Minister of Fisheries and Coastal Affairs, Mr. Svein Ludvigsen.

Chicago, 15 October 2004

Ladies and gentlemen

You have asked me to talk about "living by the Sea", and you also ask; - is it a national identity?. My answer is yes, - absolutely. Living by the sea, and 8 out of 10 Norwegian do so, are a national identity.

100 years as a sovereign state – the centennial in 2005

For Norway next year is special. In 2005, on 7 ^th> June to be exact, Norway celebrates its 100 years anniversary as a sovereign nation. During this period our nation has not escaped international turmoil – we have experienced war, suffering and poverty. Looking back at these 100 years, the Norwegian society has, however, been through a transformation from a poor country to a modern sophisticated society. Today the average income is among the highest in the world and GDP (per capita) amounts to USD 37 800 (estimated, 2003).

Especially after World War II America has been instrumental in providing an international basis for protection and guarantees of freedom and independence in our part of the world. The Marshall Plan designed by the US in 1947 has had a tremendous positive impact on the Norwegian society, as indeed on Western Europe as such. Norway’s membership, and America’s key position, in NATO has also contributed to stabilisation and peace in potentially unstable region in the outskirts of Europe.

The American Dream

Even earlier America had a positive influence on our society and its people. During the rather short period between 1875 and 1930 more than 800 000 Norwegian left for America – to look for a better life – to make the promise of the American Dream a reality. It is interesting to note that there are, according to a census in 1990, about 3.9 million Americans of Norwegian ancestry, while our population at the start of this year was close to 4.6 millions. And among these 4,6 million, 77.4 per cent of the Norwegian population as coastal residents – about 3.5 million.

Past, present and the future

You ask – living by the sea, a national identity? Whether you look at our past, the present or our future, the sea and the coast play important roles. Living by the sea has given Norwegians curiosity - a strong desire to learn what we can harvest from the sea, how we can benefit from it and what we will find on the other shore, across the sea. It has given us an international perspective clearly reflected in our marine and maritime traditions.

Shipping and fisheries have for centuries influenced and shaped our society. Aquaculture and the petroleum industry – both only some 30 years old – represent new important features. Increasingly tourism emerges as another important factor representing both challenges and possibilities for coastal communities.

Together these four aspects of our society – the marine, the maritime, the petroleum sector and tourism - form a solid platform for future growth and welfare.

The maritime sector

Norway has less than one per thousand of the world’s population. Still it is the third largest shipping nation. In 2003 the foreign-trading fleet numbered 1.622 vessels of a total of 43.2 million dwt (deadweight ton) and 60 mobile offshore units.

Perhaps just as interesting – Norway has 20 per cent of the world’s maritime insurance market, leading shipbrokers and ship financing banks, as well as classification societies with more than 16 per cent of the world’s fleet in its portfolio. Norwegian shipbuilding has been through basic changes from a previous focus on the hull till present days focus on design, modern technology and web based programmes and solutions.

The marine sector

Dwelling on shipping is relevant because I see the same basic trends and development patterns in my sector – the marine sector. In 2003 Norwegian fishermen caught about 2.7 million metric tons of fish (round weight). In addition aquaculture amounted to 520 000 metric tons Atlantic salmon and 71 000 metric tons Rainbow trout. If we should eat all this fish, every Nnorwegian had to eat 2,8 kg every day year around. Think how delicious a New York steak would taste.

Norway is rank as number nine among the world’s fishing nations. Among fish exporting countries we are ranked as number three – after China and Thailand and followed by the US and Canada.

Our seafood industry is presently facing challenges and heavy competition. In some areas from producers in low cost countries such as China, in others from influential players on the retail market – be it from super market chains or from the HORECA segment. (HORECA – hotel, restaurant, catering).

Our answers to these challenges are of course adapted to the individual case. Often the answer is to reduce, and hopefully even eliminate, the gap between production costs in Norway and in low cost countries. We have seen examples and cases telling us that increased use of cutting edge technology can reduce labour costs to a competitive level. Also, demands from consumers in the retail market have led to innovations in products and production processes. I must, however, add that this is an area where Norwegian Seafood industry still have much to address.

Aquaculture

Many of you will be familiar with our aquaculture industry and our position as a major supplier of Atlantic salmon and Rainbow trout. Now our efforts in aquaculture move beyond salmon and trout. Presently we have a strong focus also on cod, and halibut. Ways and methods of farming other fish species are evaluated, along with mussels, scallops, and sea urchins.

Basic concerns – the vision

The sea and the coast are the backbone of our society. A look at the map will tell you why. Waters under our jurisdiction cover six times the area of the Norwegian mainland!

It is thus quite obvious that we are very concerned with environmental issues and with sustainable management of our marine resources based on an overall ecosystem approach. This is reflected in my ministry’s vision: The riches of the sea – Norway’s future.

A few years ago Norwegian scientific institutes studied and evaluated the potential for value adding and growth in the Norwegian marine sector. Some of the conclusions drawn and presented were indeed controversial. But, and this is the important result – they all found a vast potential for value adding and growth. As much as five or six times the present value, looking 20 to 25 years ahead in time.

International cooperation

Obviously Norway is very concerned with international cooperation regarding environmental protection and resource management, as well as in other important fields such as marine science and research, the Law of the Sea and free trade matters. The ongoing round of trade negotiations in the World Trade Organisation – the WTO – is one example of international processes of great importance to Norway.

Norway has an advanced scientific community that in many areas is recognized to be in the forefront on the global arena. This is especially evident in marine sciences. It is, among other things, clearly demonstrated in the success of our aquaculture industry. Here research and development (R & D) played a significant part.

In this field our cooperation with the EU is especially strong. As member of the European Economic Area Norway is a participant and a partner in various R & D programmes. Earlier this year Norway has actively influenced the European Commission to focus on Oceans in the next – the 7 ^th> – framework programme for research.

Norway is not included among the 25 member countries of the European Union. These member countries constitute an important market for our seafood. For that, and a variety of other reasons, it is important for Norway to establish close ties to the EU. Our scientific interaction with EU thus has important side effects in addition to the R & D itself.

Norway also enjoys a close and fruitful R & D cooperation with the US. A number of our scientists have their education - their PhD - from the US and many are still involved in US/Norwegian bilateral research. In certain areas this bilateral research is substantial. We have not yet seen quite the same growth here as we have seen in Europe.

The agreement on cooperation between your National Oceanic and Atmospheric Administration (NOAA) and our Institute of Marine Research is – as I see it – an important step towards strengthened cooperation.

Marine biotechnology

Many, and I certainly am one, look to biotechnology as an important key to the welfare of future generations. Today a large variety of products include marine substances taken from seaweeds, the skin of fish, biproducts and so on and have become components in mobile phones, TV screens, satellites, pharmaceutical products, cosmetics and health food, to mention a few.

Let me give you an example: a certain bacteria found in seaweed is now used to limit growth of algae on vessels and aquaculture cages. Thus reducing the use and need for other more environmentally harmful substances. Through science new ways of utilising marine resources have been developed. Valuable in itself, but even more so since it benefits the environment.

In many areas we have only had the first exciting taste of the possibilities lying ahead. And, ladies and gentlemen, mark my words: - this is only the beginning. I am eager to pursue new possibilities and to look for opportunities not yet identified. If the phrase “an ocean of opportunities” ever had any meaning, this must certainly be it! To me this is an arena where international scientific cooperation is called for. Mutual benefits to scientists, and indeed also to investors, are obvious.

The “oil adventure”

Some of you have erlier today attended a seminar about energy. Norway is blessed with a long and fertile coastline, as well as with a seabed harbouring major oil and gas resources.

In this adventure American companies have been among the pioneers. Their presence and activities boosted Norwegian technology development and contributed largely to vitalisation of Norwegian mainland industries. Working together many new initiatives and creative ideas were born. We still harvest from these efforts and will continue to do so for years to come.

The petroleum industry has, as you can imagine, meant a world of difference to the Norwegian society and will continue to do so for years to come.

R&D in the 2005 Budget

Earlier this month – on October 6 ^th> - the government presented its budget proposal for 2005. I was proud - and pleased – to inform the public of the fact that more than one-third (actually 35 per cent) of my ministry’s total budget was allocated to various research and development programmes.

The future

During my three years as minister I have focused on stimulating research and development to increase innovation in the marine sector.

Through such efforts we are creating the foundation for a stronger, modern marine sector that in the future will generate larger income to companies and to the nation.

My ambitions are linked, of course, to the ministry’s vision – riches of the sea, Norway future. Today I have focussed on 3 elements:

• to increase the value adding in the traditional seafood sector – in other words: two increase the value and income from each kilo raw material caught or farmed,
• to introduce new species to aquaculture and to secure commercially sound businesses on this basis, and
• to work with the business environment in its efforts to utilise opportunities in marine biotechnology.

I invite US companies and businesspeople, as well as US R&D sector to participate and make partnership in this new marine development.

Seafood exports

Our seafood exports have long traditions – about one thousand years. It has always been important for our country, it is so at present and there is every reason to believe that it will stay that way in the future.

Norwegian seafood is exported to more than 150 countries and we are widely recognized as suppliers of high quality seafood products. Also here in the US, and the name Norwegian Salmon is still recognised and linked to quality and to our clean, cold waters.

Barriers to trade

When producing and supplying food there are treats and barriers of many kinds. Examples are easily available. In addition to fierce competition, the possibility of accidents resulting in pollution, tariff and non-tariff barriers and damaging media attention, are but some examples.

In addition consumers are aware, awake and careful. This is, however, to be expected and, indeed, as it should be.

Norway has, as you know, decided not become member of the European Union. Thus we have excluded ourselves from our most important market – and not without costs. This is a major challenge especially since salmon producers in EU use every possible opportunity to curb EU imports of our product.

Damaging media attention

From time to time we witness attempts to discredit seafood, especially farmed fish. On such occasions product image will inevitably be tarnished and producers will suffer. At the beginning of this year, an article in the renowned Science Magazine on possible health risks connected with consumption of farmed salmon was spread worldwide. As in most such cases this turned out to be incorrect and misleading, but not without consequences for producers and suppliers. To rectify a tarnished image is often both time consuming and expensive.

I addressed this issue in a round table conference in Stavanger in June. I believe that there will be a conference here in the US in 2006 on how to furnish consumers with neutral documentation and information on health benefits from consumption of seafood.