Fisheries Subsidies, Market Distortions, and Their Effects on Sustainability Outcomes in the Nigerian Blue Economy

This research analysed the structure, magnitude, and sustainability implications of fisheries subsidies operating within the Nigerian blue economy, contributing an original empirical assessment and theoretical framework for subsidy reform that accounts for the specific institutional and distributional context of Nigerian fisheries. Global evidence consistently demonstrates that capacity-enhancing subsidies accelerate overfishing, yet the fiscal architecture and distributional consequences of fisheries subsidies in Nigeria have not been systematically examined. The study employed a multi-method approach combining a comprehensive subsidy inventory through government budget analysis and stakeholder interviews, a computable general equilibrium economic model to estimate market distortion effects, and a distributional analysis of subsidy benefit incidence across fishing sector segments. Primary data were collected from federal and state fisheries agencies, fishing industry associations, and international trade documentation. Results documented total fisheries subsidies in Nigeria exceeding 18 billion naira annually, of which approximately 62 percent were classified as capacity-enhancing based on World Trade Organisation taxonomy, 28 percent as ambiguous, and only 10 percent as clearly beneficial to sustainability. Fuel subsidies directed at the commercial trawl fleet represented the largest single category, estimated to sustain a fleet size approximately 2.3 times the economically optimal level. Small-scale artisanal fishers received disproportionately low shares of total subsidy benefit relative to their contribution to national landings and food security. The general equilibrium model confirmed that subsidy removal without compensatory measures would cause short-term fishing community income declines of 19 to 31 percent, underscoring the need for sequenced reform. The study recommends a National Fisheries Subsidy Reform Strategy that prioritises reorientation from capacity-enhancing to sustainability-enabling subsidies, accompanied by social protection mechanisms for affected artisanal communities. Keywords: fisheries subsidies, blue economy, market distortion, sustainability policy, Nigerian fisheries