NB8: on benefits and challenges of the Nordic Baltic regional integration

What are the benefits of the economic and political integration between the Nordic and Baltic countries and what are the challenges to deal with before an integrated region is a reality?

NIB Newsletter asked these questions to the panellists of the seminar “Nordic and Baltic Countries: The Next Twenty Years” arranged by Finland’s Ministry of Foreign Affairs in Helsinki in late August 2011.

Rolandas Barysas, editor-in-chief of the Lithuanian business daily Verslo Žinios:

The Nordic and Baltic countries are relatively small markets, although not without certain political influence, economic attractiveness and cultural uniqueness. From a sheer numbers standpoint, a combined amount of 32 million inhabitants looks more attractive. When it comes to the media, the world nowadays more often talks in terms of regions rather than individual countries. If we don’t want to stay on the margins of international politics and the global economy, we must “add weight” by closer integration of the Nordic and Baltic regions. This will make the Nordic and Baltic region more dynamic on the European scale and, ultimately, should convert into economic benefits, bringing stability, creating opportunities and increasing social security for individuals. To make things happen, both the Nordic and Baltic regions need a change in attitude. They should stop seeing each other as “backward neighbours” and “selfish investors”. To break the stereotypes and win public support for integration the economic differences should become narrower.

Jan Fritz Hansen, Executive Vice President, Danish Shipowners’ Association:

The Nordic and Baltic countries share a sea and the optimisation of our mutual trade lanes seems like a large-scale project for all countries in the region to work together on. We have a number of major environmental challenges to tackle together. For instance, the shipping industry has to decrease the discharge of sulphur into the Baltic Sea by more than 90% by 2015. This is a huge task that requires cooperation between all parties. We can promote our integration through better coordination of positions of individual Nordic and Baltic countries in the EU and other international organisations.

Johnny Åkerholm, President and CEO of the Nordic Investment Bank:

The Nordic welfare model has been an important contributor to competitiveness, particularly because of its ability to mobilise skilled labour. Furthermore, the concomitant high level of taxation has not been a barrier to competitiveness, as the benefits have largely been rendered to the tax-payers in the form free education, social security, infrastructure and social stability. However, with the ageing of the population, this will change, and the Nordic welfare model will increasingly turn into a generational redistribution mechanism. The integration of the Baltic economies into the EU has also been very supportive to the overall development in the region. The Baltic countries need to attract investments into economic activities with higher added value. First of all, we should work more together, because together we are larger. Secondly, we would work on creating common, universal-level standards in the areas of education, as well as research and development.

Krišjānis Kariņš, Member of the European Parliament from Latvia:

The benefits of Nordic-Baltic integration are in increased standards of living. The more open the borders, the easier for companies and individuals to trade across those borders, the bigger the potential market, the higher the incomes, the better standards of living we all can share. If we look at Latvia’s export markets, we see that money is already creating those ties. We in the North seem to share a very strong sense of responsibility, and we have a common cultural experience. Similar cultures simply make the economic cooperation that much easier. We have a lot of potential and synergy to gain from each other. We have to focus on business development, revising the overly stringent labour laws and other administrative burdens that hamper development, to take care of our social welfare systems and overcome the key challenge for all of us collectively-our ageing populations.