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Í telduposti til undirritaða váttar høvundurin á frágreiðingini hjá Moody’s, at frágreiðing teirra ikki tekur støðu til spurningin um kvotuskipan. Heilt ítøkiliga svarar Harald Sperlein, undirstjóri í Moody’s soleiðis:

“We do not advice on a certain system, nor do we recommend a certain system. What we do in this report is to describe the effect that we see (from the discussed fishing reform) to the credit profile of the government.”

Í telduposti til Moody’s vísti eg á, at kjak hevur tikið seg upp í Føroyum, har víst verður til frágreiðing teirra sum ein myndugleika í spurninginum um val ímillum fiskidagaskipan og kvotaskipan. Og at eg sjálvur helt hetta vera at tamba niðurstøðurnar í frágreiðing teirra. Til hetta svarar Harald Sperlein:

“You  are right, that this is not the way how this report should be seen.”

Mín áhugi fyri frágreiðingini hjá Moody’s bleiv kveiktur mánadagin í hesi vikuni, tá Árni Gregersen, journalistur, ringdi til mín fyri at fáa nakrar viðmerkingar til frágreiðingina í tíðindunum á FM1 kl 17 mánadagin.

Yvirskriftin í tíðindaskrivi frá Landsbankanum um frágreiðingina ljóðaði: “Moody’s: Kvotaskipan jalig fyri kreditvirði”.

Í samrøðuni við Árna greiddi eg frá, at frágreiðingin hjá Moody’s ikki tók støðu til spurningin um kvotuskipan mótvegis fiskidagaskipan.

Tvørturímóti viðgjørdi greiningin meira yvirskipaðar spurningar sum týdningin av eini burðardyggari røkt av fiskastovnunum og fleiri inntøkur til landskassan frá fiskivinnuni.

Tí undraði eg meg eisini yvir, at Landsbankin í tíðindaskrivi sínum hevði valt at vinklað yvirskipaðu frágreiðingina hjá Moody’s á eldfima spurningin um kvotaskipan.

Ein vinkul, sum er blivin endurgivin á øllum tíðindaportalum í landinum, umframt at landsbankastjórin bar sama boðskap í tíðindasending Kringvarpsins á døgurða mánadagin.

Í almennari viðmerking til samrøðu mína við FM1 fanst Ingolf S. Olsen, tingmaður fyri Tjóðveldi, at Miðlahúsinum fyri at biðja meg greiða almenninginum frá um frágreiðingina hjá Moody’s.

Ingolf heldur, at “… skal nakar tulka, so mugu tað vera fólk frá Moody’s.”

Tað gav mær íblástur til at biðja Moody’s sjálvi greiða frá niðurstøðunum í teirra egnu frágreiðing.

Nú skuldi tann tulkingarspurningurin verið avgreiddur.

Tórshavn, 16. november 2018
Johnny í Grótinum, búskaparfrøðingur

Teldupostsamskifti millum undirritaða og Moody’s International sæst niðanfyri, har svarini frá Moody’s eru víst í skráskrift.

Fra: Sperlein, Harald <Harald.Sperlein@moodys.com>
Sendt: 15. november 2018 13:13
Til: Johnny í Grótinum <johnnyigrotinum@gmail.com>
Cc: Hay, Sebastien <Sebastien.Hay@moodys.com>
Emne: RE: Questions about report

Dear Johnny,

Great to hear that the report has attracted some attention.

Please find my comments below… hope this is helpful, otherwise feel free to give me a call.

Kind regards

Harald Sperlein

.................................................
Harald Sperlein
Vice President – Senior Analyst

Sub-Sovereign Group

+49 69 70730-906 tel

+49 173 659 1712 mobile
+49 69 70768-912 fax

harald.sperlein(at)moodys.com

Moody’s Deutschland GmbH
An der Welle 5

60322 Frankfurt am Main
www.moodys.com


.................................................

From: Johnny í Grótinum [mailto:johnnyigrotinum(at)gmail.com]
Sent: Wednesday, November 14, 2018 9:33 AM
To: Sperlein, Harald <Harald.Sperlein(at)moodys.com>
Cc: Hay, Sebastien <Sebastien.Hay(at)moodys.com>
Subject: Questions about report

Dear Harald

On November 8th 2018, you published a research note on the issuer The Government of the Faroe Islands with the title “Fishing policy reform ensures sustainability of fish stocks, boosts government revenue”.

I have just a couple of follow-up questions about this report, as I as an economist and experienced banker have been asked by the local media to comment on your report:

• You state that the fishing policy reform “is credit positive because it should ensure the long-term sustainability of the islands' most important industry, discourage overfishing through a new quota system and boost one of the government's main revenue sources through auction proceeds and additional fees.”

• I interpret this to imply that you appreciate the fact that the Faroese government has implemented a new system with the aim of ensuring both (1) sustainability of the stocks, and (2) a larger government take of the resource rent. è it has several angles -  which all have some relevance to factors that we analyse: e.g. The fact that the government took action and has discussed and agreed on some kind of reform to this sector. We view this that the government is using its FLEXIBILITY to take action. More flexibility is generally said positive for a government. But also the FINANCIAL PERFORMANCE is influenced by this reform. Additional revenues are generally positive in that respect. We do not say that the government has found the best solution to address sustainability, however, our take is that – compared to  before -  the government is aiming to define and agree on a better fishing policy (also by addressing some of the weaknesses in the earlier system).

• In the report you also refer to the previous system relative to the new system in the following way: “Previously, fisheries had limits on the days spent at sea (known as the effort-quota system). The government have determined that this has led to overfishing in the past as fisheries were incentivised to use all their allotted days… The TAC quota will be reviewed annually to enable the government to assess fish stock levels and be flexible in their response to setting appropriate limits to fishing. As a result, the government will be able to actively address concerns about preserving fish stocks of different species, which is credit positive as it mitigates long term risk to the fishing sector. The Faroese government will work with experts to determine appropriate measures to maintain fish stocks, affirming its clear commitment to the development of a sustainable and environmentally conscientious fishing industry.”

• I interpret this to the effect, that you have taken the Faroese government at its word with regards to the previous system (“the effort-quota system”), when “the [Faroese] government have determined that this has led to overfishing in the past”. Not that you have analyzed the previous system in detail and determined the merits of the new system relative to the old system. Is this a correct interpretation of mine? è We look at both, publicly available information and information which we get from the government. As in this case, we try to understand the motivation of the government and analyse the way how it acts and how certain factors are addressed. Of cause, we focus in that respect on the factors which are most relevant for the credit profile of a governments. Or more specifically, we do not advice on a certain system, nor do we recommend a certain system. What we do in this report is to describe the effect that we see (from the discussed fishing reform) to the credit profile of the government.

• I am asking you specifically about this, since some voices in the Faroese society are referencing your report as an authority on the choice between the old effort-quota system and the new quota system. I find this to be a stretch of your report’s conclusions. è see my previous answer. You  are right, that this is not the way how this report should be seen.

• There is an ongoing debate in the Faroese society and in the Parliament on the regulation regime, since the opposition in the Parliament (backed by large parts of the industry) wants to retain the effort-quota system, while the governmental parties also are split. Yesterday, the Minister of Fisheries put forth a proposal in the Parliament, that the implementation of the quota system for the demersal fisheries in Faroese waters is postponed from 1 January 2019 to 1 January 2020. This is because of internal discussions among the government parties. All the parties agree to manage the fishing stocks sustainably, but they disagree about the specific system. è I think what you describe is a fair observation. We understand that the full implementation is still under discussion and the postponement a reflection of the fact that an agreement will not be found in the next few month (not  election probably…). But anywhay, what we also take from the discussion about this reform is the fact that sustainability is a consideration. Probably more than it was in the past. So, this is also what we appreciate with the discussion around the fishing reform. In our view, such considerations (e.g. environment, social and governance… or generally “sustainability” are also a consideration when we look at a credit profile of a government.

Best regards
Johnny í Grótinum, economist

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