Realising the Potential of the Outermost Regions for Sustainable Blue Growth

Realising the potential of the Outermost Regions for sustainable blue growth

ANNEX 7 TO THE FINAL REPORT THE BLUE ECONOMY IN THE AZORES

Written by COGEA srl, in partnership with AND International, Fundación AZTI and Poseidon Aquatic Resources Management Ltd September – 2017

EUROPEAN COMMISSION Executive Agency for Small and Medium-sized Enterprises (EASME) Department A – COSME, H2020 SME and EMFF Unit A3 - EMFF

E-mail: [email protected]

European Commission B-1049 Brussels

Realising the potential of the Outermost Regions for sustainable blue growth

ANNEX 7 TO THE FINAL REPORT THE BLUE ECONOMY IN THE AZORES

Executive Agency for Small and Medium-sized Enterprises (EASME) European Maritime and Fisheries Fund (EMFF) 2017 EUR [number] EN

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LEGAL NOTICE This document has been prepared for the European Commission however it reflects the views only of the authors, and the Commission cannot be held responsible for any use which may be made of the information contained therein. More information on the European Union is available on the Internet (http://www.europa.eu). Luxembourg: Publications Office of the European Union, 2017 ISBN 978-92-9202-305-8 doi: 10.2826/765231 © European Union, 2017

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Contents

Mapping economic activities ...... 1 1. Identification and mapping of economic activities ...... 1 2. Synergies and tensions between maritime activities ...... 21 3. Best practices and flagship projects ...... 25 4. Gap analysis ...... 27

Mapping actors and maritime strategies...... 31 5. Mapping public authorities ...... 31 6. Summary of existing maritime strategies ...... 32 7. Mapping main stakeholders ...... 34

Mapping Blue Growth and assessing the potential...... 35 8. Growth drivers and barriers ...... 35 9. Future potential for mature and pre-developing activities ...... 40 10. Investments opportunities ...... 47

Identifying public and private intervention ...... 48 11. Potential financial, legislative and non-legislative measures for stimulating growth ...... 48 12. ORs potential contribution to IMP and BG initiatives ...... 55 13. Conclusions on concrete measures by type and timeframe ...... 57 14. Potential projects for the Atlantic Assistance Mechanism ...... 69

Roles and contributions to external initiatives ...... 70

List of interviewees ...... 70

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

List of acronyms

ARA Autonomous Region of the Azores CAGR Compound annual growth rate EEZ Exclusive Economic Zone EMFF European Maritime and Fisheries Fund ERDF European Regional Development Fund FDI Foreign Direct Investment GVA Gross Value added INE Instituto Nacional de Estatística — National statistical Institute NACE Nomenclature statistique des activités économiques dans la Communauté européenne — Statistical nomenclature of the economic activities in the European Community OR Outermost region OT Overseas territory

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Mapping economic activities 1. Identification and mapping of economic activities This chapter maps Blue Growth economic activities of the Autonomous Region of the Azores, according to the ‘Methodological notes for the definition of Maritime activities in ORs’. The CAGR (compound annual growth rate) has been computed for GVA, employment and turnover for the period 2010-2014. When 2010 data are not available, CAGR has been computed for the period 2011-2014. However, those figures are not available for all activities. In those cases where data are not available, the activity has been described basing on collected information through interviews. Sea and coastal passenger water transport is composed by cruise transport and ferry transport. According to the ‘Methodological notes for the definition of Maritime activities in ORs’, Ferry transport has been included in ‘Maritime transport’ and cruise in ‘Cruise tourism’. Therefore, the share of the number of ferry passengers and of cruise passengers on total passengers was applied to data on GVA, employment and turnover related to ‘passenger water transport’. As data on cruise passengers are available only for 2014 and 2015, we have considered the shares related to 2014. Table 1 — Evolution of the number of cruise and ferry passengers (2010-2015, No)

2010 2011 2012 2013 2014 2015 Passengers Ferry 480 921 486 149 458 477 463 434 484 058 512 688 Passengers Cruise (transit) na na na na 83 268 117 784 TOTAL 480 921 486 149 458 477 463 434 567 326 630 472 % Ferry / Total - - - - 85% 81% % Cruise / Total - - - - 15% 19%

Source: Serviço Regional de Estatistica dos Açores (Regional statistical service of the Azores) The share of GVA, employment and turnover related NACE I 55 Accommodation and I 56 Food was computed by taking into account the annual share of travels made by ‘leisure, recreation and holiday’ on the total number of travels. Table 2 — Travels in Azores, according to the reason (2010-2015, 1,000)

Share Leisure, Visit to Professional Other 'Leisure, Total recreation family or Health Religion or business reasons recreation or or holidays friends holidays'/total

2010 174.6 74.3 50.3 26.7 3.2 1.6 18.4 42.57% 2011 172.0 70.8 49.4 28.9 2.3 0.7 19.9 41.16% 2012 196.6 74.9 74.2 30.1 … … 13.2 38.11% 2013 193.2 49.3 102.6 15.5 0.8 5.0 20.0 25.52% 2014 210.4 84.4 84.8 23.0 2.5 1.0 14.7 40.11% 2015 223.2 116.3 68.5 25.0 x 3.9 8.6 52.11% Source: INE — Estatísticas do Turismo (Tourism statistics) Moreover, the share of GVA, employment and turnover related to wave energy was computed by taking into account the annual share of wave energy production on total electricity production.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Table 3 — Production of Electricity (2010-2015, KWh) (KWh) 2010 2011 2012 2013 2014 2015 Biogas 255 200 324 337 190 215 116 133 145 464 22 939 Wave Centre 25 571 6 146 10 144 3 20 888 27 441 Wind 33 744 508 32 980 260 62 652 150 68 900 006 72 431 010 61 935 559 Fuel 540 055 040 516 716 530 509 578 220 443 128 437 432 901 444 443 011 289 Diesel oil 70 750 342 71 172 945 69 397 662 73 943 691 69 672 908 72 688 119 Geothermal 173 551 756 185 630 587 134 086 304 174 266 087 182 870 486 182 043 994 Hydric 31 330 052 32 989 229 28 411 044 29 381 600 23 757 340 24 256 396 Micro - Wind 3 864 7 907 3 168 2 374 1 570 1 885 Micro - Photovoltaics 17 260 83 636 190 123 197 722 207 607 220 400 Thermal Fuel 30 228 100 466 21 231 1 839 11 15 Ind. - Photovoltaics 15 634 20 118 17 241 550 17 356 Ind. - Wind 468 2 384 981 6 733 431 6 953 245 Mini - Photovoltaics 125 240 125 836 123 487 Mini - Wind - - Total 849 763 821 840 027 678 804 560 847 792 465 354 788 868 545 791 302 125 Share Wave Centre/Total 0.0030% 0.0007% 0.0013% 0.0000% 0.0026% 0.0035% Source: Serviço Regional de Estatistica dos Açores

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Table 4 — GVA of marine and maritime activities Mature GVA Tab (M) vs pre- GVA Group Sectors le 5 develop.(P) 2010 2011 2012 2013 2014 CAGR — activity Em Fisheries and aquaculture M 24 872 715 12 517 253 13 451 675 16 389 503 27 410 943 2.46% plo - A 03.11 Marine fishing M 14 168 080 12 517 253 13 451 675 16 389 503 16 402 073 3.73% ym Living (production) ent resources - C 10.20 Processing and in preserving of fish, M 10 704 635 na na na 11 008 870 0.70% mar crustaceans and mollucs ine Extraction of aggregates - B and Non-living 08.12 Operation of gravel M 889 225 1 187 616 233 561 na na - mar resources and sand pits; mining of itim clays and kaolin e Maritime transport M 6 977 609 5 829 466 5 686 645 5 063 570 6 820 913 -0.57% acti - H 50.10 Sea and coastal M 261 937 na na na 669 197 24.43% viti passenger water transport es - H 50.20 Sea and coastal Group Sectors MatureM 6 715 672 5 829 466 Employment5 686 645 5 063 570 6 151 716 -2.17%GVA freight water transport Shipping (M) vs pre- CAGR Ports (including dredging) M 425 425 849 546 728 688 728 136 677 954 -7.24% develop.(P) - H 52.10 Warehousing and activityM na 456 942 463 120 441 641 416 988 -3.00% storage services - - H 52.24 Cargo handling M 425 425 392 604 265 568 286 495 260 965 12.73% - Ship repair M 517 364 na na 173 711 203 186 20.84% Shipbuilding - C 33. 15 Repair and - maintenance of ships and M 517 364 na na 173 711 203 186 20.84% boats Coastal tourism M 34 463 915 na 24 507 772 15 801 910 25 294 374 -7.44% - I 55 Accommodation M 14 286 181 na 11 120 190 7 832 371 13 368 810 -1.65% - I 56 Food and beverage - M 20 177 733 na 13 387 581 7 969 538 11 925 564 service activities 12.32% Tourism - H 51 Air transport M na na na na na - Cruise tourism M 46 224 na na na 118 094 26.43% - H 50.10 Sea and coastal M 46 224 na na na 118 094 26.43% passenger water transport Renewable Wave energy M 3 182.11 678.98 1 289.48 - 2 204.18 -8.77% energy

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

2010 2011 2012 2013 2014 Fisheries and aquaculture M 3 538 2 658 2 948 2 966 3 572 -3.89% - A 03.11 Marine fishing M 2 697 2 658 2 948 2 966 2 831 1.22% Living (production) resources - C 10.20 Processing and preserving of fish, M 841 na na na 741 -3.12% crustaceans and mollucs Extraction of aggregates - B Non-living 08.12 Operation of gravel M 27 26 22 na na - resources and sand pits; mining of clays and kaolin Maritime transport M 186 113 103 103 202 2.09% - H 50.10 Sea and coastal M 73 na na na 101 8.45% passenger water transport - H 50.20 Sea and coastal M 113 113 103 103 101 -2.77% Shipping freight water transport Ports (including dredging) M 10 14 11 12 12 -4.95% - H 52.10 Warehousing and M na 4.0 3.9 4.1 4.2 1.32% storage services - H 52.24 Cargo handling M 10 10 7 8 8 -7.82% Ship repair M 34 na na 14 16 -17.18% - C 33. 15 Repair and Shipbuilding maintenance of ships and M 34 na na 14 16 -17.18% boats Coastal tourism M 2 332 2 278 1 869 1 214 1 967 -2.87% - I 55 Accommodation M 905 845 748 487 796 -3.15% - I 56 Food and beverage M 1 427 1 433 1 122 727 1 171 -4.82% service activities Tourism - H 51 Air transport M 261 213 188 119 -19.80% 108 Cruise tourism M 12.9 na na na 17.85 8.46% - H 50.10 Sea and coastal M 12.9 na na na 17.85 8.46% passenger water transport Renewable Wave energy M ------energy

Table 6 — Turnover of marine and maritime activities Mature Turnover GVA Group Sectors (M) vs pre- 2010 2011 2012 2013 2014 CAGR

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

develop.(P) activity Fisheries and aquaculture M 95 859 350 40 173 056 38 458 879 39 496 210 110 957 501 3.72% - A 03.11 Marine fishing 43 199 731 40 173 056 38 458 879 39 496 210 38 403 409 -2.90% M Living (production) resources - C 10.20 Processing and 52 659 619 na na na 72 554 092 8.34% preserving of fish, M crustaceans and mollucs Extraction of aggregates - B 3 287 937 3 116 621 1 874 396 na na - Non-living 08.12 Operation of gravel M resources and sand pits; mining of clays and kaolin Maritime transport M 33 778 515 30 666 984 31 180 328 31 771 663 35 394 052 1.17% - H 50.10 Sea and coastal 2 712 041 na na na 3 233 020 4.49% M passenger water transport - H 50.20 Sea and coastal 31 066 474 30 666 984 31 180 328 31 771 663 32 161 032 0.87% M Shipping freight water transport Ports (including dredging) M 763 836 1 586 869 1 270 382 1 275 459 1 251 904 -7.60% - H 52.10 Warehousing and na 903 491 763 530 744 260 751 254 -5.97% M storage services - H 52.24 Cargo handling M 763 836 683 378 506 852 531 199 500 651 -9.85% Ship repair M 2 126 829 na na 985 309 1 140 263 -14.43% - C 33. 15 Repair and 2 126 829 na na 985 309 1 140 263 -14.43% Shipbuilding maintenance of ships and M boats Coastal tourism M 78 300 825 na 57 485 146 37 349 351 58 439 615 -7.05% - I 55 Accommodation M 27 110 605 na 20 885 873 14 540 940 23 454 603 -3.56% - I 56 Food and beverage 51 190 220 na 36 599 273 22 808 411 34 985 012 -9.08% M service activities Tourism - H 51 Air transport M na na na na na - Cruise tourism M 478 595 na na na 570 533 4.49% - H 50.10 Sea and coastal 478 595 na na na 570 533 4.49% M passenger water transport Renewable 6 655.69 1 599.23 3 027.33 - 5 416.14 -5.02% Wave energy M energy Source: INE, Sistema de contas integradas das empresas (Business integrated account system) – SCIE; A 03.11 Marine fishing – employment: INE PESCAS; H 51 Air transport: employment – SBS Eurostat Notes:  GVA and turnover are in EUR; Employment is expressed in number of units.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

 Fisheries and aquaculture – data on C 10.20 Processing and preserving of fish, crustaceans and mollusc not available for years 2011, 2012 and 2013  Extraction of aggregates — B 08.12 Operation of gravel and sand pits; mining of clays and kaolin – data not available for years 2013 and 2014  Maritime transport — data on H 50.10 Sea and coastal passenger water transport not available for years 2011, 2012 and 2013  Ports — data on H 52.10 Warehousing and storage services not available for 2010; data on H 52.22 Service activities incidental to water transportation not available. Therefore, total Ports is underestimated  Ship repair — data on C 33. 15 Repair and maintenance of ships and boats not available for 2011 and 2012  Coastal tourism — data on I 55 Accommodation and I 56 Food and Beverage services activities not available for 2011; SBS Eurostat regional data for data on employment related to year 2011 of I 55 Accommodation and I 56 Food and Beverage services activities; data on H 51 Air transport not available  Cruise tourism — data on H 50.10 Sea and coastal passenger water transport not available for years 2011, 2012 and 2013; data on H 52.22 Service activities incidental to water transportation not available Data limitations derive from the application of the law on statistical confidentiality.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

1.1 Fisheries and aquaculture Fishing and its subsidiary activities, such as fish processing, is an important economic activity in the Archipelago of Azores. It accounts for around 2 % of the archipelago total GVA and in 2014 it accounted for 3 % of regional employment. 1.1.1 Overview Fisheries The fishing effort in the Azores, although its large Exclusive Economic Zone (953 633 km2), is exercised in a narrow area around the islands and in limited number of fishing banks that correspond to the top of submarines hills and plateaus, usually far from the islands. The Azores have a relative lack of biomass and waters are biologically fragile, especially in terms of demersal and deep-water species, since it does not have a continental shelf and has high average depths. Only 0.9 % of Azores EEZ area has depths less than 600 meters. Fish habitats have a high environmental sensitivity, which requires a close monitoring of operating levels, spatial distribution of fishing effort and a permanent evaluation of water sources. The figure below shows the evolution of landings in the last seven years. Figure 1 — Evolution of total landings in volume and value (2008-2015, kg, €)

45 000 000 20 000 000 40 000 000 18 000 000 35 000 000 16 000 000 14 000 000 30 000 000 12 000 000 25 000 000 10 000 000 20 000 000

value(€) 8 000 000 15 000 000 volume (kg) 6 000 000 10 000 000 4 000 000 5 000 000 2 000 000 - - 2008 2009 2010 2011 2012 2013 2014 2015

Value (€) Volume (kg)

Source: Serviço Regional de Estatisca The most representative species in quantities are pelagic (tuna) and demersal fishes, corresponding respectively in 2015 to 50.57 % and 40 % of total landings. Table 7 — Total landings by species 2010-2015 (kg, %) 2009 2010 2011 2012 2013 2014 2015 Demersal 3 600 902 2 912 787 3 268 333 3 738 955 3 528 111 3 796 535 3 683 908 Pelagic 5 451 845 15 512 309 12 115 183 8 781 555 9 900 081 4 868 941 4 164 948 Crustacean 13 286 17 253 10 949 6 846 10 222 20 185 39 720 Molluscs 463 500 570 907 688 463 262 673 531 711 416 871 277 490 Other 16 388 16 011 10 182 5 954 2 707 1 698 70 614 species TOTAL 9 545 921 19 029 268 16 093 111 12 795 984 13 972 831 9 104 230 8 236 680 Source: Direção Regional de Estatística (Regional directorate of Statistics)

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Table 8 — Total landings by species 2010-2015 (euro, %) 2009 2010 2011 2012 2013 2014 2015 Demersal 19 761 381 17 012 083 16 673 052 16 005 332 14 411 405 15 240 078 18 190 606 Pelagic 8 947 819 19 705 778 18 557 709 19 011 720 16 957 608 9 843 101 7 567 819 Crustacean 164 655 238 408 145 362 100 153 128 766 214 578 504 521 Molluscs 34 232 30 836 27 006 18 541 3 525 2 387 18 370 Other 2 016 972 2 562 839 3 260 659 1 498 477 2 560 320 2 239 150 1 746 165 species TOTAL 30 925 060 39 549 944 38 663 787 36 634 222 34 061 624 27 539 293 28 027 481 Source: Direção Regional de Estatística In the Azores, the only fleet segment dedicated to a specific species is the tuna fleet that operates during part of the year taking advantage of the migration of tuna in the Atlantic. The tuna catches have a large annual variation, as we can see in the chart below. Figure 2 – Evolution of pelagic species landings 2010-2015 (kg)

18 000 000

16 000 000

14 000 000

12 000 000

10 000 000

8 000 000 VALUE (€)VALUE 6 000 000

4 000 000

2 000 000

- 2008 2009 2010 2011 2012 2013 2014 2015

Source: Direção Regional das Pescas (Regional directorate of fishery) Fishing of deep-water species is multi-specific, i.e. vessels are not specialized for the use of a single type of gear, and the fleet is composed mainly of vessels less than 9m long, representing 65 % of the total fleet (in number). Table 9 – Evolution of the composition of the fleet (2010-2014) 2010 2011 2012 2013 2014 Vessels (No) 692 696 672 622 599 CFF<9m 469 466 435 394 361 9m<=CFF<12m 149 156 161 155 156 CFF>12m 74 74 76 73 82

Source: Direção Regional das Pescas The maritime area of the Azores is considered as a very sensitive area under an environmental point of view. For this reason, the regional fleet operates with selective fishing techniques, contributing to the preservation of marine resources and habitats.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Areas included between 600m and 1 000m of depth is a very important deep-water fishing area for local communities, which are biologically sensitive due to its level of exploitation (1). Moreover, it is important to underline that Bluefin tuna fishing is subject to national quotas (2). Considering the geographical distance from markets, the vast majority of fish caught in the Azores is sold fresh and tuna is almost entirely delivered to the local tuna canning industry. Within marine fishing, other activities with some relevance are usually undertaken as a complement to other activities (not necessarily linked to the sea) and it may represent an important contribution to household income. The most important species are: limpets (Patella aspera and P. candei), octopus (Octopus vulgaris), barnacles (Megabalanus azoricus) and some algae (in particular, Porphyra sp. Asparagopsis armata, among others).

Box 1 – Main figures on fishing facilities and equipment of the Archipelago

2012 2013 2014 No of fish auctions 11 11 11 No of collection points 30 30 30 No of cold stores 9 9 9 No of ice machines 47 47 48 160 160 160 tonnes Freezing capacity tonnes/day tonnes/day /day Conservation capacity of frozen products 5 242 tons 5 242 tonnes 5 242 tonnes Conservation capacity of refrigerated 190 tonnes 190 tonnes 190 tonnes products 179 tonnes 179 tonnes 181 tonnes Capacity of ice production /day /day /day

Source: Lotaçor S.A. – Annual Report 2014

Aquaculture Currently there is no marine aquaculture in the Azores, mainly because natural and weather conditions are not favourable. However, there is interest in investing in this area, given the internal growing demand for seafood and the need to reach a higher level of food self-sufficiency, which remains pivotal for a region far from major markets. Aquaculture could help to meet this growing demand, complementing the fishing activity productions with sea products which are typical of the Azorean waters, in order to maximise and diversify sustainable maritime resource. Processing industry Processing of fish products is concentrated in units producing preserved tuna, exclusively aimed at exports. Considering the limited consumers’ demand for fresh fish, this industry

(1) Região Autónoma dos Açores, Governo Regional, ‘Uma proposta para uma melhor proteção da área marinha em torno dos Açores, no âmbito da reforma da Política Comum das Pescas’, http://servicos-sraa.azores.gov.pt/grastore/DRP/ProtecaoMarAcores.pdf. (2) In 2006 International Commission for the Conservation of Atlantic Tunas adopted a 15-year recovery plan for Bluefin tuna in the East Atlantic and Mediterranean, which is regularly updated based on stock assessment, actual controls and new technologies.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

is the main purchaser of production of the regional tuna fleet, especially the bonito species. Processing industry employs around 740 persons and it creates a gross value added of 11 million euros. It should be pointed out that the Azores processed tuna is labelled with ‘Dolphin Safe’ and ‘Friend of the sea’, considering that tuna fishing is done using the traditional pole- and-line fishing, i.e. an environmentally sustainable fishing practise. 1.1.2 Geographical distribution The main landing ports are Ponta Delgada (São Miguel Island), Horta (Faial Island) and Angra do Heroísmo (Terceira Island): respectively in 2014 the share on total landings was 50.7 %, 14.97 % and 12.39 %. Figure 3 – Breakdown of total landings in volume and value by island (2014, kg, €)

16 000 000.00 6 000 000.00

14 000 000.00 5 000 000.00 12 000 000.00 4 000 000.00 10 000 000.00

8 000 000.00 3 000 000.00

Value (€) 6 000 000.00 2 000 000.00 Volume (kg) 4 000 000.00 1 000 000.00 2 000 000.00

- - Santa São Miguel Terceira Graciosa São Jorge Pico Faial Flores Corvo Maria

Value Volume

Source: Serviço Regional de Estatisca 1.1.3 Main socio-economic trends Fisheries In the last years, landings have been decreasing gradually, both in volume and value, and the average annual growth (CAGR) was -4.7 % and -3.3 % (3) respectively, mainly due to the decrease of tuna landings. The number of licensed vessels has also a decreasing trend: in 2010 were licensed 703 vessels and in 2014 one hundred less (source: Direção Regional das Pescas). On the contrary, there is an increase of the number of licensed fishermen. Consequently, the average number of licensed fishermen per vessel increased.

(3) Based on data from Serviço regional de estatística dos Açores.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Figure 4 – Evolution of fishermen registered in the ARA (2005; 2010-2015)

3 200 3 151

3 100

3 000 2 948 2 966

2 900 2 831 2 800 2 697 2 700 2 658

2 600

2 500

2 400 2010 2011 2012 2013 2014 2015

Source: INE — Estatísticas da Pesca (Fishery statistics) The fishing activity gross value added was around 16 million euros in 2014 and in the last years, it presented an annual growth rate (CAGR) of 3.73 %. Aquaculture The activity does not exist in Azores. Processing industry The drastic reduction of tuna resources at the beginning of the 2000 decade led to a crisis that concerned, besides tuna fishing, also canning industry. Nonetheless, the activity still plays a major role in the Azores blue economy, since it is the most important one in terms of turnover and among the most important in terms of employment. Today there are four companies processing tuna: one in São Jorge Island, two in São Miguel Island and one in Pico Island. The Terceira Island plant is currently inactive. 1.1.4 Preliminary findings on growth potential Fisheries Considering natural constraints, the challenge for the future of the activity is to reduce fishing pressure on endangered species and contemporaneously study the possibility of exploring new species commercially viable in terms of available quantities, thus diversifying fished products. The future growth of the sector is also linked to the definitive desertion of non-selective fishing practices and to the adjustment of the fleet targeting tuna to the available resources. Fish habitats have a high environmental sensitivity, which require a close monitoring of operating levels, spatial distribution of fishing effort and a permanent evaluation of water sources. Therefore, the region intends to encourage the creation of protected marine areas with restrictions on exploitation, in order to safeguard, directly and indirectly, the fishing communities. Indeed, the creation of temporary protected areas allows protecting species in order to increase in the near future the abundance and availability of marine resources. Moreover, a better positioning of Azores products in the global market is also needed, identifying better sales opportunities. Public Authorities have been making a great effort to promote Azorean fish through the 'Azores brand' and through promotion initiatives in the international markets. The ‘Azores brand’ is a certification ensuring the quality of the product. Product diversification can also be envisaged through new presentation modes of fish like filleting, packaging and freezing.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Another aspect that would help fishing communities to survive is to diversify activities. Synergies are being developed between the fishery sector and tourism activities (whale and dolphin watching, etc.). In the Azores, commercial fishing vessels can undertake tourism activities and this represent a potential to be fulfilled for increasing sources of incomes of fishermen. Aquaculture Aquaculture is considered as a strategic sector to be developed in Azores, not only for the purpose of increasing the self-sufficiency of food products, but also for contributing to ‘develop synergies that will create a circular economy’ (4). As also reported in the plan ‘Better Fisheries, More Income’, the development of aquaculture could generate additional incomes to fishermen, allowing diversifying their activities and re-arranging fishing assets. Two types of facilities could be developed in Azores: land-based and offshore cages. While the first one could be focused to molluscs products with a potential in international markets (e.g. sea urchin, abalones, but also limpets and giant barnacles), the second one could concentrate on high demand species as gilthead seabream, but also other seabreams and amberjacks. An overall lack of know how both on farming techniques and on licensing hinder the development of the sector. Processing industry Recently, in Santa Maria Island, a black scabbard fish processing plant was created in order to diversify fish processing activities. This is a challenge as black scabbard fish is an unexplored resource in the archipelago but it has a great potential and could contribute to improve regional productivity and be a source of alternative income for regional fisheries.

1.2 Extraction of aggregates There is no data available on the INE ‘Sistema de contas integradas das empresas’ database concerning this activity. In 2013 there were six companies engaged in sand extraction. Until 2014 this activity concerned all islands with the exception of São Jorge and Corvo Islands. In the region, there are only three dredgers-vessels that are rented by the extracting companies when needed. According to information gather, this activity occupies 30 persons and has an annual turnover of around EUR 3 million. No growth potential has been surveyed for this activity.

1.3 Maritime transport The archipelago of the Azores is composed by nine Islands. This feature makes maritime transport activity of crucial importance for the overall economy of the OR, considering that around 70 % of Azorean external trade use this mode of transport. Moreover, due to its geographic position, the Azores are a nodal region for international freight maritime transport, especially for bunkering purposes. The maritime transport model shows significant differences between passengers and freight transport. While the passenger transport is economically unprofitable, it is subsidised by the Government of the Azores for ensuring a public service, freight transport responds to market demand without receiving financial support.

(4) Regional Secretary for the Sea, Science and Technology, at http://www.azores.gov.pt/Portal/en/entidades/srmct/noticias/Government_of_the_Azores_present s_mapping_of_areas_with_potential_for_aquaculture.htm.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

1.3.1 Overview Passengers transport inter-islands is done by two companies (Atlânticoline S.A. and Transportes Maritimos Açoreanos Lda) and it is conditioned by seasonality and by weather conditions. The passenger transport is done by five ships operating all along the year and two ships operating only seasonally. The latter are chartered by Atlânticoline S.A. Concerning freight maritime transport, the archipelago is linked to the Portuguese mainland through three freight companies transporting containers with an average capacity of 530 TEU. The remaining freight traffic concerns transportation of liquid and solid bulk that concerns only few ports, in particular Ponta Delgada (cereals) and Praia da Vitoria (cement) that have the necessary storage capacity. Figure 5 – Evolution of loaded and unloaded freight in the ARA ports (2008-2015, tonnes)

2 500 000

2 000 000

1 500 000

Tonnes 1 000 000

500 000

0 2008 2009 2010 2011 2012 2013 2014 2015 Loaded freight Unloaded freight

Source: Direção Regional de Estatística Among the large number of ships calling in the Azores harbours, there are 23 ships that operate almost exclusively in the region or that operate between the archipelago and the mainland: six container ships; one oil tanker, six general cargo ships, seven passenger ships and three extraction of aggregates ships. 1.3.2 Geographical distribution Passengers: The Islands of the central group, Faial, Pico and São Jorge, are the ones presenting the highest number of passengers transported, and in particular the route between the Port of Horta and Madalena, separated by Pico-Faial channel. Freight: freight transport – including containerised flows – are concentrated in Ponta Delgada and Praia da Vitoria. 1.3.3 Main socio-economic trends The number of ferry passengers has been gradually increasing, passing from 480,921 in 2010 to 512 688 in 2015 (data from ‘Serviço Regional de Estatistica dos Açores’) with positive impact in economic indicators of this activity. Gross value added increased at an annual rate of 24 % in the last years and a positive growth rate is also observed on employment and turnover, respectively +8.45 % and + 4.5%.

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Figure 6 – Evolution of the number of ferry passengers (2010-2015, No)

520 000 510 000 500 000 490 000 480 000 470 000 460 000

number of passengers 450 000 440 000 430 000 2010 2011 2012 2013 2014 2015

Source: Serviço Regional de Estatistica dos Açores Sea and coastal freight transport activity employed 200 persons in 2014 and the annual growth rate is positive (CAGR + 2 %). On the contrary, the gross value added shows a slight decrease growth rate (CAGR -2 %) and turnover is stable. In the last years, the activity recorded a decreasing trend in goods loaded and unloaded, although a partial recovery in 2015. This trend is not reflecting the increasing trend of tourism flows in the archipelago recorded in the last years. 1.3.4 Preliminary findings on growth potential Although not profitable, maritime passengers transport is one of the activities with a growth potential and is expected to generate new job opportunities in the short term, especially due to the growth of coastal tourism. As shown in the chart below, since the increase of travels spending at least one night has generated positive effects to passenger transported. Figure 7 – Travels lasting at least one night and passenger transported by ferry (2013- 2015, number)

240 000.00 520 000 220 000.00 510 000 500 000 200 000.00 490 000 180 000.00 480 000 160 000.00 470 000 460 000 140 000.00 450 000 120 000.00 440 000 100 000.00 430 000 2013 2014 2015 Travel lasting at least one night Passengers Ferry

Source: Serviço Regional de Estatistica dos Açores With a further development of coastal tourism, more connections should be envisaged in order to support tourists movements among islands. To respond to these new exigencies

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the Operational Program for the period 2014-2020 (Structural Funds) foresees the construction of two new ships for passengers, vehicles and trucks transport. The project will be presented to the European Commission. Furthermore, better infrastructures should be developed for managing passengers during seasonal peaks. As regards maritime freight transport, the geographical position of Azores represents a remarkable advantage for the archipelago for catching international shipping flows and develop transhipments facilities. Azores has therefore all potential features for creating a hub in the middle of the Atlantic that serves as a platform for cargo distribution from/to Europe, but also from/to North and South America and Africa. For reaching this purpose, the key step is to undertake a comprehensive analysis for better defining the potential role of Azores in the Atlantic and the concrete feasibility of this type of investments. Maritime freight transport is also the main channel for supplying the archipelago internal demand. The current increasing flows of tourists, which are expected to grow also in the near future, will require additional supplies of goods and related adjustment in the logistics chain, from transport to freight movements and storage. This means that increased supplies of goods need more efficient services, reducing transports costs and improving facilities on land for managing and moving cargoes (intermodality).

1.4 Ports 1.4.1 Overview The Azores ports are under the jurisdiction of Portos dos Açores, S.A. that manages all port infrastructures dedicated to the movement of goods and passengers. The archipelago has a large network of multi-purpose port infrastructures. In order to organise the use of the different facilities and to establish a development strategy adapted to the needs of each island, the regional government set a port classification (5) from class A to class E. This classification is based on ports functions: in class A are included larger ports with commercial warehouse facilities, in class D are included ports exclusively dedicated to fishing activities and class E are ports without a specific function. Main ports, classes A and B, assure the greatest part of the economic activity linked to passenger and freight transport and are also equipped with fishing facilities. The biggest port is located in São Miguel Island – Ponta Delgada Port. This port is a multi-purpose port: it is a commercial port, it has a cruise pier, a ferry pier and a marina with a capacity for 640 boats. Finally, it has a fishing area with a pier 486 mt long. The second port is the Terceira Island one – Porto da Praia da Vitoria – that has also a roll-on-roll-off ramp, a cement terminal and the Lajes military base. Recreational harbours have been, in the last decade, object of renewal and/or new marinas have been built. Currently, the archipelago has eight marinas dedicated to nautical and recreational boats that can be used also by small fishing vessels. The marinas have a total capacity of 1,855 mooring places.

(5) Regional Decree No 24/2011/A.

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Box 2 – Automatic Identification System (AIS) The Autonomous Region of Azores has a public automatic identification system of ships that is managed by the company ‘Porto dos Açores SA’. It allows:  to increase human safety in sea;  to ensure greater security and efficiency in shipping;  to ensure greater protection of the marine environment;  to improve high traffic situations and to optimize the flow;  to improving levels of port management;  to check the Exclusive Economic Zone (Portuguese Navy – search, rescue and investigation). The system is organised around ten inshore stations located on the different islands and two control stations. 1.4.2 Geographical distribution The biggest ports are located in São Miguel Island (Ponta Delgada Port) and in Terceira Island (Porto da Praia da Vitoria). Recreational harbours have been built in the different islands of the archipelago. 1.4.3 Main socio-economic trends The region has invested in the last decade in port infrastructures and facilities with the scope of stimulating economic activities that depend on maritime traffic. Thus, the majority of commercial ports in the region was renewed in order to answer to the new requirements of maritime policy and to provide them with a larger capacity for the provision of services. EU funding was crucial. In the period 1996-2011, the Autonomous Region of Azores invested EUR 390 589 603 (6) (source: Direção Regional dos Assuntos do Mar) in harbour infrastructures and equipment. Ro-Ro ramps were constructed in all class A + B ports of the region (with the exception of Corvo Island) with the scope of allowing an efficient operation of Ro-Ro ferries and thus increasing passengers and freight movement between islands. Moreover, four passenger terminals were built. The total annual movement of freight is (on average) around 2 500 000 tons (loaded and unloaded) and it has slightly decrease in the period 2008-2015 (CAGR -4.33 %).

The port activity (Warehousing and storage services + Cargo handling (7) employed 12 persons in 2014 and the annual growth rate is positive (CAGR +2 %). On the contrary, the gross value added shows a slight decrease growth rate (CAGR -2 %, 2011-2014 (8) as well as turnover (CAGR -7.60 %, 2011-2014). 1.4.4 Preliminary findings on growth potential The development of ports activity is linked to the development of other sectors, but at the same time, the availability of good facilities could support the development of other activities. In view of increasing tourists flows, which should generate increasing goods demand (new maritime freights flows) and in the light of the growing importance of cruise sector in the Macaronesia sea-basin, the development and continuous updating of port infrastructures are pivotal for fulfilling the potential of the Blue economy in the archipelago. As reported above in the maritime transport section, more efficient management of goods, as well as better infrastructures for managing passengers during seasonal peaks should be ensured, with more frequent inter-islands connections.

(6) Structural funds co-financing = 263,215,738 euros. (7) Data on ‘Service activities incidental to water transportation’ are not available. (8) 2010 data related to ‘Warehousing and storage services’ is not available. Therefore, CAGR has been computed for the period 2011-2014.

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Ports potential should be also linked to sailing and yachting activities. At present, there is a good number of marinas that can support the flows, but continuous updates and in the reception facilities (with higher number of boat places) should be planned, for keeping on attracting new flows of this tourism segment. New investments are however planned in this sense.

1.5 Ship building and Ship repair 1.5.1 Overview The building / ship repair is a marginal activity in the Azores. In 2014, this activity created a gross value added of EUR 200 000 and a turnover of EUR 1 140 263. The sector is characterised by small companies. According to information gathered, there are currently around sixteen companies mainly engaged on building/repair of fishing vessels and repair of recreational boats. 1.5.2 Geographical distribution Repair facilities are concentrated in San Miguel (mainly Ponta Delgada, but also Vila Franca do Campo) in Faial (Horta) and in Terceira (in Angra do Heroismo and Praia da Vitoria). 1.5.3 Main socio-economic trends This activity has been losing weight. Indeed, all three indicators show a significant decreasing annual growth rate in the analysed period (2010-2014): GVA -20.84 %, turnover -14.43 % and consequently employment around -17 %. 1.5.4 Preliminary findings on growth potential The regional administration of the archipelagos has been trying to stimulate this activity, by stimulating the reactivation of the existing shipyards in the port Madalena (Pico Island), which works today, below its capacity. The activity, especially ship repair, could represent an important development possibility, considering the potential increase of yachting and sailing boats calling for services in Azores. Although the activity could not have a significant impact in terms of value added or employment, it could result strategic for attracting boats, ensuring a full range of services to yachting/sailing sector. Ship repair is also linked to fishing activity as the maintenance/repair of vessels should be ensured for the appropriate management of the activity.

1.6 Coastal tourism 1.6.1 Overview The Azores are a recent tourism destination. However, for its distinctive natural features, the Azores present a high development potential for tourism. Consequently, in recent years, the tourism sector has been considered as a strategic priority for the development of regional economy.

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Figure 8 – Travels in Azores, according to the reason (2010-2015, 1 000)

250.0

200.0

150.0

100.0

50.0

0.0 2010 2011 2012 2013 2014 2015

Total Leisure, recreation or holidays Visit to family or friends Professional or business Health Religion Other reasons Lineare (Leisure, recreation or holidays)

Source: INE — Estatísticas do Turismo Unlike the mainland, where tourism remains strongly linked to sun and beach, the Azores tourism offer is more nature-oriented. The mix of tourism products of Azores has been widening in recent years including, among others, recreational boating, diving, cetaceans watching, fishing, geotourism, volcanological tourism, bird watching, surf, golf, diving, hiking, trekking, among others. The Azores have been increasingly identified as a recommended destination in the international tourism: e.g. one of the nine best destinations in the world by the American magazine Family Travel; the choice of Santa Maria by The Guardian as one of the best destinations worldwide in 2013; the selection as one of the top 25 destinations in the world by Fodor's 2013 Go List, etc. The Azores are not, currently, a vacation destination for families with children and most of the tourists flows originate from the mainland. Foreign tourists are mainly from other Northern and Central Europe and a lesser share from North America (USA and Canada). Accommodation is dominated by traditional hotels. The table below shows the number of guests by type of accommodation. Table 10 – Evolution of the number of guests by type of accommodation (2008-2015, no) 2009 2010 2011 2012 2013 2014 2015

Traditional hotels 327 901 347 902 344 595 326 370 331 587 345 594 428 012 Rural tourism 5 972 6 414 6 626 6 982 2 101 9 776 11 693 Local ------39 847 accommodation Holiday Camps / 6 186 8 310 7 909 12 197 11 998 - - Juv Hostels Camping 9 685 11 781 14 241 10 571 10 978 - - Guest houses 4 824 4 155 4 817 4 462 1 858 - - Private 2 815 3 096 3 966 3 843 936 - - accommodation Total 357 383 381 658 382 154 364 425 359 458 355 370 479 552 Source: Serviço Regional de Estatistica dos Açores Recently, low cost companies started to fly to the archipelago. In Azores, there are companies active in maritime tourism (i.e. boats operating on the sea for tourism purposes) with the exception of Corvo Island, where, however, the companies established in the neighbour Flores island operate regularly. Indeed, it is quite common that companies, although based on certain islands, operate in neighbour islands and may even have facilities in these islands. Currently there are 106 licences related to maritime tourism activities and 170 boats. On average, an operator possesses two boats. According to information gathered, in 2013,

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there were 153 operators dealing with tourists' animation and maritime tourism activities. These operators are mostly micro-companies which started their activity after 2007. The archipelago is a stopover for sailing vessels crossing the Atlantic, it is the continuation of an ancestral pattern of navigation dating back to the beginning of the establishment of the Atlantic routes. In order of importance (number of visits by vessels), the Canary archipelago is the most important, followed by the Azores, Madeira and, lastly, Cape Verde. 1.6.2 Geographical distribution Coastal tourism activities are basically spread over all islands of the archipelago. Only Corvo island present a limited presence of businesses operating in the maritime tourism activity. 1.6.3 Main socio-economic trends The tourism sector has been showing a growing importance. The number of hotels has been growing in the last years and this growth has been accompanied by an increase in the number of tourists. According to data from the Regional Statistics, the number of guests in accommodation facilities has been increasing since 2010 at an annual growth rate of 5 % (CAGR 2010-2015). The approach implemented by Regional Authorities in the last years for developing the sector, focused on markets diversification, mitigation of seasonality and the development of services, such as congress areas, golf and nautical tourism, investments for four and five-star resorts and rural tourism — thus avoiding massification of ‘Azores’ destination. The analysis of the indicators related to this activity (computed as the sum of NACE codes I 55 Accommodation and I 56 Food and beverage service activities), however, show a decreasing trend: GVA -7.44 %; employment -2.87 % and turnover -7.05 %. It should be reminded here that Accommodation and Food and beverage service activities are not exclusively linked to the tourism activity and therefore dependent of the evolution of other activities and on the economic crisis. 1.6.4 Preliminary findings on growth potential Although tourism remains at present an emerging sector, it is one of the activities of the regional economy with the highest growth potential. The sector can generate remarkable impacts on income generation and employment, both in the sector itself and in a very wide range of activities to which it relates. Taking advantage of the unique characteristics of the region should be a pillar of the development in the Azores, including nature tourism, rural tourism, nautical tourism and cruise tourism. It is considered as a key priority to continue the enhancement of the offer, raising it to international standards requirements and minimizing the effects of seasonality. There is the need to deepen, e.g. through an ad-hoc study, the market/target knowledge, in order to adequately direct tourism investment and communication. New markets should be explored. Indeed, there are some emergent tourism activities not yet explored: i.e. shark diving and swimming, diving with manta rays (Manta and Mobula) and whale sharks (Rhincodon typus), near seamounts. In Santa Maria, there is a recognized high potential for the development of these diving activities in the open sea, as some of the most suitable sites are located near already existing land-based infrastructures. These activities require further regulation and their economic potential is still unknown for lack of accurate information. The potential of the sector is equally distributed among different islands composing the archipelago. This means that support should be ensured to all islands for developing adequate hotel infrastructures and guaranteeing connections all along the year, especially in seasonal peaks. The overall development of maritime tourism in the Azores should follow sustainability models, for the purpose of constantly ensuring a trade-off among (i) the development of

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the different activities composing tourism, (ii) the creation of support infrastructures (e.g. ports, marinas, other facilities) and (iii) the protection of the environmental resources, which represent the real added value of the island to be sustainably exploited.

1.7 Cruise tourism 1.7.1 Overview The Azores routes concern mainly the annual repositioning of cruise ships between North America and Europe. Every year in autumn, in fact, many/most important cruise ships are ‘re-positioned’ from the Mediterranean (in which the cruise season is mainly concentrated in Spring-Summer) to the Caribbean Sea (in which the cruise season is mainly concentrated in Autumn-Winter). During the cross-Atlantic trip, cruise ships stops in Azores. These stopovers are mainly concentrated in October and November. In 2008 was inaugurated the Cruise Terminal ‘Portas do Mar’ in the Ponta Delgada Port. This infrastructure stimulated the arrival of new cruise ships. It consists of a cruise terminal and a marina with public facilities such as a swimming pool, a shopping area with restaurants and shops. 1.7.2 Geographical distribution The port of Ponta Delgada, in São Miguel Island, is the main cruise port of Azores. It follows, in order of importance, the port of Horta, which has been experiencing an increase in the number of cruise ships scales. With the exception of the port of Praia da Vitória, which registers a regular inflow of tourists from cruise ships, although clearly below the importance of ports of Ponta Delgada and Horta, the other ports register a residual activity. 1.7.3 Main socio-economic trends In 2015 the ports of the Azores recorded 138 cruise ship scales and 117,784 passengers, around 40 % more than in 2014 with registered 83,268 passengers and 90 stopovers. In 2016, the Azores should receive ‘Disney Magic’ and ‘Carnival Vista, ships that will arrive for the first time. Another new entry should be the German operator AIDA Cruises’. Finally, it is worth to mention the arrival of the Jewel of the Seas at Ponta Delgada in November 2016. After visiting Lisbon, the Ponta Delgada harbour receives the Jewel of the Seas, a cruise ship of the Royal Caribbean Cruises International. The Jewel of the seas, with a capacity of 2078 passengers undertakes a 13 days transatlantic trip between Civitavecchia and San Juan, with call in Valencia, Lisbon and Ponta Delgada. 1.7.4 Preliminary findings on growth potential This is an activity with high development potential but it is necessary that the archipelago starts to be seen as a cruise destination in addition to the seasonal repositioning of ships, which, currently, represent the majority of movements in archipelago. Cruise tourism is not a direct source of employment for the Azores, but indirect effects originating from it could be remarkable for the local economy. In fact, cruise tourism could serve as a vehicle for tourist promotion and the region should positively awaken the cruise passenger attention, in order to stimulate the desire to come back for vacation. Coordination of interests and efforts among different stakeholders involved in the sector should be strengthened, in order to allow the territory to better meet the need of cruise ships for calling Azores ports and keep passengers for longer stays.

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1.8 Marine renewable energies—wave energy In the Pico Island, there is one of the first wave energy plant in the world, OWC type (oscillating water column connected with a Wells turbine). The plant is a pilot project and has been designed by the Instituto Superior Técnico in collaboration with the Queen’s University of Belfast and the University College Cork. This central was the first in the world to be connected to an electricity distribution network. It started operating in 1999. It produces around 0.003 % of the archipelago electricity but its functioning is influenced by numerous technical and structural problems requiring a constant and important financing. Its functioning is not continuous. With information currently available, it is not possible to assess the socio-economic impact of the activity neither the potential. On the other hand, technical problems surveyed so far and the marginal volumes of energy produced do not allow the wave energy to be considered as a promising activity for the short-medium term. The possible future introduction of more efficient production technologies could allow reconsidering the activity under a long-term perspective.

1.9 Deep sea mineral resources The exploitation of deep sea mineral resources is still in an initial phase. There are, however, initiatives that have demonstrated the potential of this activity. First of all, it should be considered that the Economic Exclusive Zone (EEZ) of Azores represents at present around 57 % of the Portuguese EEZ and around 30 % of European EEZ, covering an area of around 1 million km2. The Azores are identified as one of the areas of the Atlantic where the ocean mining could become a reality because seafloor is characterised by massive sulphides, crusts and polymetallic nodules. The proximity of the islands and available port infrastructure may represent an added value in terms of logistics in a future commercial scenario exploitation of these resources. However, to date there is any exploitation of these mineral resources in the EEZ of the Azores, but only plans for prospecting studies. The University of the Azores is realising a project for the assessment of the potential environmental impact of the development of such activity in the maritime space of the archipelago under Horizon 2020. The information currently available does not allow to assess the potential of the sector in Azores. Furthermore, the exploitation of deep-sea mineral resources is still at an embryonic stage and the financial sustainability of the sector should be further fine- tuned, as resources needed at present for extracting minerals from the seabed are still too high.

1.10 Other activities 1.10.1 Research & development In the area of Research and Development related to the Marine Fisheries, it is important to mention the Department of Oceanography and Fisheries of the University of the Azores (DOP / UAc). The Department was established in 1976. Since its foundation the DOP / UAc assumes as ‘motto’ scientific knowledge, the conservation of marine life and the sustainable use of the Atlantic Ocean in the Azores. The team of PDO / UAc currently includes 28 PhDs from different nationalities, a larger number of doctoral students, technical and administrative staff. The DOP / UAc has a Master (Integrated Studies of the Oceans) and a PhD (Marine Sciences).

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DOP / UAc, member of the Institute of Marine Research (IMAR) works in network with other universities ID centres, being recognized by the Foundation for Science and Technology (FCT). IMAR is one of the international reference centres in Deep Sea research, totalling about 30 % to 35 % of publications in international scientific journals. Moreover, with significant activity in the area of marine sciences, we can also highlight the Department of Biology of the University of the Azores. The department develops significant research activities in the field of marine biology, which includes topics such as marine resources, biological oceanography, modelling and mapping of coastal biotope, among others.

1.10.2 Sea school There is a project concerning the setting up of the ‘Sea school’, a vocational school aiming at meeting the training needs in the areas of commercial shipping, fisheries, maritime tourism activities and activities linked to environmental monitoring. This school is expected be an organic unity of the education system of the Azores. In 2012, a Cooperation Protocol between the Government of the Azores, the University of the Azores, the municipality of Horta and the Nautical School Infante D. Henrique has been signed. Note that the Regional Annual Plan for 2015 (approved by the Regional Legislative Decree No. 2/2015 / A, January 7) allocates a budget of € 1 715 000 as a contribution to the start-up of the Sea School. Moreover, this project has been included in the Regional Operational Programme 2014-2020 of the Azores.

1.11 Possible impacts of climate change in the Azores (9) Impacts of climate changes in the Azores’ maritime sectors are manifold and concern different activities. Increasing water temperatures and ocean acidification could generate a reduction in biodiversity and in stocks to be exploited for commercial purposes, with a possible change of the distribution of migratory species. Increased ocean temperature could generate more frequent and stronger sea storms, increasing the risk of coastal flooding and endangering coastal infrastructures. Furthermore, considering that most of infrastructures are located on the coast, the sea level rise may harm sea ports infrastructures and all port-related activities, although there are limited measurements which could state whether these changes are due to seasonal variation or to effects of climate changes. Changes in seasonal precipitation may endanger water availability during the year and the concentration of precipitations in shorter periods could generate more frequent landslides. Nonetheless, warmer winters might incentivise winter tourism, contributing therefore to the reduction of seasonality. In general, adaptation actions should therefore be undertaken for several activities, many of which are maritime activities, especially transport, coastal zone management and water supply.

(9) Source : European Commission, 2014, The economic impact of climate change and adaptation in the Outermost Regions, http://ec.europa.eu/regional_policy/sources/activity/outermost/doc/impact_climate_change_en.pdf .

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

2. Synergies and tensions between maritime activities The table below reports synergies and tensions of each activity with other maritime activities and which are the contribution to sustainable Blue growth SYNERGIES CONFLICTS WITH OTHER CONTRIBUTION TO GROUP SECTOR WITH OTHER MARITIME MARITIME SUSTAINABLE GROWTH ACTIVITIES ACTIVITIES The use of environmentally The use of sustainable fishing environmentally practice, certifies that sustainable fishing fishing in the Azores is a practise, allows sustainable activity. processing industry The creation of to use the labels protected marine areas ‘Dolphin Safe’ and with restrictions on The creation of marine ‘Friend of the sea’. exploitation, allow protected areas reduces The Regional safeguarding, directly fishing areas already Network of Protected and indirectly, the limited by natural Fisheries Areas includes a fishing communities. Living constraints. and wide range of marine The capture of some resources The high variability in aquaculture protected areas also species with high catches may hamper to safeguard demand and captured investments on the biological resources with the use of certified downstream processing for fishing. sustainable techniques, industry. There are synergies has the potential for with tourism greater development, activities. In the being important to Azores, commercial study issues such as fishing vessels can new packaging undertake tourism techniques, new activities. distribution channels, new markets, fish traceability. As regards passengers transport, synergies exist with tourism, as shown in Fig.8, considering that inter-islands connections are a key service to be Maritime transport is an ensured for allowing The development of important activity of the movements among maritime transport in archipelago. In the last islands. the archipelago area years, investments have Maritime Synergies exist also could create conflicts been made in harbour transport with ports, since the with the increasing infrastructures in order existence of number of marine to improvement Shipping adequate protected areas. maritime transport of infrastructures allows passengers. better management of passengers flows. Freight transport development is (also) linked to demand evolutions generated by tourism flows. This activity is Landscape impact of Maritime transport is an strongly linked with harbour infrastructures important activity of the Ports the development of could interfere with archipelago. In the last maritime transports tourism and leisure years, investments have and with cruise sector, been made in harbour

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SYNERGIES CONFLICTS WITH OTHER CONTRIBUTION TO GROUP SECTOR WITH OTHER MARITIME MARITIME SUSTAINABLE GROWTH ACTIVITIES ACTIVITIES shipping. infrastructures in order To attract new cruise to improve maritime operators, harbours transport of passengers dedicated to cruise and freight as well as shipping have been cruise shipping. renewed and enlarged. Integrate commercial or industrial port activity with other activities, particularly those related to recreation and water sports. It is an activity No conflicts identified Contribution to strongly connected sustainable blue growth with fishing and derives from the nautical tourism, support it could provide since it provides to other activities, Ship repair services to vessels ensuring in the Azores and ensure the an important service to effective vessels of all types management and (fishing, leisure, etc.) development of these activities Coastal tourism is increasing and has synergies with other The combination of maritime activities nature tourism activities such as inter-islands and maritime tourism passenger transports (observation cetaceans, and scuba diving with nautical/recreational diving, marine bird Coastal tourism. No conflicts identified watching, water sports tourism Tourism sector is such as sailing, sports) particularly are activities with high dependent on air development potential transport. The arrival and contribution to a Tourism of low cost sustainable growth if companies is seen as properly regulated. an incentive to tourism. To attract new cruise Cruise tourism has a operators, ports high potential of dedicated to cruise development, in shipping have been particular, if the Cruise renewed and No conflicts identified archipelago becomes a tourism enlarged. This is cruise destination in having a positive addition to the seasonal impact in cruise repositioning of ships. tourism activity

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

2.1 Synoptic view of legislative, non-legislative and financial synergies and tensions among maritime activities The following table reports a synoptic view of main synergies and tensions grouping them under legislative, non-legislative and financial frames Synergies with other maritime activities

ACTIVITY LEGISLATIVE NON-LEGISLATIVE FINANCIAL  Use of environmentally sustainable fishing practices for safeguarding biological resources for fishing Fisheries and  The Regulation of aquaculture Maritime and Tourist Activities of the Azores allows that fishing vessels undertake tourism activities pesca- tourism.  For passengers transport: it supports coastal tourism providing inter-islands transport services; Maritime transport  Freight transport development is (also) linked to demand evolutions generated by tourism flows The existence of adequate infrastructures is the requirement for the Ports development of the Blue economy (transport, cruise, coastal tourism, fishing, etc.) It is a key service to be Ship repair ensured to leisure boats and fishing vessels The activity is dependent on air transport The existence of Coastal tourism adequate connections among islands ensure a greater mobility of tourism flows Adequate Cruise tourism infrastructures have been created in ports

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Conflicts with other maritime activities ACTIVITY LEGISLATIVE NON-LEGISLATIVE FINANCIAL Fisheries and  The creation of aquaculture marine protected areas reduces fishing areas already limited by natural constraints.  The high variability in catches may hamper investments on the downstream processing industry Maritime transport Conflicts with the increasing number of marine protected areas. Ports No major conflicts identified Ship repair No major conflicts identified Coastal tourism No major conflicts identified Cruise tourism No major conflicts identified

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

3. Best practices and flagship projects 1. Name of the project: POPA: AZORES FISHERIES OBSERVER PROGRAMME Objectives: ‘Dolphin safe’ certification. Results achieved: ‘Dolphin safe’ certification. Reasons for considering it as flagship project: in terms of innovation, the project has certified tuna fished in Azores, adding value to fishery production. This project should also be considered as effective and efficient since it generated a concrete output (i.e. sustainable fishing of tuna and tuna certification), and will also continue in the future. Furthermore, the project is also reproducible and transferable to other contexts

2. Name of the project: FishMetrics Objectives: Development of an innovative methodology that allows obtaining precise measurements of fish landed through digital images, this information is essential for assessing the state of exploitation of marine resources. Results achieved: The first prototype solution achieved ‘excellent results when compared to the traditional way of sampling.’ Given these results, Gui Menezes decided to run for National BES Innovation Contest and START, a contest of business ideas sponsored by BPI bank, which contributed over one hundred projects. The Fishmetrics won the BES competition in the area of trade and services, and ranked in the top eight projects in START Reasons for considering it as flagship project: the project introduced an innovative and concrete methodology, which is still running. The solution can be adopted by any stakeholders for measuring fish.

3. Name of the project: Marca Açores Objectives:  promotion and valorisation of Azorean products in the domestic and foreign markets;  encourage and promote a greater participation of regional companies in national and international strategic events;  disseminate the Azores brand as a synonym and guarantee of quality;  increase the visibility, consumption and notoriety of the products and services produced in the Azores at international level,  promote the expansion of the export economic base by investing in all sectors that offer competitive advantages as a route to sustained economic growth in the medium and long term;  gradually increase the value of exports and regional GDP. Results achieved: The Azores brand has attributed around 1500 labels to food products, services, establishments and crafts. Significant increase of sales has been registered Reasons for considering it as flagship project: The project can be considered innovative, as introduced a promotional brand for supporting the positioning of the Azores production in National and international contexts. If produced an efficient and effective way of promoting Azores, attributing the label to a high number of products and services. The project will continue in the future. In general, the association of a product or service to a local brand is transferable and reproducible in other contexts.

4. Name of the practice: Pesca-tourism Objectives: Diversification of fishery activity, increasing earning of fishermen and offer new services to tourists flows. Results achieved: Not available Reasons for considering it as best practice/flagship project: The practice can be considered as innovative, since it is a new service to be offered to tourists and a new source of income for fishermen. The practice is sustainable, reproducible and transferable to other contexts.

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3.1 Best practices and flagship projects details Name of the Other subjects/ Maritime Leading project/ stakeholders Timing sectors Budget actor(s) practice involved involved Until 2003 the Programme was supported by regional Agreement between Regional funds. Between 2003 and Project: Administration, Earth Island 2005 it became co-financed Institute, the Tuna Canning by the European POPA: Industry Association (Pão do Fishing Commission through the Funded in AZORES Mar), the Fishing Boat Owners INTERREG IIIb Programme/ 1998 Processin FISHERIES Association (APASA) and IMAR – g industry ORPAM project. Since then it OBSERVER Instituto do Mar — through the has been exclusively PROGRAMME University of The Azores Center supported by the regional (IMAR-DOP/UAç), government through the Regional Secretary of Fisheries. The Start-up project of the Azores Fishmetrics University in partnership with Project: was Lotaçor Ltd and a Portuguese Fishing developed FishMetrics company specialised in vision in 2006 and metrology technologies and 2007 Started in Project: Government All business in February All 3 429 000 Marca Açores of Azores Azores 2015 – on sectors going

Best Registered Fishery practice: commercial No financial measure is Since 2008 Pesca- fisheries Coastal envisaged tourism vessels tourism

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4. Gap analysis In this section, each maritime activity has been analysed in order to identify ‘what is missing for a sustainable Blue Growth’ in terms of ‘Human resources skills’, ‘Infrastructures’, ‘Research’ and ‘Data’.

 Fisheries and aquaculture The fishing activity is characterised by work force with low education (It is estimated that 77.3 % has basic education), limiting entrepreneurial capacity for possible diversification of the activity or improving their business in general (e.g. production methods, security Human on board, better positioning of productions, etc.). The sector is not resources skills attractive to young people and has difficulties in recruiting workers. Existence of high number of small family businesses with weak management capacity. Safety and working condition on board is not optimal.

Fishing ports and landing places equipment for landings, managing and storing fish are out-of-date. The energy efficiency of these facilities is not optimal and is also out-of-date. Infrastructures for supporting the development of types of storages Infrastructures other than fresh are missing or concentrated only in the tuna segment. Modernisation of processing industry and improvement of its marketing capacity.

There is high level of research in the Azores in relation to marine resources and especially fisheries, but the links with the sector is poor, not only for improving the overall sustainability of the activity, Research but also for innovating and diversifying the production. Strengthening the external links of the Azores as intercontinental platform (namely Europe — America — Africa) in the area of knowledge of the oceans.

Data Long lengths series available on the main sector indicators.

 Maritime transport There is a need for new qualifications in shipping and logistics Human management, that could be covered by specific courses of the Sea resources skills School.

In view of increasing export capacity, transport frequency to and from the smaller islands is not enough. Infrastructures present bottlenecks in managing passengers during seasonal peaks. Infrastructures Intermodality (i.e. connection among different types of transport) is not well developed. Lack of a network of logistic services linked to the international network and distribution channels, for improving the use of a port systems as a logistic platform in the Atlantic area.

Investments in the Azores in recent years are still insufficient to approach European levels, and a greater dynamization of scientific Research research is necessary through public and private investment in this sector. Lack of research and applied knowledge centres.

Data Lack of data on Sea and coastal passenger water transport.

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 Ports There is a need for new qualifications in shipping and logistics Human management that could be covered by specific courses of the Sea resources skills School.

Although investments have been made in port infrastructures and ports have been modernised there is still the need to improve logistics and further develop cruise shipping and nautical tourism facilities and infrastructures. Infrastructures Inadequate berths infrastructure in relation to demand from larger leisure vessels Lack of a competitiveness network of logistic services linked to the international network and distribution channels, for improving the use of a port systems as a logistic platform in the Atlantic area.

Investment in the Azores in recent years is still insufficient to approach European levels, and a greater dynamization of scientific Research research is necessary through public and private investment in this sector.

Data Lack of data on services activities incidental to water transportation.

 Ship building / repair There is a need for new qualifications in ship repair (training and updating courses) that could be covered by specific courses of the Sea Human School. New specialisations should be made available, for duly resources skills handling the repair of different types of vessels (fishing, yachting/sailing, cruise).

Currently this activity lacks of equipment and materials for duly carrying out the activity (spare parts of vessels and engines). Furthermore, due to the remoteness of the archipelago, time needed Infrastructures for making spare parts available is significant. Subcontracts with spare parts providers are missing. Furthermore, infrastructures in ports are limited and do not fully support ship repair activity.

Research No information to this regard.

Data Data on ship repair are insufficient.

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 Coastal Tourism Human resources qualifications related to tourism should be adapted Human to the sector’s demand resources skills The training courses are still relatively recent. Lack of synergies between hotel management School and professional schools.

Accommodation sector characterised by high dispersion and the absence of national and/or international chains. There is in fact a large number of hotels, whose offer is scattered and not structured. Big hotel chains are missing. Inadequate berths infrastructure in relation to demand from larger Infrastructures vessels. Lack of smaller facilities that serve to support the boats and their users. Low infrastructures as catalysts for the directly increasing of the sporting activities and the tourism activities. Enhance the planning and regulation of maritime space dedicated to recreational tourism.

Research Lack of integration between R&D and nature recreation tourism.

Absence on data related to nautical and recreational activities. Data Data on Accommodation and on Food not necessarily linked to tourism. Absence of data on air transports.

 Cruise tourism Human See coastal tourism. resources skills

Infrastructures Need to further enhance cruise infrastructure and facilities.

Research No research activity has been identified.

Data Data on economic indicators related to cruise shipping are insufficient.

4.1 Synoptic view on the gaps identified The following table reports a synoptic view of main gaps identified grouping them by ‘legislative’, ‘non-legislative’ and ‘financial’ gaps. ACTIVITY LEGISLATIVE NON-LEGISLATIVE FINANCIAL  Low qualification of fisherman, with limited business management capacities and limited diversification capability.  The sector is not attractive to young people and has difficulties in recruiting workers. Fisheries and  Infrastructures for supporting the aquaculture development of types of storages other than fresh are missing or concentrated only in the tuna segment.  Lack of links between the research and the sector (for stock management and products/processes innovation). Maritime A strategic vision of the  Need for new qualifications in transport Azores as the Atlantic shipping and logistics management,

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ACTIVITY LEGISLATIVE NON-LEGISLATIVE FINANCIAL hub is not well that could be covered by specific structured courses of the Sea School.  The frequency of connections between islands is not adequate (ferry services)  Intermodality is not well developed.  New qualifications in shipping and logistics management.  Improve logistics and further develop cruise shipping and nautical tourism Ports facilities and infrastructures.  Inadequate berths infrastructure in relation to demand from larger leisure vessels.  new qualifications in ship repair (training and updating courses).  lack of equipment and materials for duly carrying out the activity (spare Ship building / parts of vessels and engines). repair  time needed for making spare parts available is significant.  infrastructures in ports are limited and do not fully support ship repair activity.  Human resources qualifications Enhance the planning related to tourism should be adapted and regulation of to the sector’s demand. Coastal tourism maritime space  Low infrastructures as catalysts for dedicated to the directly increasing of the sporting recreational tourism activities.  Need to further enhance cruise Cruise tourism infrastructure and facilities.

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Mapping actors and maritime strategies 5. Mapping public authorities Maritime Name of the Main roles and Address Website sector(s) authority responsibilities It contributes to the definition of regional policy in the maritime sector of the Azores, to the sustainable Direção management of maritime Rua Cônsul Dabney http://www.azores.g Regional dos space, ocean exploration, — Colónia Alemã All ov.pt/Portal/pt/entid Assuntos do licensing of sea and water Apartado 140 ades/srmct-dram/ Mar uses, and protection of 9901-014 Horta the coastal borders, as well as guiding, coordinating and controlling their execution. It contributes to the definition of regional policy in the areas of Rua Cônsul Dabney Direção fisheries and aquaculture, http://www.azores.g Fishing and — Colónia Alemã Regional das including industry and ov.pt/Portal/pt/entid aquaculture Apartado 140 Pescas related activities, as well ades/srmct-drp 9901-014 Horta as to guide, coordinate and monitor their implementation. Ensure implementation of http://www.azores.g Direção Rua Comend the policy defined by the ov.pt/Portal/pt/entid Tourism Regional do Ernesto Rebelo, 14 Regional Government for ades/sreat- Turismo 9900-112 HORTA the tourism sector drturismo/ It contributes to the definition and Largo do Colégio, Nº Direção http://www.azores.g Maritime implementation of 4 Regional dos ov.pt/Portal/pt/entid Transports regional policies in the 9500-054 — Ponta Transportes ades/srtop-drt/ areas of air, sea and land Delgada transport. Serviço Núcleo do Faial Regional de Alameda Barão de http://srea.azores.g All Regional statistics Estatística Roches, n.º 37 ov.pt/ dos Açores 9900 — 104 Horta Direção-Geral dos Portos de São Miguel e Santa Portos dos Maria http://www.portosd Ports Managment of ports Açores, SA Rua Teófilo Braga, osacores.pt/ n. 1 9500-247 Ponta Delgada

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6. Summary of existing maritime strategies 6.1 National Ocean Strategy 2013-2020 (NOS) The National Ocean Strategy 2013-2020 (NOS) identifies the areas of intervention that can enable Portugal to face several challenges concerning the promotion, the growth and the competitiveness of the maritime economy. The Mar-Portugal Plan, is an action plan that establishes and promotes the coordination of all areas concerning the oceans. It ensures an economic, social and environmental promotion of the national maritime space through the implementation of sectoral and cross-sectoral projects The ENM2013-2020 presents a new ocean and coastal areas development model in order to meet the new challenges on promotion, growth and competitiveness of the sea economy. The return of Portugal to the sea depends on the implementation of a strategy based on knowledge and technological progress. The ENM2013-2020 identifies policy areas and presents an action plan that includes programs with specific objectives The Mar-Portugal Plan above all foresees the economic, social and environmental recovery of the national maritime space through the implementation of sectoral and intersectoral projects. The financial resources include national and Community funds, and other cooperation financial instruments available, mainly the common strategic framework for Structural Funds (European Regional Development Fund, European Social fund and European Maritime and Fisheries Fund). Concerning EMFF it foresees four pillars: Green and intelligent fishing, Green and smart Aquaculture, Sustainable and Inclusive Territorial Development (shared management). Moreover ‘Horizon2020’ is strongly linked with research programs aimed at facing social challenges and promote competitiveness. Moreover, within this program marine and maritime research will be subject of a strategic approach and own mechanisms, aiming to give it the necessary transversality. A financial instrument to support projects concerning the environment and nature conservation, LIFE program, will help to finance environmental actions of ENM2013-2020. 6.2 National Strategy of research and development for an intelligent specialisation 2014-2020 Among the Axes of the Strategy stands out Axis 4 — Economy of the Sea, which was organized around five thematic vectors that fit specific topics and areas of innovation and active relationship with public policies:  Marine Food Resources (Fisheries and Aquaculture)  natural Systems and Renewable Energy Resources  ports, Logistics, Transport, Shipbuilding and Marine Works  deep Sea resources  culture, Tourism, Sports. 6.3 Programa Operacional De Cooperação Territorial Madeira-Açores-Canárias (MAC) 2014-2020 The European Commission approved on June 3, 2015 the new cooperation program Interreg Spain-Portugal MAC (Madeira-Azores-Canarias) 2014-2020 which will have a budget of 130 million euros (85 % funded the European Regional Development Fund- ERDF). Cape Verde, Senegal and Mauritania will also participate to the program, allowing to enlarge the natural area of socioeconomic and cultural influence and increase the possibilities of cooperation. The program specific objectives are: improve scientific and technological capabilities and knowledge; increase transfer and dissemination of technology and cooperation between companies and universities or other research centres in priority sectors; create conditions for the internationalization of companies; improve the ability to react to potential natural

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threats that affect the cooperation area; increase the attractiveness natural areas, especially those of tourist interest; protect and improve the conservation areas natural and biodiversity; consolidate cooperation strategies between actors operating in the eligible area of the Program. The program is design around 5 main axes (axis 6 and 7 concern technical assistance) and axis 4 oriented to preserve and protect the environment and promoting resource efficiency is the one with highest financial resources (it absorbs 28.20 % of ERDF aid). It concerns natural biological, environmental and geographical fragility, the need for intervention in the vast territory of the Natura 2000 network and the intense natural risks that characterize the area of cooperation. 6.4 Transnational Cooperation Programme for the Atlantic Area 2014-2020 The Transnational Cooperation Programme for the Atlantic Area 2014-2020, has been established based on the objectives of the Europe 2020 Strategy and Maritime Strategy for the Atlantic. The Program aims to contribute to these strategies adopting attainable goals, likely to generate results with a positive impact on the territory of the Atlantic Area. The Programme 2014-2020, co-financed by the ERDF for a total amount of € 140 013 194 will cover a wider area than the previous program due to the inclusion of the Canary Islands and regions Autonomous Azores and Madeira. The program should support the reduction of barriers to innovation and contribute to the creation of a business context oriented to innovation, by attracting new investments and activities in areas of R & D & i. Another priority is to create companies knowledge more oriented. Finally, the program foresees the promotion of a most competitive economy but at the same time more environmentally friendly and efficient in terms of resources.

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7. Mapping main stakeholders

Maritime Name of the Main roles and responsibilities Address sector(s) stakeholders Observatorio Solmar Avenida Center Turismo Promote the analysis, Avenida Infante D. http://www.observatorioturismoacore Tourism dissemination and monitoring of Açores (Tourism Henrique, nº71 — Esc. 101 s.com/ the evolution of tourism observatory of the 9504-529 Ponta Delgada Azores) Rua Eng. Abel Ferín Fishing LOTAÇOR Management of auctions Coutinho, nº 15 http://www.lotacor.pt/ 9500-191 Ponta Delgada IMAR / Universidade Rua Prof. Dr. Frederico dos Açores http://www.horta.uac.pt/intradop/ind Marine research Research Machado — 9901-862 (University of the ex.php/imar-topmenu-123 Horta — Portugal Azores) Centro do Clima, Research in the fields of insular Metorologia e climatology and meteorology, Rua Capitão João d’Ávlia – Mudanças globais maritime climate and meteo- Pico da Urze (Climate, Weather oceanography, physical and http://www.dca.uac.pt/centro/c_cmm Marine research 9700-042 Angra do and Global Change chemical properties of the g Heroísmo Center), atmosphere, hydro-climatology, Açores, Portuga Universidade dos agro-climatology and Açores Bioclimatology.

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Mapping Blue Growth and assessing the potential 8. Growth drivers and barriers The following table reports growth drivers and barriers to growth of each maritime activities identified, analysing them in terms of R&D, Access to finance, Infrastructure, Education, training and skills, Public engagement and Local cooperation (10).

Fisheries and aquaculture Drivers to growth Barriers for growth Existence of scientific research that supports the sector in terms of Fishing area is ecologically very improving the quality and sensitive. Pressure on deep-water development of the sustainability of species by artisanal fleet is R&D water resources noteworthy. Investigate the Region skills in For aquaculture, lack of veterinary aquaculture, particularly as it relates medicines for different farmed species to the species of greatest potential in the region For aquaculture: availability of Access to finance incentives for commercial aquaculture Out-of-date fishing ports, landing places and auction markets Excessive fleet relative to tuna quotas. High variability in catches hampers Infrastructure - investments on the downstream processing industry Conditions for quality preservation, control and traceability are not adequate. Low education qualifications, generating a reduced management capability and limited interest in diversifying the activity Education, training Creation of the Sea school The sector is not attractive to young and skills people. Existence of high number of small family businesses with weak management capacity Public authorities pay particular attention to fishing issues. There is a growing concern relative to fleet adjustment and environment preservation (biological stocks) and its economic impact on fishing communities. Public Authorities have created the Public engagement 'Azores brand' and are engaged in promotion initiatives in the international markets. Public awareness and support to offshore aquaculture projects For aquaculture: existence of an ‘accelerated licensing procedure’ for installing plants and making them operational Growing demand for pre made High dependence on foreign markets, Local cooperation products and other presentations both supply and demand

(10) i.e. synergies and conflicts at local level with other activities, be they maritime or non- maritime.

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Maritime transport Drivers to growth Barriers for growth Lack of research and applied R&D - knowledge centres Existence of EU funds that allow Access to finance investments in this area Modern vessels for passengers regular transport Gaps in the logistics system Existence of infrastructures for Infrastructure Reduced intermodality level of the distribution and supply of LNG, which transport system represents a good fuel alternative for vessels (to be developed) Lack of skills and expertise in shipping and logistics management Education, training Creation of the Sea school Lack of cooperation between the and skills industry and the education/training system Public authorities look at maritime transport as a key element of the development of the maritime sector. Existence public transport service obligations of goods and passengers, Public engagement - which ensures the regular supply of all the islands Existence of bodies with specific functions for planning and regulation of the sector Possible maritime space conflicts with Possible synergies with other maritime Local cooperation other maritime activities activities (tourism) (recreational and nautical tourism)

Ports Drivers to growth Barriers for growth R&D - - Existence of EU funds that allow Access to finance - investments in this area Lack of specialised areas dedicated to goods movements Investments have been made in port Lack of larger investments than Infrastructure infrastructures and facilities those already allocated for new facilities and creation of specialised areas The MSC Academy and Escola Náutica Infante D. Henrique established a partnership for the new high degree Education, training Qualifications in shipping and course on 'Shipping and Logistics and skills logistics management are missing Management', in a clear approach between shipping activity and higher education. Public authorities involved in maritime Restricted legislation: impossibility of Public engagement transport represent a key element of the making concessions (mixed harbours development of the maritime sector. private/public) Lack of interest of the private sector to invest in highly conflictual area, Local cooperation - where the geographic factors create total a dependence of maritime transport

Ship repair Drivers to growth Barriers for growth R&D - - Access to finance - -

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Ship repair Drivers to growth Barriers for growth Lack of equipment and materials: limited spare parts and long time is needed for making them available Infrastructure - Limited infrastructures in port for supporting ship repair (tailored to fishing vessels) Lack of cooperation between the Education, training Creation of the Sea school industry and the education/training and skills system This activity is receiving attention from public authorities that are trying to Public engagement - stimulate the reactivation of the shipyards in the archipelago It is an activity strongly connected with fishing, nautical and recreational tourism Subcontracts with spare parts Local cooperation and maritime transport. There is an providers are missing. important and potentially growing demand for this activity

Coastal tourism Drivers to growth Barriers for growth Ecologically sensitive area and therefore R&D - existence of protected areas Access to finance - - Inadequate infrastructures for large Investments have been made in port recreational vessels Infrastructure infrastructures and facilities Lack of facilities in the marinas to support boats and their users Existence of an Hotel management school and professional schools and creation of Need to develop staff qualification in the Sea school. different branches (accommodation, There is an university degree of services to tourists, amusement, etc.). Education, training technological specialisation promoted by Training courses are still recent. and skills the Azores University in collaboration with Lack of cooperation between the Escola Náutica Infante D. Henrique with industry and the education/training the scope of training and certifying system maritime-tourism operators. Awareness of public authorities of development potentialities: definition of Need to enhance and regulate maritime Public engagement the Strategic and marketing plan for space dedicated to recreational tourism tourism The archipelago is a stopover for sailing boats crossing the Atlantic Local cooperation - Low cost air companies now flying to the Azores

Cruise tourism Drivers to growth Barriers for growth R&D - - Access to finance - - Investments have been made in port infrastructures and facilities: Cruise Infrastructure - Terminal in Ponta Delgada stimulated the arrival of new cruise ships The MSC Academy and Escola Náutica Infante D. Henrique established a Education, training partnership for the new high degree - and skills course on 'Shipping and Logistics Management', in a clear approach between shipping activity and higher

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Cruise tourism Drivers to growth Barriers for growth education. Awareness of public authorities of development potentialities: cruise tourism Public engagement sector is considered important for the development of regional economy.

Azores routes concern mainly the annual repositioning of cruise ships Local cooperation - between North America and Europe: activity concentrated in October and November. 8.1 Synoptic view of legislative, non-legislative and financial growth drivers and barriers The following table reports a synoptic view of main growth drivers and barriers grouping them under legislative, non-legislative and financial frames Growth drivers

ACTIVITY LEGISLATIVE NON-LEGISLATIVE FINANCIAL For aquaculture:  Existence of scientific research that For aquaculture: existence of an supports the sector in terms of availability of incentives ‘accelerated improving the quality and development for commercial Fisheries and licensing of the sustainability of water resources aquaculture aquaculture procedure’ for  Creation of the ‘Azores brand’ for installing plants promoting Azores production in and making international market them operational  Existence of infrastructures for  Existence of EU funds Maritime distribution and supply of LNG, which that allow transport represents a good fuel alternative for investments in vessels (to be developed) maritime transport  Existence of EU funds that allow Ports investments in ports development  There is an important and potentially growing demand for this activity Ship repair  Public authorities are trying to stimulate the reactivation of the shipyards in the archipelago  Availability of professional and Coastal specialisation schools tourism  Azores is a needed stopover for cross- Atlantic sailing/yachting trips Cruise tourism  Investments have been made in port infrastructures and facilities

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Barriers to growth

ACTIVITY LEGISLATIVE NON-LEGISLATIVE FINANCIAL  Infrastructures and facilities in fishing ports, landing places and auction markets are out-of-date  High variability in catches hampers investments on the downstream processing industry  Conditions for quality preservation, control and traceability are not Fisheries and adequate. aquaculture  High number of small family businesses with weak management capacity  Low academic education qualifications, generating a reduced management capability and limited interest in diversifying the activity  For aquaculture, lack of veterinary medicines for different farmed species  Connections among different modes of transport are not well developed  Lack of skills and expertise in shipping Maritime and logistics management- transport  Lack of cooperation between the industry and the education/training system  Lack of larger  Restricted  Qualifications in shipping and logistics investments for legislation: management are missing- new facilities (e.g. impossibility  Lack of interest of the private sector to gentry cranes, of making invest in highly conflictual area, where Ports storage facilities, concessions the geographic factors create total a etc.) and lack of (mixed dependence of maritime transport specialised areas harbours  Lack of specialised areas dedicated to for goods private/public) goods movements movement  Lack of equipment and materials: limited spare parts and long time is needed for making them available  Limited infrastructures in port for Ship repair supporting ship repair (tailored to fishing vessels)  Lack of cooperation between the industry and the education/training system  Inadequate infrastructures for large Maritime space recreational vessels dedicated to  Need to develop staff qualification in Coastal recreational different branches (accommodation, tourism tourism should services to tourists, amusement, etc.). be enhanced and  Lack of cooperation between the regulated industry and the education/training system Azores routes concern mainly the annual Cruise repositioning of cruise ships between tourism North America and Europe: activity concentrated in October and November

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9. Future potential for mature and pre-developing activities 9.1 Fisheries and aquaculture

 Potential for employment The fishing activity is characterised by aged work force with low education. This generates a limited potential for diversifying the activity as it is at present, and the management capabilities of fishermen is scarce. The sector is not attractive to young people and has difficulties in recruiting workers. However, the creation of the Sea School could open new training opportunities regarding fisheries both in terms of scientific knowledge and research & development and in terms of more operational jobs by creating products innovations. The Sea school or other ad-hoc training courses should indicate to fishermen possible alternatives for supporting them to diversify their activities and improving the profitability of their businesses. Regarding aquaculture, several studies and projects have been made identifying a development potential of this activity in the archipelago, both for land-based facilities and for offshore cages. Aquaculture could boost economic development and job creation in the AAR, both high skill jobs and low skill jobs.

 Potential for value added Concerning fisheries, the increasing demand for natural products from the sea is an opportunity to be explored and new species not yet exploited should be exploited, taking advantage of the full potential of the Azores Sea. This requires the evaluation of the market potential for new sea products (fresh and processed). The introduction of training courses (e.g. through the Sea school or through other channels) could support the diversification of activities for fishermen and the potential increase of profitability of the sector, not only through diversification, but also by identifying new possible market opportunities (e.g. new positioning in the supply chain, new selling opportunities, etc.). Moreover, some species with high demand and captured with the use of certified sustainable techniques, have the potential for greater development, being important to study issues such as new packaging techniques, new distribution channels, new markets, fish traceability. The range of processed fish products, conservation processes and packaging could be developed creating value added products more adapted to internal and external demand. Indeed alternative fish products with market acceptance could be developed. Another element to promote is traceability and quality control over the fish value chain.

 Potential for competitiveness Not available. There is a need for new Availability of human resources qualifications that could be covered by specific adequately skilled courses of the Sea School.

Potential for attracting FDI Aquaculture has the potential to attract new FDI.

EMFF, Compensation Plan for Additional Costs of Fish Products in the Azores. Availability of public funds Incentives are available for establishing new plants for commercial aquaculture.

Availability of support sectors / Research organisations (Universidade dos Açores, facilities (e.g. research, IMAR–Instituto do Mar) are available and could infrastructures, etc.) support the development of the sector.

Potential in terms of positioning in Public Authorities have created the 'Azores brand' the international market and are engaged in promotion initiatives in the

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international markets. Offshore aquaculture may complement the activity of fishing with sea products which are typical of the Azorean waters, in order to maximize and diversify sustainable maritime economy and create value added products.

9.2 Maritime transport

 Potential for employment The development of the potential of maritime transport is linked mainly with ferry transport between the islands. With the current development of coast tourism, the ferry transport activity will be further developed in order to facilitate connections among the islands. The construction of two new transport ships is foreseen within the Operational Program for the period 2014-2020 (Structural Funds). This could have a positive impact on employment: i.e. pilots for the new ships, staff on board, staff on ports. Furthermore, more intense frequencies of connections among islands of the archipelago may generate new jobs requests. As regards freight transport, the development of the Azores as the Atlantic transport hub would have an impact on employment in the port area and for all possible services (transhipment, free trade area, bunkering, etc.) connected to this role.

 Potential for value added Concerning the ferry passenger transport synergies with the tourism sector through the creation of travel packages and the public support give new development prospective to this activity. Concerning freight transport, putting Azores in the middle of Atlantic routes and raising it to a transport hub would generate positive effect on the economy. Furthermore, the introduction of alternative fuels in ships (especially LNG), could induce a greater number of calls from ships Azores could benefit from this.

 Potential for competitiveness The cost optimisation of shipping routes limits the competitive advantages of small ports in terms of freight and services. Availability of human resources There is a need for new qualifications that could be adequately skilled covered by specific courses of the Sea School.

The geographic position of Azores could be an important element for investors to develop Potential for attracting FDI transhipment facilities or other incidental services to maritime transport in Azores.

Availability of public funds ERDF

Two new transport ships will be constructed within Availability of support sectors / the Operational Program for the period 2014-2020 facilities (e.g. research, (Structural Funds) in order to cope with the infrastructures, etc.) increasing passengers’ movements among islands.

Potential in terms of positioning in See above regarding the role of Azores as Atlantic the international market hub

9.3 Ports

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 Potential for employment The design of seaports as logistics platforms integrated into national and international supply chains, is an opportunity of development for the Azores that could create new jobs mainly operational and technical jobs. See also maritime transport as regards the role of Azores as a possible transport hub.

 Potential for value added The activity potential could be fulfilled by improve the technical and operational conditions of the ports, customer services and communication as well as by reducing taxation and bureaucracy associated with port transactions. In order to facilitate FDI, concessions for the management of ports should be facilitated.

 Potential for competitiveness There is a need for new qualifications that could be covered by specific courses of the Sea School. The MSC Academy and Escola Náutica Infante D. Availability of human resources Henrique established a partnership for the new adequately skilled. high degree course on 'Shipping and Logistics Management', in a clear approach between shipping activity and higher education.

The potential for attracting FDI is hindered by the lack of concessions (i.e. mixed management private/public). Ports are public and belong to Potential for attracting FDI. regional government. The restricted legislation does not allow concessions (which actually is one of the most common port management models.

Availability of public funds. ERDF for infrastructural investments.

As regards the port infrastructures dedicated to recreational boating, they have been ‘remodelled’ Availability of support sectors / and updated. However, there is still a lack of facilities (e.g. research, areas for the movement of goods and there is a infrastructures, etc.). need for large investments for infrastructure facilities.

The ARA is already positioned at international level Potential in terms of positioning in but there is still some room for development. the international market. See freight maritime transport for the possible role of Azores as an Atlantic hub.

9.4 Ship repair

 Potential for employment This activity, currently marginal, has a certain future potential of development. Indeed, considering the growth of all activities linked to nautical and recreational tourism as well as the increase in sea passenger transports, this activity can be characterised in a near future by a growth itself. The growth of this activity will certainly require stable specialised jobs for repairing activities of fishing and leisure, but potentially also cruise, although this requires highly specialised workers. The potential for employment could be noteworthy in case yards specialised in cruise ships repair are settled.

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 Potential for value added Depending on the types of specialisation intended to be pursued, the activity could generate a more or less important impact on the economy. The development of repairing activities for cruise vessels should have the highest impact, requiring significant investments but higher earnings. Repairing of leisure boats could have also an important impact on the local economy (considering the amount of boats calling Azores), with more limited initial investment required. Repairing of fishing vessels could have a less important impact on local economy and a minor investment would be needed.

 Potential for competitiveness There is a need for new qualifications that could be Availability of human resources covered by specific courses of the Sea School. adequately skilled. However, human resources qualifications in repairing exist in Azores.

Potential for attracting FDI. N/A

Availability of public funds. N/A

The regional administration of the archipelagos has Availability of support sectors / been trying to stimulate this activity, by facilities (e.g. research, stimulating the reactivation of the existing infrastructures, etc.). shipyards in the port Madalena (Pico Island), which works today, below its capacity.

Azores are positioned in the middle of Atlantic. Potential in terms of positioning in This means that they intercept (or potentially can the international market. do it) all transatlantic flows, with a wide market which could require repairing activities.

9.5 Coastal tourism

 Potential for employment With a unique geographical location and with unusual characteristics associated with aspects such as volcanism, green landscapes, the omnipresence of the sea, culture and its products, the Azores have a high potential for the development of coastal tourism, not yet totally explored, with future positive impact on employment in all connected activities. The main objectives of public authorities are:  to develop the tourism offer of the Azores as a whole;  to boost the supply of each island directing it to specific market segments;  to attract visitors and investors;  to stabilise businesses and people in the islands, increasing the profitability of local businesses and quality of life;  to encourage entrepreneurship;  reduce the seasonality of the destination. The achievement of these objectives is based on the definition of strategic and complementary products. Nautical tourism, cultural and sightseeing touring, gastronomy, health, and well-being, are some of the products that diversify and enrich the offer. This new tourism dimension plays a significant role as a source of employment with a considerable induced impact in other activities and a spillover effect on other sectors. So, new jobs could be created both temporary (tourism is quite seasonal) and long-term jobs and also low skilled and high skilled jobs (i.e waiters in restaurants, operational staff in

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

hotels, hotels management, boat skippers, qualified staff for activities such as nautical activities, etc.).

 Potential for value added There are large opportunities to promote the development of new tourism and new communication strategies products based on existing resources in order to improve the economic results of tourism in the region. The possibility of mixing diversified tourism products (coastal tourism with other types of tourism such as scientific tourism, naturalistic, tourism, and volcanology) allows to create value added tourism products with high development potentialities.

 Potential for competitiveness There is a university degree of technological specialisation promoted by the Azores University in collaboration with Availability of human Escola Náutica Infante D. Henrique with the scope of resources adequately training and certifying maritime-tourism operators. There skilled. is a need for new qualifications that could be covered by specific courses of the Sea School. Training courses are still recent.

The potential to attract FDI is linked to the development of Potential for attracting high standards hotels and resorts as well as developing FDI. nautical sports and chartering.

Availability of public ERDF for infrastructural facilities, ESF for personnel funds. training.

Availability of support Ports infrastructures have been modernised but there is a sectors / facilities (e.g. need for further developing facilities in the marinas to research, infrastructures, support boats and their users. Also accommodation etc.). facilities should be boosted.

The new emerging forms of tourism attract new targets. Moreover the Azores are central in the transatlantic traffic Potential in terms of of pleasure boats. Indeed Horta is one of the world’s positioning in the marina with the highest movement. This is an advantage international market. that could be further developed and other Azores marinas could be boosted for the purpose.

9.6 Cruise tourism

 Potential for employment The Azores have a good development potential as cruise tourism destination. The archipelago is now recognized as one of the world wonders in environmental and landscape terms. For its natural beauty, it is an alternative destination to the usual routes of the Mediterranean. The development of cruise tourism stimulates and requires the development of specialised reception infrastructures, activities, services and ‘know- how’ that create new employment. However, the potential for employment is linked to satellite activities that could benefit from cruise ship calls.

 Potential for value added The Azores have a good opportunity for new routes and destinations outside the Mediterranean that are (almost) at a point of saturation. The West Atlantic will naturally be a good alternative for geographically proximity. The potentialities in terms of value added concern not only cruises crossing the Atlantic Ocean but also the possibility to do cruises around the archipelago Islands with positive impacts in terms of connected

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activities: cruise terminals, restaurants, shops, parks for excursion buses, excursions, support services, etc.

 Potential for competitiveness The MSC Academy and Escola Náutica Infante D. Henrique Availability of human established a partnership for the new high degree course on resources adequately 'Shipping and Logistics Management', in a clear approach skilled. between shipping activity and higher education.

Potential for attracting N/A FDI.

Availability of public funds. N/A

Availability of support sectors / facilities (e.g. Investments have been made in port infrastructures and facilities: Cruise research, infrastructures, Terminal in Ponta Delgada stimulated the arrival of new cruise ships. etc.).

To include the Azores in the cruise ships scales and go beyond the seasonal repositioning of ships (which now Potential in terms of account for most of the movements in the Azores), it is positioning in the necessary to be competitive in terms of operating costs for international market. ships and to be able to attract new markets of tourists. The concept fly & cruise can be developed in the Azores (e.g. like in the Baltic and Fjords).

9.1 Synoptic view of the future potential by activity The following table reports a synoptic view of main future potential for each activity grouping them by potential for ‘employment’, ‘value added’ and ‘competitiveness’.

Potential for value Potential for ACTIVITY Potential for employment added competitiveness  Identification of new possible market opportunities (e.g.  Aquaculture has the new positioning in the potential to attract new  Although not attractive for supply chain, new FDI. young people the activity has selling opportunities,  Incentives are available a potential for employment etc.). for establishing new taking advantage of possible  New species with a plants for commercial training facilities (e.g. the marketing potential aquaculture. Sea school). should be identified  'Azores brand' supports  The attractiveness of the and exploited, also by the promotion of activity should be boosted by studying issues such Fisheries and products in identifying new as: aquaculture international markets. products/markets and — new packaging  Aquaculture may offering therefore new techniques, complement the activity possibilities to fishermen and — new distribution of fishing with sea young people. channels, products which are  The development of — new markets, typical of the Azorean aquaculture sector could also — fish traceability waters (e.g. barnacle) generate some positive — identification of a with a high potential for effects on employment. range of processed being competitive on fish products the market. — conservation processes and packaging. Maritime  Ferry transport could have  The development of  The geographic position transport positive impact on Azores as the of Azores could be an

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Potential for value Potential for ACTIVITY Potential for employment added competitiveness employment by introducing transport hub in the important element for more intense connections Atlantic could have a investors to develop frequencies among islands. remarkable impact on transhipment facilities  The development of Azores value added. or other incidental as the transport hub in the  Introduction of services to maritime Atlantic could have a alternative fuels in transport in Azores. remarkable impact on ships (especially employment considering the LNG), which could number of services that induce a greater could be developed number of scales calls (transhipment, free trade from ships Azores area, bunkering, etc.). could benefit from this. Increased value added for this activity could be generated by raising the role or Azores to transport hub and by  The potential for See maritime transport, for the  reducing taxation and attracting FDI is Ports transport hub bureaucracy hindered by the lack of associated with port concessions. transactions;  concessions for the management of ports should be facilitated.  Depending on the  Considering the existing types of specialisation demand and its potential  Ship repairing skills intended to be growth in the future, the exist in Azores but need pursued, the activity Ship repair activity has a potential for to be fostered and could generate a employment in connection further qualified for more or less with cruise shipping, leisure specific segments. important impact on and fishing. the economy.  Azores are central in the transatlantic traffic of pleasure boats. Indeed Horta is one of the world’s marina with the highest movement. This is an advantage that could be further developed and other Azores marinas could  The possibility of be boosted for the  Coastal tourism, not yet mixing diversified purpose. totally explored, with future tourism products  Further infrastructure positive impact on allows to create value facilities should be Coastal tourism employment in all connected added tourism developed in the activities (volcanism, green products with high marinas to support landscapes, sea-related development boats and their users. activities, culture, etc.). potentialities.  The potential to attract FDI is linked to the development of high standards hotels and resorts as well as developing nautical sports and chartering.  Accommodation facilities should be boosted to higher standards. Cruise tourism  The potential for employment  The potentialities in  Investments have been

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Potential for value Potential for ACTIVITY Potential for employment added competitiveness is linked to satellite activities terms of value added made in port – see coastal tourism — that concern not only infrastructures and could benefit from cruise ship cruises crossing the facilities: Cruise calls. Atlantic Ocean but Terminal in Ponta also the possibility to Delgada stimulated the do cruises around the arrival of new cruise archipelago Islands ships. with positive impacts  it is necessary to be in terms of connected competitive in terms of activities. operating costs for ships and to be able to attract new markets of tourists.  The concept fly & cruise can be developed in the Azores.

10. Investments opportunities Ports infrastructures need to be further developed and improved to satisfy the increasing demand of services for storage, transport of goods, and transport of passengers, and mainly for recreational and nautical activities and cruise shipping. Urban facilities for cruises doing a call in the archipelago should be further fostered. The creation of an Experimental Centre of Aquaculture could contribute to test the technical and economic feasibility of aquaculture in the Azores, considering different species and forms of production. The Centre would deepen the skills of the Region the aquaculture area, in particular related to the species of greatest potential. Creation of a specialised tool for the promotion services linked to the sea such as the maritime tourism activities, tourist entertainment activities, water sports and infrastructure to support recreational boating, natural and cultural heritage, cultural facilities, etc.

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Identifying public and private intervention 11. Potential financial, legislative and non-legislative measures for stimulating growth Figure 9— Logical diagram for fishery and aquaculture

Fishery and Objectives of the Strategies/plan/ EMERGING NEEDS strategies/plan/ programme aquaculture programme

* Need to modernize fishing ports, landing places and auction markets - Promote competitive, sustainable, Infrastructures * Need to improve conditions for quality preservation, control and traceability. efficient, innovative and knowledge- * Need to stimulate entrepreneurship capacity based fisheries; - Promote competitive, sustainable and efficient aquaculture ; Operational Programme MAR - Encourage scientific knowledge and 2020 (FEMP+POSEICAN) * Need to continue scientific and experimental research in the area of data collection management National level Research knowledge of the oceans - Increasing employment and territorial * Need for research in aquaculture - Promote marketing and processing by improving the organization of the Education and market of the fishery and aquaculture training * Need of specialised training and education

- Research, technological development and innovation cooperation with * Need to strengthen external links as intercontinental platform in the area of - Improve access to technology neighbours knowledge of the oceans information and communication as well as utilization and quality - Competitiveness of regional companies ARA Operational Programme - Low carbon economy OR level - Climate change and prevention and management of risk - Environment and efficiency of resources - Sustainable transportation and main infrastructures - Employment and labour mobility - Social inclusion and combating poverty - Lifelong teaching and learning

Marine Food Resources (Fisheries and Aquaculture) Natural Systems and Renewable Energy National Strategy of research Resources and development for an smart Ports, Logistics, Transport, Shipbuilding specialisation 2014-2020 and Marine Works National level Deep Sea resources Culture, Tourism, Sports

- improve scientific and technological capabilities and knowledge - increase transfer and dissemination of technology and cooperation between companies and universities or other research centers in priority sectors; Programa Operacional De - create conditions for the Cooperação Territorial internationalization of companies; Madeira-Açores-Canárias - protect and improve the conservation (MAC) 2014-2020 natural areas, especially those of tourist interest; - protect and improve the conservation areas natural and biodiversity; - consolidate cooperation strategies between actors

- reduction of barriers to innovation - createion of companies knowledge more oriented. Transnational Cooperation Promotion of a most competitive Programme for the Atlantic economy but more environmentally Area 2014-2020 friendly and efficient in terms of Atlantic level resources. Concerning infrastructures, the OP MAR addresses the need of improving land infrastructures supporting measures to improve the safety of working conditions of fishermen and ports. The OP MAR foresees support to start-up initiatives of fishermen under the age of 40 dealing thus with the need of stimulating entrepreneurship capacity. Moreover, the ‘Compensation Plan for Additional Costs of Fish Products in the Azores’ gives support for compensation of additional costs incurred by operators in the fishing, growing, processing and marketing of certain fishery and aquaculture products. In terms of research, the ARA Operational programme duly addresses the needs surveyed in terms of support to scientific research & development. The MAC program also addresses the needs that emerged in terms of research. Moreover, the OP MAR addresses the need for research and innovation in aquaculture.

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As for training and education the ARA OP supports the creation of the new Sea School that will focus qualification related to fisheries, maritime transport, ship repair and construction, maritime tourism activities and environmental and fisheries observation. As for cooperation with neighbours, the MAC programme and the Transnational Cooperation Programme for the Atlantic Area address the identified needs.

Figure 10 — Logical diagram for maritime transport

Maritime Objectives of the Strategies/plan/ transport EMERGING NEEDS strategies/plan/ programme

* Need to increase transport frequency to and from the smaller islands mainly - strengthening research, technological development and innovation; Infrastructures in view of increasing export capacity. * Need to Increase the intermodality level of transport system. - enhancing access to, and use and Competitiveness and * Need to develop a network of logistic services linked to the international quality of, ICT; Internationalisation network and distribution channels, for improving the use of a port systems as - enhancing the competitiveness of Operational Programme 2020 a logistic platform in the Atlantic area SMEs; - promoting sustainable transport and removing bottlenecks in key network infrastructures; Research * Need for further investment in scientific research and in applied knowledge - promoting sustainable and quality centres employment and supporting labour mobility; and - enhancing institutional capacity of Education and public authorities and stakeholders and training * Need for a specialied training of human resources for operational functions

- Research, technological development Data Collection and innovation systems * Need to develop data collection systems - Improve access to technology information and communication as well ARA Operational Programme as utilization and quality OR level - Competitiveness of regional companies - Low carbon economy - Climate change and prevention and management of risk - Environment and efficiency of resources - Sustainable transportation and main infrastructures - Employment and labour mobility - Social inclusion and combating poverty - Lifelong teaching and learning

- improve scientific and technological capabilities and knowledge - increase transfer and dissemination of technology and cooperation between companies and universities or other research centers in priority sectors; - create conditions for the Programa Operacional De internationalization of companies; Cooperação Territorial - protect and improve the conservation Madeira-Açores-Canárias natural areas, especially those of tourist (MAC) 2014-2020 interest; - protect and improve the conservation areas natural and biodiversity; - consolidate cooperation strategies between actors

- reduction of barriers to innovation - creation of companies knowledge more Transnational Cooperation oriented. Programme for the Atlantic - promotion of a most competitive Area 2014-2020 economy but more environmentally Atlantic level friendly and efficient in terms of resources. In terms of infrastructures, the needs should be covered by the Competitiveness and Internationalisation Operational Programme 2020 to which concerns maritime infrastructures and by the ARA Operational Programme to which concerns the construction of two ferries. In this context, the financing of interventions in maritime infrastructures has the aim of giving a greater cohesion and dynamics to the regional market and increasing the efficiency of the functioning of the maritime transport system. The construction of 2 ships — with a minimum capacity (each) of 650 persons and 150 light vehicles or 40 light vehicles and 195 lane meters for heavy trucks – aims at

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strengthening the internal market facilitating the transport of exporting goods, the tourism and citizens' mobility. These vessels will provide the provision of a maritime transport service supported by vessels with the size and functionality adjusted to the movement of passengers, vehicles and cargo among all the islands of the archipelago, in connection with the air movement in a logic of service of general interest. In terms of research, the ARA OP dedicates an important part of its resources to the promoting R&D initiatives in the business context, with the aim of strengthening the link between companies and R&D and high education centres. As for training and education the ARA OP supports the creation of the new Sea School that will focus qualification related to fisheries, maritime transport, ship repair and construction, maritime tourism activities and environmental and fisheries observation.

Figure 11— Logical diagram for ports

PORTS Objectives of the Strategies/plan/ EMERGING NEEDS strategies/plan/ programme

- strengthening research, technological * Need to improve logistics and further develop cruise shipping and nautical development and innovation; Infrastructures tourism facilitiesand infrastructures. - enhancing access to, and use and Competitiveness and * Need to develop competitiveness network of logistic services linked to the quality of, ICT; Internationalisation international network and distribution channels. - enhancing the competitiveness of Operational Programme 2020 * Need to improve the port systems (concessions) SMEs; - promoting sustainable transport and removing bottlenecks in key network Research * Need for further dynamization of scientific research related to the sector infrastructures; - promoting sustainable and quality employment and supporting labour mobility; and Education and * Need for a specialised training of human resources - enhancing institutional capacity of training public authorities and stakeholders and

Data Collection systems * Need to develop data collection systems - Research, technological development and innovation - Improve access to technology information and communication as well ARA Operational Programme as utilization and quality OR level - Competitiveness of regional companies - Low carbon economy - Climate change and prevention and management of risk - Environment and efficiency of resources - Sustainable transportation and main infrastructures - Employment and labour mobility - Social inclusion and combating poverty - Lifelong teaching and learning

- improve scientific and technological capabilities and knowledge - increase transfer and dissemination of technology and cooperation between companies and universities or other research centers in priority sectors; - create conditions for the Programa Operacional De internationalization of companies; Cooperação Territorial - protect and improve the conservation Madeira-Açores-Canárias natural areas, especially those of tourist (MAC) 2014-2020 interest; - protect and improve the conservation areas natural and biodiversity; - consolidate cooperation strategies between actors

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In terms of infrastructures, Competitiveness and Internationalisation Operational Programme 2020 addresses the need for requalification of maritime infrastructures. In the ARA region, ports are key links in the transport chain and in strengthening the integration of the regional economy. The Operational programme foresees the following investments: in the commercial harbour of Velas de São Jorge expansion in 150m and improvement of safety and operational conditions, creating the conditions for a logistics service within the required quality standard); in the port Pipas on Terceira Island adaptation to the ferry operation, in the port of Calheta-São Jorge construction of the ro- ro ramp; In the port of São Roque do Pico construction of an infrastructure to improve operational conditions and efficiency in the embarkation and disembarkation of passengers and vehicles, also complying with the safety requirements in operation in the port area; in the ports of Santa Cruz das Flores and Corvo requalification of infrastructures in the western group of islands, through structural interventions under the conditions, allowing the movement of cargo and passengers; Ponta Delgada port reinforcement of the mooring; Port of Praia da Vitória requalification of security and accessibility systems; Porto da Horta construction of 2 landing-places with reinforcement of the inlet of the commercial wharf and expansion of the platform, upgrading of the port systems safety and supply of fuel to vessels. The ARA Operational Programme addresses the needs in terms of improving facilities for tourism and nautical activities. Indeed the programme foresees the construction of small local public infrastructures related with nautical activities, small marinas and local berths to support small vessels crossing the Atlantic. As for research, the ARA OP and the MAC programme address the need for a more accurate knowledge of non-climate-related natural hazards and risks related to human activities (such as technological accidents). As for training and education the ARA OP supports the creation of the new Sea School that will focus qualification related to fisheries, maritime transport, ship repair and construction, maritime tourism activities and environmental and fisheries observation.

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Figure 12 — Logical diagram for ship repair

SHIP REPAIR Objectives of the Strategies/plan/ EMERGING NEEDS strategies/plan/ programme

- strengthening research, technological * Lack of equipment and materials Infrastructures development and innovation; * Insufficient development of local specialized subcontractors - enhancing access to, and use and quality Competitiveness and of, ICT; Internationalisation Operational - enhancing the competitiveness of SMEs; Programme 2020 Research * no information to this regard - promoting sustainable transport and removing bottlenecks in key network infrastructures; - promoting sustainable and quality Education and * new qualifications in ship repair (training and updating courses) for repairing employment and supporting labour training cruise, fishing and recreational vessels mobility; and - enhancing institutional capacity of public authorities and stakeholders and Data Collection efficient public administration systems * Need to develop data collection systems

- Research, technological development and innovation - Improve access to technology information and communication as well as ARA Operational Programme OR utilization and quality level - Competitiveness of regional companies - Low carbon economy - Climate change and prevention and management of risk - Environment and efficiency of resources - Sustainable transportation and main infrastructures - Employment and labour mobility - Social inclusion and combating poverty - Lifelong teaching and learning

- improve scientific and technological capabilities and knowledge - increase transfer and dissemination of technology and cooperation between companies and universities or other research centers in priority sectors; - create conditions for the Programa Operacional De internationalization of companies; Cooperação Territorial Madeira- - protect and improve the conservation Açores-Canárias (MAC) 2014- natural areas, especially those of tourist 2020 interest; - protect and improve the conservation areas natural and biodiversity; - consolidate cooperation strategies between actors

- reduction of barriers to innovation - creation of companies knowledge more oriented. Transnational Cooperation - promotion of a most competitive Programme for the Atlantic economy but more environmentally Area 2014-2020 friendly and efficient in terms of Atlantic level resources. Ship repair in Azores is not well developed as only few companies are carrying out this activity and with limited and progressively declining operational capacities. Exception made for qualifications opportunities potentially offered by the forthcoming Sea school, no specific measures are envisaged by operational programmes/plans for supporting the development of this activity. Actually, considering the remarkable role that the activity can offer to the increasing flows of ships calling Azores, a structural development policy of the sector has not been surveyed. The integration of ship repair in a holistic development of maritime transport and ports infrastructures would allow to create better synergies between these sectors, with common infrastructures and other facilities. The activity however needs to be boosted and made more attractive for new investments, considering that it resulted to be declining in the recent years.

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Figure 13— Logical diagram for coastal tourism

COASTAL Objectives of the Strategies/plan/ TOURISM EMERGING NEEDS strategies/plan/ programme

* Need for berths infrastructures - strengthening research, technological Infrastructures * Need for smaller facilities to support boats and their users development and innovation; * Need for infrastrutures as catalysts for sporting activities and nautical - enhancing access to, and use and Competitiveness and activities quality of, ICT; Internationalisation Operational * Need to regulate maritime space dedicated to recreational tourism - enhancing the competitiveness of SMEs; Programme 2020 - promoting sustainable transport and removing bottlenecks in key network infrastructures; Research * Need for further integration between R&D and nature recreational tourism - promoting sustainable and quality employment and supporting labour mobility; and - enhancing institutional capacity of Education and *Insufficient training of human resources mainly concerning nautical and training recreational activities. public authorities and stakeholders and efficient public administration

Cooperation with * Need to develop cooperation in terms of developing a common image of the - Research, technological development neighbours region and related promotional actions and innovation - Improve access to technology information and communication as well ARA Operational Programme OR Data Collection as utilization and quality level systems * It is difficult to estimate the economic impact generated by the tourism - Competitiveness of regional companies activity that has an important growth potential - Low carbon economy - Climate change and prevention and management of risk - Environment and efficiency of resources - Sustainable transportation and main infrastructures - Employment and labour mobility - Social inclusion and combating poverty - Lifelong teaching and learning

- improve scientific and technological capabilities and knowledge - increase transfer and dissemination of technology and cooperation between companies and universities or other research centers in priority sectors; - create conditions for the Programa Operacional De internationalization of companies; Cooperação Territorial Madeira- - protect and improve the conservation Açores-Canárias (MAC) 2014- natural areas, especially those of tourist 2020 interest; - protect and improve the conservation areas natural and biodiversity; - consolidate cooperation strategies between actors

- reduction of barriers to innovation - creation of companies knowledge more oriented. Transnational Cooperation - promotion of a most competitive Programme for the Atlantic economy but more environmentally Area 2014-2020 friendly and efficient in terms of Atlantic level resources. As already mentioned, the ARA Operational Programme addresses the needs in terms of improving facilities for tourism and nautical activities. Indeed the programme foresees the construction of small local public infrastructures related with nautical activities, small marinas and local berths to support small vessels crossing the Atlantic. The ARA Operation Programme also supports the enhancement and promotion of natural and cultural heritage like for example dissemination and awareness-raising projects for renovation / expansion of the Environmental Certifications granted at international level such as Biosphere Reserves, Azores Geopark, Quality Cost, Blue Flag, etc. Moreover, the OP for the Atlantic Area responds to the needs to support the development of nautical activities as well as the organisation of a specific offer for oceanic yachts and sailboats and intends to promote the attractiveness of the region for international nautical events.

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As for training and education the ARA OP supports the creation of the new Sea School that will focus qualification related to fisheries, maritime transport, ship repair and construction, maritime tourism activities and environmental and fisheries observation. In terms of cooperation with neighbours, the OP for the Atlantic Area addresses the needs emerged mainly concerning the tourist promotion of coastal fishing and the creation of a promotional portal. Figure 14 — Logical diagram for cruise tourism

CRUISE Objectives of the Strategies/plan/ TOURISM EMERGING NEEDS strategies/plan/ programme

- strengthening research, technological development and innovation; Infrastructures * Need to further enhance cruise infrastructures and facilities - enhancing access to, and use and Competitiveness and quality of, ICT; Internationalisation - enhancing the competitiveness of Operational Programme 2020 SMEs; *Insufficient training of human resources mainly concerning nautical and - promoting sustainable transport and Education and recreational activities. removing bottlenecks in key network training infrastructures; - promoting sustainable and quality employment and supporting labour Cooperation with * Develop cooperation with Canary Islands, Lisbon and the Madeira ports mobility; and neighbours - enhancing institutional capacity of public authorities and stakeholders and

- improve scientific and technological capabilities and knowledge - increase transfer and dissemination of technology and cooperation between companies and universities or other research centers in priority sectors; - create conditions for the Programa Operacional De internationalization of companies; Cooperação Territorial - protect and improve the conservation Madeira-Açores-Canárias (MAC) natural areas, especially those of tourist 2014-2020 interest; - protect and improve the conservation areas natural and biodiversity; - consolidate cooperation strategies between actors

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The MAC program addresses the need of cooperation with Canary Islands, Lisbon and the Azores ports.

12. ORs potential contribution to IMP and BG initiatives

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

The Archipelago’s maritime activities contribute all to Blue Growth and in particular to two objectives: maritime, coastal and cruise tourism and aquaculture. Blue energy, Blue biotechnology and marine mineral resources could be developed in the near future. Most of maritime activities contribute to marine knowledge in particular the maritime activities contribute to support private industry competing in the global economy but also to improving the quality of public decision-making, to strengthening marine scientific research, to increase competition and innovation amongst users of marine data and to reduce uncertainty in knowledge of the oceans and the seas. Indeed most of Azores activities are related to international markets (the internal market is very limited) such as coastal tourism, cruise tourism, maritime transport fisheries and aquaculture. Fisheries, aquaculture, coastal tourism are the maritime activities contributing to strengthening marine scientific research and to reduce uncertainty in knowledge of the oceans and the seas. The maritime activities contribute to maritime planning mainly in relation to the coordination between administrations, the reduction of conflicts between sectors, the protection of the environment. The management of fish resources, the international transport and the cruise tourism contribute to increase cross-border cooperation.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

13. Conclusions on concrete measures by type and timeframe By analysing the Logical diagrams above, and considering all findings reported in the previous sections of the report, the following ‘legislative’, ‘non-legislative’ and ‘financial’ conclusions emerged. For each of them, the following details are provided:  possible time frame for fulfilling the potential (short/medium term or long term);  stakeholders that should activate the measure;  possible best practices experimented in other territories (i.e. cross-fertilisation possibilities);  measures for achieving/implementing them.

 Fisheries and aquaculture Stakeholders that Possible best practice/flagship Conclusion Time frame should activate the Measures for achieving them project measure In the same Azores, trawling  Assessment of deep-sea In order to safeguard the fragile has always been prohibited, stocks and identification of biological resources of Azores, longlining is sustainable exploitation levels. environmentally sustainable fishing prohibited within 3 miles of  Rules for the appropriate practise (already adopted by Azores the coast and only the less Local management of the resources fishery sector) should be consolidated. It intensive handlining is administration, and identification of measures is an important step for guaranteeing the Short to medium allowed. This has generated a supported by for monitoring both the sustainable development of the fishery term action positive effect on the central exploitation levels and the sector. Pressure on the deep-sea stocks availability of resources in

administration pressure on stocks. by artisanal fleet is not fully sustainable Azores.  Creation of possible marine and specific measures should be Also deep-sea fishery by protected areas, with envisaged for guaranteeing the artisanal fleet should be restriction on exploitation on sustainability of this fishing practice better monitored and resources.

regulated. LEGISLATIVE

As also emerged in the analysis in chap. 1, catches of tuna have been Local Introduction of measures for the progressively reducing, while the fleet administration and progressive reduction of the fleet capacity remained more or less the Long-term action private Not available or support for a possible same. For this reason, tuna fleet stakeholders (fleet diversification of targeted species should be progressively adapted to owners) and/or new activities. available resources

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Stakeholders that Possible best practice/flagship Conclusion Time frame should activate the Measures for achieving them project measure As emerged from the different steps of the analysis, one of the main needs for  A study could be launched for fishery in the Azores is the identifying possible new diversification of the activity and the species with a market production. Possible diversification relevance. could be:  Maximisation of the use of  Identification of new target ‘Azores brand’ for better species commercially viable and positioning new possible innovation to products to species/products in the global generate value added to Local market. production (new packaging Short to medium administration and Not available  Fishermen should be informed techniques, new distribution term action private and supported for diversifying channels, new markets, fish stakeholders their activities. Training traceability). courses for this specific  Diversification of activities (e.g. purpose should be arranged. pesca-tourism, whale watching or  Through coordination table other forms of maritime tourism) with the research, fishery LEGISLATIVE The diversification could be supported by - sector could explore its the creation of links between the potential, especially in terms

NON research and the sector (for stock of production diversification. management and products/processes innovation) Infrastructures and facilities for  Study for identifying main supporting fishery sector should be needs of the territory for duly developed, namely: supporting the sector  facilities in fishing ports, landing development (what places and auction markets for the Local infrastructures, for which Long term action Not available movement and management of the administration activity and which facilities are product; specifically needed following  facilities for improving the the diversification adopted). preservation, control and traceability  Planning and development of of the products, infrastructures and facilities.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Stakeholders that Possible best practice/flagship Conclusion Time frame should activate the Measures for achieving them project measure As emerged in all steps of the analysis, training and specialisation courses should be undertaken for fishermen  Creation of a training centre and young people for: (the Sea school could  Improving business management represent the most skills of fishermen; appropriate venue).  Improving safety conditions on board  Incentivise fishermen and of fishing boats, especially artisanal young people (through fishery; Stakeholders and schools) to attend these Short to medium  Presenting to fishermen possible local Not available courses. term action diversification possibilities and administration  Supporting fishermen in the creating the awareness of their diversification of their potential activities, following them  Supporting fishermen for concretely throughout the entire process, undertaking diversifications (new and monitoring their status species, new products, new selling even after that the new opportunities, etc., but also new activity has been run. activities, e.g. pesca-tourism);  Attract young people to the sector.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Stakeholders that Possible best practice/flagship Conclusion Time frame should activate the Measures for achieving them project measure As regards aquaculture, the study highlighted that the potential for the development of the sector exist and  Promotional campaigns aimed could be focused on the following at attracting FDI for species: aquaculture, promoting  gilthead seabream incentives made available for  other seabreams the development of the sector  amberjacks and the accelerated licencing  barnacles. procedure. Especially the latter, which is a high  Use of Azores brand for value product, it could be used for Stakeholders and promoting the aquaculture Short/medium- complementing fishing activities. local Not available production. term action However, the overall lack of know-how administration  Organisation of courses for on farming techniques and on licensing, training personnel or for requires that specialised training supporting business courses should be held for training development in this sector. adequate personnel or fishermen for  Development of contracts with undertaking this activity. feed providers for improving Furthermore, access to veterinary and reducing the time needed medicines should be also granted for for access to medicated feed the different farmed species, for ensuring and to veterinary medicine. safeguard of harvest against external

pathogens.

No financial conclusion identified FINANCIAL

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

 Maritime transport Stakeholders that Possible best Conclusion Time frame should activate the practice/flagship Measures for achieving them

measure project

No specific legislative conclusion has been identified LEGISLATIVE

 Analysis of demand and costs- As regards passenger ferry transport, benefit analysis for identifying the the gap analysis has highlighted that sustainability of introducing new more connections should be Short to medium connection. Ferry companies Not available scheduled in order to support term action  Definition of possible connections tourists movements among improvements. islands, also beyond seasonal peaks.  The use of EU funds could support

the development of the sector.

 Analysis for the identification of bottlenecks and definition of infrastructural needs.  Planning and development.  The ERDF could represent a useful

About passenger ferry transport, LEGISLATIVE

- source for funding this type of the analysis highlighted the investments. difficulties of management of

NON Local and National Another element should be passengers flows during seasonal Long-term action Not available authorities considered. Azores ports are 100 % peaks. Better infrastructures public. An analysis of possible benefits should be developed for managing achievable by involving private actors passengers during these periods. in the ports management should be done, considering that private investments could support infrastructural facilities development (see also ‘Port’ conclusions below).

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Stakeholders that Possible best Conclusion Time frame should activate the practice/flagship Measures for achieving them

measure project  Comprehensive analysis for better defining the potential role of Azores in the Atlantic.  Identification of possible cargo About freight transport, segments which should be development of Azores as the developed. transport hub in the middle of the  A strategic vision should be Atlantic that serves as a platform for adopted by public authorities. cargo distribution from/to Europe, but Local and National  Development of infrastructural also from/to North and South Long-term action Not available authorities facilities for the America and Africa. movement/storage of goods The future development of LNG- (warehousing, cranes, possible propelled vessels (which would need free trade areas, etc.). more frequent refuelling) could  Attraction of FDI for concessions further strengthen this position. (greenfield, brownfield, landlord, etc.) in ports area.  Strengthening LNG facilities for bunkering purposes. Specialised courses in shipping and logistics management could be held in The gap analysis identified an overall Azores, and the Sea School could lack of qualified personnel in represent the most appropriate venue shipping and logistics for this purpose. management. This type of expertise The industry should work closer to should be developed in the Short/medium Local authorities and training centres in order to better archipelago for driving the Not available term action young people meet the market need and the development of the sector and create demand of qualified personnel. new jobs opportunities. Furthermore, the industry should be Collaboration between the industry more involved in the promotion of and training centres should be Blue Careers in order to attract new fostered. resources in training centres and in

the blue jobs opportunities.

No financial conclusions identified FINANCIAL

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

 Ports Possible best Stakeholders that should Conclusion Time frame practice/flagship Measures for achieving them activate the measure project  Public authorities should launch a As emerged from the analysis, port study for assessing possible management model in Azorean ports alternative management models is public-driven. An analysis for for Azorean ports. exploring possible alternatives Short to medium  The final step (long-term action) Local authorities Not available port management models should term action would envisage the adoption of be carried out in order to attract the most appropriate model for

LEGISLATIVE foreign investments and develop developing needed infrastructures infrastructures. and raise Azores as the hub of the Atlantic Infrastructures need to be further adapted to increasing and changing demand from cruise and

leisure tourism. Berths resulted to

be not adequate to meet current demand. Azores are central in the transatlantic  Analysis of cruise and leisure traffic of pleasure boats. Indeed Short to medium demand for facilities in harbours; Local authorities Not available

Horta is one of the world’s marina term action  Planning and development of LEGISLATIVE

- with the highest movement. This is needed facilities an advantage that could be further

NON developed and other Azores marinas could be boosted for this purpose. Further infrastructure facilities should be developed in the marinas to

support boats and their users.

No financial conclusion has been identified FINANCIAL

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

 Ship repair Possible best Stakeholders that should Conclusion Time frame practice/flagship Measures for achieving them activate the measure

project

No legislative conclusion has been identified LEGISLATIVE

 Creation of specialised training courses for qualifying and updating Although some qualifications exist in personnel the archipelago, new qualifications  The sea school could should be made available for the represent the natural venue purpose of meeting the increasing for this type of training. demand of ship repair from:  The industry should work  fishing vessels closer to training centres in  leisure boats Short to medium Local authorities, sector order to better meet the  cruise ships. Not available term stakeholders market need and the Specialisations in these kinds of ship demand of qualified repair should therefore be available personnel. and constantly kept updated at the  Furthermore, the industry highest levels. should be more involved in Collaboration between the industry the promotion of Blue and training centres should be LEGISLATIVE Careers in order to attract - fostered new resources in training

NON centres and in the blue jobs opportunities. The growing demand for this activity  Definition of is hindered by the lack of equipment agreement/contracts with and material for repairing ships. In possible providers for making few words, spare parts are to spare parts available in due available and need time to make Short to medium time; Operators Not available them available. For this reason, term  Being informed in advance of specific actions should be possible types of traffic that undertaken for making all needed could invest the archipelago material available for repairing (e.g. cruise ships plan their ships stopover in advance).

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Possible best Stakeholders that should Conclusion Time frame practice/flagship Measures for achieving them activate the measure project Depending on the specialisation Considering that infrastructures in intended to be pursued, ports are limited and do not fully infrastructures developments in support ship repair activity and its Short to medium ports should closely follows Local authorities, operators Not available possible development, synergies term shipyards needs, since the ship with port development policy repair is one of the key services should be created. to be provided to al vessels

calling Azores.

No financial conclusion has been identified FINANCIAL

 Coastal Tourism Stakeholders that Possible best Conclusion Time frame should activate the practice/flagship Measures for achieving them

measure project Each development action should be assessed focusing on its A constant trade-off should be ensured environmental sustainability, among (i) the development of the different considering that Azores main asset activities composing tourism, (ii) the creation is the natural environment and the of support infrastructures (e.g. ports, No time frame Local authorities Not available preservation of this resource is

marinas, other facilities) and (iii) the pivotal in any development policy. protection of the environmental Specific rules should be adopted resources. envisaging the preliminary assessment of environmental impact. The analysis of synergies and tensions among Maritime spatial LEGISLATIVE maritime activities showed that coastal planning resulted to tourism is often in contrast with other be the most Maritime spatial planning should be Local authorities activities for the use of space. For this reason, Short to medium appropriate solution developed by local authorities in and stakeholders the planning and regulation of maritime term action for solving conflicts coordination with economic actors involved space dedicated to recreational tourism among activities involved. should be enhanced and coordinated with sharing the same other activities space.

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Stakeholders that Possible best Conclusion Time frame should activate the practice/flagship Measures for achieving them

measure project A new approach for coastal tourism. The Azores resulted not to be up to now a  The diversification of the vacation destination for families with children offer and the adequate and most of the tourists flows originate from promotion should start by the mainland. While this segment potentially analysing in-depth all could be kept, a diversification of the offer – possible tourism potential, exploiting the potential of Azores’ assets – in order to adequately direct

should be followed by: tourism investment and  Identifying new markets (not only communication. Portugal) Local authorities,  Local actors, supported by  mitigation of seasonality by identifying all private local authorities should Short to medium new attractions for other periods of stakeholders Not available identify possible synergies term

the year as congress areas, golf and involved in the and concentrate their efforts LEGISLATIVE - nautical tourism; sector for reaching these purposes.  investments for four and five-star  Diversification strategy NON resorts, raising accommodation levels should be also supported by to international standards; an appropriate  rural tourism; communication action,  development of other maritime looking at the global market tourism activities (i.e. shark diving as possible recipients of and swimming, diving with manta rays these actions (but focusing (Manta and Mobula) and whale sharks on Europe and America). (Rhincodon typus), near seamounts).

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Stakeholders that Possible best Conclusion Time frame should activate the practice/flagship Measures for achieving them

measure project  Creation of life-long learning courses for training staff involved in the tourism sector.  The Sea school could represent the most appropriate venue for this Increase the level of staff qualification in purpose. all branches of coastal tourism  The industry should work (accommodation, services to tourists, closer to training centres in Short-medium Local authorities, amusement, etc.), adapting it to the sector’s Not available order to better meet the term private operators demand. market need and the Collaboration between the industry and demand of qualified training centres should be fostered. personnel.  Furthermore, the industry should be more involved in the promotion of Blue Careers in order to attract new resources in training centres and in the blue jobs

opportunities.

No financial conclusion has been identified

NANCIAL FI

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

 Cruise Tourism Possible best Stakeholders that should Conclusion Time frame practice/flagship Measures for achieving them activate the measure

project

No legislative conclusion has been identified LEGISLATIVE

Azores routes concern mainly the annual repositioning of cruise ships between North America and Europe  Creation of a round table Coordination of interests and efforts involving cruise lines and Local authorities, local among different stakeholders involved Short to medium- local stakeholders for stakeholder and cruise Not available in the sector should be strengthened, in term action allowing the archipelago lines order to allow the territory to better offer to meet the cruise meet the need of cruise ships for calling ship demand. Azores ports and keep passengers for longer stays. Need to further enhance cruise The round table mentioned infrastructure and facilities. Better above could also serve for

infrastructures are needed for Long term action Local authorities Not available identifying possible needs of LEGISLATIVE

- ensuring adequate berthing to cruise cruise lines in terms of ships calling the Azores. infrastructures.

NON Considering that each island has its own Local authorities should attractions, the archipelago could Micro-cruises have stimulate the  Identification of possible provide useful solutions for developing been successfully development of the investors interesting in ‘micro cruises’, namely cruises experimented in many Short to medium practice, ship owners such a type of cruise. around the archipelago Islands. locations worldwide and term action (also from Europe)  Adequate promotion also The solution would not require could be undertaken should be interested in through institutional significant investments, since they will with different types of investing in this type of channels. take place with yachts with limited ships. tourism in Azores.

numbers of cabins.

No financial conclusion has been identified FINANCIAL

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

14. Potential projects for the Atlantic Assistance Mechanism Atlantic assistance Mechanism Maritime activities Possible project priorities Innovation projects creating synergies between fishing sector Fisheries & and processing industry: new aquaculture packaging techniques, new distribution channels, fish Promote entrepreneurship and traceability. innovation Fisheries & Creation of an experimental aquaculture aquaculture centre. Promote innovative business Blue biotechnology initiatives and synergies with knowledge centres. Protect, secure and develop the Create synergies between potential of the Atlantic marine Coastal tourism protected areas and sustainable and coastal environment tourism. Creation of a promotion tool for Improve accessibility and the marketing of products and Coastal tourism connectivity services linked to maritime tourism activities. Promote synergies between fishing Fishery and and nautical tourism. aquaculture Promote synergies between fishing Coastal tourism and HORECA sector. Create synergies between ferry Coastal tourism passenger transport and coastal tourism (travel packages). Create a socially inclusive and Creating the possibility to have sustainable model of regional Maritime transports alternative fuels in ships (LNG). development Develop cooperation with ship- owners and cruise operators and enlarge cooperation with other Cruise tourism ports. The concept fly & cruise can be developed in the Azores (e.g. like in the Baltic and Fjords).

Realising the potential of the Outermost Regions for sustainable blue growth ANNEX 7 TO THE FINAL REPORT — THE BLUE ECONOMY IN THE AZORES

Roles and contributions to external initiatives

 Transatlantic Ocean Research Alliance Cooperation in the field of ocean observation for a better understanding of the Atlantic Ocean and promotion of a sustainable management of its resources, a more sustainable and profitable fisheries management, a better articulation between all the activities that take place Including the exploitation of new natural resources from the deep ocean, such as the exploitation of polymetallic nodules and the prospecting of genetic resources with potential for the development of innovative products in the field of marine biotechnology, namely in the chemical industry, pharmaceutical and cosmetic ‘.

 Ocean governance The potential contribution of ARA to Ocean governance is related to:  cooperation in R&D and knowledge of sea resources;  cooperation on maritime transport and in particular for which concerns the sharing of information.

 EU neighbourhood actions Several activities may play a role in EU neighbourhood cooperation:  technology transfer in biotechnology and renewable energy;  education & training on specific skills in maritime activities;  cooperation on tourism to develop ARA image;  exchanges of best practices.

List of interviewees

Organisation Maritime activities concerned Number of interviewees

Direção Regional dos All maritime activities 1 Assuntos do Mar

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[Catalogue number [Catalogue

822

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doi: 10.2826/765231