Mark Carney warns of 'market failures' from overfishing in world's oceans
9 March 2018, 02:21
The world's oceans are facing a "market failure" that risks triggering the extinction of fish species, the Governor of the Bank of England has warned.
In an exclusive interview with Sky News, Mark Carney has become one of the most influential voices to warn of the sustainability of humankind's relationship with the sea.
His intervention comes amid growing evidence that fish stocks worldwide are diminishing following decades of overexploitation.
With industrial fishing fleets employing ever more sophisticated techniques to catch fish, including the use of remote nets and electrical pulse systems, scientists have warned that unless there are restrictions on fishing the world could have exhausted the main species of fish by the middle of this century.
Mr Carney, who has spoken out previously about the risks posed to the financial system by climate change and rising sea levels, said the problems were a consequence of an economic theory known as "the tragedy of the commons", whereby individuals can, left unchecked, overuse their shared resources.
:: In Too Deep: The race to save our 'Wild West' seas
"It's individually rational behaviour: the cost of having another cow on that on the common pasture - for the individual it's a net benefit but for the group it can lead to overgrazing and net cost. The extra fishing trawler in the high seas - again, individual benefit. But for the world: overfishing potential extinction of some fish stocks. So those are market failures."
He said it was up to governments across the world to attempt to intervene, since the high seas, where much of the fishing happens, is beyond national jurisdictions and rules.
Mr Carney pointed out that Lloyds of London, the world's leading insurance market, had seen costs and claims rising significantly as a result of increasingly frequent extreme weather events.
"If you're insuring coastal property in the US you have to take into account climate change risk and the rise in extreme weather events - or else you'll probably be out of business soon," he said.
"When climate change really becomes a core financial stability risk for banks and others it could be too late... We don't have a solution to that."
However, he said that since much of the innovative thinking about how to deal with climate and environmental issues had come from the UK, the challenge represents an opportunity for the City and the financial system.
Nonetheless, with many politicians - most notably US President Donald Trump - still sceptical about the reality of climate change, the Governor's intervention remains controversial.
Fishing lobby groups insist that they are behaving responsibly, and that they merely follow quotas imposed by politicians - most prominently the EU, whose fleets fish in many waters around the world.
:: In Too Deep airs on Sky News on Friday at 9pm
(c) Sky News 2018: Mark Carney warns of 'market failures' from overfishing in world's oceans