Aquaculture policy statement
Historisk arkiv
Publisert under: Regjeringen Stoltenberg I
Utgiver: Fiskeridepartementet
Minister of Fisheries Otto Gregussen's statement to the Storting, 23 January 2001
Tale/innlegg | Dato: 23.01.2001
Minister of Fisheries Otto Gregussen’s statement to the Storting, 23 January 2001
Aquaculture policy statement
Minister of Fisheries Otto Gregussen’s statement to the Storting, 23 January 2001
1 An industry of great promise
Norway is a society of opportunity, and few sectors demonstrate this more clearly than the aquaculture industry.
During an interpellation in the Storting (national assembly) in 1961 Mr Johan Karlsen of the Labour Party asked the minister of agriculture whether the government was aware of the salmon- and trout-farming experiments that were being conducted at Sykkylven on the west coast, and that might prove to be of great importance in boosting the local economy in Norway’s coastal regions. He also asked whether the government intended to do anything to support these experiments.
Only thirty years have gone by since two men from the island of Hitra west of Trondheim first tried to grow salmon in a net cage in the sea in an attempt to farm a new species. The story of the Grøntvedt brothers from Hitra is a good example of how entrepreneurs laid the foundation for the new aquaculture industry, which has since grown into a thriving modern industry.
Innovative thinking and creativity based on an exchange of expertise and on cooperation between actors in the industry, aquaculture organizations, research institutions and the public administration has been the hallmark of the aquaculture industry throughout its development. This also goes a long way towards explaining the success of the industry.
We have already made a great deal of progress, but Norway’s potential is far greater than this. So far, we have only made use of some of the opportunities offered by the marine environment. Reports from scientific institutions show a great potential for growth in the fisheries and aquaculture industry, not only in areas such as salmon and trout farming, but also in marine fish, shellfish, biotechnology and the use of by-products. The project "Wealth creation in Norway", run by the Norwegian School of Management, describes fisheries and aquaculture as the Norwegian industry with the best prospects.
This presents us as politicians with a challenge. We must take steps to ensure that Norwegian seafood has every opportunity to be competitive. Norway has particular natural advantages as an aquaculture nation, but to ensure stable and satisfactory growth it is essential to provide a good legislative and administrative framework.
The fisheries and aquaculture industry is one of the most international sectors in Norway. Ninety-five per cent of all production goes to markets outside Norway. Today, Norway is one of the world’s largest exporters of seafood. Seafood products are exported to more than 150 countries, and the seafood industry is growing more strongly than other export industries. The world population is growing, and greater purchasing power in fish-eating regions such as Asia is resulting in growth in world demand.
Wealth creation in the coast-based industries can of course only take place in the coastal regions. This is why the Labour Party has such a deep interest in creating coastal communities where people will want to settle – because this is where the opportunities are to be found. To succeed in this process, we must bear in mind several interlocking factors.
The infrastructure in Norwegian coastal districts must be further developed. An effective transport network is particularly important so that Norwegian seafood can be carried from the producers and out to the markets. And like any other industry, the fisheries and aquaculture industry is dependent on the provision of good public services – day care centres, schools, care for children and the elderly, and so on. This means that aquaculture policy is concerned with much more than just licences for salmon farms and the level of customs duties.
Because of Norway’s special advantages as an aquaculture nation, there is no reason to believe that internationalization will result in the management and operation of aquaculture businesses being moved out of Norway to other countries. With the advantages given by a unique coastline, access to raw materials and globally competitive expertise, the industry will continue to grow with a firm basis in Norway. International investments should be seen as a wise adaptation to a global market.
General interest in the aquaculture industry is high in Norway. In consequence, there is an active dialogue between the government and the Storting on the development of strategies for this sector.
During its consideration of a white paper on the development of the Norwegian fisheries industry (Report No. 51 (1997-98) to the Storting) on 17 March 1999, the Storting made the following decision:
"The Storting requests the Government to draw up long-term national strategies for the Norwegian aquaculture industry, in order to ensure that the industry is provided with the necessary trade policy framework for its further development in Norway. Particular attention should be paid to improving access to the various markets for Norwegian farmed fish."
During the debate on the Government’s inaugural address in the Storting on 23 March 2000, the following decision was made:
"The Storting requests the Government to put forward a wealth creation programme for the aquaculture industry."
This statement is the Government’s response to the two above-mentioned decisions by the Storting. In the following I will describe the fundamental policy and operating framework for the aquaculture industry in more detail.
2 Market access
One of the Government’s goals is to ensure the best possible market access for Norwegian seafood by means of a stable and long-term, and thus predictable, regulatory framework in all markets.
The EU is the most important market for Norwegian seafood today. Exports from Norway are regulated by Protocol 9 to the EEA Agreement. This means that customs duties have been abolished for some products and reduced for others. However, a number of products that are important for Norway, such as herring, mackerel, salmon, shrimps, scallops and Norway lobster, are not covered by the tariff reductions in the EEA Agreement, and are generally subject to high customs duties when exported to the EU.
In the Government’s opinion, the solutions adopted in the EEA Agreement are not suitable ways of safeguarding the interests of the fisheries and aquaculture industry vis-à-vis the EU. It has also proved difficult to improve market access for Norwegian fish exports within the framework of the EEA Agreement.
Norwegian exports of salmon to the EU are regulated by a special agreement. This includes provisions on export duties, minimum prices and a ceiling for the annual growth of salmon exports. The agreement has functioned satisfactorily up till now, but expires on 30 June 2002. The Government’s aim is to ensure that there is a stable, long-term and predictable framework for salmon exports to the EU market.
Since it is difficult to improve market access for fish to our most important trade partners, Norway must give priority to improving market access through negotiations in the World Trade Organization (WTO) and new EFTA free trade agreements. These are long-term processes, and it takes time before our efforts produce results. We will maintain a high profile in our work within the WTO to ensure that industrial goods, including fish, are put on the agenda in the forthcoming negotiations.
3 Sustainable growth
3.1 Environmentally-sound production
A healthy marine environment is an essential basis for harvesting marine resources and for wealth creation from the ocean. This means that environmental considerations must be an important element in management of the industry, including aspects such as research and development, regulation of production and the standards set by the authorities for the industry. The marine environment is particularly important because of the growing demands from consumers for documentation of the quality and safety of foodstuffs. Efforts to prevent environmental damage from sectors such as industry and shipping are therefore of crucial importance to the Norwegian fisheries and aquaculture industry.
New and improved operating routines have resulted in major improvements in fish health and in the environmental status of the aquaculture industry. Discharges of nutrients by the industry are no longer considered to be a problem for the surrounding environment today. Nevertheless, we must continue to monitor discharges of nutrients and keep the use of chemicals and medicines under control as the industry grows. And there are still issues related to the environmental impact of fish farms that must be dealt with, including measures to combat salmon lice and to control the escape of farmed fish. As announced earlier, the Government intends to present proposals for a system of national salmon fjords and salmon rivers in 2001. This will make it possible to give stricter protection to some of Norway’s most important wild salmon stocks.
It is important to develop a system of type approval for fish farming installations and equipment, among other things as a means of reducing the number of farmed fish that escape. We are now working to put such a system into place.
The Storting has recently amended the Aquaculture Act, partly in order to improve its environmental profile. The amendments entered into force on 1 January 2001. The Ministry of Fisheries will continue the development of legislation on environmental aspects of the industry. New regulations on the operation of fish farms have already been in force for two years, and new regulations have recently been laid down on the operation of hatcheries, which include environmental considerations and the issue of fish health. We will also be drawing up complete legislation, including operating requirements, for farming of shellfish and other species.
In addition, I have plans for an environmental monitoring system to be in place in the public administration in the course of 2002. This will include requirements for fish farmers and others to monitor environmental conditions in and around their own installations using approved methods.
3.2 Safe seafood
Consumers must have the opportunity to experience Norwegian seafood as both safe and a pleasure to eat. We must therefore ensure that the marine environment is clean, that farmed fish are healthy and that animal welfare considerations are taken into account, and we must have systems that ensure that products are safe to eat. These basic requirements can only be met by means of active efforts from both the authorities and actors in the industry.
In many cases, access to markets can only be obtained if documentation is available and products can be traced back to their origin. Publicly run control systems are needed to prove that production is sustainable and that seafood is safe. It is particularly important to ensure that fish feed does not contain any substances that may cause injury to fish or people or environmental damage.
The Government will continue the established arrangements for example for controlling levels of medicine residues, and will give priority to upgrading control systems and analytical tools. These will include new methods of testing shellfish for algal toxins.
3.3 Fish health
Salmon and trout farming now produces almost twice as much fish meat as the total amount of meat produced by Norwegian agriculture. Despite this, fish farming accounts for less than 2 per cent of the total consumption of antibiotics in Norway. The Atlantic salmon is our healthiest domestic animal. This excellent state of health has been achieved by close cooperation between research institutions, actors in the industry and the public administration, and we will make every effort to ensure that it is maintained.
Fish and shellfish farming is a form of biological production, and must therefore meet special requirements. All biological production is vulnerable to naturally-occurring diseases, which can cause severe setbacks in such industries when they flare up. This means that we must focus on measures and controls to prevent infection by intensifying our research efforts and by making use of earlier experience from salmon and trout farming.
The industry has a particular responsibility to promote environmental concerns, fish health and food safety. To ensure that aquaculture firms follow up the requirements of the authorities in these fields, I intend to introduce requirements for internal control in the industry.
4 Active public-sector management
4.1 Providing space in the coastal zone
Access to suitable areas in the coastal zone is a basic requirement for continued growth and development of aquaculture.
In allocating areas to the aquaculture industry, a balance needs to be struck between the interests of the industry and those of other parties. This requires a coherent planning process for the coastal zone. It is also important to ensure that coastal communities clearly understand the enormous potential that aquaculture represents, and municipal planning processes must encourage developments that will make it possible to realize this potential. It is reasonable to assume that future growth in the aquaculture industry will take place mainly in the municipalities that do most to encourage this, for instance by drawing up coastal zone plans that take the interests of aquaculture into consideration.
Most attention so far has been paid to localities for salmon and trout production. However, in the last few years there has been growing interest in cultivating shellfish and other species. As a result, there have been changes in the types of areas that are needed, and the challenge for the authorities is now to ensure that the areas allocated provide opportunities for cultivating a wide variety of species.
We should also look more closely at opportunities for combining cultivation of several species in one locality, provided that this does not have negative effects on the health of any of the species involved.
4.2 Active management of salmon and trout farming
4.2.1 Balanced growth in production
Since the aquaculture industry is engaged in biological production, decisions on production have to be taken long before the products reach the market. It is therefore not possible to control supply as closely as can be done with non-biological products. In the salmon sector, fluctuations in supply and the subsequent fluctuations in salmon prices have resulted in trade policy reactions from other countries.
It is important for the industry to ensure that growth in production is stable and in reasonable proportion to market trends. Since 1996, feed quotas laid down by the Ministry of Fisheries have been used to regulate salmon production. The Brundtland government introduced such quotas at a time when the situation in the industry was very dramatic. This was a crucial step and meant that the government took on major responsibilities.
In principle, I am of the view that adjustment of production to market trends should be the responsibility of the actors in an industry. However, given current market conditions, particularly in the EU market, controlled growth of salmon production has proved to be necessary. As I see it, only the Norwegian authorities possess the necessary instruments to regulate total production effectively at present. I therefore believe that the authorities should continue to play an active role in adapting the growth of salmon and trout production to market trends in the next few years. There is also fairly broad agreement on this within the industry.
4.2.2 Industry structure and restrictions on ownership
The importance of the aquaculture industry to coastal communities is steadily growing, but at the same time we are witnessing a concentration of ownership interests, which means that exclusive rights to farm salmon and trout are being concentrated in fewer hands. This does not promote the variety that the industry needs. I therefore intend to lay down general rules concerning restrictions on ownership of salmon and trout farms in the near future.
The EEA Agreement may put certain restrictions on the way the authorities can manage the aquaculture industry. The EFTA Surveillance Authority (ESA) has claimed that it is contrary to Article 31 of the EEA Agreement (which lays down that there shall be no restrictions on the freedom of establishment) to take into account people’s links with the local community when allocating fish farming licences. We are now drafting an answer to the ESA in which we will dispute this interpretation of the EEA Agreement.
4.3 New system for regulating production
The current form of production regulation, which makes use of production volumes measured in cubic metres combined with rules on density and feed quotas, should in my opinion be developed further. It must be possible to use existing localities more effectively. At the same time, we must ensure that the negative environmental impact of production is minimized.
In connection with the introduction of requirements to monitor environmental conditions in fish farming localities, I therefore intend to introduce a new system of production regulation, based mainly on licences, feed quotas and the carrying capacity of the individual locality. In practice, this means that full utilization of a feed quota will only be permitted if the locality has sufficient environmental carrying capacity. In this way, environmental considerations will become an integral part of the system of production regulation in the future.
4.4 Computer-based reporting in the aquaculture industry
The Labour Party has launched a programme for innovation in the public sector. There is room for simplification and greater efficiency in the aquaculture industry too. I want to lighten the industry’s load as regards the amount of reporting required by the public authorities.
One of the goals set out in the state budget for 2001 was to use developments in information and communication technology (ICT) to allow electronic reporting by aquaculture firms. In cooperation with the Norwegian Fish Farmers' Association and other relevant users of Norwegian aquaculture data, I have just launched a project to develop an electronic reporting system.
According to plan, the aquaculture industry will be able to replace today’s paperwork with electronic reporting from next year.
4.5 New licences for salmon and trout farms
Production growth in salmon and trout farming in recent years has mainly taken place without the allocation of new licences. It will be possible to increase production still further within the framework of the existing licences, for example by raising feed quotas.
In my opinion, there is also room to allocate new licences, and I am pleased to note that there is broad political agreement on this. The first round of allocations will be carried out in 2001, and will be followed by regular rounds of allocations in the next few years. I would like to emphasise that this process will form part of a coherent policy to ensure balanced growth in production.
My purpose in making it possible to allocate new salmon and trout farming licences is to encourage the development of commercial aquaculture in areas that are not currently fully utilized. In the first round of allocations, licences will therefore be granted in districts where there is a substantial potential for growth, but where few licences have previously been allocated.
In the debate on the forthcoming licensing round, we have also considered the interests of the smaller fish farmers, and the issue of whether those who already have one or two licences should be given priority. My view is that if licences are allocated to the smaller operators, we should give priority to those who clearly need to improve their business base, but would find this difficult to do without several licences.
In my opinion, we should require substantial payment for the allocation of licences for salmon or trout sea-water rearing units. A licence gives the recipient the exclusive right to carry out a business activity, and it is reasonable for the community to receive part of the value of the licence. I do not consider it appropriate to allocate licences free of charge when they can subsequently be traded at a substantial profit. In response to the Storting’s decision of 28 November 2000, we are now considering how to introduce a system of payment for the allocation of licences. A proposal has been made to include the legal authority for this in the Aquaculture Act, and is now being circulated for comment. The Government intends to submit a proposal to the Odelsting on this matter before Easter.
4.6 Special taxes in the aquaculture industry?
There has been a broad-based public debate on the taxation and distribution of future profits from the fisheries and aquaculture industry. Proposals have been made to introduce special taxes on fish farming licences, for example, a tax per unit area or a tax when licence rights change ownership.
In my view, the consequences of such taxes for the industry should be thoroughly reviewed before they are introduced. For example, we need to consider legal, economic and political principles related to the use of the coastal zone, and the effects of the proposed taxes on the international competitive position of the industry. I will take the initiative for a review of these issues.
5 A policy for the future development of the aquaculture industry
The policy instruments used to steer the aquaculture industry are administered by several different public authorities. It is therefore important to ensure that these authorities cooperate closely and share the same understanding of policy goals, and to ensure that the various policy instruments are applied in a coordinated manner. Cooperation with the fishing industry and other coastal zone industries is also important to enable us to exploit the potential of the coastal zone to the full.
The Government will therefore appoint a separate committee to coordinate the work of the various public authorities with respect to the aquaculture industry. The committee will be headed by the Minister of Fisheries and will include representatives of relevant ministries and of the Research Council of Norway and the Norwegian Industrial and Regional Development Fund. In its work, the committee will focus in particular on developing a close dialogue with representatives of the aquaculture industry and with the regional elected bodies along the coast.
5.1 New opportunities
Sea ranching, which involves releasing and later recapturing living organisms, is opening up new opportunities. At this stage, the species that offer most potential are lobsters and scallops. In time, I believe that we will be able to use these new operating techniques to develop sea ranching into another important commercial activity. But before we can exploit its full potential, we must improve our understanding of areas that will be affected by sea ranching. This will include a consideration of environmental issues, suitable localities, the allocation of licences and the conditions under which operations are permitted.
The production of seafood will continue to be the foundation of the Norwegian fisheries and aquaculture industry. But in future, molluscs and marine fish species such as halibut, cod and related species and wolf-fish will become increasingly important to the aquaculture industry. It will also be possible to develop a number of other products based on marine raw materials. One technique that can be used is bioprospecting, which means searching for marine genetic material and naturally bioactive molecules that we can use. Our waters contain unique marine raw materials in the form of proteins and other biologically active molecules that may be useful to sectors such as the food processing industry and the pharmaceutical industry. The Government has started efforts to look for ways of safeguarding and protecting access and rights to and the sharing of genetic resources.
5.2 Innovation programme
Commercial production of shellfish and marine fish species is at an early stage at present, and as yet, few of the actors involved can operate at a profit. In a transitional phase, public funding will be needed to help the development of marine industries that are not yet fully commercial. In the longer term, there is a great potential for economic growth in this part of the industry.
An innovation programme for the commercial exploitation of marine resources has just been launched. In this year’s state budget, the overall financial framework for the programme is NOK 86 million. The programme is part of a joint effort by the Ministry of Fisheries, the Ministry of Local Government and Regional Development and the Ministry of Trade and Industry. The objective of these initiatives is to facilitate projects in fields where existing policy instruments are not sufficient to meet all the challenges that the growing fisheries and aquaculture industry is facing. The priority areas will be further developments in the farming of marine species and projects that combine elements of fish farming and sea ranching.
5.3 Research and expertise
If Norway is to make full use of its comparative advantages as regards cultivation of the oceans, marine research and development efforts in both the private and the public sector must be intensified. In a white paper on research in Norway published in 1999, the marine sector was identified as one of five national priority areas. The white paper described the marine sector as a field where research may result in very significant economic growth.
I am very pleased to note the clear increase in funding for aquaculture research in this year’s state budget. This must continue in the years ahead. It is important to strengthen all areas of aquaculture research, including research related to environmental issues and diseases.
Norway currently has some of the world’s leading expertise in salmon and trout farming. We must maintain and further develop our efforts in this part of the industry. I would like to emphasise the importance of following up the initiative that has been taken to map the salmon genome. This will provide us with a better basis for further breeding efforts.
Research focusing on product development and product quality is important in supporting marketing of Norwegian seafood, both nationally and internationally. Research must also be carried out on new aquaculture species. It is particularly important to solve the problems associated with intensive production of fry of marine fish species. Another major challenge is to find adequate supplies of feed for further growth of the industry, while at the same time maintaining the reputation of Norwegian farmed fish as first-class seafood. In this connection, we must evaluate the management of wild fish resources to ensure that the overall yield from the fisheries and the aquaculture industry is as high as possible, and at the same time investigate the possibility of utilizing new sources of feed.
The industry itself has the main responsibility for funding applied research. Some research and development projects are run by aquaculture companies themselves, and the industry also funds marine research through a new research and development tax that was introduced on 1 January 2001. This tax is expected to bring in revenues of about NOK 100 million a year.
It is a paradox that despite the promising future of aquaculture, which has prospects unequalled by any other industry, poor recruitment is a general problem. This applies both to vocational courses at upper secondary level and to higher education in fisheries and aquaculture. The Ministry of Fisheries and the Ministry of Education, Research and Church Affairs appointed a working group to draw up an action plan to improve recruitment to the fisheries and fish farming industries. The plan shows that there will be a substantial need for expertise in the aquaculture industry in the future, and places a responsibility for improving recruitment on all those involved in the industry.
5.4 Expanding the public administration for the aquaculture sector
The rapid growth of the aquaculture industry during the 1990s has not been followed up by corresponding developments in the public administration. In my view, a comparison of aquaculture and other important sectors in Norway shows that the administrative resources available to the aquaculture industry are at the absolute minimum. At the same time, the responsibilities of the administrative bodies are being expanded as they are assigned new, essential tasks in fields such as quality control, regulation of production and management of the coastal zone. It has been claimed in some quarters that inadequate administrative resources act as a bottleneck for further development of the industry.
I will therefore look more closely at the resources needed in a cost-effective administrative system for the aquaculture industry. This will form part of the Government’s programme for innovation in the public sector.
My goal is to put into place a modern administrative system for the aquaculture industry, in which expertise and capacity are adapted to the industry’s needs, and to ensure that the system is further developed as the industry grows.
5.5 A new Aquaculture Act
A good public administration system is dependent on coherent legislation that is drawn up with a view to facilitating wealth creation. My goal is to ensure that the legislation does not put obstacles in the path of the aquaculture industry, but on the contrary promotes its development.
In December 2000, the Storting adopted a proposal submitted by the Ministry of Fisheries for an act relating to sea ranching, which will provide opportunities for new commercial activities within the aquaculture sector. We are now incorporating provisions on sea ranching into a set of regulations that are intended to promote new opportunities for cultivating the oceans.
We are also preparing a complete review of the Aquaculture Act, and intend to submit a bill containing a new draft Act. The new Aquaculture Act is to provide a legal basis for active management of the industry, taking into account environmental considerations, food security, management of the coastal zone and the necessary control of production. At the same time, the regulations that govern the aquaculture industry will be modernized. The objective is to provide all actors in the industry with a coherent set of rules based on a single, comprehensive Aquaculture Act.
6 Conclusions
I opened this statement with a description of how two entrepreneurs created the basis for today’s modern salmon farming industry. Hard work by individuals, companies and organizations, together with a substantial research effort and help from the authorities, have all been essential to the progress we have made so far.
I have presented measures here that I believe will help the aquaculture industry to develop further as one of Norway’s main growth industries. The responsibility for realizing the considerable potential of the marine sector lies with actors in the industry, while the authorities are responsible for providing the industry with a satisfactory administrative and legislative framework.
The Government will:
- give priority to efforts to improve market access for Norwegian seafood.
- maintain a high profile in the WTO to ensure that industrial goods, including fish, are put on the agenda in the forthcoming negotiations.
- work for a clean marine environment and ensure that consumers can experience Norwegian seafood as both safe and a pleasure to eat.
- play an active role in adapting the growth in production of salmon and trout to market trends.
- initiate a project to develop an electronic reporting system for the aquaculture industry.
- work towards the development of a new system for production regulation based mainly on licences, feed quotas and the carrying capacity of the individual locality.
- allocate new licences for salmon and trout production, and introduce charges for the allocation of licences.
- continue efforts to increase the aquaculture research effort.
- strengthen the public administration responsible for the aquaculture industry.
In order to realize the full economic potential of the industry, it is important to ensure that the authorities cooperate closely and share a common understanding of policy goals, and that the various policy instruments are applied in a coordinated manner. Cooperation with the fishing industry and other coastal zone industries is also important to enable us to exploit the potential of the coastal zone to the full. The Government will therefore appoint a separate committee to coordinate the work of the various public authorities with respect to the aquaculture industry.
The Labour Party believes in seizing the opportunities that are available. To succeed, we must act now. We will achieve our goals if we pool our efforts. The challenge for all of us is to seize the extensive opportunities that lie in making full use of our marine resources. By doing this, the fisheries and aquaculture industry can play its part in ensuring that Norway offers people a good life, and that it continues to do so in the future.