Bright future – hot investments

 - The future lies in the North, including the Barents Region, said keynote speaker Professor Laurence C. Smith from University of California, Los Angeles, in the Arctic Business Forum 2012.

Professor Smith travelled all the way from Los Angeles to Rovaniemi to speak about his book – The World in 2050 – Four Forces shaping civilization´s Northern Future – now also available in Finnish. His core message states that by 2050, the future lies in the North for a number of reasons. Climate change, demographic trends, global logistics, energy demand and so forth – are all contributing global factors.

Another contributing fact is that the Arctic countries have peaceful borders and good cross-border cooperation which significantly helps to enhance the economic potentials. The environment is about to change but even here the consequences of the warming of the Arctic are more seriously felt in southern regions where rising sea level and changing climate patterns are estimated to have a much greater impact on everyday life.

The book has added to the recent Arctic and Northern hype in Finland and elsewhere and predicts a bright future for the Business Forum audience – 150 participants, mainly business people from the Barents Region.

Investments of 125 billion euros

The organizer of the Forum, the Lapland Chamber of Commerce, presented their High North investment list which is updated annually. This year the geographical scope of the inventory has been widened covering all of the Northern regions of Europe, including also Oulu and Kainuu regions in Finland. In fact, it now covers most of the Barents region, except for Karelia, Komi and Nenets in Russia.

According to the list, the expectations are that 125 billion Euro will be invested in the European High North within the next ten years. They are distributed as follows:
  • Northern Finland 22 billion,
  • Northern Sweden 30 billion,
  • Northern Norway 23 billion
  • Northern Russia (Murmansk and Archangelsk) 41 billion.
Oil and gas investments are together 35 billion (including the Shtokman field in the Barents Sea), transportation and infrastructure over 20 billion, wind power over 20 billion and mining industry a bit less than 20 billion. Tourism and commercial development are also notable factors but the scale is smaller. All these developments require new transport logistics, which are included in the investment list.

Relatively, these numbers rise even more when compared to the national annual budget of Finland, which is a bit over 50 billion Euro. Year by year, the estimate of expected investments have grown higher. The Chamber of Commerce is talking about an “AAA” –list of the most likely investments. If one counts in everything possible the sums exceeds 200 billion Euro.

The Finnish ministry of transport delivered a two sided message to the Forum. They, on one hand confirmed the needs for the development of new transport links in Finland, in particular mine related developments including connections to Arctic sea ports in Norway and Russia. On the other hand, the perspectives are murky due to no concrete plans for either new railroads or to an even lesser extent the finances for such projects.

The Participants left the Forum with high expectations encouraged by the visionary messages. Yet, the challenges are just as great on the way ahead which is by no means paved.

This was the third Arctic Business Forum organized annually in Rovaniemi by the Lapland Chamber of Commerce.

Markku Heikkilä
Head of science communication, Arctic Centre, University of Lapland
Photo: Marjo Laukkanen, Arctic Centre

Professor Laurence C. Smith (left) together with permanent secretary of the Ministry of Environment Hannele Pokka,
Finland’s Arctic Ambassador Hannu Halinen, Lappset company Chairman of the board Johanna Ikäheimo and
University of Lapland Rector Mauri Ylä-Kotola.

More about the book: The World in 2050 – Four Forces shaping civilization´s Northern Future and the author in the UCLA newsroom.


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