ISBN Number:
9789264097612
Publication Date:
5/04/2011
Pages 264

The North Atlantic (NORA) region is a transnational area comprising the Faroe Islands, Greenland, Iceland, and the coastal counties of Norway. These territories are linked by shared characteristics and challenges, as well as by historical, institutional and cultural links. Improving accessibility to the region, ensuring sustainable development of its fisheries, enlarging and diversifying its economic base, and meeting the challenges of climate change are key issues. Strengthened regional co-operation can help these territories address them by exchanging know-how and best practices, pooling resources and reaching economies of scale, improving the efficiency of public sector provision, and increasing the “voice” of the region.

However, transnational co-operation in the NORA region faces some barriers, as it involves territories that compete in their main economic activities, are separated by large distances, and have strong institutional and economic links with other countries and regions. In order to get the most from transnational co-operation, this report recommends that the NORA territories: focus co-operation efforts on targeted themes and issues; draw up a regional development strategy; promote greater awareness of the benefits of co-operation; develop a “variable geometry” approach to regional co-operation; and enlarge and refine the role of the NORA institution as a facilitator of co-operation.

Key facts

• The NORA region covers an area of land and sea bigger than the continent of Europe but scarcely populated. The region’s inhabitants are predominantly based in small dispersed coastal settlements.
• Large distances and limited connections (between the four territories in the region and between the NORA territories and the main world markets) are a key challenge.

Large distances and limited connections

•  The region’s economies are still very dependent on fisheries and raw materials: fisheries accounts for almost 80% of exports from Greenland and the Faroe Islands, while it remains an important source of employment in Iceland and coastal Norway.

Dependence on fisheries and raw materials

• There is significant internal migration (from smaller to larger settlements) and outmigration in the region. “Brain drain” is especially high among Faroese and Greenlanders.
• There have been recent efforts to diversify the region’s economies, but efforts have mainly focused on developing industries based on raw materials (mining, oil, aluminium).
• Tourism still represents a small share of the region’s economic activity (except on Iceland), but there are increasing efforts to develop this sector.
• NORA territories (and the Arctic regions in particular) are expected to see their climate change more and earlier than most other parts of the world. Climate change will have significant adverse consequences but it may also create some economic opportunities.
• The Nordic Atlantic Cooperation – the NORA organisation operating under the aegis of the Nordic Council of Ministers – supports co-operation and knowledge exchange in the NORA region.

Key policy issues

• How to improve the internal and international accessibility of the NORA Region
• How to ensure the sustainable development of the fisheries sector
• How to enlarge and diversify the economic base of the region
• How to meet the challenges of climate change
• How to overcome the main barriers to regional co-operation: economic competition, long distances, lack of connectivity, strong institutional and economic links with other territories

Recommendations

• Reinforce ICTs. E-health or e-education can support a more efficient provision of services, while e-commerce and e-business can promote business opportunities.
• Reinforce regional transport networks and facilitate a more rational use of regional air hubs.
• Strengthen innovation, research and regional co-operation on fisheries. The three elements are crucial for improving both the efficiency and sustainability of this sector.
• Reinforce the exchange of information and know-how. Exchange of best practices and know-how are key to better confronting regional challenges including those related to climate change.
• Promote high value-added and niche products from the marine sector and beyond, including “blue biotech”, eco-tourism; research related to climate change; and Arctic and North-Atlantic products.
• Promote further regional exchanges and co-operation in R&D, education and training.
• Define a long-term development strategy for the NORA region.
• Communicate the benefits of regional co-operation to NORA members and stakeholders.
• Develop a “variable geometry” approach to regional co-operation, capable of integrating neighboring territories.

Table of contents

Assessment and recommendations

Chapter 1. Major trends, challenges and strengths of the NORA region

The NORA territories have a relatively high GDP per capita (only Greenland falls well below the OECD average) and economic performance before the crisis was solid. Yet these territories are highly dependent on a reduced number of primary commodities, mainly fisheries, but also oil and gas. The public sector is relatively large and a major employer in the region. At the same time, this region is characterised by its extreme peripherality, by the sparse settlement pattern and by significant difficulties in terms of communications and accessibility. These factors complicate the region’s trade, economic diversification and provision of public services. This chapter starts with a definition of the unit of analysis of this review: the NORA region. It then assesses the major socio-economic and demographic trends in the region. Finally it underlines four main challenges for the region: geographic peripherality; ensuring sustainable development of the fisheries sector; economic diversification; and adaptation to climate change.

Chapter 2. Policies supporting a sustainable, competitive economy in the NORA region

Reinforcing economic competitiveness and a sustainable development process in the NORA region will largely depend on its capacity to overcome different challenges related to the remote location of the region, its vulnerability to climate change, and its narrow productive base. The chapter is divided into four sections. Section 1 provides recommendations for improving accessibility and for coping with the peripherality and demographic challenges of the region. Section 2 focuses on the future productivity and sustainability of the fishing industry, as one of NORA’s main economic sectors. The third section identifies the opportunities for diversifying the economic base, and the crucial role that innovation plays in the region. The fourth section considers the challenges of climate change for the main economic activities of the region and the crucial role of adaptation measures to confront the effects of climate change.

Chapter 3. Governance and co-operation in the NORA region

Chapter 3 focuses on the potential of transnational co-operation in the NORA region. The similarities in framework conditions and challenges shared by the NORA regions, the small size of markets and the limited resources within each of the NORA territories argue for collaborative efforts, exchange of know-how and best practices, and transnational co operation to confront some of the main challenges of the region. The chapter starts with a description of the wide and complex web of territorial co operation already present in the NORA region. The second section explores both the range of potential benefits of transnational co operation, and the main barriers that regional co-operation faces. The third section describes the main areas in which there is potential for transnational co operation. Finally, the fourth section provides a series of recommendations to overcome the barriers to co-operation and to maximise the contribution of transnational co operation in the NORA region.

How to obtain this book

Readers can access the full version of OECD Territorial Reviews: NORA Region: The Faroe Islands, Greenland, Iceland and Coastal Norway by choosing from the following options:

• Subscribers and readers at subscribing institutions can access the online edition via OECD iLibrary, our online library.
• Non-subscribers can browse the full text on line and purchase the PDF e-book and/or paper copy via our Online Bookshop.
• Order from your local distributor.
• Government officials with accounts (subscribe) can go to the "Books" tab on OLIS.
• Access by password for accredited journalists.

Related information

• Website of the NORA Region Conference 2011, taking place 5 April 2011, Copenhagen, www.noraregion.org
• Regional Development Policies in OECD Countries, 2010 
• OECD Economic Surveys: Norway 2010
• OECD Economic Surveys: Iceland 2009
• OECD Territorial Reviews: Norway,  2007

Find out more

For more information and publications on Regional Development, visit: www.oecd.org/regional

Permanent URL: www.oecd.org/regional/nora