Fishing quotas in the Faroe Islands are now worth staggering sums. Recent sales of vessels show that most of the value no longer lies in the ships themselves, but in the fishing rights that follow them.
According to the Faroese state-owned media outlet Kringvarp Føroya, earlier this year, the pelagic vessel Jupiter was sold for about €36.5 million – more than triple the €11.3 million it was bought for just two years earlier.
Another ship, Eysturbúgvin, changed hands for €18.5 million after being purchased for only €4.3 million. Experts stress that it is not ageing steel that drives prices, but quotas.
Quotas carry hidden value
Faroese economist Hans Ellefsen says the massive price jumps prove that fishing licences have become gold in themselves. “This is resource rent. It is money the country should take in,” he explains.
He warns that the system lets some shipowners make huge profits from quotas they once received for free. “Fish in the sea belong to the people,” he argues. “It is wrong that these values end up in private pockets.”
Call for auctions
Ellefsen believes the solution is simple: auction quotas instead of giving them away. That would let the state capture the rent, ease the strain on public finances, and secure long-term sustainability.
He points out that if more of the rent were collected, the country could reduce its fiscal gap by six per cent. “With auctions, the market regulates itself, and society benefits from the value,” he says.
At present, the rent goes mainly to a few large shipowners. Ellefsen warns that this fuels inflation and pushes up prices for homes and services. “When some can pay far more than others, it creates pressure across society,” he says.