Faroe Islands Fisheries in the Northeast Atlantic: Brexit, Russia, and economic incoherence

Abstract

Among major fishing nations, the Faroe Islands is an exemplar of what should not be tried in the way of fisheries governance and management. Governance is not management, and the Faroes reinforces that point. The government has managed to degrade its demersal sector (cod, haddock, saithe), while undermining its pelagic sector (mackerel, herring, blue whiting) by alluring gifts of free quota for firms that have little interest in using a significant share of that quota. Not all free gifts are valuable. In this paper we document Faroese fisheries performance over the past 24 years to illustrate how things can go badly wrong. We develop econometric models of the demersal and pelagic fisheries to provide empirical support for a general account of incoherence and disarray. Pelagic quota has been given (for free) to demersal vessels unable to fish for pelagic stocks. This has maintained the number of demersal vessels at a higher level than is justified—only because such vessels serve as a destination for mackerel quota (that is then transferred to pelagic vessels). Such policies bring economic incoherence to both sectors. Faroese policies continue to undermine economic rationality in this crowded pelagic fisheries complex.