The impact of climate policy uncertainty on the dynamic connectedness among leading fish-exporting nations

The main objective of this research is to investigate the fisheries interconnectedness among fish-exporting nations and how the climate policy uncertainty (CPU) may affect that dynamic connectedness. Using data from January 2012 to June 2024, we conduct a two-stage analysis. In the first stage, we use a TVP-VAR model to analyze market interconnectedness. The results show that over half of the variability in export returns comes from cross-country spillovers, indicating strong global fish trade integration. Japan and Thailand are identified as key shock transmitters, while Chile and China emerge as major receivers. In the second stage, we apply DCC and ADCC-GARCH models to assess the asymmetric effects of CPU on fisheries trade. The results reveal that negative CPU shocks have a significantly stronger impact on market interconnectedness than positive shocks, suggesting that uncertainty and adverse policy shifts exert disproportionate pressure on fisheries markets. Also, the CPU has persistent, long-term effects on fisheries interconnectedness, highlighting the enduring nature of climate-related uncertainty in global trade. These findings challenge the "One Ocean Hypothesis," which has gained attention since COP25 in 2019. This study contributes to the marine economy literature by demonstrating how CPU shapes the relationships among fish-exporting nations. The results have practical implications for policymakers and industry stakeholders, surmising that climate policies in one country can influence fisheries markets worldwide.