Transformation in the Fishing Sector: public hearings

Agriculture, Land Reform and Rural Development

27 June 2011
Chairperson: Mr M Johnson (ANC)
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Meeting Summary

The Committee continued with hearings on the transformation of the fishing industry. The Food and Allied Workers Union, who had been assessing the impact of long-term fishing rights, stated that the industry had had to deal with massive retrenchment, and the Department had failed to respond adequately to questions on retrenchments, or quota benefits, and no clear guidelines were provided as to what recourse was available when companies did not comply with the stipulations in their applications. There were also allegations of racism, by skippers, Sea Harvest, and when allocations were awarded. Health and safety issues were also of great concern. Low wages meant that fishermen could not sustain themselves. The Union urged the Department to strengthen its monitoring of the applications, to ensure that transformation, proper employment and living wages were made conditions of the quota allocations.

The SMMES Fishing Forum, who had consulted with role players countrywide, recommended that the fishing industry could achieve success through involving whole communities, and through setting up cooperatives, with areas forming and running their own black-empowered businesses. This would create more jobs, support more families, and allow a framework for investment in the industry, including training and skills transfer. Diversity in small scale fisheries and the contributions of this sector had not been properly taken into account when the Marine Living Resource Act was drawn, excluding many fishers.

Independent boat owner Mr Sulaiman Achmat cited some of the restrictions that prevented him from making a proper living, and complained that small scale fishers were suffering because of allocation of rights to commercial fishing companies. Mr Poggenpoel set out similar concerns, particularly in respect of the fishers in Kalk Bay, noting also the decline of fish stocks that threatened the livelihood of the smaller fishers. Both urged that channels of communication be opened. Symanyene Fishing, a small company who had invested in the sector by also acquiring a processing facility, outlined the impact of the restrictions on Total Allowable Catch, noting that reductions in the TAC affected the industry’s ability to offer jobs, and suggested ways in which this model could be reviewed.

Members expressed their sympathy for the plight of small fishers, who clearly needed their situation to be addressed. The Department of Agriculture, Forestry and Fisheries (DAFF)  was warned that corruption and racism would not be tolerated, and the Committee called for written responses on instances that the Department was investigating. The Department was also asked to comment on issues raised during the public hearings, and to indicate what it would be doing in response.

The Department of Agriculture, Forestry and Fisheries then briefed the Committee on climate change. The agriculture sector would feel the effects of climate change most strongly. This sector currently contributed less than 5% to the Gross Domestic Product, about 13% to employment, and 4.6% of the greenhouse gas emissions. South Africa was a low forest-cover country, and the extent of change of natural forests and woodland areas had not yet been assessed. However, rural communities living in forests would be strongly affected. Fisheries would also be hard-hit, through changes in sea level, temperature, carbon dioxide concentration, radiation and other factors, and the small-scale industry would feel the effects most strongly. DAFF had developed an Agriculture Greenhouse Gases Inventory, and Climate Change Sector Plan, with the assistance of local universities. It was obvious that adaptation strategies were needed. The Agriculture Atlas of Climate Change and the Integrated Adaptation plan explained where the agriculture industry would be in twenty to thirty years. DAFF was also working on awareness programmes to would assist farming communities with coping mechanisms, including implementation of soil, water and nutrient conservation strategies, harvesting of rain water, minimising the use of fertilizers and pesticides. There had been little research as yet into the forestry sector, but this would have to be done. Although DAFF had no research capacity of its own, it had collaborated with other institutions. DAFF would be taking part in the Conference of Parties, although agriculture was not a separate agenda item.

Members questioned the effects of alien plants, noted that grasslands had been neglected and expressed disappointment that the agriculture sector would not be comprehensively discussed at the Conference of Parties. They noted that more research was needed, and expressed disappointment that insufficient research capacity was available. They questioned whether carbon credit systems would be discussed, but the Department said that this was not the best approach. Members also noted that rural communities were no longer permitted to use forest resources as they wished, and their rights had been curtailed. One Member noted that it was necessary to be realistic and accept that climate change could not be avoided altogether, and urged that DAFF must work with other sectors, and should invest more in research capacity, and asked the DAFF to comment on whether population growth had been taken into account in the long-term plans.

Meeting report

Transformation in the fishing industry: Continuation of public hearings
The Chairperson stated that the Committee had convened this meeting partially to continue with the public hearings into transformation in the fishing industry, but also wanted to leave time aside for a presentation on climate change by the Department of Agriculture, Forestry and Fisheries. It was important, especially since South Africa would be hosting the Conference of Parties (COP17) that this Committee fully understand climate change issue, to enable Members to make valuable input and contributions.

Food & Allied Workers Union: submission
Mr Mthunzi Mhlakane, National Organiser: Fishing Sector, Food and Allied Workers Union, stated that for the past few years this Union (FAWU) had been assessing the long term fishing rights to see if the allocations had achieved their intended objectives, mainly of ensuring job security and providing quality jobs.

He argued that the current situation meant that the fishing industry as a whole had had to deal with massive retrenchment, closing off factories, and that consolidation of quota resulted in a closure of a number of factories. All of this happened soon after the larger private limited companies secured their fishing rights. When FAWU engaged the Marine Coastal Management division of the Department no adequate response had been received; for instance, no answer was given on a direct question as to whether Oceana was intending to retrench 529 workers, or how many workers would benefit from the quota. It became clear that there were no clear guidelines as to what recourse could effectively be taken if a company did not live up to the stipulations stated in its applications.

When the Portfolio Committee on Labour was doing an oversight visits on fishing factories it had noted for itself that there were some companies whose entire top management team was white. It was also noted that most skippers of sea-going craft were white, and many were racist. Recently the FAWU forced Sea Harvest to take actions against skippers who had displayed racist attitudes to black crew members. Within the squid industry, there had been allegations of companies using fisherman as fronting shareholders of companies, yet giving them no benefit from the gains of the company, but instead exploiting them still further. These issues had been raised at Departmental level, and the Department was urged to investigate, yet nothing came of the matter.

Health and safety issues were also of great concern, as FAWU had received several reports, especially from those in the squid industry, that a fisherman who fell sick during a trip would either have to wait until the trip was over to get medical attention, or he would have to disembark at the nearest town to seek medical assistance, but must find his own way back home. Often, fishermen would have to buy their own protective gear, and this was almost unaffordable at their low salaries. They would therefore invest in poor quality gear, compromising their health and safety.

Another disturbing issue was the low wages for the sea-going fishermen. In the pelagic industry, fishermen’s salaries were awarded, except in the case of Oceana employees, at the discretion of the skipper, due to labour-brokering arrangements with skippers.  In the squid sector a fisherman received R30 daily allowance and R5 per kilogram on his catch. These income levels were not sustainable, as the fishermen were not even able to afford basic sustenance.

FAWU therefore requested that the Department’s Marine and Coastal Management (MCM) unit must strengthen its monitoring tools with regard to adherence, by companies, to the stipulations of their application. MCM also must ensure that transformation was a condition of the quota allocation, thereby giving a guarantee on issues of employment equity and shared trust. MCM should also make proper employment of sea-going fishermen and seasonal workers a condition of the quota allocation thereby ensuing quality of jobs and job security. MCM was also asked to make the payment of a living wage as another condition of the quota allocation, to address the exploitation that was rampant in the industry.

SMMES Fishing Forum submission
Mr Harry Mentor, Chief Executive Officer, SMMES Fishing Forum, outlined that the Forum wished to make certain recommendations to the Minister. He noted that all role-players in all different areas of the country had been consulted, from Ocean View to East London and to Port Nolloth. All had noted that the fishing industry had to be made successful. The recommendations included the need to organise the people of various areas in communities in the fishing industry. It was also envisaged that the various areas could then be further organised into co-operatives, with information clearly outlined. Each area should form and run its own black-empowered businesses. Near-shore and in-shore fishing rights would need to be allocated to the SMME (small, medium and micro sector) and small scale rights holders. It was noted that operations from six factories could provide 600 jobs. Membership of cooperatives would create another 1 500 permanent jobs, which would give access to employment to about 16 500 people. The SMME Forum believed that the creation of such a situation would create a framework to develop investment in the industry. This would then allow for full involvement, training and skills transference in the industry.

Mr Mentor noted that small scale fishers were an integral part of the rural and coastal communities where they resided. In Western Cape, women were involved in harvesting, but in the most recent years they too tended to have been marginalised.

Mr Mentor noted that the diversity within the small scale fisheries, and the potential contributions of small scale fisheries to poverty eradication and food security, was not addressed in the Marine Living Resource Act (MLRA). This had resulted in a large percentage of traditional small scale fisheries being excluded from the process. He urged that small scale fisheries resources must be managed through a community-based co-management approach that would also ensure sustainable harvesting and utilisation of resources. He therefore called for a holistic approach to fisheries and management.

He noted that development of new small scale fisheries policy would come more than two decades after the promulgation of the MLRA, and after long-term commercial rights were granted. Fishers whose rights had been affected by the allocation of commercial fishing rights in their villages did not receive any allocations. He concluded also that international and regional agreements on sustainable and responsible fishing were important to the small scale fishing industry.

Mr Sulaiman Achmat: submission
Mr Sulaiman Achmat, an independent boat owner, stated that he had been a fisherman all his life, and he often also bought in fish for resale. He had purchased a boat, suitable for line fishing, but lost it because of the legislation subsequently introduced. There were too many restriction placed on him. He cited, by way of example, that he was limited to fishing only 600 meters into the ocean, which was insufficient. He believed that the impetus to sustain his own business had been removed, both for racist reasons, and in order to support the large commercial fishing industry. Since the rights were taken away, small scale fisherman had not been able to survive, and he also pointed out that the rights now taken away from him had been owned by his family since the 1860s, and it was unfair that they be given to the large companies. This process had made it difficult for him to sustain his living.

Mr Jacobus Poggenpoel submission
Mr Jacobus Poggenpoel, who stated that he had been the first black person nominated to the Fisheries Advisory Council, spoke of the Kalk Bay fishing community, who were dependent on the resources of False Bay for their existence, as they had been for the past 200 years. In recent years big trawlers were granted rights to trawl in the False Bay area. That had depleted fish stocks and threatened the livelihood of the smaller fishers. Corporate fishing had therefore damaged the industry and harmed the local communities.

The Kalk Bay fishing community provided sustenance for about 300 families, and was also a tourist destination. The community had fought for several years for the harbour to stay a commercial fishing harbour, as this was the only historic hand-line harbour still in existence. It had also fought against allowing a yachting basin to be built in Kalk Bay. However, now that many fishermen had started to lose their rights, the survival of the community was under threat. He hoped, following these hearings, that government would intervene and open up the channel of negotiations. He pleaded for the Committee to look seriously into the matter.

Symanyene Fishing submission
Mr Neels Scheepers, owner of Symanyene Fishing, noted that his company supported the government’s initiatives in the fishing industry in general. However, it did not support the reductions in the Total Allowable Catch (TAC) restrictions, saying that this would jeopardise the business. Symanyene Fishing, a Black Economic Empowerment (BEE) rights holder, had invested in the sector, in support of its long term commitment, and had pledged, in its applications, to abide by the criteria set out by the Long Term Rights Allocation Process (LTRAP)

The rights holders owned and operated their own vessels, and since the LTRAP was set up in 2005, they had further enhanced their investment in the sector. They had acquired a 50% stake in a processing facility, Umoya Fish Processors, on the West coast. This facility had been struggling to meet its financial commitments to suppliers, due to the staff reductions occasioned by the TAC. The extra quota that was made available for processing through the facility was needed to maintain the existing jobs, which in turn were needed in order to sustain the facility. However, now Umoya was not able to sustain its projects, and their rights had diminished. Because the company was relatively small, it was unable to sustain their operations when the TAC was continually being reduced.

Mr Scheepers therefore recommended, in order for similar small-scale enterprises to survive, that the TAC should be increased, and that the same compliance criteria must be required of all participants within the WCRL sector. He also noted that the TAC model could be reviewed by reducing the amount that was allowed for poaching.

Discussion
The Chairperson said that the experiences related to the Committee showed that there were troubling situations. He sympathised with the plight of the small fishers. He asked the Department of Agriculture, Forestry and Fisheries (DAFF or the Department) to provide explanations for the situation with small fishers, and said that they clearly needed justice. Fisheries should be corruption-free, and he said that harsh penalties should be levied on those who were responsible for corruption. The Portfolio Committee would be taking a tough line with the Department if there was any evidence of corruption.

Mr Johann Augustyn, Chief Director: Marine Resource Management, DAFF, stated that whilst he could respond to some of the comments, he did not have all the relevant details with him. He also apologised for the fact that the Director General of the Department could not attend these hearings, due to prior engagements.

He noted that there had been some investigations in the industry. He also stated that he was not aware of any corruption within the Department, but would welcome an investigation into allegations of corruption if any were to emerge.

The Chairperson interrupted to ask Mr Augustyn for specific answers on each of the cases.

Mr Augustyn said that the legal division of the Department was working on several cases, but he was not aware of the particular issues that were involved in each, and therefore could not provide exact feedback.

The Chairperson interrupted again, asking him to provide specific examples. He was not happy with lack of information from the Department, and asked for concrete ways to move forward, and not interested in general discussions. The Chairperson also asked why the legal advisors were not present.

Mr Augustyn said that if the small staff were to send all their resources to investigate these matters, they would not be able to follow any of their daily tasks. It must be appreciated that some of the issues could not be settled overnight. There were legal procedures that had to be followed.

The Chairperson said that Mr Augustyn was out of line, for using language that was insulting to the Committee. There was a job to be done and the Committee would make sure that it was able to respond to the need of the people who had voted them in.

Ms M Pilusa (ANC) suggested that the Department should provide a written response. The team who could answer the questions specifically was not present, so adequate answers could not be given at this meeting. She added that the Committee was not calling for a high-level report from the Minister or Director General, but wanted the answers as to what was actually happening on the ground. She again suggested that a written response would be appropriate. She also suggested that the Department should listen carefully to the recordings of all the submissions, and the testimony provided by individuals, and respond to each and every case.

Mr S Abram (ANC) stated that the three days spent on the public hearings on the transformation of the fishing sector was insufficient. He agreed that it was unjust for the rights of the poor fishers to be taken away. He recommended that there was only one way to bring justice, and that would be to establish a judicial commission. He also wanted comment on the apparent existence of a racist agenda in the Department, and why no reports from the past had yet been made available.

Ms R Nyalungu (ANC) wanted to know what the Department planned for the future, and what, specifically, it would be doing to address what had been noted during these sessions.

The Chairperson interrupted to request the guests at the meeting not to clap and cheer.

The Chairperson stated that the Committee had had some poor experiences in calling for written responses in the past, because the questions were often not answered.

Mr Chestyn Liebenberg, Acting Director: Legal Services, DAFF, stated that in the previous meeting some comments had been made about the company Apega West Limited. The Department had met with the directors of that company in March 2011. The shareholders of the company stated that none of them had benefited since rights were granted to the company. However, it must be noted that the Department had judged that the quantum allocation of right to this company was not viable, and the decision was made by the Minister at the time not to allocate any more rights to the company. It was clear that the Department did need to look into the way that rights were granted to the small boat owners. The Department would address the issues that were raised at the meeting, and would also seek assistance from the Department of Labour.

The Chairperson stated that Portfolio Committee had been in contact with both the large companies and the local communities, and had attempted to negotiate ways whereby the rural communities would be able to sustain themselves. Members were concerned that real transformation had not happened. The Committee wanted to see results urgently. People were suffering now.

Climate Change Issues: Department of Agriculture, Forestry and Fisheries (DAFF) briefing
Mr Ikalafeng Kgakatsi, Director: Climate Change and Disaster Management, DAFF, stated that his briefing would address the matters outlined in letters from the Committee to the Department.

Mr Kgakatsi said that the South African agriculture sector could be considered as one of the more sensitive sectors in the economy, as it would be the most likely to feel the impacts of climate change (CC). This sector contributed less than 5% to the Gross Domestic Product (GDP), but approximately 13% to national employment. The agriculture sector contributed 4.6% of the total net greenhouse gas emissions (GHG) in the country. He noted that greenhouses gases would, in this sector, be released through soil respiration, use of fertilizers, changing crops in farms and bio-mass emitted from cattle.

South Africa had been rated as a low forest-cover country, relative to countries in the Congo Basin. Approximately one third of the land was covered with forests, including natural forests and plantations. However, much of the natural forests and woodland areas had been transformed over the last few decades. The extent to which there had been change was not yet known. Since forests played a vital role in the sustenance of rural communities, the impact from Climate Change would likely affect these communities in the most direct way.

It had been estimated that the fisheries industry would be one of the hardest-hit as a result of climate change. The changes in sea level, temperature, carbon dioxide concentration, radiation and other factors would impact on the capture, production, marketing and sales of fish commodities. The small scale fishing industry would suffer the most devastating effects, as reduction in quotas would mean that less fish would be caught. In some cases, certain species of fish could become extinct, adding to the crisis.

In order to understand and tackle the problems caused by climate change, the DAFF had developed an Agriculture Greenhouse Gases Inventory, with the assistance of local universities. The Inventory report was the source of inputs into the development of South Africa’s Second National Communication (SNC), which would also be used by the Department of Environmental Affairs (DEA). DAFF had also drafted the Climate Change Sector Plan (CCSP), which would be made available to Members, for questions and critiques.

It had been argued that climate change could not be stopped. DAFF would therefore need to implement adaptation strategies. The DAFF had developed and published the Agriculture Atlas of Climate Change and the Integrated Adaptation plan, which would explain where the agriculture industry would be in twenty to thirty years. For example, certain crops would not be able to grow in some parts of the country, and this meant that DAFF and other departments and research organisations would need to find alternatives to those “lost” crops.

DAFF was also working on an awareness programme that would assist farming communities with coping mechanisms. The programme aimed to establish the needs of the rural communities and to develop strategies so that the effects of climate change could be minimised. Some of the adaptation methods being promoted by DAFF included the implementation of soil, water and nutrient conservation strategies, harvesting of rain water, minimising the use of fertilizers and pesticides. These would help to ensure that rural communities were able to sustain themselves during droughts and other harsh environmental degradation.

In regard to the forestry sector, Mr Kgakatsi stated that there was little research conducted on adaptive capacity of natural forests and woodlands. It was important to incorporate the forestry sector within the policy development process of the DAFF. He emphasised that commercial forestry planning would have to incorporate the long term climate projections, and implement forest management interventions.

DAFF had collaborated with various research institutions on climate change including the Agricultural Research Council (ARC), the Council for Scientific and Industrial Research (CSIR) and the Water Research Commission (WRC). Some of the research projects included the Agricultural Greenhouse Gases Inventory, and the Atlas of Climate Change. In addition, DAFF regularly participated in the National Committee on Climate Change (NCCC), the Intergovernmental Committee on Climate Change (IGCCC) and formed part of the South African delegation at the United Nations Framework Convention on Climate Change (UNFCCC) negotiations.

He then discussed the forthcoming Conference of Parties (COP 17). DFF had attended the negotiations in Bonn, Germany, to set the agenda. DAFF, as a relevant authority on climate change, would be hosting national workshops on 11 and 12 August 2011. Although agriculture would not be covered as a separate topic at the COP 17, DAFF was intending to have a pavilion showcasing the current levels of research, and the mitigatory actions that were under way. DAFF would also work with the Department of Environmental Affairs in hosting the COP 17.

The Chairperson thanked the Department, and emphasised that the Atlas and the Greenhouse Gas inventory were important matters and more investment would be needed to fund its research.

Discussion
Mr R Cebekhulu (IFP) wanted to know whether the invasion of alien plants would impact on the local indigenous plants, especially local grasslands.

Mr L Bosman (DA) reiterated that the agriculture sector was likely to be the hardest hit by climate change. The grasslands had been neglected, and there was limited area covered in forest. He was disappointed that the agriculture sector was not going to be discussed separately at COP17. The net emissions in the farming sector had not been calculated in full and he said that more research was needed in this area. He wanted the Department to produce a sector plan after the database of greenhouse emissions had been created. The Atlas would also be helpful, as this would assist in mapping the climate trends and their impact on crops. He wanted to know whether any carbon credit system in the agriculture sector was being discussed.

Mr L Tolo (COPE) stated that in the past, people in the rural areas could manage the forests however they had wanted. If they had wanted to cut a tree for their sustenance, then they were free to do so. However, when the large companies had moved in, there was a careless approach to the management of tree-cutting. This had been curtailed more recently, by government employing forest rangers, but this also meant that the rights of the rural people were also being curtailed, as they were no longer able to harvest the trees or plants as they had in the past. Mr Tolo asked the DAFF to comment on this situation.

Mr S Abram (ANC) argued that as the climate had changed, so had farming practices. For example, it had become evident that areas where potatoes used to be cultivated had become barren, and were not able to produce any more potato yields. He wanted to underline that it would be necessary for DAFF to work with the various sectors in order to mitigate some of these problems. However, it was also necessary to adopt a realistic stance and recognise that it was impossible to mitigate the effects of climate change in totality. The Department should explain what needed to be done to improve the research quality. He argued that the public sector had lost a lot of talent to the private sector, which had left a shortage of high quality scientists in government entities. He also wanted the Department to fund more awareness programmes, so that people could be made aware of the crisis.

The Chairperson wanted to know about the Department’s budget allocations towards managing and monitoring the spread of alien species.

Mr Ceba Mtoba, Chief Director: Forestry, DAFF, noted Mr Abrams’ concerns about internal capacity and promised to convey the concerns to the Director General of the Department.

Mr Mtoba also stated that there were several diseases that affected the cattle industry and stated that this was one of the areas on which DAFF would focus in the future.

Mr Mtoba reminded the Members that South Africa was a water-stressed country, particularly in the rural areas. Sometimes, people in the rural areas used the water haphazardly, not being aware of the larger consequences of their actions.

Mr Mtoba informed the Committee that the Department was conducting research on the impact of invasive and alien plants. For example, wattle had a negative impact on local water systems, and the Department was researching ways to deal with the issue. The Department had initiated programmes where individuals had been hired to clear the alien plants. This programme served the purpose of creating jobs and eliminating the wattle plants. The Department had also been approached by private companies, who offered to clear the areas infested with wattle and use them for bio-mass. Thus far some of the projects handled by the private sector had met with success, but the Department’s main reservation had been the damage to other species caused by the improper removal of the alien plants.

The Department had also been faced with a predicament where it had wanted to invest in research, but had no funding to do so. He noted that the Department had insufficient funding to finance full time researchers, and if it did go and purchase research from the private sector, it could do so only in respect of research that the private sector had already undertaken. He added that in 2011, National Treasury had allocated R3 million to assist the DAFF in financing research projects. Climate change would change the intensity and frequency of floods, droughts, wild fires and rain storms. The Department had linked the risk management of climate change to disaster management, and this would lead to greater understanding and tackling of the potential impacts of climate change.

Mr Mtoba stated that the Minister had raised concerns that agriculture should have been included in the COP17. However, South Africa was not the only driver in deciding the agenda of COP17, and the country had to work with other nations and incorporate their viewpoints and suggestions.

Mr Kgakatsi added that the developed countries and the OPEC countries did not want agriculture to be a separate agenda topic, and so it was eliminated as a separate topic on the COP17 agenda.

Mr Mtoba claimed that the idea of carbon credits was noble, but it may not be the best solution for Africa. The initiative was driven by international non-government organisations (NGOs), and so the Department would like to invite other developed nations to assist in developing the carbon credit system. Until then, there appeared to be no benefits from instituting this system in South Africa.

Ms N Twala (ANC) asked whether the Department had invested in raising awareness programmes for poor fish farmers, or offered alternative employment strategies.

Ms Twala also asked how greenhouse gases were defined.

Mr N du Toit (DA) stated that South Africa was barely coping with the proper utilisation of its resources, and asked if the Department took population growth figures into account when planning its long term model.

Mr Mtoba stated that when research was conducted, population growth was often isolated, which was unfortunate. However, the Department had been working to reform the research methodologies.

Mr Tolo stated that cutting of forests had affected the livelihood of the rural indigenous communities. As the populations grew, the impact on the forests would be increase dramatically.

Mr Mtoba stated that the forestry was a protected industry and when a company applied for logging rights the Department of Water Affairs would conduct a survey on the future impact of logging on water supplies. Other Departments would conduct similar surveys to ensure that the impact on the environment was minimised.

The Chairperson expressed the Committee’s disappointment with the Department’s approach to extensive research. Whilst others were already implementing projects that would assist with climate change, such as wind turbines and solar panels, this Department was still conducting research. He regarded this approach as unacceptable and urged the Department to begin implementing projects, as research alone meant that it was not taking any responsibility for the development of the green technology.

The Chairperson agreed with Members that more answers and details of programmes needed to be conveyed in writing.

The meeting was adjourned.

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