Greenland

When Greenland joined the EU in 1972, common access to the fishing resources in EU waters was viewed by many as a serious threat to the Greenlander's existence.

A referendum produced a majority vote to withdraw and the country did so in 1985. Since then a series of five year agreements with the EU have been set up.

Fishing accounts for approximately 90% of the country's exports and the activity of international companies has proved to be very lucrative for Greenland for the past 20 years.

The 1990s were productive times in Greenland. On average less than 150 vessels fished what was considered an area rich in resources. Between 1988 and 1995 the average catch per year from Greenlandic, foreign and chartered vessels was 188,500 tonnes.

Prawns

On average 73,000 tonnes of prawns were caught a year during this period, 33,000 tonnes of cod per year and 15,000 tonnes of Greenland halibut per year.

Prawns sold to Royal Greenland increased from 37,447 tonnes in 1990 to 44,221 tonnes in 1995, while cod sales decreased dramatically from 16,901 in 1990 to just 1,405 tonnes in 1995. Greenland halibut rosed from 6,883 to 15,120 in 1995.

Today, the majority of Greenland's fishing industry is still managed by Royal Greenland, which is owned by the Home Rule Government.

The main product is prawn and is exported all over the world including Europe and Japan. Royal Greenland is the world's largest retailer of cold-water prawns.

Some of the world's largest shrimp beds are also based in Disko Bay and there is also significant fishing for halibut and salmon. Cod was previously an important catch for the country, but only 2,000 tonnes were caught in 2001 and since then there has been a question mark over whether it will remain an economically viable sector.

Royal Greenland itself manages over 10 processing factories on the island and has 15 smaller plants as well as two plants in Denmark and one in Germany. It also runs six vessels, most of them catching for shrimp.

Profitable

In the 20001/02 financial year Royal Greenland achieved a turnover of DKK3.461 million with a pre-tax profit of DKK101 million. Profit was DKK61 million after tax.

Results were considered to be 'satisfactory' considering a continuation of low prices for the company's main product, prawns.

The 2002/03 fishing season was better despite poor prawn prices still affecting trade. Morten Sander, group sales director at Royal Greenland told World Fishing he was 'pleased' with the company's current set of results.

For the year ending September 30 2003, the group achieved a turnover of DKK3,651 million, an increase of DKK190 million and resulting in a profit before tax of DKK120 million. This was over DKK200 million higher than expected.

A Royal Greenland statement says: 'The increase in turnover must been seen in the light of the unfavourable market conditions and exchange rates and therefore represents a considerable increase in volume. Royal Greenland's strategy of expanding out of the recession has proved to be an effective weapon in combating the negative tendencies.'

The company's foreign activities have helped fuelled this success. "Our wide assortment of products and well established global customer base has given us a unique position in what are considered difficult times," says Morten Sander.

"It really gives us more than one leg to stand on in the current climate," he adds.

Despite poor prices for prawns on the global market, the company still opened a combined crab and prawn factory in Paamiut and shelved original plans to open a factory in Aalborg Denmark. The company's trawlers have also contributed to a healthy profit.

"Greenland's fishing industry is extremely strong right now," says Morten Sander. "Prawn prices have been low but resources are very good and will probably last another decade at least."

He praises what he describes as a 'very well managed' industry. "We have benefited from a good stock management programme here and it has worked very well."

EU deal

A new EU-Greenland fishing agreement was agreed in 2003. Greenland received DKK 320 million from the EU in exchange for granting fishing quotas to EU member states.

This gave new fleets authorisation to access Greenland's fishing grounds either to catch quotas or to carry out research. Vessel owners will pay a licence fee to help finance the agreement.

Negotiations were tightly based around an extensive report by Spanish socialist MP Rosa Migueles following the Spanish sector calling for access to surplus quotas.

The report also proposes the creation of joint ventures between EU and Greenland companies, with the intention of benefiting the local economy and make better use of the fishing rights.

But in February this year the EU rejected another report by Rosa Migueles which proposed that paid, not caught quotas, could be transferred to Spanish and Portuguese fleets.

"It is very necessary for us to have a close relationship with the EU and Greenland has benefited enormously from the EU deals," says Morten Sander.