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OECD Territorial Reviews: NORA Region 2011

The Faroe Islands, Greenland, Iceland and Coastal Norway

image of OECD Territorial Reviews: NORA Region 2011

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.

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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.

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