University of Akureyri
18 January 2002
The European Union Fisheries Policy
Address of the Foreign Minister,
It is not my intention to present to you a scholarly analysis of the Community Fisheries Policy, nor do I intend to describe its implementation in any detail. For that kind of analysis I refer you to the section on fisheries in my report to the Althing in the year 2000.
For obvious reasons, I frequently have occasion to discuss the position of Iceland with regard to the rest of the world, including Europe, and particularly with regard to the European Union. One aspect of this discussion involves the Common Fisheries Policy, which can have a substantial impact on us, both in the short term and the long term, fisheries being the most important industry in Iceland.
The Discussions Ahead
Public discussion of the question of Europe here in Iceland may go on for quite a long time, and there is no way to tell to what conclusion it will lead us. But it is an important discussion.
The problem with the discussion at this stage, however, is that it can revolve only around the Common Fisheries Policy in its current form. Even so, there is nothing to stop us from exchanging views on the policy and contemplating its advantages and disadvantages. In addition, it is not a bad idea to give some thought to the position that Iceland would have to take regarding the fisheries policy if it should become an option for Iceland to join the EU.
The fact is that neither I, nor any cabinet ministers of the member states of the EU, nor the Commission itself can say what the Common Fisheries Policy will be like in the future, nor can they predict what form any agreements with individual member states might have. Issues of this kind are discussed only in the Council of Ministers, and in fact the treaties of the European Union can be amended only by Intergovernmental Conferences or by accession treaties with new member states.
There are no prospects of the Ministers of the European Union entering into negotiations with states that have not applied for membership. On the other hand, it is worth bearing in mind that there are numerous examples of new provisions finding their way into the EU treaties on the accession of new member states in order to meet the special interests of the states in question. Such examples include the recognition of the special status of arctic agriculture on the accession of Sweden and Finland.
Do we have anything in common?
Here, in the University in Akureyri, which has emphasised fisheries as a separate field of study, I would like to make an attempt to place the fisheries policy in a political context and explain what it is that we have in common with the European Union and what it is that separates us.
We believe that in many ways we have done better than the European Union. I have worked for a long time on policymaking within the Icelandic fishing industry myself, and I would be the last person to detract from the results achieved in recent years. However, a lesson can always be learnt from observing what other people have done, and there is nothing more dangerous than complacency. Nothing under the sun is perfect ? not even the Icelandic fisheries policy. Politics is to a large extent a matter of finding the right balance between different interests. The clash of interests is even more multifaceted and complex in the European Union than in Iceland, and in fact it has been even more difficult for them than it has been for us to find acceptable and efficient solutions.
The reason I bring this up is that in the political discourse here in Iceland it is often maintained that membership of the European Union is out of the question because of the Common Fisheries Policy. Without any further reasoning or analysis, it is assumed that the Common Fisheries Policy is incompatible with Icelandic interests, that it is a question of black and white ? oil and water which cannot be mixed.
However, I have travelled far and wide, both as Minister for Fisheries and Minister for Foreign Affairs, and almost invariably the issue of fisheries has been raised in the course of my visits. It has been my conclusion that the problems faced by fisheries in the four corners of the world are remarkably similar. The poet Tomas Gudmundsson remarked in one of his poems how the hearts of men in the Sudan and South Iceland are alike. I have remarked in my travels how ministers of fisheries are alike.
First, we must understand why the European Union adopted a Common Fisheries Policy. To put it simply, we need only look at a map to see the reason. The fish stocks of the European Union are, to a lesser or greater extent, common. Just look at the North Sea and the Mediterranean. This is nothing new to us, as we share stocks with the EU for which and we have negotiated utlilisation.
Objectives of the EU
Let us now look at the objectives laid down for itself by the European Union.
First, they want to improve productivity and technological improvement and ensure optimal utilisation of the workforce in the sector. Second, they want to secure the livelihood of those who work in the sector and raise personal income, ensure market stability, a secure supply of marine products and swift and secure delivery of marine products to consumers at a reasonable price.
All efforts to achieve these objectives, furthermore, have to conform to the principles of anti-discrimination, environmental protection and consumer protection. The goal is responsible and sustainable utilisation of marine resources in the interest of all. Finally, the policy is to take account of the objectives of development aid.
It is difficult to argue with these objectives, and I assume that most of us, if not all of us, can support them. The problem is that results have not been forthcoming, and the implementation of the policy has resulted in all kinds of conflicts.
The protection of fish stocks conflicts with demands for greater catches, technical advances in the fleet conflict with the need to reduce the fishing effort. The policy is purportedly a common policy, but its implementation and control is in the hands of fifteen member states. There are demands to ensure employment in disadvantaged coastal regions, but at the same time the fleet has to be reduced. The income of fishermen needs to be secured, but the catches of the EU fishing vessels are falling and imports are rising. The public objective is to secure more fishing permits in the economic jurisdictions of countries outside the EU, but at the same time there is growing awareness that this has led to overexploitation and obstructed the normal development of fisheries in the developing countries with which agreements have been made on fishing quotas.
The International Council for the Exploration of the Sea maintains that at the beginning of the seventies the total number of fully mature roundfish was 90% greater than in the beginning of the nineties. This is reflected in the member states of the EU. The cod stock is in a particularly bad state. The situation is better in the case of pelagic fish, and satisfactory in the case of some demersal species such as Norway lobster and flatfish. It is clear, however, that this situation cannot be tolerated any longer.
The Council of Ministers (the fisheries ministers of the member states) ignored for a number of years the advice of the Commission and marine biologists and approved greater catches than the stocks could tolerate. The tug of war between the member states, where no one was willing to yield and come home empty handed had the result that the TAC was increased against all reason.
In recent years this has improved and understanding of the need to heed scientific advice has increased.
A recent Green Paper issued by the EU Commission makes the point that the policy has not resulted in the sustainable utilisation of fish stocks and proposes recommendations designed to promote long-term stability and a more environmentally oriented approach. Special arrangements are proposed to combat discards of fish and protect young fish.
Access to the fishing grounds in the 6-12-mile coastal zone will remain limited to the coastal state, and special rules will continue to apply to the Shetland Box. The rule on relative stability, which provides that the share of a member state in the TAC in a particular area is determined on the basis of their experience in the preceding year, is left in place.
It is proposed that decommissioning of vessels must be made more efficient and the idea suggested that in order for a new vessel to be registered, a vessel with far greater fishing capacity must be decommissioned.
It is recognised that the billion Euros and more injected into the fisheries sector within the European Union have not proven a sound investment and may even have harmed the long-term interests of the sector.
Other management systems, such as transferable quotas, "co-management systems" with interested parties and access levies for the right to fish for some parts of the Community fleet are mentioned. Finally, means are discussed of increasing decentralised decision making and promoting stakeholder involvement.
Although most of these ideas have certain advantages and will, if implemented, bring the Common Fisheries Policy closer to our own, there is still a long way to go before the implementation of the policy can be said to be acceptable from the point of view of Icelandic interests. It is interesting, however, to observe these developments because if Iceland should one day decide to apply for membership of the EU, this ongoing discussion within the EU would have an impact on the reception any requests made by Iceland would meet.
Let us for a moment imagine ourselves as an applicant state. As I said before, the general objectives of the Common Fisheries Policy are difficult to oppose as such. Furthermore, it seems to me quite clear from the rules of implementation of the policy that the Icelandic economic jurisdiction could be a separate management zone and catch quotas would be issued on the basis of previous fishing experience and therefore remain in Icelandic hands.
The economic jurisdiction of the European Union is divided into fishing zones. On the basis of scientific advice, the amount to be harvested from each stock in the zone is determined at councils of fisheries ministers, and the TAC then divided among member states in proportion to their fishing experience and the importance of fisheries for their economies. The allocation and implementation of these quotas is then left to the state in question, as is the management.
It is quite possible, because of the current imbalance between capacity and available quotas, particularly in Spain, that there would be demands from stakeholders for quotas if Iceland were to apply for membership of the EU. However, there is a clear majority among the member states in favour of maintaining the principle of relative stability. It is not in the interests of other member states to undermine this principle.
Nonetheless, it is necessary in my opinion, in the event of any membership talks, to emphasise the special situation of the zone around Iceland in unqualified terms. A solution similar to the one achieved by Norway in the course of its membership talks would not be satisfactory.
I find it difficult to visualise a council of fisheries ministers from thirty states, including a substantial number of land-locked states, intruding on sensitive decisions involving fishing permits, quotas, mesh sizes etc. in Icelandic waters. However, there is nothing to prevent a consensus on objectives and general principles. The special situation of the Icelandic fishing zone would not need to be defined as a general exception from the Common Fisheries Policy, but as a special implementation of the policy in a certain delimited area on the basis of the principle of subsidiarity, so that decisions on the utilisation of our natural resource, which is not shared with other member states of the EU, would be taken in Iceland.
It is far from self-evident that such a special provision laid down in an accession treaty would meet with the approval of all the member states. But it is not impossible either, and it is clear that without such a special provision we will forever remain outside the EU. Whether we put this to the test one day will also rest on views external to the fisheries sector and the willingness that we perceive to understand and meet these views of ours.
Fisheries management is the aspect of the Common Fisheries Policy which will unavoidably be in the limelight, but we should nevertheless mention three other aspects, i.e. market organisation, state aid and concessions, and relations with third party states.
Market organisation is intended to ensure a stable supply, price and quality on the EU fish markets, and primarily involves sales from fishing vessels. In this context, organisations of stakeholders in the fisheries sector play a key role, and at the same time Community funds offer price support, subject to specific disposal of the catch based on market conditions.
Conditions are quite different in Iceland, and different means are employed to achieve market stability. No member state of the EU has as low a ratio of local market sales to exports as Iceland. However, the role and operation of the organisations of producers in the EU market system differ from one member state to the next. It may be that some aspects of this system could prove usable in Iceland. It would be an interesting experiment for those interested in fisheries to fit Iceland into this model.
The annual EU tariff quotas established unilaterally for the purpose of securing imports of raw materials for the fish processing industry in the EU at reasonable prices have a direct impact on Icelandic interests. The general terms for Icelandic products are quite acceptable as a result of the EEA Agreement, but the impact of tariffs has been felt, e.g. as regards herring, lobster and redfish fillets which are not included in the tariff reduction provisions of the EEA Agreement.
State Aid and Concessions
The development of fisheries as an industry using state aid and concessions is one of the most disputed aspects of the Common Fisheries Policy. Iceland has criticised this internationally (within the WTO) and joined forces with several other countries to combat these tendencies.
Fortunately, there is a growing understanding that this state aid has not had the intended results, and in fact sometimes quite the reverse. However, it is far from true that all the funds employed in subsidising the fisheries industry of the EU serve to undermine the competitive position of Icelandic fisheries.
Part of these funds has been used to develop fish markets, improve harbour facilities, re-train seamen and make it easier for them to find other employment when they can no longer work in fisheries etc. However, a considerable part has been used to finance the construction of vessels for which there is no economic basis, which contributes to overfishing.
Relations with Third Countries
All fisheries agreements with third countries are the responsibility of the Commission. For a long time it was the stated policy of the Commission to use the importance of the European market as leverage to obtain fishing quotas from other states, i.e. to exchange market access for access to fishing grounds. The gains from this policy have been meagre, to say the least, and there are various indications that there will be fewer agreements of this kind in the coming years, as the developing countries increasingly try to utilise their own resources.
Fisheries agreements between the EU and North Atlantic States largely involve quota exchanges. For example, the agreement between Iceland and the European Union provides for an exchange of 3000 tons of redfish in Icelandic waters for 30,000 toms of capelin from the Greenland quota, which the EU has purchased. In some years, the British and German vessels that were issued these quotas in our jurisdiction have had no success in their fishing, although last year they succeeded in catching about 2000 tons. The agreement between Iceland and the EU is open to review this year, but no amendments are foreseen.
Environmental Protection and Food Security
Environmental protection has been coming into its own as an independent objective to be taken into account in all policymaking within the EU. The Common Fisheries Policy has not been left untouched. For instance, provisions banning driftnets have been taken up in the policy.
It is interesting also that there is increasing talk of eco-labels as a means of increasing consumer awareness, not only of product content, but also of the way in which products have been obtained.
Food security and food production control has been the focus of attention in recent years, with mad cow disease and foot-and-mouth disease as prominent examples.
In the near future, a European Food Safety Authority will be set up with extensive authority to establish general rules on food. It will be a matter of extreme importance, especially for the Icelandic fisheries industry, to secure acceptable participation in the work of the Authority.
EEA and Protocol 9
It is impossible to end this discussion without mentioning the EEA Agreement and its Protocol 9, which provides for trade in fish and other marine products between the European Union and Iceland. As you know, the EEA Agreement is intended to secure virtually full participation in the internal market of the EU and to ensure uniform rules in all industries. The intention is for the same competitive environment to apply throughout the area. Thus, Iceland is safe from the Community anti-dumping measures for aluminium and ferrosilicon, as these products are included in the Agreement. The same is not true of fish and marine products. There are special rules for these products ? competition rules are not uniform, tariffs on Icelandic marine products have not been fully lifted, and, to give an example, Norwegian salmon farmers are under the constant threat of EU anti-dumping measures.
We have for some years now been trying to bring about amendments to Protocol 9. It is particularly unfortunate that products such as herring, lobster, etc. are not included in the tariff reduction provisions of the Agreement. This will be even more deeply felt when important markets in Eastern Europe with huge future potential disappear behind the tariff walls of the European Union, as for the moment there is free trade in marine products between Iceland and most of the applicant states on the basis of EFTA free-trade agreements.
Stakeholders in the Norwegian fishing industry have raised the question whether the market section of the Common Fisheries Policy could be incorporated into the EEA Agreement in order to avoid the Community anti-dumping measures. For the moment, this does not appear likely.
The Policy Develops in the Right Direction
At a recent EU summit launching the preparations for the next Intergovernmental Conference, great stress was laid on the importance of clarifying further the natural division of labour between the common institutions of the EU, on the one hand, and national institutions on the other, bearing in mind the principle of subsidiarity. It will be interesting to see what impact this will have on the review of the Common Fisheries Policy. In my mind it is clear, for instance, that the utilisation of resources which are not shared with other member states should be subject to the decision of each member state, including the determination of TAC and allocation of quotas. It is quite clear, at any rate, that if Iceland elected to apply for membership in the future, this would have to be an non-negotiable objective of any talks between Iceland and the EU.
I cannot predict the future, but based on the points that I have mentioned, it appears to me that the EU Common Fisheries Policy is developing in the right decision.
Iceland has in many ways provided a good example and thereby exerted an indirect influence. We enjoy respect for our progressive and well-managed fishing industry. We have a great interest in good relations with the EU regarding fisheries. In many areas our paths are parallel, in others they are not. We need to nurture these relations for the benefit of both parties.
Finally, I would like to thank the University of Iceland for inviting me here. I would like to offer my best wishes to the students, staff and the university itself. This university is engaged in important activities serving our most important industry, and thereby the Icelandic nation.