Analysis of the crab quotas users in the Far East indicators by business sc…

Analysis of the crab quotas users in the Far East indicators by business scale

Industry Economic

November 11th, 2022

The organization of the marine fishery, by definition, requires higher costs and, accordingly, the profitability of the business than is envisaged for SMEs. Therefore, the share of small business in the crab sector is extremely small: 7% in the Far East in the absence of small crab enterprises in the North. 60% of Far Eastern small businesses are affiliated with large enterprises, half do not have their own vessels, quotas are leased to large businesses.

Crab quota users by business scale

As the analysis shows, the volume of quotas in the use of SMEs does not allow for optimal loading and, accordingly, efficient operation or timely renewal of crab fishing vessels. With the required volume of quotas of 1 thousand tons per vessel, this figure for SMEs is on average 244 tons.

The financial indicators of enterprises confirm that the principle of quota distribution cannot have a significant impact on the state of small business: before the first investment auctions for crab quotas, its profitability did not exceed 1%. Low profitability and small business benefits do not generate income for local and regional budgets, do not provide high levels of wages and personal income tax, typical for marine fisheries. Employment in independent small enterprises does not exceed 5% of the crab fishing segment or 700 persons.

Economic indicators of "historical" crab quotas users

Small businesses usually work as contractors for large infrastructure projects. With the development of the investment quotas program, new opportunities open up for SMEs in providing a wide range of services for new onshore plants and vessels.