Fisheries Minister Cadmiel Muthemba told AIM that this measure aims at solving the crisis the fishing companies are facing. Some claim that the high costs of fuel are bankrupting them.
Muthemba said that a team from the Fisheries and Finances Ministries is studying the possible effects of reducing the tax, currently fixed at 3.73 meticais per litre (at current exchange rates, there are about 25.7 meticais to the US dollar).
However, businesses in fisheries, agriculture and industry have already received tax reductions, and are only paying half this amount. Nonetheless, the fishing operators claim that it is still too much.
"I hope to have some solutions before the end of this year, to enter into force by 2008", said Muthemba. So the fishing companies will receive no relief for this year's prawn fishing campaign, which ends in November.
Muthemba acknowledged that fuel accounts for about 50 per cent of the operational costs of prawn fishing. He said that of the 56 licensed industrial fishing ships, on average, between March and June, four of them were not putting to sea due to the high costs of fuel.
Of the 16 licensed semi-industrial boats with a freezing system for conservation of their catch, only seven are operating, and of the 25 licensed to use ice, only 13 are going to sea.
There are also eight ships licensed to fish for deep water prawns {gamba}, but one of them is also not operating, due to the high price of diesel.
The secretary general of the Mozambican Industrial Prawn Fishing Association (AMAPIC), Joao Mangave, told AIM that the problem can only be solved if the government completely removes the tax on fuel for fishing vessels. Another possible solution would be to revoke the monthly quotas of fuel for each boat, he said.
For instance, an industrial fishing ship, of between 950 and 1,320 horsepower, has the right to 74,000 liters of tax-reduced diesel a month during the fishing period (between March and November), and only 24,000 liters a month for the rest of the year. Mangave regarded the fuel rationing as "typical of centralized economies".
"The real fuel consumption when the ship is at sea is much higher than these quotas, because, besides having more than one engine using diesel, it has to carry-out many manoeuvres during bad weather to avoid sinking', explained Mangave. For the extra fuel there is no tax reduction.
Although acknowledging that the real consumption of fuel in the fishing industry is far higher than the fixed quotas, Muthemba says that what will happen is a reduction of the tax, not its total removal.
"We will perhaps not eliminate the tax, maybe we will reduce it a little further, but this is still under study, and we do not know to what extent it will be reduced. But we will work on the data for real consumption", he said.
Muthemba also noted that the problem for the fishing industry is not simply the tax on fuel, but also the fall in the price of prawns on the European market because of competition from aquaculture prawn producers in Asian and Latin American countries. They can sell cheaper prawns, because their production costs are lower.
In Mozambique, of the 13,000 tonnes of prawns exported in 2006, only about 1,000 tonnes came from aquaculture, in Beira, Quelimane and Pemba.
Adding to their difficulties, most Mozambican fishing companies hire their vessels and now face difficulties in paying the owners of the boats, because their profits are low.
The semi-industrial fishing companies who use ice to preserve their catch also face the problem of not accessing the European market, because this technology does not guarantee proper conservation, and so falls foul of European Union health regulations.
Muthemba said that prawns represent about eight per cent of the country's exports earnings, bringing in more than 96 million US dollars in 2006.
SOURCE: AIM
