axis 3
o Rural infrastructure.
o Diversification and development of rural economic activities.
o Improvement of training.
o Technical Assistance.
Reflecting the advice of the consultants who prepared the IPARD sector strategy for the meat sector,
it is considered that successful implementation of the IPARD programme will need advisory services
to potential beneficiaries in the preparation of sound investment proposals and applications and
facilitate the access to bank services to ensure the pre-financing and private co-financing needed
under IPARD (e.g. guarantee funds).
Consideration of the proposed use of IPARD funds to support development of the fishery sector and
strengthen its competitive position is based on a number of important premises.
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There is a limited total budget and the part allocated to the fishery sector will probably be limited
to the extent that it reflects its current proportionate contribution to the GNP attributable to the
agricultural sector.
A range of issues have been identified that will contribute to the development of the fishery
sector. The proposed programme should not be over ambitious and aim to provide financial
assistance for all possible activities and all participants; rather it should be selective so that the
level of funding can make a real difference to development prospects.
IPARD funding is not a source of social welfare; care has to be taken to identify and implement
actions that contribute to efficiency rather than maintain the status quo and, where it exists,
inefficiency.
Preference should be given to those with the capacity for change and development and to take the
steps needed to modernise the Montenegrin fishery sector. It may be argued that this is
inequitable. This is not the case – the reality is that if development and changes do not take place
the whole sector will suffer from the inability to compete as full members of the EU. The
successful implementation of individual projects that make the participating enterprises more
efficient should act as drivers for change in other enterprises that may subsequently be eligible for
assistance from other financial instruments.
Prioritisation that will lead to selective IPARD funding means that there will be “winners” and
“losers”. However, the aim should be that the changes resulting from IPARD funding result in a
net benefit to the Montenegrin economy i.e. higher total employment and income and greater
efficiency. The aim is to ensure sustainable enterprises with the capacity to compete in an open
market while providing fair and equitable incomes to the employees.
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It may be that some of the existing agents in the sector will chose not to participate for a variety of
reasons such as the owner’s age, the current location of their business being unsuitable for
expansion, lack of interest etc.
IPARD funding should be seen as a starting point for implementation of the National Fisheries
Strategy; additional funds may become available later to further develop the operational
programme.
Recommendations made below relate to Axis 1 and Axis 3; there are no recommendations for Axis 3.
11.3 Proposed Measures under IPARD Axis One
11.3.1 Marine Fisheries
The situation regarding assistance to the marine fish catching sector is complicated due to the EU
policy of not supporting new capacity in the fleet. While this position will be clarified in the FMP, at
this stage it is not proposed that IPARD support new build, however strong the case may be for
renovation of a technically obsolete fleet. It is suggested that if the concept of developing a new fleet
segment of larger boats with greater autonomy is accepted, the Montenegrin government provides its
own funds when this does not lead to an increase in the total number of boats licensed by the
Montenegrin authorities.
IPARD funding should be made available to making some of the existing vessels more efficient with
new engines and new and improved fishing gear (including the introduction of new types of gear as
allowed by Montenegrin regulations) that are designed to reduce fishing costs and improve
profitability. At the same time, assistance should be given to modify vessels so that they can meet EU
food safety regulations, with functioning systems to chill fish and reduce the potential of
contamination from dirt and diesel, while protecting the product from the elements during unloading.
This approach fits with EFF axis 1.
For new engines the minimum criteria should relate to the age and seaworthiness of the vessel and the
age of the engine. Once the concept is accepted the actual criteria may be defined in greater detail e.g.
the replacement of engines over a certain age. Not all vessels would be assisted. It goes without
saying that vessels provided with a new engine will also need to satisfy other requirements related to
food safety and on-board safety.
Figures above indicate there is a wide variation in the estimated cost of a new engine (€10,000 to
€250,000) with a mean average of €65,000. Respective figures for replacement gear are €5,000 to
€150,000 with an average of €46,000.
No information is available on the cost of maintaining the quality of fish and on-board safety
equipment.
Further funds should be available to support on-shore investments to maintain and store the foish,
such as cold stores, ice makers and refrigerated transport.
11.3.2 Lake Fisheries
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IPARD support should be limited to developing on-shore infrastructure for storage of boats,
equipment and product. If fish is caught and sold live, this could include investment in holding tanks.
There should be no support for the catching sector in terms of boats and engines until there is a clearer
idea on the maximum sustainable yield of fish resources found in the lake and an agreed transboundary fisheries management plan with Albania.
11.3.3 Recreational Fisheries
The potential for IPARD funds is limited to assisting the recreational fishing sector in the restocking
of lakes and rivers.
11.3.4 Aquaculture
While there a number of issues related to the development of the fish farming in fresh waters, given
the limited IPARD funds it is suggested that assistance be limited to expanding production at a select
number of farms and making them more efficient with the intention of reducing production costs. In
turn, this will lead to the sector becoming more cost competitive. Assistance should be provided
within the context of a water management plan that meets the needs of the EU Water Directive.
Given the issue of continuity of fresh water supplies, assistance should only be provided for
investment at those sites that can guarantee continuous supply and should be restricted to enterprises
with existing investment in the sector. The types of investment to be supported are: new or increased
grow-out capacity; improved brood stock and increased vertical integration with the production of
ova, fish fry, fingerlings and juveniles. Farms that are supported will be expected to meet all other
standards with the implementation of HACCP and Good Operating Practices, while introducing
measures to increase profitability such as improved FCR, and further IPARD support should be
available to meet those objectives.
Complementary action is needed in the public sector to support development in the private sector with
the aim of improving national capacity to promote sustainable and healthy aquaculture production for
domestic consumption and trade. This will require the design and implementation of a national AAH
strategy (see above).
11.3.5 Mariculture
Similar to aquaculture, emphasis should be on increasing production of specific enterprises with the
aim of creating economies of scale and reducing costs and first hand sales prices. Assistance should
be provided within the context of Marine Spatial Planning for the Bay of Kotor and the
implementation of public sector activities designed to facilitate the export of product e.g. monitoring
water quality and residues, which could form part of national AAH strategy.
The enterprises that receive IPARD assistance must also implement HACCP and Good Operating
Practices to reduce the risk of compromising food safety. IPARD support should be available to meet
these objectives.
11.3.6 Fish Processing
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In recent years, individual companies have undertaken significant investment to increase processing
capacity for lake fish, trout and carp. At the moment, however, the utilisation of installed capacity is
low due to supply and/or marketing problems. These companies could receive further assistance to
increase capacity utilisation, with a policy designed to encourage value added production of imported
frozen fish for sale in the domestic and export markets, substituting for the imports from other
countries in the region. The potential for this is related to the buying policies of the supermarket
chains that through the on-going rationalisation process in the retail sector hold an ever growing
market share. If this business proposition is to be successful, the quality and pricing of products must
be competitive with currently established market leaders.
11.3.7 Fish Marketing
If fish consumption is to be increase, consumers have to be provided with the opportunity to buy.
While towns on the coast and in the major cities are served by direct purchase from boats, retail
shops, green markets and supermarkets this is not the case in smaller inland towns. At the same time,
the size of population in the individual towns and their relative isolation limits the potential for large
supermarkets with the floor space necessary to justify contemplation of a fresh fish counter. On that
basis, it is proposed that IPARD funding should be available to fund new retail outlets with support to
municipalities for specific stalls in existing green markets, enterprises interested in opening shops and
mobile shops with the capacity to serve a number of markets.
11.4 Proposed Measures under IPARD Axis Three
Three interventions are proposed for Axis 3 and these relate to technical assistance.
1. A priority is the preparation of a detailed fish harbour strategy, with an options analysis,
identification of needs, outline plans and a techno-economic feasibility study. The output will be
recommendations on development of fishery specific landing facilities together with on-shore
complementary assistances in support of a cluster development.
2. Assistance in the design and implementation of a national AAH strategy.
3. Assistance in the valuation of prospects for aquaculture on Lake Skadar.
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The outputs will form the basis for new proposals with the context of any future financial packages
for the fishery sector in the future.