EUSBSR-22: Towards the Baltic’s Regional Priorities

The two-day forum focused on several modern challenges: i.e. energy and social security, climate change measures and crises resilience, the green and digital transitions, etc. The third article in the series on the EU’s sub-regional strategies describes the Baltic region’s efforts in dealing with challenges, and additional attention to innovation and funding projects. Besides, some strategy’s changing priorities are also under attention.   

In the beginning of the 21st century the EU leaders realised that the European integration process need a new sub-regional dimension: i.e. the EUSBSR has become the first macro-regional strategy (launched in 2009), which is addressed on over 85 million people in eight EU member states (Denmark, Estonia, Finland, Germany, Latvia, Lithuania, Poland and Sweden) with cooperative actors from Norway and Iceland.
The sub-regional strategy has been historically oriented towards resolving three main spheres of “united activities”: saving the sea, connecting the region and increasing prosperity; however, global challenges of the last decade have made some vital alterations in the EUSBSR.
More on the strategy in the previous articles: https://www.integrin.dk/2022/09/19/european-strategy-for-the-baltic-sea-region-planning-and-practical-implementation/, and https://www.integrin.dk/2022/09/21/sustainability-in-the-baltic-sea-region-eusbsr-in-action/

Over 500 participants have been registered for the event, a little bit less actually appeared, including several country’s ministers and officials, e.g. Pekka Haavisto, minister for foreign affairs; Krista Mikkonen, interior minister; Maria Ohisalo, minister of the environment; Kimmo Jarva, Lappeenranta’s major; Jyrki Katainen (former Finland’s PM during 2011-14) heading presently Finnish innovation fund, as well as several representatives of other organisations dealing with the region’s strategy (such as the Council of the Baltic Sea States, Interreg and VASAB, etc.) and representatives from Commission’s Directorate-General, such as DG REGIO, MARE and CLIMA.
For example, Commissioner for Cohesion and Reforms Elisa Ferreira participated through a video-message; at: https://ec.europa.eu/regional_policy/en/newsroom/news/2022/09/28-09-2022-kick-off-of-the-13th-annual-forum-of-the-eu-strategy-for-the-baltic-sea-region

The strategy’s priorities in the forum’s agenda
In line with the present EUSBSR priorities, the forum’s work concentrated on the following discussions which took place in six parallel sessions: = new plans and visions for “saving” the Baltic Sea; = challenges in social security; = innovations for digital-green transition and in sustainable growth; = measures to combat climate change; = energy and connectivity; and = “recovery in aftershocks” (the latter covered recovery and resilience plans in all EU states).

For example, in implementing the “green deal” and combating climate change’s priorities, which have been influencing abilities and opportunities in the governance structures in the region, the EUSBSR has had, generally, four main and broadly interconnected priorities: a) environment and climate change; b) research and innovation, c) economic development; and d) connectivity (transport, energy and digital networks).
Due to their cross-sectoral and cross-thematic nature, these priorities also support vital EU-wide political directions (e.g. “economy that works for people”, green-digital transition and the energy efficiency). In that respect, the EUSBSR has supported the sustainable development of the blue economy as the sea-basin strategy while helping to increase knowledge of the “blue-bio-economy” through a dedicated platform in the Baltic Sea region.
See more in: https://www.submariner-network.eu/blue-platform

Experts from the Baltic States exchanged views on energy independence, alternative fuels perspectives, new green technologies, sustainable and competitive transport means, etc. In energy and resources’ efficiency a number of breakthroughs are expected: e.g. the city of Lappeenranta has approved a program for a resource efficient city by 2050. The program includes the following focal points: to make carbon neutral district heating and electricity production, CO2 neutral and sustainable transportation, all waste from food production and consumption shall be recycled, transition to circular economy shall create new business models and opportunities, water consumption and energy use for water treatment shall be reduced by 50 per cent, all nutrients from community in industrial wastewater shall be extracted and recycled.
In collaboration with public construction managers in Lappeenranta, the city council has developed during 2017-20 effective financing tools in construction’s energy efficiency with a budget of € 5,5 billion. More in: http://www.lappeenranta.fi/fi.
For example, this November LUT University in Finland organizes a conference on “Future energy solutions” and regional energy independence. The conference’s ideas include discussions on hydrogen economy “valleys” in North-East Europe and synthetic fuels, storing of electricity and heat, and small modular reactors.

= Youth in strategy’s active stances. Present forum offered a lot of networking opportunities for increasing role of young people in delivering the strategy’s goals. Numerous activities are performed within the VASAB competence aimed at spatial cooperation in the region. Young Planners’ Summer Schools are organized periodically for the young (in terms of experience and practice) professionals in the field of spatial planning in the Baltic Sea Region. First Young Planners’ Summer School, called as Young Planners’ Contest was held in Poznan (Poland) in August 2019. Second Young Planners’ Summer School was held in Greifswald (Germany) at the end of August 2022. See: https://vasab.org/home/about/young-planners/

= Funding
The EU multi-annual budget for up to 2027 has allocated about € 392 billion (a third of the total) for the European cohesion policy: it represents huge investment and support for national and regional programs, including both sustainability programs and actions aimed at increasing growth, jobs, social integration and better regional cooperation. These EU budget allocations fall under three main categories of funding including both the EU and the states investments in:
= 1) jobs and growth (with €381 bn), which includes the activities of the following funds: the European Regional Development Fund (ERDF), the European Social Fund (ESF+); the Cohesion Fund, and the newly approved Just Transition Fund with about €19.2 bn.
= 2) Interreg: providing assistance to the European-wide sub-regional territorial cooperation among the EU member states (with about € 9 billion funding).
= 3) the EU financial instruments (mainly from the European Commission) in managing and providing necessary technical assistance to the member states.
More in the EU Regional Policy Panorama in: https://ec.europa.eu/regional_policy/en/newsroom/panorama/2021/12/12-01-2021-cohesion-policy-2021-2027-budget-in-brief
Special forum’s session analyzed existing financial assistance (from the strategy, Interreg, the EU budget, etc.) for projects. Session’s moderators (first, E.Kolosova/Joint Secretariat of the Interreg Baltic Sea Region and second -Johan Magnusson/DG Regional and Urban policy) explained how Interreg projects help implementing the EUSBSR Action Plan (E.Kolosova and colleagues); and revealed numerous funding sources and instruments available to applicants (the speaker from DG Regio).
Within the EU cohesion policy’s funding, there are actually three financial sources: a) Interreg, with 14 programs for all four EU macro-regional strategies and available funding of €2,3 bn; and cross-border projects (Interreg A, C and B) with €6,3 bn; b) the EU Cohesion Policy itself with about € 370 bn oriented to such objectives as: competitive EU, green and digital transition, sustainable growth with citizens’ involvement, etc.; and c) two additional funding through EAFRD (agro-rural support) and EMFAF (maritime and aquaculture). More in: https://interreg-baltic.eu/funding; reference to applicants in: https://interreg-baltic.eu/gateway.
There are two kinds of projects to be supported: – so-called small ones for one year (€0,5 mln funding) with at least 3 organizations from 3 EU states; and – core projects for 3 years, no limits for funding, with participants from 3 organisations from 3 states.
The projects are ranging from innovation to bio-economy and bio-technology, to transport, to energy and to spatial planning. There have been already registered 48 projects’ applications oriented to mentioned priorities.

= Innovation
The parallel session on innovation was organised and carried out by the EUSBSR Policy Areas of Innovation and Bio-economy (moderator E. Kokkonen/Finland Baltic Institute). The head speaker, Ch. Ketels/Harvard Business School) concentrated on innovation issues in the transition from climate change measures to sustainable growth.
Underlining that innovation is a key to prosperity, the speaker revealed that the GDP growth in the BSR during 2000-19 has been for the region’s eastern part at 4 percent, though in the EU and BSR less than 2 percent; during 2019-21 the GDP rates reduced dramatically, correspondingly, to 2 and 0,5 percent. However, six BSR states are presently among top in the Global Innovation Index; as to the EU’s Digital Economic and Social Index (DESI) among first 3 are Finland, Denmark and Germany, which are famous in finding new business models.
Concentration in innovation is high in the BSR – about 50 percent of investment in innovative science and research occurred in top 5 companies in BSR.
The speaker underlined that innovation issues are closely connected to how BSR is addressing the SDGs, with a stress on common actions: states can do mote together than individually! However, “interests” for innovation in the EU and the region/states are often quite different; besides, the “tools” are “politically dangerous”, as the goals are often far from economics! And in most cases ineffective political leadership is divided from economics, argued the speaker.

The strategy’s changing priorities
The EUSBSR’s present triple priorities include saving the sea, connecting the region and increasing prosperity. It is hard to see anything novice it these goals: “saving” the Baltic Sea has been a permanent long-term priority, the task of a proper “connecting the region” has been p[resent in all the State of the Region Reports” prepared by the Baltic Development Forum during 2013-17; increasing prosperity and wellbeing is not new at all: the concept is included in the basic laws of almost all strategy’s member states. Hence, the real life is much more complicated than “just three goals”, due to mounting global challenges and present extremely negative consequences of the Russian war in Ukraine.
In the current exceptional circumstances triggered by the post-pandemic and the consequent economic crises, cooperation among countries and regions is needed more than ever, as crises’ economic, fiscal and social consequences could not be tackled by any single country alone. The EU is providing innovative tools and extraordinary financial means to recovery and resilience (both in the short- and long-term), through investing in a green, digital, sustainable and socially inclusive economies. The recovery from the crisis represents a major opportunity for shaping the Europe of the future.
Starting from the end of 2016, the Commission was making reports every two years describing the progress made towards the implementation of all four EU macro-regional strategies. In May 2019, about a year before the covid-pandemic, the second report on the implementation of the EU macro-regional strategies appeared, which included examples of illustrated achievements with concrete results, with visualizing challenges and the ways forward. On the 2nd report in: https://ec.europa.eu/regional_policy/sources/cooperate/macro_region_strategy/pdf/council_conclusions_17052019.pdf

The third report was approved in September 2020: it explored the strategies’ development in the post-pandemic period with the aim of securing a sustainable, competitive and socially inclusive economic recovery. In that respect, the 3rd report assesses the role of the EU strategies’ importance in delivering the new EU priorities for a green, digital and resilient future. More in: https://www.adriatic-ionian.eu/wp-content/uploads/2020/10/COM_2020_578_EN_ACTE_f.pdf . The next report on the implementation of the EU macro-regional strategies will be ready by the end of 2022.

It is interesting to notice how quickly sub-regional priorities are changing: e.g. just about six years ago, during Swedish presidency in the EUSBSR the priorities were the following four main: demographic challenges, industrial innovation, environmental issues and democratic governance.
More on the previous priorities can be found in “Looking towards 2030: preparing the Baltic Sea Region for the future”, a summary published in October 2016.
Now, both the long-term and short term priorities have changed dramatically, to include digitization, sustainability, climate change, circular economy, etc. In line with the new trends, present EUSBS forum has chosen mainly two – sustainability and climate change, among several of minor importance. To make no mistake, the forum’s organisers underlined that the participants will be “managing other challenges “.
For example, the Danish priorities towards wind energy, adopted over a decade ago, have been highly praised by the EU’s institutions as a truly longtime and effective sustainable strategy’s direction.

 

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