EUBORDERREGIONS FP7 RESEARCH PROJECT

CASE STUDY #1

NORWAY - RUSSIA

Case Study Report

Elaborated by The Barents Institute Team UIT The Arctic University of

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Table of Contents

1. Introduction ...... 4 1.1 The border, the border region and the border traffic zone ...... 4 1.2 Data material and network analysis ...... 5 1.3 Historical background ...... 8 1.4 The impact of the past on current cross-border relations ...... 10 1.5 Minorities and their impact on current cross-border relations ...... 11 2. Socio-economic characteristics ...... 13 2.1 County ...... 13 2.2 Region ...... 14 2.3 Regional indicators compared to national indicators ...... 16 2.4 Differences between the Norwegian and Russian parts of the border region ...... 18 2.5 Socio-economic characteristics affecting cross-border cooperation ...... 19 3. Cross-border transport and infrastructure ...... 21 3.1 The border crossing point of Storskog-Borisoglebsky ...... 21 3.2 Border crossings through Storskog-Borisoglebsky ...... 23 3.3 Treatment of travellers crossing the border at Storskog-Borisoglebsky ...... 25 3.4 Air, sea and rail traffic ...... 25 3.5 Infrastructure ...... 26 4. The visa regime and the border traffic permit ...... 27 4.1 The visa regime ...... 27 4.2 The border traffic permit ...... 28 5. Bilateral and regional cooperation ...... 32 5.1 Economy ...... 32 5.2 Culture and art ...... 33 5.3 Environment ...... 33 5.4 Safety and security...... 34 5.5 International context for cooperation ...... 35 5.6 Cooperation on the regional level ...... 36 6. Municipal cooperation: The case of Sør-Varanger and Pechenga ...... 37 6.1 Twin towns ...... 37 6.2 The cooperation between the municipal administrations ...... 38 6.3 Health and care ...... 39 6.4 Education ...... 40 6.5 Sport...... 42 6.6 Libraries ...... 43 6.7 Media ...... 44 6.8 Business and labour ...... 44 6.9 Obstacles for municipal cross-border cooperation ...... 45 7. Cross-border cooperation between organizations and institutions...... 47 7.1 Educational cross-border cooperation ...... 47 7.2 Cultural cross-border cooperation ...... 47 7.3 Cross-border cooperation between non-governmental organizations ...... 48 7.4 Motivating factors ...... 48 7.5 Obstacles ...... 49

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8. Economic relations ...... 51 8.1 Economic relations between Norway and Russia ...... 51 8.2 Economic relations in the border region ...... 52 8.3 Informal and illegal trade in the border region ...... 53 8.4 The labour market ...... 53 8.5 Tourism ...... 54 8.6 Fisheries and hydroenergy – two success stories ...... 56 8.7 Barriers for economic cross-border cooperation ...... 57 8.8 The future for economic cross-border cooperation ...... 58 9. Perceptions of the border, the border location and regional development ...... 60 10. The role of the in the borderland ...... 62 11. Policy options ...... 64 12. References ...... 66

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1. Introduction

This case study report forms part of the research project European Regions, EU External Borders and the Immediate Neighbours. Analysing Regional Development Options through Policies and Practices of Cross-Border Co-operation (EUBORDERREGIONS). The main objective of the project is to identify challenges to economic, social, and territorial cohesion as well as regional development potentials in different borderlands at the EU’s external frontiers.1

The report examines cross-border cooperation (hereinafter referred to as CBC) in the Russian- Norwegian borderland in the of Europe. Although the Russian-Norwegian border is formally not an EU border, it shares in many ways the characteristics of the eastern external EU border further south. Although not a member of the union, Norway is to a large extent integrated in the EU community through its membership in the European Economic Area. Importantly, Norway has been a member of the Schengen since 2001.

1.1 The border, the border region and the border traffic zone

The Russian- Norwegian border was established in 1826. The border is 196 kilometres long. The biggest part of it (153 kilometres) follows rivers and lakes. The border can only be crossed at one point, the Storskog-Borisoglebsky border-crossing. Visa, or border traffic permit for border residents, is required for travellers crossing the border from either side.

The Russian-Norwegian border region is in our research defined as Finnmark County (Norwegian: Finnmark fylke) (48.637 km2/ 74.710 inhabitants) on the Norwegian side and Murmansk Region (Russian: ) (144.900 km2/ 772.500 inhabitants) on the Russian side of the border. Finnmark County is the only Norwegian county bordering Russia and Murmansk Region is the only Russian region bordering Norway. The border region is located in the central part of the Euro-Arctic Barents Region (see figure 1 below).

The entire transnational border region covers 193.537 km2. Of this 75 % belongs to Russia and 25 % to Norway. The region has 847.210 inhabitants. Of these as many as 91 % live on the Russian side of the border. The region is extremely sparsely populated with only 1.1 people per km2. The only real city in the borderland is Murmansk with a population of roughly 300.000. There are, however, several smaller towns on both sides of the border.

In our research we have focused particularly on the Russian-Norwegian 30-kilometre border traffic zone (hereinafter referred to as BTZ). The BTZ covers 12.629 km2 and includes the two border municipalities of Sør-Varanger (Norwegian: Sør-Varanger kommune) on the Norwegian side (3.967 km2 / 10.077 inhabitants) and Pechenga (Russian: Pechengsky Rayon) on the Russian side (8.662 km2/ 38.920 inhabitants). The area includes the Norwegian town of (7.209 inhabitants) and the Russian towns of Zapolyarny (15.835 inhabitants), (12.771 inhabitants), and Pechenga (2. 959 inhabitants). A total number of 48.997 people live within the zone. Since 2012 most residents of this zone have been entitled to a so-called border traffic permit which may be used instead of a regular

1 See www.euborderregions.eu 4 visa when crossing the border (see section 4.2). The BTZ is the part of the border region where the cross-border interactions are strongest (see chapter 6).

Figure 1. Map of the Barents Euro-Arctic Region with Finnmark County and Murmansk Region marked with red circles (Source: Arctic Centre, University of Lapland)

1.2 Data material and network analysis

The report is based on data material collected from 2012-2013 during the EUBORDERREGION project period. It does not reflect later developments in the region. In our approach we have to a large extent followed the EUBORDERREGION fieldwork toolkit for data collection. Quantitative as well as qualitative methods have been applied. Our main source of data has been 67 qualitative in -depth interviews with people representing institutions and organizations on both sides of the border which are, or have recently (2007-2013) been, involved in CBC. 37 interviews were conducted in Russia and 30 in Norway. Of the Norwegian interviewees the vast majority (25) were based in Sør-Varanger municipality, while 5 came from other parts of Finnmark County. Of the 37 Russian interviewees 20 were based in Murmansk while 17 were based in Pechenga. The people interviewed represented both public and private organizations, as well as NGOs. The public sector interviewees included representatives of regional and municipal authorities, and , as well as representatives of public educational and research institutions. The private sector interviewees included representatives for enterprises involved in cross-border business, as well as representatives for mass media and cultural institutions in the region. The NGO interviewees were involved in various activities, from environmental to religious issues. In the report interviews have been anonymized and names of particular persons or institutions will, as a rule, not be mentioned. 5

Our interviewees represented a total number of 49 organizations. 26 of these were Russian and 23 Norwegian. Among the Russian organizations 16 were based in Murmansk and 10 in Nikel. Twenty- three of the Norwegian organizations were based in Kirkenes, 2 in Vadsø, 1 in Alta and 1 in Hammerfest. 27 organizations belonged to the public sector, 16 to the private sector, and 6 were NGOs. The organizations were involved in the following fields of activity (Number of organizations in parenthesis): 2

- Commerce/business/sales/production/service/consulting/construction/development/ transportation (15) - Governance/administration/management (12) - Mass-media/social and public communications (6) - Primary and/or secondary or general or popular education (5) - Research and innovation and/or higher education (4) - Culture/sport/leisure/religion (3) - Health care/social care and assistance (2) - Other field (2)

Only six of the organizations were involved in cross-border cooperation projects that were funded by EU CBC programs (all ENPI Kolarctic projects). Most organizations received or had received funding from the Norwegian Barents Secretariat, which is the most prevalent funder of cross-border cooperation in the region. A few organizations were involved in self-financed CBC.

The representatives of the various organizations interviewed were asked which other organizations they cooperate with in CBC projects. Based on the answers we could, with the help of NetMiner, map cross-border networks of organizations. The networks consisted of 113 organizations (64 partner organizations in addition to the 49 we had interviewed).

Figure 2 (below) shows how the various organizations are geographically distributed. Each node represents one organization and the arrows represent the links between them. The red line in the middle of the figure represents the border. To the left of the border we find the Russian organizations, marked with blue colour. To the right of the border we find the Norwegian organizations, marked with green colour. The position of the nodes show their approximate distribution in space.

As the figure shows most of the organizations operate near the border, in Finnmark County on the Norwegian side of the border and in Murmansk Region on the Russian side. Some organizations are based further away, in neighbouring regions (middle of figure) while some are based even further away (right and left peripheries of figure). As the figure shows the organizations are relatively evenly distributed on the Norwegian and Russian side of the border.

2 The fields of activity as defined in the EUBORDERREGIONS toolkit. 6

Figure 2. Geographical distribution of organizations involved in CBC. Country marked by colour.

Figure 3 (below) shows how the various organizations relate to each other and forms part of CBC networks. The national belonging of the organizations is marked by colour (green for Norway, blue for Russia) and shape (squares for NGOs, circles for public organizations, and triangles for private organizations).

The figure illustrates how CBC takes place in smaller or larger networks of organizations. Some organizations have several (up to ten) partners. These organizations appear as central nodes in the various clusters. No particular national belonging or sector group dominates among these. We see that both Norwegian and Russian, public and private organizations, and NGOs have central positions in the network map. Most organizations have, however, not many but few partners and in most cases only one. As the figure shows there are several isolated “couples” of organizations that only relate to each other.

Generally we see that cooperation takes place between organizations that are similar to each other. Private organizations cooperate with public organizations while NGOs relate to NGOs. We find, 7 however, quite a few examples of cross-sectional CBC, involving both public and private, public and NGOs, and private and NGOs.

Figure 3. Network of linkages between organizations involved in CBC and their distribution by country (colour) and sector (shape).

1.3 Historical background

The Convention of 1826 between Russia and Sweden (which at the time also included Norway) defined the current borderline between Russia and Norway. From the early 17th century until the convention was signed the central part of the borderland, which today constitutes the municipalities of Pechenga and Sør-Varanger, had been considered a Russian-Norwegian common land where both states enjoyed certain rights. The areas to the west were controlled by Norway and the areas to the east of the common land were ruled by Russia. The convention was a 8 result of long negotiations between the two sides. Religious belonging was the most important guiding principle when the new border was drawn. As a rule, Lutheran areas were assigned to Norway, while areas with an Orthodox majority were assigned to Russia. The location of churches and cemeteries in the areas also played a significant role in the delineation process (Wikan 2003).

From 1826 until today, except from the years from 1917 to 1944, the borderline defined by the Saint Petersburg Convention has marked the divide between Norway and Russia.3 While there has been little dispute over the land border between Russia and Norway, the maritime border between the two countries was contested until 2010 when the Treaty between the Kingdom of Norway and the Russian Federation concerning Maritime Delimitation and Cooperation in the and the Arctic Ocean was signed. The treaty divided the so-called “Grey Zone”, a contested area of 175 000 km2, into two parts of equal size – and lifted the moratorium on the exploration and exploitation of hydrocarbon resources in it (Neumann 2010).

During the 19th and early 20th century the Russian-Norwegian border had little practical impact and was relatively open. The region was marked by an intensive social, economic and cultural cross- border interchange. With the creation of the after the Russian Revolution of 1917, coincident with the end of the First World War, the Soviet, Norwegian and Finnish governments instituted formalized regimes with regards to cross-border relations. During the Cold War, acrimonious relations intensified between East and West and greatly restricted cross-border interaction. A militarization of the border region took place, particularly on the Russian side. The borderland became a place for great tension between NATO and the Pact member countries respectively. Despite these geopolitical tensions, citizens who lived in the borderlands, especially Norwegians, succeeded in reaching out to their neighbors with cultural, sport, and school activities.

By the rule of Mikhail Gorbachev beginning in 1985, it was clear that change would come to the region. Gorbachev’s Murmansk speech of 1987, in which he outlined a need to demilitarize the Arctic and improve the cooperation between the Arctic states (Gorbachev 1987), would be pivotal in the coming decade as we see the establishment of the Barents Region in 1993 promulgated by Norway, the establishment of the Arctic Council in 1996 agreed upon by all of the Arctic eight countries, and, not least, a remarkable increase in CBC and goodwill between Norway and Russia over the last two decades.

The breakup of the Soviet Union in 1991 resulted in a re-opening of the border. In the early 1990s, there was a marked increase in border crossings, from less than 2.500 per year in the 1980s to more than 8.000 in 1990, 15.000 in 1991 and 80.000 in 1992. Most dramatic was the increase of Russian citizens visiting Norway. In the early 1990s, during the years of economic crisis in Russia, many impoverished Russian “trader tourists” crossed the border in order to sell various items on the so- called “Russian markets” that appeared all along the North Norwegian coast (Thuen 1993).

In 2012 a common Russian-Norwegian BTZ was introduced. The BTZ agreement provided most residents of the border municipalities of Sør-Varanger and Pechenga with the right to obtain a special border traffic permit (Russian: Razreshenie na mestnoe prigranichnoe peredvizhenie. Norwegian:

3 From 1917-1944 the borderline marked the divide between Norway and Finland. In 1917 Finland gained the Petsamo corridor (today’s Pechengsky Rayon) to the Barents Sea. Finland had to cede the area to the Soviet Union in 1944 after losing the war. 9

Grenseboerbevis) which allows them to cross the border without regular visas and stay on the other side (within the border zone) for up to 15 days (see section 4.2).

Despite the above mentioned liberalization efforts, the Russian-Norwegian border remains, however, one of the most closed European borders. It can only be crossed at one point, the Storskog- Borisoglebsky border-crossing, and only during certain hours of the day with valid documents (passport, visa and/or border traffic permit). Norway’s membership in Schengen (from 2001) has contributed to a significant securitization of the border regime on the western side. On the Russian side of the border there are several closed or restricted zones that lie on the borderline. These zones tend to be under the direct control of the Federal Security Service of the Russian Federation (FSB) (Shirshov 2009). The Russian border region remains highly militarized. The borderland is considered to be strategically important for the Russian Navy. Murmansk is the centre for the Northern Fleet and the 200th Independent Motor Rifle Brigade is stationed in Pechenga, just across the border.

Figure 4. Murmansk is the centre for the Russian Northern Fleet (Photo: Wikipedia)

1.4 The impact of the past on current cross-border relations

Russian-Norwegian historical relations are, on both sides of the border, referred to as a model and as a resource for current CBC. The Pomor Trade (1740-1917) between and Northwest Russia is often mentioned as a historic predecessor of the modern Barents cooperation, the transnational regional cooperation in the High North. The historical term Pomor is frequently used as a name for all kinds of cross-border projects. There is for example the Russian-Norwegian Pomor Brotherhood, an association cultivating cross-border friendship in the region, and there is the Pomor Exercise, an annual joint Russian-Norwegian naval exercise. In 2006 plans for a Pomor Zone, a Russian-Norwegian transnational free economic zone in the borderland, were presented in a report assigned by the Norwegian Ministry of Foreign Affairs (Johnsen 2006, Wråkberg 2009) 10

Russian-Norwegian comradeship during WW2 also sustains modern CBC. The liberation of the eastern part of Finnmark by the Soviet Red Army in 1944 is celebrated, even today, on both sides of the border. Every year official delegations from Norway join the celebration of Victory Day in Nikel and Murmansk. Russian delegations visit in turn the annual commemoration of the liberation of Kirkenes by the Red Army on October 25.

The biggest permanent exhibition in Kirkenes, the Borderland Museum (Norwegian: Grenselandmuseet), is very much devoted to WW2 and depicts the Soviets as true liberators. A Red Army memorial (Russemonumentet), raised after the end of WW2 in Kirkenes, has during recent years become a site for Norwegian-Russian official meetings. In 2013 Russia’s Prime Minister Dmitry Medvedev laid down wreaths at the memorial together with his Norwegian counterpart Jens Stoltenberg during the Barents Summit.4

The memories of the Cold War are ever present in the minds of the borderlanders. Locals generally perceive this period in history as one of unfortunate separation. But even the Cold War can from time to time serve as a source for narratives about fruitful CBC on the local level. For instance, throughout the 1960s, 70s, and 80s, border residents organized plenty of local cross-border sport and cultural events. From 1973 this local CBC took place within the framework of an agreement for friendship and cooperation signed between the border municipalities of Sør-Varanger and Pechenga (Figenschou 2011).

A rare example of economically significant CBC during the Cold War was the joint Soviet-Norwegian construction of several hydroelectric power plants in the border river (Pasvik River) during the 1960s. To this day, the power plants provide both sides of the border with energy. The power plant cooperation has been much celebrated locally and continues to serve as a model for meaningful CBC projects in the region and beyond.5

1.5 Minorities and their impact on current cross-border relations

Until the 19th century the border area was mainly occupied by Sami reindeer herders. Later, Norwegian, Russian, and Finnish settlers arrived. As late as 100 years ago Russian-Norwegian borderland was an ethnically complex zone with several nations and tribes living along each other on both sides of the borderline (Yurchenko 2002). Today, after a century of effective “nationalization” on both sides, the border has, however, become an ethnic divide, with Russians populating the eastern side and Norwegians the western side. Still, a few minorities do exist: A small minority of Norwegians has been living on the Russian side of the border. These so-called Kola-Norwegians were forcefully deported by Soviet authorities during the 1940s. Some of them were later able to return to Murmansk Region where they, over the years, to a large extent were assimilated into the Russian majority population (Jentoft 2005). Since 1992 about 200 Kola Norwegians have been granted Norwegian citizenships. Hardly any Norwegians remain on the Russian side today. Since 1991, there has, however, been a significant influx of Russians to the Norwegian part of the border region, mainly Russian women marrying Norwegian men. The immigration has been most noticeable in the border

4 BarentsObserver, 3 June 2012. 5 Det grenseløse vannet. http://www.detgrenselosevannet.no/index.php?page_id=1 11 town of Kirkenes where the Russians today constitute about 4 % of the population.6 Quite a few of those involved in CBC in Kirkenes are ethnic Russians. The Russians living on the Norwegian side of the border have played a positive role for the development of CBC. With their double language skills and good knowledge of both countries they have operated as brokers between the two sides of the border.

A small minority of Sami, the indigenous inhabitants of the borderland, lives on both sides of the border. The Sami have, like the Russian minority in Norway, contributed positively to the development of CBC in the region. CBC between Sami organizations in Russia and Norway constitutes today a significant part of the overall Russian-Norwegian CBC. Institutions like the Norwegian Sami Parliament and the Sami Parliamentary Council play an important role in promoting CBC. The core areas for Sami activities are the towns and settlements of inner Finnmark on the Norwegian side of the border, and the town of Lovozero on Russian side. In the central part of the border region, in Sør- Varanger and Pechenga, the Sami population is, however, quite insignificant and Sami organizations here play a very limited role in CBC.

A significant group of people of Finnish descent exists on the Norwegian side of the border. With a few exceptions the Finns have, however, been assimilated into the Norwegian majority and they do not play a particular role in current CBC.

6 Statistics Norway: http://www.ssb.no 12

2. Socio-economic characteristics

The Russian-Norwegian border region consists of two administrative units; Murmansk Region on the Russian side and Finnmark County on the Norwegian side. These are the units that will be the object for analysis here. First, we present the region separately in terms of location, landscape, climate, population and leading sectors of regional economy. Second, we examine the border regions within their national contexts. Finally, we focus on the main differences between the Russian and Norwegian border regions.

2.1 Finnmark County

Finnmark is the northernmost Norwegian county. All of its territory is located north of the Arctic Circle. To the west, Finnmark borders the county of Troms, to the north the Barents Sea, to the south Finnish Lapland and to the east the Murmansk Region in Russia. Most of Finnmark consists of tundra. The inner parts of the region have a continental climate with very cold winters. The coastal part, where the majority of the population lives, has a slightly milder climate owing to the influence of the Gulf Stream.

Figure 5. Map of Finnmark (Source: Wikipedia)

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Finnmark is the largest and least populated Norwegian county with the area of 48.637 km2 and 74.710 inhabitants. The population density, 1.5 people per km2, is ten times lower than the country average (16 people per km2). The few towns in the county are small. The administrative capital, Vadsø, has, for example, a population of only 6.125. The largest town in the county, Alta, has a population of 14.439, while Kirkenes, the centre of Sør-Varanger municipality, has a population of about 8.000 (including its suburbs of Hesseng and Bjørnevatn).7

Fishing has traditionally been the most important livelihood in Finnmark and fisheries continue to play an important economic role up until this day. Resource extraction has also played a significant part in recent regional developments. Kirkenes was for example established and developed only because of the mining of iron ore that began in 1906. The extraction of oil and gas off the coast of Hammerfest in the Barents Sea since the 1970s augments industrial development in the region. The Russian-Norwegian Treaty on Maritime Delimitation and Cooperation in the Barents Sea and the Arctic Ocean is expected to lead to even more development of the oil and gas sector in the future. There may also be a further development of mining in several parts of the county. Finally, tourism is a growing economic sector in the region.

2.2 Murmansk Region

Murmansk Region is mainly located on the Kola Peninsula. The region borders the Barents Sea to the north, the to the east, the Russian republic of Karelia to the south, and Finnish Lapland and Finnmark to the west. Most of the region is covered by tundra (in the north) and taiga (in the south). The inner parts of the region have a continental climate. The coastal part has a milder climate due to the presence of the Gulf Stream. Murmansk Region is one of eleven Russian regions that constitute the North-West Federal District of Russia (hereinafter referred to as NWFD).

Murmansk Region covers 144.900 km2 (three times the area of Finnmark) and has 772.500 inhabitants (about ten times more than Finnmark). The density of the population of Murmansk Region is slightly lower than the Russian average - 5.3 people per km2 versus 8.3 for the entire country. The capital and biggest city in the region is Murmansk, with a population of 300 000. Murmansk is the 6th most populous city in North-West Russia. Being the largest Russian ice-free port, Murmansk is a nationally and internationally important logistics hub. Tourism industry is not significant in the region. The main destinations are the ski resorts of Kirovsk and Khibiny.

Mining, fisheries, and energy are important economic sectors in Murmansk Region. Mining includes such activities as extraction and processing of ferrous and non-ferrous metals, and industrial production of copper, nickel, cobalt, aluminium, and apatite concentrate. Fishers in the region provide more than one-sixth of Russia's catch. The long coastline of the Kola Peninsula with its numerous bays sheltered from wind facilitates regional investment projects within the field of fish farming. Murmansk has an energy surplus due to the availability of no less than 17 hydroelectric power stations as well as the Kola nuclear power plant. Murmansk Region generates 2 % of Russian electricity and sells 25 % of its generated electricity outside the region.8

7 Statistics Norway: http://www.ssb.no 8 Ministerstvo inostrannikh del Rossiiskoi Federatsii: Pasport Murmanskoi Regioni, 2014: http://www.mid.ru/bdomp/ns- dipecon.nsf/1517c199eb1da84743256a420049024a/43392aeb7b396e73c32572a6004657da!OpenDocument 14

Figure 6: Map of Murmansk Region with branches of industry marked (Source: Russland.no)

Murmansk Region is export oriented in its foreign trade. Raw materials, minerals and metals produced in the region are delivered to the Western markets via the Barents Sea, and through the Russian-Finnish border. In return, the region imports equipment and consumer goods.9

9 Ibid. 15

Figure 7. Murmansk harbour (Source: Wikipedia)

2.3 Regional indicators compared to national indicators

A consistent comparison of regional and national indices for the Russian-Norwegian border region is difficult owing to the lack of statistical information on regional level in Norway. As the NUTS2 statistics for Norway is provided only for the whole Northern Norway (which includes the three counties of Finnmark, Troms, and Nordland), the available data has limited applicability for the needs of the current research.

In order to better adapt to the realities of a country with such a vast territory as Russia, we have included an additional unit of comparison, between national and regional scale – namely the NWFD which, in addition to Murmansk Region, includes ten regions; the Republic of Karelia, Republic of Komi, Nenets Autonomous District, Region, Region, Leningrad Region, Novgorod Region, Pskov Region, Vologda Region, and the city of St. Petersburg.

As one can see from Table 1 (see below), Finnmark covers 15 % of Norway’s territory but the county is home to only 1.5 % of the country’s population. Murmansk Region covers 0.85 % of Russia’s territory and is home to 0.55 % of its population. Murmansk Region has the fifth largest territory and the 11th largest population among the NWFD regions.

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Indicator Finnmark Fylke Murmansk Region

Territory 48.637 km2 (15 % of country) 144.900 km2 (0.85 % of country) Population 74.710 inhabitants 772.500 inhabitants (1.5 % of country) (0.55 % of country) Population density 1.5 people per km2 (15.5 for all 5.3 persons per km2 (8.7 for all of Russia) of Norway)

Table 1. Territory, population and population density for Finnmark County and Murmansk Region

Measured by GDP per capita the Russian and Norwegian border regions have lower indices than the country averages: the index of Finnmark equals 80 % of the national figure while the GDP per capita in Murmansk Region equals only 40 % of the average Russian GDP (see table 2 below). In the context of the NWFD, Murmansk Region residents have the third highest average monthly earnings.

Compared to other Norwegian counties the number of workers within the sectors of agriculture/forestry/fisheries (mainly fisheries) in Finnmark is relatively high, and so is the number of people working in the sectors of public administration, education and health/social services. In Murmansk Region the number of workers is high in comparison to the national average in spheres such as fishing (35 times higher than the number for all Russia), mining (2.6 times higher), energy (1.9 times higher) and transport (1.5 times higher). Nevertheless, both Finnmark and Murmansk Region have relatively high unemployment rates compared to the national averages for Norway and Russia.

Although the human development index for Murmansk Region (0.831) is higher than the national average for Russia (0.788, ranked 55 in the world), it is still considerably lower than the average for Norway (0.955, ranked 1 in the world).10 In the national context Murmansk Region shows quite low rates of life expectancy. In 2011 the average was 68.9 years (63 years for men and 74.6 years for women), while the Russian average was 69.8 (64.0 for men and 75.6 years for women). The birth rate of Murmansk Region is close to the average in the NWFD (the former has 11.7 births per 1000 of population while the latter has the rate of 11.4). At the same time, it is lower than national average (12.5). The Russian North-West regions are characterized by a population decrease. Among these, Murmansk Region has, however, the smallest decrease (it loses 0.2 people for a population of 1000 while the average for the NWFD is 1.7). This number is explained by the low death rate in Murmansk Region compared to the average for the Northwest region (11.9 people per 1000 of population per year compared to the NWFD average of 14.9).

Indicator Finnmark County Murmansk Region

GDP (per capita) 41.100 euro 7.260 euro (80 % of country average) (40 % of country average)11 Average monthly For all of Norway – 4.979 euro12. 563 euro (73 % of country average) earnings

10 UNDP Human Development Report 2013: http://hdr.undp.org/sites/default/files/hdr2013_en_summary.pdf 11 The Central Bank of the Russian Federation: http://www.cbr.ru/eng/ 12 Statistics Norway: http://www.ssb.no 17

Employment Industry, mining – 15.3 %, Industry, mining - 36.4%, structure Agriculture, forestry and fisheries Agriculture - 4 %, - 6.8 % Fishing and fish farming - 7.1%, Service – 30.0 % Energy - 5.4 %, Public administration and Service – 17.8 %, defence - 11.4 % Public administration – 5.4 %, Education – 10.7 % Education - 9 %, Health & Care - 21.4 % Health & Care - 9 %, Other – 3.7 % Other - 5.9%13. Unemployment rate 3.3 % (2.9 % for all of Norway) 6.6 % (5.6 % for all of Russia) Human For all of Norway - 0.955 (ranked For all of Russia - 0.788 (ranked 55 in the Development 1 in the world). No ranking world). Index14 available for regional units. For Murmansk Region - 0.831. Expected living age For all of Norway - 81.9 years: For all of Russia – 69.8 years: 64.0 for 80.2 for men, 83.6 for women. men and 75.6 for women. No data available for regions. For Murmansk Region - 68.9 years: 63 for men and 74.6 for women. Net migration rate15 For all of Norway - 4.04 per 1000 For all of Russia - 0.36 inhabitants per 1000 inhabitants. Fiscal conditions a) 27 % a) 20 % (standard), 13 % for SME a) Corporate taxes b) 46.8 % b) 13 % for citizens, 30 % for non- b) Individual taxes c) 25 % (standard); 15 % for residents c) VAT food /drinks; c) 18 % 8 % for transportation, cinema and hotels

Table 2. Comparison of socio-economic indicators for Finnmark County and Murmansk Region

2.4 Differences between the Norwegian and Russian parts of the border region

The Russian-Norwegian border is a border of contrasts. On the List of bordering countries with greatest relative differences in GDP (PPP) per capita the Russian-Norwegian border is ranked fourth among the European borders, with a ratio of 3.188.16 In 2012 the Norwegian GDP per capita was almost 7 times higher than the Russian one.17 In Norway, life expectancy is more than ten years higher than in Murmansk Region – with an average of 81.9 years: 80.2 for men and 83.6 for women.18 Moreover, the general living standard on the Norwegian side of the border remains much

13 Ministerstvo inostrannikh del Rossiiskoi Federatsii: Pasport Murmanskoi Regioni, 2014: http://www.mid.ru/bdomp/ns- dipecon.nsf/1517c199eb1da84743256a420049024a/43392aeb7b396e73c32572a6004657da!OpenDocument 14 UNDP Human Development Report 2013: http://hdr.undp.org/sites/default/files/hdr2013_en_summary.pdf 15 UNCTAD Handbook of Statistics - Country Comparison, 2010: http://www.nationsencyclopedia.com/WorldStats/UNCTAD-net-migration-rate-inhabitants.html 16 Wikipedia: List of bordering countries with greatest relative differences in GDP (PPP) per capita: http://en.wikipedia.org/wiki/List_of_bordering_countries_with_greatest_relative_differences_in_GDP_(PPP)_ per_capita 17 International Monetary Fund: World Economic Outlook Database. October 2013: http://www.imf.org/external/pubs/ft/weo/2013/02/weodata/index.aspx 18 World Health Organization: http://www.who.int 18 higher, even if the living standard has improved considerably on the Russian side during the last few years.

The level of corruption is very low in Norway. In Russia it is, however, quite high. Transparency International’s Corruption Perceptions Index ranks Norway as number 5 in the world (with a score of 86) whereas Russia is ranked as number 127 only (score 28).19

Public services are generally better on the Norwegian side. In Norway we find an elaborate social safety net in addition to public services such as free education and universal healthcare. Public expenditure for health and education is significantly higher in Norway than in Russia. Such public expenditure is also reflected in the infrastructure and logistics (roads, airports, and public transport), although perhaps not to the satisfaction of the Norwegian local population. The infrastructure and logistics on the Russian side is generally less developed than on the Norwegian side, though recently, the roads infrastructure from Kirkenes to Murmansk, and from Murmansk to St Petersburg have improved greatly.

The environmental situation on the Russian side is much worse than on the Norwegian side with considerable emissions coming from the mining and processing of heavy metals and minerals. The widespread use of nuclear power for civil, industrial, and purposes also poses a risk not just on the Russian side, but to the entire region as a whole, although so far there have not been any accidents.

The military is present on both sides of the border. On the Norwegian side the Garrison of Sør- Varanger guards the Norwegian-Russian border. The degree of militarization on the Russian side is much higher. The 200th Independent Motor Rifle Brigade is stationed just across the border in Pechenga. Murmansk Region is also the home of the Russian Northern Fleet and the military is an important employer in the region. Significant parts of Murmansk Region, including the border zone, consist of closed military zones.

2.5 Socio-economic characteristics affecting cross-border cooperation

During the early 1990s the tremendous difference in living standard actually invigorated cross-border interactions. Murmansk Region in general and Pechenga in particular received a considerable humanitarian aid from Finnmark. Nowadays the situation has changed. Today the cooperation takes place on a more equal basis, although the Norwegian side still tends to be the main financial contributor. Over last few years there has been a growth in business oriented CBC, particularly within the region’s petroleum industry. The focus on business CBC was more than anything sparked by the plans for the development of the Shtokman field, which is located in the Russian part of the Barents Sea.20 Shtokman is considered to be one of the world's largest undeveloped natural gas fields. In 2005 Russia and Norway signed a number of agreements related to development of this zone. Several Norwegian companies established themselves in Murmansk Region with a hope of gaining from the development of the field. In 2010 the Shtokman development was, however, postponed. Since then the interest among Norwegian companies for CBC with Russia in the North has declined

19 Transparency International: Corruption Perceptions Index 2013: http://www.transparency.org/cpi2013/results 20 Official Shtokman Development A.G. website: http://www.shtokman.ru/en/ 19 significantly. Another “megaproject”, the development of ports to service shipping on the Northern Sea Route from Europe to Asia, is now frequently mentioned as something that could spark a new and stronger CBC in the region.

Common labour market challenges have also sparked a lot of recent CBC in the region. According to representatives for public centres for employment on both sides of the border structural and youth unemployment are particularly problematic issues that need to be solved. Regional authorities on both sides of the border are now working together to provide internships for unemployed residents.

Over the course of time, Russian employees have attained a good reputation among Norwegian companies. According to our interviewees within the business sector of Finnmark, many local enterprises actually prefer to recruit workers from Russia rather than from EU countries (for instance from , or Spain). Russians represent, they claim, a more stable working force. Russians are also preferred for their alleged “climate competence”. The knowledge and experience of working in a cold climate is considered to be very important, particularly in the aquaculture and fishing industries. Besides companies from Northern Norway in general. The idea to alleviate the flow of labour across the border also appeals to border municipalities. Both sides interpret potential increase of cross-border commuters as a positive development. First, it might reduce the shortage of labour in border municipalities, especially on the Norwegian side of the border. The mayor of Sør- Varanger claimed in an interview that categories of workers as plumbers, carpenters, engineers, teachers, health care specialists, nurses, and cultural workers are in particular demand. Secondly, it will improve the purchasing power of Russian commuters, and consequently increase the amount of consumed goods and services on both sides of the border.

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3. Cross-border transport and infrastructure

Good conditions for cross-border transport are important for the development of a viable CBC. Although cross-border traffic across the Russian-Norwegian border has intensified in recent years, there is a potential for a further increase. The main challenges for such an increase is insufficient infrastructure. There is a need for further development of roads, railways and seaways, as well as public transport across the border. The capacity of the border-crossing point of Storskog- Borisoglebsky needs to be improved in order to cope with the current cross-border traffic and facilitate more interaction across the border.

3.1 The border crossing point of Storskog-Borisoglebsky

The border-crossing point of Storskog-Borisoglebsky is located 15 kilometres from the Norwegian town of Kirkenes and 41 kilometres from Nikel, the closest Russian town. The nearest international border-crossing is the Finnish-Russian Raja-Jooseppi border-crossing point, 100 kilometres to the south. The border crossing point consists of two border stations, Storskog on the Norwegian side and Borisoglebsky on the Russian side. The Norwegian station has been rebuilt several times over the last twenty years in order to cope with the increasing cross-border traffic. The current Russian border station, financed and constructed by Norway, was opened in 2003.

Figure 8. The Storskog-Borisoglebsky border crossing point seen from the Norwegian side (Photo: Wikipedia)

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The traffic across the Norwegian-Russian border is still quite insignificant, although it has increased considerably during the last five years. In 2010 141.000 people crossed the border. In 2011 the number had increased to 196.000 and in 2012 to 252.000. In 2013 there was a further increase to 320.000.21 Thus, the number of people crossing the border has more than doubled in only three years. A further increase is expected in the coming years. The existing border-crossing point is designed for only 150.000 border-crossers annually. There is therefore an urgent need for an upgrade of the border-crossing point, or even a construction of a new one. The lack of capacity on the border is already creating problems for travellers. During the weekends the waiting time is often between one and a half and two hours. Purportedly, quite a number of Russian travellers prefer to travel abroad through Finland rather than Norway in order to avoid the long waiting times at the Norwegian-Russian border crossing. Indeed, many of our informants complained about the waiting time at the border, which sometimes seems to be even more of a nuisance than the visa application process (see section 4.1).

In November 2013 Russian authorities announced that 26 million euro would be spent on building a brand new border check-point. The plan has been developed by The Federal Agency for the Development of the State Border Facilities of the Russian Federation and the authorities of Murmansk Region. On 12 September 2013 the financial plan was approved in the first instance by the European Union’s Kolarctic funding program. According to the plan, which awaits a final approval, the construction work will start in 2014.22

A working group established by the Norwegian Ministry of Justice presented a report in 2011 stressing the need for improvement of the capacity on the Norwegian side. The report concluded that only a new border station would fully solve the challenges that the increasing traffic poses.23 In a White Paper on the High North (2011-2012) the Norwegian government promised to increase the number of in-coming and out-going lanes and control booths, to install new equipment for electronic passport control, and to carry out language training for the employees at the border station. The Norwegian government also suggested that the number of staff at the border station could be increased.24 In 2012, in its remarks to the above-mentioned White Paper, the Norwegian Parliament’s Standing Committee on Foreign Affairs and Defence recommended, the immediate construction of a “brand new and highly modern border station to meet the sharp increase in traffic over the border.”25 So far any measures have, however, not been taken.

An agreement on cooperation at the Storskog-Borisoglebsky border crossing point was signed between Russia and Norway in February 2011. Under the agreement the Russian border station is to be granted international status. This will make it possible to transport all types of goods through . The Norwegian government hopes that, in time, this reform may facilitate the export of seafood to Russia. So far this important Norwegian export product is transported mainly through

21 Statistics from Eastern Finnmark Police Department. 22 BarentsObserver, 25 September 2013. 23 Storskog grensepasseringssted 2011-2014, Rapport fra arbeidsgruppe: https://www.politi.no/vedlegg/lokale_vedlegg/ostfinnmark/Vedlegg_1252.pdf 24 Meld. St. 7 (2011–2012) Report to the Storting (white paper): The High North Visions and strategies: http://www.regjeringen.no/pages/38005979/PDFS/STM201120120007000EN_PDFS.pdf 25 Utenriks- og forsvarskomiteen: Innst. 236 S (2011–2012): Innstilling fra utenriks- og forsvarskomiteen om nordområdene. Visjon og virkemidler: https://www.stortinget.no/no/Saker-og- publikasjoner/Publikasjoner/Innstillinger/Stortinget/2011-2012/inns-201112-236/2/ 22

Finland. The agreement also makes it possible to extend the opening hours at the border.26 Currently the opening times of the border is 0700-2100 Norwegian time/1000-2400 Russian time. Local actors we have spoken to, particularly those involved in cross-border export or import, would like the border to be open 24 hours.

3.2 Border crossings through Storskog-Borisoglebsky

Seventy-five % (239.000) of all the people crossing the border in 2013 were Russians. It is common for Russians from the border region (including the city of Murmansk) to cross the border for a day of shopping in Kirkenes. Many Russians also cross the border in order to use Kirkenes airport as a hub for travels to destinations further south in Norway, or in Europe. The airport has direct connections to Tromsø and Oslo and is, by many Russians living in Murmansk Region, considered to be more convenient than . The ticket prices are also generally lower than on the Russian side of the border.

As late as in 2006 as much as 20 % of all the border-crossers were Russian sailors travelling between Russian ships in Norwegian harbours and their homes in the Murmansk Region. Since the early 2000s the number of sailors crossing the border has decreased steadily at the same time as the number of other groups of travellers has increased. At present, however, the sailors constitute less than 5 % of the total number of border-crossers.27

Only 18 % (58.446) of the people crossing the border in 2013 were Norwegians. The total number of Norwegians increased, however, by 50 % from 2012.28 The dramatic increase of Norwegians crossing the border can be explained by the introduction of the border traffic permit for border citizens in May 2012. Since the introduction of the permit many Norwegians living in and around Kirkenes have started to cross the border regularly, primarily to buy petrol (which costs three times less in Russia than in Norway) and various other services in the Russian border towns in Nikel and Zapolyarny.

Seven % (22 596) of the border-crossers in 2013 were from third countries (neither Norway nor Russia). The majority of these were, according the authorities, Finnish citizens travelling between Murmansk and Northern Finland. The low percentage of international travellers must be explained by to the relative remoteness of the border-crossing. Finnish and Swedish travellers tend to use the Finnish-Russian checkpoints (Raja-Jooseppi and Salla) further south when crossing into or out of Murmansk Region.

Our research group observed the border-crossing traffic at Storskog-Borisoglebsky as a part of our data collection. The border was observed for 2x30 minutes every day at different hours during four observation weeks, one for every season from 2012 to 2013. All vehicles crossing the border were counted and categorized according to type (car, truck, van, minibus or bus) and nationality (Russian, Norwegian or other nationality). A total number of 742 vehicles crossed the border during our observations (about one vehicle for every minute of observation) (see table 3 below).

26 Meld. St. 7 (2011–2012) Report to the Storting (white paper): The High North Visions and strategies: http://www.regjeringen.no/pages/38005979/PDFS/STM201120120007000EN_PDFS.pdf 27 Storskog grensepasseringssted 2011-2014, Rapport fra arbeidsgruppe: https://www.politi.no/vedlegg/lokale_vedlegg/ostfinnmark/Vedlegg_1252.pdf 28 Information from Østfinnmark politidistrikt. 23

60 % of the vehicles had Russian crossing the border had Russian vehicle registration plates. 40% were Norwegian. Somewhat surprisingly, not a single vehicle was registered in a third country. No less than 87 % of the vehicles crossing the border were personal cars. Of these 56% were Russian cars and 44 % Norwegian.

Only 9 % of the vehicles crossing the border were trucks. According to transport and logistics analysts, unfavourable and unnecessarily complex rules and regulations lead to the comparatively small number of goods transport across the Russian-Norwegian border. The amount of goods crossing the border peaked in 2007. From 2007 to 2010 it was, however, reduced by 50% from 4000 to 2000 tons. The bulk of the goods crossing the Russian-Norwegian border consists of equipment for Russian fishing boats docking in Kirkenes and other Norwegian harbours.29 Quite a lot of the goods exported to Russia from Norway or the other way (including fish products) around crosses through Finnish-Russian border-crossings further south. 77% of the trucks crossing the border during our observations were registered in Russia.

The public transport across the border is insignificant. Only 3% of the vehicles crossing the border were minibuses and 1% of them buses. One or two shared Russian minibuses travel between Murmansk and Kirkenes every day. The few buses that cross the border are charter buses. There is no public transport between the border towns of Zapolyarny, Nikel and Kirkenes for the time being. Residents in these towns have, in order to cope with the lack of public transport, developed a system of shared private taxis.

Type of vehicle Norwegian Russian Total

Cars 38 % 49 % 87 %

Trucks and vans 2 % 7 % 9 %

Minibuses 0 % 3 % 3 %

Buses 0 % 1 % 1 %

Total 40 % 60 % 100 % (Totally 742 vehicles)

Table 3. Vehicles crossing the Norwegian-Russian border during four weeks of observation, categorized according to type and nationality

The border-crossing is located in the middle of a vast Arctic wilderness. Therefore, hardly anyone would cross the border on bicycles. Border-crossing on foot or by riding animals such as horses and reindeer is strictly forbidden by the authorities. The average number of passengers per vehicle (including all the types mentioned above) crossing the border is 3.2, with Russian vehicles having a slightly higher number of passengers than the Norwegian ones. 30

29 Storskog grensepasseringssted 2011-2014, Rapport fra arbeidsgruppe: https://www.politi.no/vedlegg/lokale_vedlegg/ostfinnmark/Vedlegg_1252.pdf 30 Ibid. 24

3.3 Treatment of travellers crossing the border at Storskog-Borisoglebsky

Informants who frequently cross the border at Storskog-Borisoglebsky claim that the attitude shown to them by the border-crossing point staff has improved significantly over the last few years. Only some years ago the border guards had, allegedly, a reputation for being rather arrogant. “They acted as robots”, claimed one informant. Today they have, supposedly, become much more “human”, “much more friendly, polite and helpful”. The guards on both sides of the border have also improved their skills of the language of the other side. The Russian border guards speak a little Norwegian and the Norwegian border guards know some basic Russian. This makes it much easier for them to solve various problems occurring on the border and to explain rules and regulations for the travellers. Our informants have not complained about corruption or other irregularities on the border. Despite these improvements, long waiting lines and the thorough inspections on both sides can cause stressful experiences for travellers. Some informants, particularly those crossing the borders often with various types of goods, claim that the inspections on the border are unnecessarily scrupulous and that they should be eased.

3.4 Air, sea and rail traffic

Air transport between Murmansk Region and Northern Norway is limited. The air company Nordavia flies currently twice a week between Tromsø (which is located west of the border region) and Murmansk. A weekly direct flight between Murmansk and Kirkenes was operated by the Norwegian company Widerøe from 2007 but the route was terminated after only one year.

Sea traffic between Norway and Russia is currently limited to transport of goods. There is no cross- border passenger traffic, although there have been plans for establishing a Norwegian Coastal Steamer route between Kirkenes and Murmansk. In 2013 the Governor of the Murmansk Region Marina Kovtun publicly supported the plan at a meeting in Kirkenes.31 Increased mining and petroleum development in the region, alongside the development of the so-called Northern Sea Route, the Arctic Sea connection between Europe and Asia, may increase the transit traffic to and from Norway via Russia in the future.

There are currently no rail links between Norway and Russia. On the Russian side of the border a 200 kilometres long railway connects Murmansk with Nikel. The railway is primarily used for freighting goods from the mines in Nikel but it is also open for passengers. On the Norwegian side of the border the 9 kilometre Sydvaranger railway line is used solely to transport iron ore from the local mine to the port of Kirkenes. The Kirkenes World Port Group consortium has proposed to connect this railway with the Russian rail network. The consortium concluded that a link would enable fast and cost-efficient passenger and freight transport connections (World Port Kirkenes Group 2003). The vision of a cross-border railway link has received support locally and Kirkenes Næringshage, an umbrella organization for various enterprises in Kirkenes, has actively promoted the idea. Neither Norwegian nor Russian authorities have so far supported the local proposals.

31 Nordlys, 5 February 2013.

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3.5 Infrastructure

Good cross-border infrastructure is a prerequisite for the development of efficient CBC. In the Russian-Norwegian border region the cross-border infrastructure, although not very well developed yet, has improved during the latest years. The main road from Norway to Russia used to be in a very bad condition, especially on the Russian side of the border. Recently, the quality of this road has improved significantly, much thanks to huge Russian investments in infrastructure.32 Russia has recently completed the construction of a new road from the border towards Murmansk. The new road reduces the driving time between the Norwegian side of the border and Murmansk by 20 minutes.33 The former military restrictions on traffic along this road have been lifted. On the Norwegian side some work has been instigated in order to improve the E105 road from the border towards Kirkenes town and airport.

Generally speaking, the lack of public transport is hampering CBC in the region. The public overland transport across the border is very limited, consisting only of a couple of minibuses travelling between Kirkenes and Murmansk. There are no regional cross-border air connections and no cross- border sea connections.

32 BarentsObserver, 3 September 2013. 33 BarentsObserver, 15 December 2011. 26

4. The visa regime and the border traffic permit

4.1 The visa regime

The current visa regime is, according to our informants, one of the main practical obstacles for the development of a viable CBC in the Russian-Norwegian borderland.

Visa is demanded for all visitors crossing the border from both sides. A special visa agreement between Norway and Russia has since 2011 made it easier to obtain visas for some special groups, including citizens with close relatives on the other side of the border, journalists, official delegations, and transport crew members. For citizens in the BTZ the border traffic permit may be used instead of a regular visa. The so-called Pomor visa, a visa that can be issued without any special invitation from the Norwegian side was introduced in 2010 specially for citizens of Murmansk Region and other Russian regions close to the Norwegian border.

The Norwegian government has stated that its long-term aim is the establishment of a fully visa-free regime with Russia.34 The introduction of the Pomor visa and the border traffic permit zone (see section 4.2 below) can be seen as steps on the road to full visa freedom. This is also in line with the stated policy of the European Union which is in the process of developing a roadmap for the establishment of a visa-free regime between EU and Russia. Russia has agreed to ease access for EU citizens to Russia, should the visa-free regime be established.

Visas to Norway/Schengen for Russian citizens can be obtained through the Norwegian general consulate in Murmansk. A new Norwegian visa centre opened here in January 2013 offering “faster, better and friendlier visa service”.35 The new visa centre guarantees completion of the paperwork in less than 15 minutes. The centre has already reduced the waiting time considerably and made the process of getting a visa for Norway easier. Visas to Russia for Norwegian citizens can be obtained from the Russian general consulate in Kirkenes. In March 2013 a special Russian visa centre similar to the Norwegian one on the Russian side was established in Kirkenes making the application process smoother there as well.

Visas are rather expensive on both sides of the border. In Norway the price for getting a single-entry tourist visa to Russia is about 70 euro. A similar visa for Norway costs currently around 35 euro in Russia. Usually the applicants for visa on both sides of the border have to wait for about two weeks for the visa to be issued. On the Russian side all applicants have to travel to the Norwegian General Consulate in Murmansk in order to get a visa. This makes it expensive and cumbersome to obtain a visa for people living far away from the regional capital. For people in Nikel a trip to Murmansk and back implies no less than seven hours driving. In 2012 the Norwegian General Consul expressed an intention to open an honorary consulate in Nikel in order to ease the process of getting a visa for the borderlanders.36 Local authorities as well as ordinary people in Nikel and Zapolyarny have in various fora supported the idea but so far it has not received approval from .

34 Ibid. 35 BarentsObserver, 24 January 2013. 36 BarentsObserver, 27 June 2012.

27

Many of our informants referred to the visa regimes as one of the main barriers for Russian- Norwegian CBC. The visa regime makes it necessary to spend a lot of time and money when crossing or planning to cross the border. In addition to this comes the time and money spent obtaining the visa. Especially for larger delegations the costs for obtaining visas may be very high. The visa regime also makes it necessary to plan long in advance before crossing the border. The visa regime thus hampers some of the more “spontaneous” forms of CBC. It creates, to cite one informant, an “artificial distance” between the Norwegian and Russian partners. Not all informants complain, however, about the current visa regime. Those who are involved in CBC on a daily basis tend to hold multi-entry visas for a year or more. For this group, obtaining a visa has ceased to be an obstacle in daily life. Informants involved in CBC claim that the Pomor visa and (to a lesser degree) the introduction of the border traffic permit has made their work easier. The establishment of the visa centres in Murmansk and Kirkenes are referred to as small positive steps.

One particular problem with the Russian visa regime is the very strict separation between visas issued for tourism and visas issued for business purposes. The first does not allow for the second and vice versa. There are several recent examples of Norwegians being arrested for being engaged in “non-tourism related activities” with a tourist visa or in “non-business related activities” with a tourist visa. Many Norwegians who frequently cross the border claim that the regulation is too strict, not allowing for any combination of activities, like sightseeing in-between conference sessions. For some people the regulation makes it necessary to obtain a new visa for every trip according to the purpose of the trip.

4.2 The border traffic permit

In May 2012 Norway and Russia signed the Border Resident Treaty. The two countries agreed to establish a local BTZ extending for 30 kilometres on either side of the border. The zone covers 12.629 km2 and has a population of 48.997 people. It corresponds more or less to the two border municipalities of Sør-Varanger and Pechenga (See figure 1).37 Citizens living within the BTZ are eligible for a border traffic permit (Norwegian: grenseboerbevis, Russian: Razreshenie na mestnoe prigranichnoe peredvizhenie) which can be used instead of a regular visa when crossing the border. The permit has a few limitations:

- In order to obtain a border traffic permit a person must have been living for at least three years within the zone. - Citizens who are considered to be a threat to internal security on either side of the border are not eligible for a permit. - The permit can only be applied within the BTZ which extends for 30 kilometres on either side of the border. It is illegal to cross the outer border of the zone. - Holders of the permit are not allowed to stay for more than 15 days on the other side of the border. - The border traffic permit is valid for a maximum five years.

37 All of Pechenga is included in the border traffic zone. A few settlements in western Sør-Varanger were not included in the zone because they were located too far from the boundary. 28

Figure 9. Map of the Russian-Norwegian BTZ (Source: www.regjeringen.no)

The border traffic permit and the BTZ are in accordance with the EU Regulation 1931/2006 which allows Schengen countries to conclude or maintain bilateral agreements with neighbouring third countries for the purpose of implementing a local border traffic regime.38 Norway and Russia are not the only countries that have established a BTZ: Slovakia and the Ukraine introduced the first zone in 2008. Poland and the Ukraine followed in 2009, and Moldova in 2010 and Latvia and Belarus in 2012. In 2013 Russia also concluded an agreement with Poland for the establishment of a BTZ including all of , the city of Gdansk and several surrounding Polish regions.

Many of our Norwegian informants claimed that the border traffic permit opened the border for a completely new category of border-crossers – namely Norwegians who would not spend their time and money for obtaining a normal visa to Russia. Norwegian border citizens are generally happy with the permit as it saves them from all the troubles of getting a normal visa. To this date as many as 30 % of the eligible residents of Kirkenes have obtained the border traffic permit. On the Russian side of

38 Regulation (EC) No 1931/2006 of the European Parliament and of the Council of 20 December 2006 laying down rules on local border traffic at the external land borders of the Member States and amending the provisions of the Schengen Convention: http://eur- lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2006:405:0001:0022:EN:PDF 29 the border the interest for the visa has, however, been extremely limited. Only 3% of the citizens of Pechenga municipality eligible for a permit have obtained one.39 The reason for this lack of interest is simple enough: the Russian border citizens must go to Murmansk in order to apply for and obtain the permit, and the price for it is the same as that for a multi-entry Pomor visa which they anyway are entitled to. The Pomor visa tends to be preferred as it allows the Russians entrance to all of Schengen, not only the tiny Norwegian BTZ. The only advantage of a border traffic permit is, according to our informants, that one can enter Norway without getting stamps in the passport. Thus, the passport will last longer and one will, eventually, save some money! But this is again only true as long as the destination is within the BTZ. Norwegian authorities have nevertheless actively tried to promote the border traffic permit in Russia. In March 2014 the Consulate arranged for instance a special “open day” for border traffic permit issuance.40

If we look at the actual traffic across the border before and after the introduction of the BTZ we find a clear increase. Many interviewees argue that this is due to the new permit. We should, however, be very careful about making such conclusions, for the increase was actually higher during the year before the introduction (39 %) than the year after (28 %). There has, however, been a noticeable increase in the number of local Norwegian border crossings. As mentioned in section 3.2, the number of Norwegian border crossings increased by about 50 % I 2013. The Norwegians have gradually started to take advantage of their possibility to cross the border to buy cheap goods and services. Petrol, three times cheaper on the Russian side, is the most popular thing to buy. The increased Norwegian influx has so far had a limited but positive effect on the local economy in the Russian border towns of Nikel and Zapolyarny. The economic effect of cross-border shopping on the Russian side is, however, still very small compared to the impact cross-border shopping has on the Norwegian side, in Kirkenes.

When the BTZ was introduced there was a certain fear that it would also have some negative effects. On the Norwegian side some people claimed that businesses in Kirkenes would suffer, and that local companies and shops would lose their clients. The petrol stations in Kirkenes have experienced a limited decline in the number of customers, but other enterprises have to this date not noticed any change due to the new regime. On the Norwegian side some people expressed fear for an increase in crime after the introduction of the zone. Such an increase has, however, not taken place according to the police. Finally, there were warnings that Russian border residents would exploit the border traffic permit in order to enter Schengen proper. This has not happened either.

Today people on both sides seem to be satisfied with how the border traffic permit works, although it should be added that many would have liked to see an even more liberal regime. Representatives of local companies have for instance argued for the introduction of a common labour market within the BTZ that would allow people to commute across the border.

When the BTZ was introduced Norway’s foreign minister at the time, Jonas Gahr Støre, called it “an important step towards opening the border area for even closer contact and cooperation between Norway and Russia” and claimed that it would “significantly simplify travel for border residents, and thus facilitate increased contact between Norway and Russia.”41 In practice the effects (positive or

39 Statistics from the Russian General Consulate in Kirkenes and Eastern Finnmark Police Department. 40 BarentsObserver, 11 February 2014. 41 NewsinEnglish.no, 10 November 2010. 30 negative) of the border zone have been limited. The BTZ has however, had a significant symbolic effect. On both sides of the border the zone seems to have strengthened the idea of the borderland as a unified area, and given it a sort of a common identity. After the introduction of the border permit the border zone has (in a way) acquired its own common “citizenship”. This has been celebrated by most citizens, including many of those who do not see any practical use for the permit.

The introduction of the border traffic permit has increased the hope for a visa free regime for the entire border region (Murmansk Region and Finnmark or even larger areas). The need for an expansion of the BTZ was brought up by several of our informants and has repeatedly been discussed in regional and national mass media on both sides of the border.42

42 See i.e. Interfaks.ru, “Bezvizovy rezhim s Norvegiey mozhet byt vveden na vsey territorii Murmanskoy oblasti” [Visa-free regime with Norway might be introduced in the whole territory of the Murmansk Region], December 9, 2013: http://www.interfax.ru/tourism/tourisminf.asp?sec=1466&id=345730 31

5. Bilateral and regional cooperation

CBC between Norway and Russia in the border region takes place on bilateral level, through cooperation between regional and local authorities, and through various forms of non-governmental cooperation. The bilateral relation between Norway and Russia is ultimately the most important basis for CBC in the region. Regional and local governments play, however, also a significant role. The regional and local governments’ involvement creates a framework for other actors who would like to engage in CBC activities. We see this particularly on the local level where the municipal authorities on both sides of the border through their cooperation have created a fruitful climate for cooperation for public as well as private/NGO actors within various fields (see chapter 6).

Over the last years, the bilateral relations between Norway and Russia have improved steadily. This has resulted in a number of agreements between the two countries. In 2010 Norway and Russia signed the Treaty on Maritime Delimitation and Cooperation in the Barents Sea and the Arctic Ocean. The treaty settled a 44-year old dispute for 175,000 square kilometres of maritime area in the Barents Sea. Norway and Russia decided to divide the contested areas into two equal parts. In 2012 the Border Resident Treaty was signed. A local BTZ with a special visa regime was established on both sides of the border between the two countries and a border traffic permit for residents living in the area was introduced (see section 4.2). The most important areas of cooperation, such as fisheries, environment and nuclear safety, are coordinated by special joint bilateral government commissions. These commissions are important arenas for dialogue and practical problem-solving.

5.1 Economy

Norwegian-Russian trade is regulated by the Agreement on Trade and Economic Cooperation of March 26, 1996, and the Agreement on Mutual Investment Protection of October 1995. Issues relating to trade within fields like energy, transport, communication, fisheries and tourism are discussed on a bilateral minister level during the annual meetings of the Joint Russian-Norwegian Commission on Economic, Industrial and Scientific-Technical Cooperation.

Fisheries is an economic field where Norway and Russia has a long tradition for cooperation. The Joint Norwegian-Russian Fisheries Commission was established in 1976 and is the oldest of the joint commissions. The Fisheries Commission has served as an effective tool for cooperation, joint management and regulation of fish stocks in the Barents Sea. The commission has effectively ensured the sustainability of the fish stocks in the sea, which is among the most productive in the world (Hønneland 2007).

Energy is another important field for bilateral economic cooperation. Both Norway and Russia are important producers of energy (particularly oil and gas) and have a mutual interest in cooperation within this field. A Russian-Norwegian memorandum of energy cooperation was signed in 1992. The Treaty on Maritime Delimitation gives new opportunities for common exploration and exploitation of the rich deposits of oil and gas in the formerly disputed parts of the Barents Sea. The treaty specifically states that transboundary deposits may be exploited jointly by the two states.43 The

43 See Regjeringen.no: «Overenskomst mellom Kongeriket Norge og Den Russiske Føderasjon om maritim avgrensning og samarbeid i Barentshavet og Polhavet»: http://www.regjeringen.no/upload/UD/Vedlegg/Folkerett/avtale_norsk.pdf 32 treaty sparked an increased dialogue within the field of energy and on June 21 2011 a new declaration on Norwegian-Russian energy cooperation was signed by the Norwegian Ministry of Petroleum and Energy and the Ministry of Natural Resources and Environment of the Russian Federation. An expert group has also recently been established in order to better understand and discuss issues related to possible joint petroleum activities in the future.

5.2 Culture and art

Cultural exchange has been an important element in Russian-Norwegian bilateral cooperation since the time of the Cold War. In 1994 the first Russian-Norwegian agreement of cultural cooperation was signed and this agreement remains the main framework for all intercultural activities. The Norwegian Ministry of Foreign Affairs has for several years been funding the Barentskult, a grant program specially designed to promote Russian-Norwegian cross-border culture and art-projects.44 The Norwegian MFA also supports cultural festivals uniting participants from both sides of the border.

5.3 Environment

The first Russian-Norwegian governmental agreement on environmental cooperation was signed in 1988. Environmental cooperation takes mainly place through the Joint Norwegian-Russian Environmental Commission. The cooperation includes protection of marine environment, nature conservation, pollution reduction and environmental monitoring. Nuclear security and monitoring of radioactivity on the Kola Peninsula has been a particularly important area for cooperation.45 A joint monitoring program for the borderland has been introduced with a particular focus on monitoring emissions from the Pechenga nickel plants. The plants have been of particular concern for the Norwegian side. Environmental cooperation involves, in addition to the official bodies, several research institutions on both sides of the border.

Within the border region the two countries, together with Finland, have established the Pasvik-Inari Trilateral Park. The Pasvik-Inari Trilateral Park is a protected cross-border wilderness area in Finland, Norway and Russia situated along the Pasvik River. The area of the park covers 14.903 square kilometres located in the municipalities of Sør-Varanger, Pechenga and Inari (Finland). The Pasvik- Inari cooperation has been going on since 1990 when Norway and Russia reached an intentional agreement for nature protection in the border area. The trilateral park has been an important framework for cross-border cooperation that has involved national, regional and municipal authorities, as well as research institutions and local actors, like schools and libraries. In 2006, an EU financed project called Promotion of nature protection and sustainable nature tourism in the Inari- Pasvik area was initiated in the park. In 2012 this project was followed by another project called ABCG Heritage – Arctic Biological, Cultural and Geological Heritage.46 One of the most long-lasting projects of the Trilateral Park cooperation has been the Phenology of the North Calotte project. The project was started in 2002 and has since then been financed by the Norwegian Barents Secretariat. Over the years the project has created a platform for various environmental educational activities

44 Barentskult. See: http://www.barents.no/barentskult.137539.en.html 45 Regjeringen.no: «Norwegian-Russian Environmental Cooperation»: http://www.regjeringen.no/en/dep/kld/Selected-topics/svalbard_og_polaromradene/Norwegian-Russian- environmental-cooperation.html?id=451246 46 The two projects were funded through the Interreg IIIA North Kolarctic Neighbourhood Programme. 33 such as the Environmental School Camp in Rajakoski (Pechenga, Russia) for Russian, Norwegian and Finnish school children.

The trilateral park cooperation has, through the mentioned (and other) projects, raised local awareness of the common natural and cultural heritage in the border area. It has also ensured the protection of the unique landscape and wildlife in the area. The cooperation has successfully involved many partners and established an active network of public as well as private actors in the border region. The Pasvik-Inari Trilateral Park has actively taken part in cooperation with similar parks in other parts of Europe. The park has joined the Europarc Federation as well as the Trans Parc Net and received certificates from these institutions.

Figure 10. The Pasvik Inari Trilateral Park (Photo: www.pasvik-inari.net)

5.4 Safety and security

Despite the fact that Norway is a NATO member while Russia stands outside the alliance the cooperation between the two countries in the field of security has been good during the last years. Military cooperation regularly takes place between the two countries’ navies and coast guards. Norway and Russia have also conducted frequent joint exercises in the Barents Sea. The most important of these exercises is the annual naval POMOR exercise which has been held since 1994. The exercise focuses on various challenges that both countries face in the Barents Sea (Pettersen 2012).

The Exercise Barents brings together the Joint Rescue Coordination Center in Northern Norway and the Maritime Rescue Coordination Center in Murmansk. The exercise focuses on rescue and oil spill prevention and response. It has been held annually or every second year since 1991.

Barents Rescue is an exercise organized by Russian, Norway, Sweden and Finland within the framework of the Barents Euro-Arctic Region. The exercise rotates between the four countries. The aim of Barents Rescue is improve the capacity for handling emergency situations that require cross- border cooperation (Pettersen 2010: 67).

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The task of the Russian and Norwegian border commissioners is to safeguard the border regulations of 1949. The Norwegian border commissioner (formally a civil servant with a background as an officer) is stationed in Kirkenes. The Russian Border Commissioner is the of the FSB’s Border Guard Service in Murmansk Region. The border commissioners have been cooperating closely with each other ever since 1950. Today the commissioners or their deputies frequently meet to discuss issues related to border security. The commissioners meet at least once every month. Their deputies meet as many as 50-60 times every year. In practice the commissioners’ offices are in contact on a daily basis. The border guards do not only communicate and report to each other. They also conduct joint exercises where they train in order to handle various incidents and illegal border- crossings. The border guards also participate in common sport activities, like football and skiing. Every year in March border guards from both countries take part in the Friendship Ski Race in Rajakoski, Pechenga (see section 6.5).

5.5 International contexts for cooperation

The bilateral cooperation between Norway and Russia takes place within various international frameworks and fora. Most important are the Northern Dimension, the Arctic Council and the Barents cooperation.

The Barents Cooperation takes place between Norway, Sweden, Finland and Russia within the transnational Barents Euro-Arctic Region which was established in 1993. The region includes the northernmost counties of the Nordic countries in addition to Murmansk and Arkhangelsk regions, the republics of Karelia and Komi and the Nenets Autonomous Okrug on the Russian side. The aim of the Barents cooperation has, since the beginning, been to strengthen cross-border cooperation between the northern parts of the Nordic countries and Russia and to ensure good neighbourly relations and stability in the region. Important fields of cooperation have been security, culture, youth, education and research, trade and business development, environment, health, transportation and indigenous peoples.

The Barents cooperation combines intergovernmental and interregional cooperation. The Barents Euro-Artic Council47 is the intergovernmental administrative organ. The chairmanship of the council rotates between the four member states. The interregional cooperation is organized under the Barents Regional Council48. Members here are the thirteen regional entities that form part of the Barents Region. The regional council also has a rotating chairship.

The Northern Dimension is a joint policy between EU, Russia, Norway, and Iceland. It was initiated in 1999 and renewed in 2006. The EU Northern Dimension was established as an instrument for promoting the EU’s regional cooperation in the High North, with particular emphasis on cooperation with Russia. The Northern Dimension “aims at providing a framework to: promote dialogue and concrete cooperation, to strengthen stability, well-being and intensified economic cooperation and to promote economic integration, competitiveness and sustainable development in Northern Europe.”49 The cooperation takes place within four Northern Dimension Partnerships; environment

47 The Barents Euro-Arctic Council: http://www.beac.st/in-English/Barents-Euro-Arctic-Council 48 The Barents Regional Council: http://www.beac.st/in-English/Barents-Euro-Arctic-Council/Barents-Regional- Council 49 The Northern Dimension: http://www.northerndimension.info/ 35

(NDEP); public health and social well-being (NDPHS), culture (NDPC) and transport and logistics (NDPL). The partnerships work as independent entities responsible for developing concrete cooperation in their respective fields.

The Arctic Council50 is a circumpolar intergovernmental body for cooperation. During the latest years the importance of the council has been growing steadily. The Arctic Council brings together all the Arctic States as well as representatives of the indigenous peoples in the region. The Arctic Council has also developed into a forum for scientific activities, for research on climate change and arctic issues. In 2011 the Council member states concluded the Arctic Agreement. The agreement coordinates international search and rescue in the Arctic. The EU today has the status of ad hoc observer in the Council.

5.6 Cooperation on the regional level

Regional authorities on both sides of the border have been involved in CBC for a long time. The three counties of Northern Norway and the regions of Northwest Russia have played an important and active role in the development of CBC, particularly through the Barents cooperation. Murmansk Region and Finnmark County first signed a bilateral agreement for cooperation in 1988. Today the agreement includes plans for cooperation within the fields of business development, communication, transport, infrastructure, education, research, culture, sport and youth. The counties’ cooperation has served as an example for the Barents cooperation.

Since 2010 the Murmansk Region administration has been organizing Days of CBC in Nikel. Several informants in Pechenga and Kirkenes mentioned the establishment of this event as one of the most positive recent developments in the region.

The Norwegian Barents Secretariat51 is an important institution in the region. The secretariat is owned by the three northernmost Norwegian counties (Troms, Nordland and Finnmark) and funded by the Norwegian Ministry of Foreign Affairs. The secretariat has currently around 20 employees. The head office is located in Kirkenes but the secretariat also has branches in on the Russian side of the border, in Murmansk, Arkhangelsk, and Naryan-Mar. Since 1993 the secretariat has been supporting more than 3000 small and medium-sized CBC projects involving Russian and Norwegian partners. The Secretariat funds approximately 200 Norwegian-Russian projects annually. The Norwegian Barents Secretariat is thus, by far, the most important funder of CBC projects in the region.

50 The Arctic Council: http://www.arctic-council.org/index.php/en/ 51 The Norwegian Barents Secretariat: http://www.barents.no/barents-cooperation.137584.en.html 36

6. Municipal cooperation: The case of Sør-Varanger and Pechenga

Several municipalities on the Norwegian as well as the Russian side of the border are involved in CBC. The longest, strongest, and most intense CBC exists between the two border municipalities of Sør- Varanger and Pechenga. The two municipalities first signed a friendship agreement in 1973. After the fall of the Iron Curtain, intermunicipal cooperation has gradually turned broader and more intense. Today CBC has become a part of ordinary working routine for the municipalities. In June 2008 the two municipalities signed a so-called twin town agreement signalizing common aspirations for further cross-border integration. 52 Since the signing of this agreement concrete plans for intermunicipal CBC has been developed every second year. These new cooperation plans are, according to our informants, generally “more precise, more thorough, and easier to implement” than the old plans. The relation between the two municipalities has been positively affected by the introduction of the BTZ in 2012. The BTZ, which geographically roughly corresponds to the area of the two municipalities has encouraged local cross-border integration (see chapter 4).

6.1 Twin towns

Unlike other examples of city twinning, the twinning project involving Sør-Varanger and Pechenga was initiated from above, not from below, (Sergunin & Joenniemi 2011). The twinning started only after an instruction letter had been sent from the Norwegian Minister of Foreign Affairs to the mayor of Sør-Varanger in 2008 (Haugseth 2014). Soon after the letter was sent, the municipal and national authorities on both sides agreed to declare Nikel and Kirkenes, the two municipal centres as twin towns. Locally, some people have been critical towards the twinning project as the initiative did not come from the local population but from above.

The mayors of both municipalities stated in our interviews with them that the local administrations treat the “twin towns” as a temporary project, which will last for some years only. Both sides emphasize that intermunicipal cooperation was initiated much earlier than the twinning project and that its scope goes far beyond it today. A Norwegian informant explained to us that “twin-towns” are in fact “more important on the global scale than for the local community”. One may, as many locals do, regard the Sør-Varanger – Pechenga twinning as pure “window-dressing”, as a way of presenting the cross-border cooperation as more successful than it really is. The municipal administrations appreciate, however, the publicity that the local CBC has owing to the twin-cities agreement.

The practical effects of the twin town agreement have been modest. One of the reasons for this is probably that it did not include any extra funding for cooperation. The funding for the intermunicipal cooperation was actually reduced after the agreement was signed. Sør-Varanger used to, for instance, employ a full-time international advisor who worked with intermunicipal cooperation. This position was, however, abolished when the municipality faced financial difficulties in 2013 and had to cut its budget. The Ministry of Foreign Affairs of Norway was asked to provide a financial coverage for the position but refused to do so.

52 See Sør-Varanger kommune: Felles erklæring om samarbeid mellom Sør-Varanger kommune Finnmark fylke (Norge) og den munisipale enheten Pechenga rayon Murmansk oblast (Russland) innen prosjektet «Tvillingbyene»: 37

Membership in the European City Twins Association is now seen as the next step for positioning Nikel and Kirkenes within the European network of adjacent settlements (Joenniemi & Sergunin 2012). The idea of applying for membership was mentioned in the latest intermunicipal cooperation plan as one of the project work goals for the period of 2014-2015.

Figure 11. The mayors of the border municipalities on the border. Cecilie Hansen from Sør-Varanger and Irina Neverova from Pechenga (Photo: Trude Pettersen / BarentsObserver)

6.2 The cooperation between the municipal administrations

The local administrations claim to have weekly contacts with their colleagues across the border. Electronic correspondence is the most frequently used means of communication. Russian and Norwegian predominate as languages of communication while English is used only from time to time. Interpreters are frequently utilized as very few Norwegians command Russian and vice versa. Official delegations of the border municipalities meet twice a year - every May and October. Recently a new arena for meetings, the Days of CBC, was established. The event takes place every November in the town of Nikel and usually consists of two days of discussions. The main organizer of the CBC Days is the Ministry of Economic Development of the Murmansk Region.

The procedure for instigating collaboration varies between the two sides. On the Norwegian side of the border anyone is free to start cooperation project with partners on the other side. On the Russian side the system is more centralized. Here citizens who are interested in CBC with Norwegian

38 partners need to express their wish to the local administration, which then (if the initiative is accepted) will try to find a partner matching the requirements of the initiator on the other side of the border. Since 2005 as many as 70 % of CBC projects involving actors or organizations in Pechenga have been coordinated by the local administrations.

The Russian federal law No. 131 does not include expenses for international ties among the expenses that a municipal budget can cover. This limits the available finances for CBC projects on a local level. In practice there are only three possible ways to contribute to CBC projects financially for the Russian side: 1) by transferring some costs to the so-called representative expenses of the municipality (Russian: predstavitelskie raskhody); 2) to do project related work within working hours or after it without extra payment (so-called “labour contribution”, or, in Russian, trudovoy vklad); and 3) provision of municipal property for temporary utilization for project needs. Usually the realization of a CBC project requires the application of all these ways.

Although the structure, functions and range of power of the two administrations differ a lot, two common traits can be found:

- Until 2013 both municipalities employed special international advisors for taking care of CBC related issues. In 2013 the Norwegian side abolished this post (see above) but it still exists on the Russian side.

- Both municipalities have used special coordinators for various sectors. Special civil servants have been responsible for CBC interactions within particular fields (for instance education, sport or health cooperation).

EU-finances are only available for the CBC partners when an EU partner is involved. In the case of Sør-Varanger and Pechenga this would imply involving the Finnish neighboring municipality Inari. A few small trilateral projects have so far been conducted, mainly in the fields of youth and gender issues. However, the vast majority of the cooperation activities takes place without Finnish participation. These projects are almost exclusively financed by the Norwegian Barents Secretariat.

There is no special fund-raising department in any of the municipalities. Skills of application writing (mainly for support from the Norwegian Barents Secretariat) have been developed only on the Norwegian side of the border.

Intermunicipal CBC takes place within fields like health and care, education, sport, libraries, media, business and labour.

6.3 Health and care

The contact between the hospitals in Kirkenes and Pechenga began in 2007 when a new head physician who had a great interest in cooperation with Norway was appointed on the Russian side. Since that time, AIDS and tuberculosis prophylactics, nursing care, and first aid (in particular reanimation and hospital care) have become the key fields of cooperation between the two hospitals. The cooperation includes meetings at different levels: between heads of the hospitals, between doctors with particular qualifications, and between regional medical centres (the

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Murmansk Emergency Medical Center has for instance been much involved). Some of these meetings are organized as conferences.

Cooperation within the fields of healthcare is in many ways pushed forward by the practical needs for it. Due to the increase of border-crossings, situations when foreigners get ill or have an accident on both sides of the border occur more frequently. As a general rule, the first aid on both sides of the border is provided to everyone free of charge regardless of the nationality of a person. In cases of heavier injuries, the foreign patient is analysed on the side where the emergency happened, and then transported to the border where the medical brigade from the other state is waiting. In 2011 five patients (both Norwegians and Russians) were transferred across the border. Given that such a procedure is cumbersome and could be dangerous for patients, the hospitals on both sides are lobbying for the possibility of conveying the patient to the hospital on the other side of the border. Border guards admitted that such a change is possible, but only if some arrangements are made. One problematic issue is the content of the ambulance supplies as the lists of forbidden medicines are different on each side of the border.

Besides the abovementioned types of cooperation, various forms of information exchange and project work exist between the Norwegian and Russian partners. Recently a project called SCANKIT led by specialists from St. Petersburg was instigated. The aim of this project is to determine the impact of hard metal salts on the health of pregnant women. A similar investigation was conducted in Pechenga in the late 1990s. Pechenga was chosen as the site for research because of the well- known emissions from the local Pechenganikel smelter. Due to the constant worries of many residents of Sør-Varanger about the consequences of air pollution from Pechenga, the research received Norwegian funding. The only role of the Pechenga hospital in this project has been to take blood tests from its patients. No Norwegian researchers are involved in the project.

The cooperation between the hospitals has so far not been very stable, due to a frequent change of hospital directors in Pechenga. As our interviewees on the Russian side pointed out, there is a need for an official framework for cooperation between the hospitals. The only valid agreement today regulates the procedure of border crossing for the emergency brigade between the Murmansk Emergency Medical Center and the Kirkenes Hospital. The Pechenga Hospital is left aside. The cooperation between the hospitals has recently received support from the regional level on the Russian side. The Ministry of Health and Care of Murmansk Region repeatedly has urged the Pechenga hospital to deepen its cooperation with its Norwegian partners.

6.4 Education

Cooperation within the field of education encompasses kindergartens, schools and vocational education. Cooperation between kindergartens in the two border municipalities started in the 1990s without any coordination from municipal authorities. The first partnership was established directly between kindergarten № 1 in Nikel and the private kindergarten of Prestøya in Kirkenes. Today there are no such direct partnerships between kindergartens on the two sides of the border. Although the overall number of kindergartens on both sides of the border is quite high (11 in Pechenga and 39 in Sør-Varanger), all of them communicate with each other through the coordination of the local administrations only.

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From the early 2000s kindergartens on both sides of the border have been organizing an annual joint exhibition of children drawings, called “Russia and Norway through children’s eyes”. The exhibition is usually displayed for six months in Kirkenes in the Borderland Museum and then for six months in Nikel. In 2013, for the 20th anniversary of the establishment of the Barents Region, the administrations of the two border municipalities published a special calendar made up of children’s’ drawings presented during these exhibitions.

The project work between kindergartens began in 2006. The title of the project was “Neighbours and Friends” (Norwegian: Naboer og venner, Russian: Sosedi i druziya). The project has three categories of participants: 1) a group of executive leaders that consists of the heads of the kindergartens; 2) a group of educational leaders; 3) a group of children and their parents.

Kindergarten leaders meet twice per year. These meetings usually take place during day trips to Kirkenes. Besides discussing cooperation of other groups, kindergarten executives are also involved in experience exchange. In 2010 they organized for instance three conference-like meetings, which served as platforms for discussing differences in the systems of pre-school education and its regulation in Norway and Russia.

Meetings between the educational leaders are usually focusing on methodological issues of pre- school education. The educational leaders usually meet over two days. This way the participants are able to follow the kindergarten life schedule from the moment of its opening till its closure, from having breakfast with the kids till seeing them off at the end of the day. It thus gives a very good insight into the practical pedagogy of the other side. Groups of children and their parents usually include five kids and five accompanying persons (often one of parents). Such delegations usually spend a day in a kindergarten on the other side of the border.

As our interviewees pointed out, cooperation between kindergartens has resulted in a methodology improvement in the system of pre-school education on both sides of the border. Looking back, CBC practitioners said that kindergarten interactions “have become institutionalized, they keep up the same type of activities although the participants and leadership is changing”. The cooperation between the kindergartens has become one of the most stable forms of CBC taking place on the municipal level.

The pioneers of school cooperation were the School № 3 in Nikel and the Pasvik Folk High School in Svanvik. Since cooperation between the schools was instigated in 1988, they have tried many formats of collaboration. The most profound of them was the so called “12th grade” in the 1990s which included intensive Norwegian courses and joint teaching. The cooperation ended after some years due to the lack of funding. Today the cooperation activities of the two schools include delegation exchanges and training of Russian pupils in the Pasvik Folk High School.

Another long-lasting cooperation went on between School № 9 in Zapolyarny and the Bjørnevatn School from 1996 to 2011. This cooperation ended due to financial insufficiencies on both sides. The cooperation included two annual exchanges of high school pupils (first, of the 11th grade, later of the 9th grade).

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In 2011-2012 English teachers of the two municipalities took part in the project English Teachers in the Border Schools. The project was initiated by the University of Nordland and Murmansk State University of Humanities (MSHU). During the project teachers were attending lessons on both sides of the border, discussing methodological issues, reading and interpreting English and American authors. At the end of the course the participants received certificates and diplomas.

Centres of vocational education in the Russian-Norwegian borderland operate in two fields - art (painting, music, dancing) and sports. Within the field of art the Nikel Art School was one of the pioneers of Russian-Norwegian CBC. The school’s first contact with Norwegian partners was in fact instigated as early as 1978. Over the years the school has been providing internships for students from Oslo, and it has sent an annual delegation to a student summer camp in Storslett in Troms County (the last camp occurred in 2010). The Art School had developed a wide network of Norwegian cooperation partners, which stretches far beyond the immediate border municipality. Cooperation with Sør-Varanger includes exchanges of classes and exhibitions, joint seminars for teachers from Nikel, Kirkenes and Karasjok and project work in bilateral (Russian-Norwegian) and trilateral (Russian- Norwegian-Finnish) formats.

The art educational systems on the two sides of the border differ from each other. The Russian system tend to be more advanced. The Nikel Art School provides for example its students with thirteen hours of illustration training every week, compared to only one or two hours in Kirkenes. This asymmetry somewhat constrains the cooperation and makes it less productive. Another obstacle for effective cooperation are the different levels of school subordination in the two countries. The Norwegian schools are subordinate to the regional level while the Russian schools are subordinate to the municipal level.

During the last two years, there has, according to our interviewees, been a decline in cooperation between art schools while the collaboration between music schools has increased. Concerts with the participation of musicians from both sides of the border have been a traditional way of commemorating the 1944 liberation of the Russian and Norwegian borderland from Nazi occupation. Traditionally these performances are prepared by Music School № 2 in Zapolyarny and the Kirkenes School Brass Band. Another example of successful collaboration has taken place between violin players from both sides. Besides joint concerts and rehearsals, specialists from Zapolyarny have been invited to take part in the string players’ seminar called “Oppstryk Finnmark”.

6.5 Sport

Municipal CBC in the field of sport has taken place since the 1960s but got a more structured form in 2008 when a meeting of coaches from all the major sport disciplines was held. Since then sport cooperation activities have included experience exchange between coaches, joint trainings of young athletes and various championships and competitions in football, ice hockey, skiing, swimming and orienteering. Sport teams from both sides of the border have regularly been taking part in municipal competitions.

In 2009 the first Barents Hockey League matches were played by six teams from Norway (Kirkenes), Russia (Murmansk, Nikel, Sputnik and Zapolyarny) and Finland (Ivalo). Over the course of time, the set of teams has changed and today seven teams - Kirkenes, Tromsø, Nikel, Zapolyarny, Murmansk,

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Olenegorsk and Ivalo - compete in the league. The Barents Hochey League runs hockey series both for adults and children. The junior and senior series engage approximately 600 people. Figure skating is also included in the League organization: performances of Russian and Norwegian female figure skaters are an essential part of every hockey tournaments.53

On the tri-border point where Norway, Finland, and Russia meet at an international ski run called “The Ski of Friendship” takes place every year. The twelve-kilometre long skiing-track, starts and ends in Russia, but crosses Finnish and Norwegian territory along the way. During the competition every participant is allowed to cross the borders. The event attracts thousands of participants from all three countries. The initiator, organizer and sponsor of this border-crossing event is the Russian hydroelectric power company “Kaskad Pazskikh GES”.

Figure 12. The ice rink as an arena for Russian-Norwegian CBC (Source: Barents.no)

6.6 Libraries

The cooperation between the libraries in the two municipalities has been going on for a long time and has been one of the most successful examples of local CBC. The first meeting between representatives of the libraries in Pechenga (Russia) and Sør-Varanger (Norway) was arranged back in 1983 when four Nikel librarians visited the library in Kirkenes. The first visit from Kirkenes librarians took place seven years later. From the early 1990s there has been a regular cooperation between the two sides.

One of the initial motivations for CBC was the rapid increase of Russian readers in Kirkenes due to the frequent visits of Russian sailors to the town from the early 1990s. In order to reorganize the collection of Russian literature at the Kirkenes library, Marina Trusova, the head of the Nikel Library at that time, was invited to cross the border on weekly basis. Later, in order to cope with the need

53 Barents Hockey League: http://www.barents-bhl.org 43 for dealing with Russian clients, the Kirkenes library hired two Russian employees on a permanent basis. Both of them work in the library to this date. The cooperation between the libraries has included exchange of workers, books, exhibitions and other material, as well as ideas and best practices.

For the last thirteen years the Pechenga municipal library has joined the International Contest of Children's Handwritten Books. The library serves as a jury and a collector of contest works and passes the most advanced pieces further to the regional and international level. The contest itself has been organized by Murmansk Regional authorities with the support of the general consulates of Norway, Finland, and Sweden in Murmansk.54

The cooperation between the libraries is special in the way that it has existed without funding or involvement from national, regional, or local authorities. It can thus be described as a successful example of self-financed “people-to-people cooperation”, in the true sense of the word.

6.7 Media

Cooperation between the newspapers of Gazeta Pechenga and Sør-Varanger Avis was first instigated in the 1970s. Gazeta Pechenga is a small municipal enterprise employing only four journalists. Sør- Varanger Avis is private and has 24 employees. Due to the asymmetries between these two newspapers, cooperation has been driven financially by the Norwegian side. In an interview the editor-in-chief of Sør-Varanger Avis told us that, although the interaction with Russian municipal periodical imposes additional costs for the newspaper, it is interpreted as an investment.

The collaboration between the two newspapers has included the publishing of Sør-Varanger Avis in Russian free for Pechenga residents, the organizing of training programs for Russian journalists, and an exchange of articles and advertisements.

Since 2008 Gazeta Pechenga has been publishing a special rubric called “Neighbours” which covers Russian-Norwegian joint intermunicipal events. Sør-Varanger Avis is regularly covering Pechenga.

6.8 Business and labour

As our interviewees on both sides of the border have stated, the local CBC lacks strong a business dimension. The main reason for this is first and foremost the rigid border regime.

During the 2000s several projects (for instance, the Norwegian-Russian-Finnish project “Female entrepreneurship” and the international CBC project “Notabene”) were instigated with the aim of promoting CBC within the field of business and entrepreneurship. These projects did, however, not result in any practical achievements. According to local entrepreneurs the projects focused too much on teaching and information and too little on practical measures needed, for instance bank loans with a reasonable interest rate. The fact that the business sectors of the two municipalities are very different also hampers the development of successful business cooperation. In Sør-Varanger the

54 2014 god kultury Murmanskaya Oblast: “Nam mir zaveshchano berech”: http://2014.culture51.ru/novosti/218-nam-mir-zaveshano-berech/ 44 business sector is diversified, ranging from medium to micro-sized enterprises. In Pechenga we find only micro-sized businesses with very little resources. This of course creates an asymmetry between the two sides.

There has also been an asymmetry in the way enterprises on the two sides have exploited the cross- border traffic. In Sør-Varanger business early adapted to serve the needs of Russian border shoppers. Since the early 1990s the enterprises in Kirkenes have experienced a constant improvement because of the influx of Russian customers. Enterprises in Pechenga have lagged behind. Only recently have there been a small increase in income on the Russian side, due to the increase of Norwegian visitors after the introduction of the BTZ.

The local division of the Norwegian Labour and Welfare Administration (later referred to as NAV) in Sør-Varanger and the Center of Employment in Pechenga currently engage in an information exchange with the long-term aim of establishing Norwegian businesses on the Russian side of the border.

From 2008 to 2012 NAV and the Murmansk Region Center of Employment carried out a project on training unemployed disabled people from Murmansk Region. Some of these were from Pechenga. During the years the project lasted twenty disabled people were able to learn Norwegian while having successively three internships – two in Norway and one in Russia.

A municipal CBC pilot project on cross-border commuting was instigated in 2013. The aim of the project is to determine whether commuting could have a positive effect for both sides of the border. Taking into consideration the higher monthly earnings in Norway, it was decided not to restrict participants to currently unemployed Russian borderlanders but to give a chance to all Pechenga residents with required qualification. At the first stage five residents with specialization in social care were selected to be employed in kindergartens in Sør-Varanger. According to the plan, the selected workers shall spend five weekdays in Kirkenes and two days off in Nikel. The project will include a six- month training and adaptation module that will contain an introduction course to Norwegian language, culture and society. The most challenging issue for the planning of the course has been the provision of housing for the Russian trainees in Kirkenes. In Kirkenes there is currently a lack of available places and the ones that are available tend to be costly.

6.9 Obstacles for municipal cross-border cooperation

In Norway as well as in Russia the autonomy of regional and local self-government is recognized and guaranteed. The bodies of regional and local self-government are not part of the system of bodies of state authority in neither country. Norwegian and Russian municipalities and regional governments have, however, a different degree of autonomy regarding the right to pursue CBC, that is the right to establish and pursue relations with foreign partners. The range of authority of Russian municipalities in pursuing CBC is not clear from the legal perspective and municipal servants are often afraid to violate the federal law. Norwegian municipalities generally have a higher level of competence and more responsibility than their Russian counterparts. To cooperate in certain fields (for instance, in the field of employment or rescue service) Norwegians need to seek for a Russian partner at the regional level of government. This creates a problematic asymmetry between the two sides and makes cooperation more challenging and cumbersome.

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The Norwegian local authorities have generally a larger budget than their Russian counterparts. This too creates a certain asymmetry. The Norwegian partners tend to contribute more to CBC projects. Some projects are almost exclusively funded by the Norwegian side. On the Russian side of the border the municipal budgets cannot by law contain any expenditures related to international ties or CBC.

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7. Cross-border cooperation between organizations and institutions

CBC between various governmental and non-governmental organizations and institutions takes place on all levels. Education and culture are fields where we find a particularly active cooperation across the Russian-Norwegian border.

7.1 Educational cross-border cooperation

Educational institutions on all levels are involved in CBC programs. The cooperation involves exchange of teachers, students and pupils, longer and shorter visits and study trips, language courses, summer schools et cetera. A Norwegian-Russian College has been established in Murmansk. Russian and Norwegian universities have actively cooperated for years within a wide-range of fields. The cooperation today includes joint degree programs (two out of three are distant learning degrees), internships, conferences and seminars arranged for students and academic staff.

At the municipal level cooperation between schools and kindergartens is often referred to as one of the most successful and stable forms of CBC. In the near borderland, Sør-Varanger and Pechenga, there is a lot of exchange going on. This cooperation is, however, totally dependent on Norwegian funding, mainly from the Norwegian Barents Secretariat.

At the regional level cooperation is built on the partnership model with equal economic contributions. The successful establishment of the Russian-Norwegian College in Murmansk is one result of this fruitful cooperation. Graduates of the college attain the right to enter Norwegian Universities.

There are extensive programs for youth exchange across the Russian-Norwegian border. The number of exchange students crossing the border has increased steadily, from 539 in 2003 to 1374 in 2010, and it is expected to increase further during the next years.55 The flow of pupils and students across the border has, however, always been very asymmetric. In 2003 70 % of the exchange students were Russians. In 2010 the proportion had risen to 86%. The competition for exchange student scholarship is also much tougher on the Russian side. On the Russian side student exchange is seen as a real opportunity for getting a career. In Norway very few students see Russia in general, and Murmansk in particular, as an attractive destination for studying.

7.2 Cultural cross-border cooperation

There is a long tradition for CBC between cultural institutions on both sides of the border. Already during the Cold War cross-border cultural (and sport) cooperation was quite developed in the borderland, especially between institutions in Sør-Varanger and Pechenga. The CBC was encouraged by the Soviet and Norwegian authorities as a sort of soft and “harmless” “people-to-people” diplomacy.

Since the end of the Cold War cultural cooperation has continued to be the most vivid and successful form of CBC in the region. Today cultural CBC is more extensive than ever before and involves almost

55 Meld. St. 7 (2011–2012) Report to the Storting (white paper): The High North. Visions and strategies: http://www.regjeringen.no/pages/38005979/PDFS/STM201120120007000EN_PDFS.pdf 47 all kinds of art practiced in the region. The cooperation involves public institutions and private ensembles, professional as well as amateur groups. Common festivals and concerts are arranged on both sides of the border. Artists from Russia frequently tour Norway and vice versa. The cultural CBC is still most intense in the area closest to the border where personal contacts between artists on both sides of the border are strong.

The Barents Spektakel festival has been held annually in Kirkenes since 2003. The festival is arranged by the Kirkenes-based curators Pikene på broen who refers to it as “Norway´s most border-crossing festival”. Russian-Norwegian friendship and cross-border cooperation are the recurring themes of the festival. Every year famous Russian performers are invited to the festival. The Barents Spektakel also includes seminars about political issues in the border region.56

Cultural CBC is financed almost exclusively by the Norwegian side. The Norwegian Ministry of Foreign Affairs has been particularly supportive of cross-border cultural cooperation in the region, regarding it as a “door opener” for further cooperation in other fields, and as a tool for establishing good relations with Russia. The ministry is the main sponsor of the Barents Spektakel. In order to encourage cultural CBC projects a special grant program, BarentsKult, has been introduced on the Norwegian side of the border. BarentsKult is financed through the Norwegian Barents Secretariat. 57

7.3 Cross-border cooperation among non-governmental organizations

Civil society plays, along national, regional and local governments, a considerable role in the CBC that takes place across the Russian-Norwegian border. Various non-governmental organizations (NGOs) are cooperating within fields like media, humanitarian aid, environment, culture, and indigenous peoples’ issues. Sport and cultural associations on both sides of the border are also active in CBC.

Most NGOs on both sides of the border have at some point been engaged in some form of CBC. On the Norwegian side, particularly in Kirkenes, there are several NGOs with Russian partners. The majority of the Russian NGOs with Norwegian partners are located in Murmansk. Some of the NGOs on the Russian side, like the environmental NGO Bellona, function in practice as foreign agencies, branches of Norwegian NGOs. These NGOs actually mention CBC as one of their key activities.

For NGOs active in CBC, external funding is usually one of the main financial sources. NGO CBC projects rely currently to a large extent on funding from Norway, particularly from the Norwegian Barents Secretariat.

7.4 Motivating factors

Many of the current contacts between Norwegian and Russian NGOs and institutions were initiated during the early 1990s. At this time the most important motivation for the Norwegian partners was to help the Russians. For Norwegians, cooperation with Russia at that time came with no expectations and was purely for altruistic reasons. The interviews we have made with people active in NGO or institutional CBC on the Norwegian side show that the humanitarian argument for partnership still exists today, but that it is much less prevalent than ten or twenty years ago. The

56 Barents Spektakel: http://www.barentsspektakel.no/en/about 57 The Norwegian Barents Secretariat: Barentskult: http://www.barents.no/barentskult.137539.en.html 48 humanitarian discourse has been replaced by a firm belief in mutual benefit from cooperating. Even in the health sector, which was probably the most humanitarian oriented sector in the 1990s. The Norwegian partners now claim to gain many new insights through their cooperation with Russian partners. There is a belief on both sides among stakeholders involved in social/institutional cooperation that such cooperation can in fact contribute to a mutual benefit and lead to positive development for the entire border region. Quite a few projects emerge out of a common need to solve [potential] transnational problems -- for instance oil spillage or nuclear catastrophe or an AIDS epidemic.

Stakeholders involved in the cultural CBC tend to argue that by cooperating with partners on the other side, they contribute to peace and stability in the region. Artistic exchange is, it is claimed, the best way to get to know one another. On both sides of the border people generally refer with respect to the culture and art of the neighbouring country. Cultural cooperation, presumably, also has an educational effect, for those directly involved and for the spectators who get an insight into the culture and life on the other side of the border. Stakeholders claim that art cooperation contributes to peace in the region and to good relations between neighbours on both sides.

On the Russian side of the border stakeholders claim that cooperation with Norwegian partners is important, as it helps Russian institutions to adapt to Western rules and regulations and to become more competitive. This is particularly true for the academic institutions involved in CBC.

An important motivation for engaging in CBC on both sides of the border is that CBC activities “enrich the daily life” of those involved. CBC gives a unique opportunity for travelling and for meeting new people from other countries. Many stakeholders claimed that the CBC gave a rare and valuable insight into the culture and practices of the other side.

For Norwegian actors cooperation with Russian partners is more challenging than cooperation with Finnish or Swedish partners. Nevertheless, Russia is considered an attractive or interesting partner by most stakeholders. The challenge of cooperating with Russian partners is actually referred to as a positive rather than a negative factor by most stakeholders. Swedish and Finnish partners are, on the contrary, considered to be “boring”, as they are so similar to Norway.

Unlike actors within the field of business (see section 8.7), Norwegian NGO and institutional stakeholders do not worry about the risks of establishing links with Russian partners. The CBC taking place between Norwegian and Russian NGOs and institutions is reportedly well regulated and transparent.

7.5 Obstacles

The main obstacle for institutional as well as NGO CBC is lack of finances. CBC within this field requires constant external funding. The support from the Russian side is very limited. The support for social/institutional cooperation on the Norwegian side is much more generous, but not always sufficient.

A particular problem facing Russian-Norwegian institutional CBC is the asymmetry between the power assigned to institutions in the two countries. Norwegian institutions are, generally, much

49 more free to make decisions and sign agreements. Russian institutions, on the other hand, need to get approval from “above”, often from the central government in Moscow, even for making decisions with relatively little consequence. This makes planning and decision-making cumbersome processes.

The main barrier for CBC between NGOs is, according to our data, language. There is a lack of people knowing Russian on the Norwegian side and there is a lack of people speaking Norwegian on the Russian side. The knowledge of English is limited, particularly on the Russian side. Small NGOs lack the resources to hire translators and this makes communication with partners on the other side very challenging. The visa regime is another challenge for smaller NGOs on the Russian side due to the time and costs of visas. NGOs with more resources, as well as institutions are in a better position to cope with the visa regime.

A few stakeholders on the Norwegian side expressed worries about a new Russian law that requires non-profit organizations funded from abroad to register as "foreign agents”. The law was introduced in 2012 with the purpose of preventing foreign powers from financing extremist organizations within Russia. So far the law, however, does not seem to have hampered contacts between Norwegian and Russian NGOs. Norway has so far avoided supporting Russian NGOs involved in extremist or terrorist activities. There is no similar law on the Norwegian side.

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8. Economic relations

8.1 Economic relations between Norway and Russia Norwegian-Russian trade represents approximately 2.2 billion euro (2012), equally divided between export and import.58 The two countries account only for an insignificant part of each other’s foreign trade. Norway contributes to 0.3 % of Russia’s total turnover. Russia contributes to approximately 1.5 % of Norway’s turnover. In 2012 Russia was Norway’s eleventh largest trade partner while Norway was Russia’s seventeenth largest trade partner.59 The Russian-Norwegian trade is considerably smaller than the trade between Sweden and Russia or Finland and Russia. Russian- Norwegian trade declined in 2009, primarily as a result of the international financial crisis. In 2010 the trade started to grow slowly again.

Russian-Norwegian trade is currently dominated by a few sectors. 67 % of Norway’s export to Russia consists of fish and other seafood products. Russia is currently the biggest market for Norwegian seafood (having recently surpassed France). In 2012 Norway exported seafood for about 0.8 billion euro to Russia, an increase of 10 % from 2011.60 For the last years as much as 50-70 % of the Russian export to Norway has consisted of metals, particularly raw aluminium. The assortment of import and export between Norway and Russia remains stable.

Russian companies have not made any major investments in Norway. Their presence in Norway has mainly been limited to representative offices. Norwegian investments in Russia have been more significant. The Norwegian telephone company Telenor is for instance the largest foreign investor in the Russian telecommunication market. The Norwegian petroleum giant Statoil and the DNB bank have also invested in the Russian marked. Norwegian interests in Russia are mainly concentrated to Moscow and Saint Petersburg. Outside these regions the Norwegian presence is minimal, except from in the regions of Murmansk and Arkhangelsk.

Norwegian-Russian trade is regulated by the Agreement on Mutual Investment Protection of October 1995and the Agreement on Trade and Economic Cooperation of March 26, 1996. A declaration on partnership for modernization was signed by Norway and Russia in 2011. The declaration is intended to “promote investment and the establishment of new businesses in Russia and to ensure the active engagement of the private sector”.61 The joint Russian-Norwegian Commission on Economic, Industrial and Scientific-Technical Cooperation is the main forum for issues relating to bilateral trade within important fields like fisheries, energy, transport, communication, and tourism.

The Russian membership in the World Trade Organization in 2012 is expected to have a positive impact on the trade relationship between the two countries. The custom barriers will for instance be reduced and this will benefit the export of aluminium from Russia as well as the export of seafood products from Norway. The WTO membership is also expected to ensure a more predictable and transparent business climate and security for those involved in cross-border trade between the two

58 Statistics Norway: www.ssb.no 59 Information from the Russian embassy in Oslo and Statistics Norway. 60 Norges Sjømatråd: www.seafood.no 61 Meld. St. 7 (2011–2012) Report to the Storting (white paper): The High North Visions and strategies: http://www.regjeringen.no/pages/38005979/PDFS/STM201120120007000EN_PDFS.pdf 51 countries. The European Free Trade Association, where Norway is a member, began free trade negotiations with Russia in January 2011.

The Norwegian-Russian Chamber of Commerce (NRCC) was established in 2003. The NRCC is a non- profit, non-governmental organization. The NRCC currently has 170 members from both Russia and Norway, which makes it the biggest chamber of commerce in Norway. The aim of the NRRC has been to “stimulate and improve business relations between Norwegian and Russian companies regarding import, export, shipping, business development, tourism or investment activities”, as well as to “enhance the understanding of each other’s business culture, market developments and other socio- economic developments of importance”.62 The NRCC is today an important forum for Russian- Norwegian business networking. The chamber frequently organizes various events; seminars, and courses. Every year the NRCC also arranges a Russian-Norwegian Business Forum.

8.2 Economic relations in the border region

Economic CBC in the border region has very little significance for the national economies of Russia and Norway. First, as we have seen, the overall Russian-Norwegian trade relations are insignificant, except from for a few sectors. Secondly, the border region is economically marginal compared to the southern and central and Russia.

In 2011 business with Norway contributed to 4.2 % of the value of export and import combined for Murmansk Region. Norway was the main foreign investor in Murmansk Region in 2012 (30% of the total investments which equals 6.24 million USD).63 Norway was thus ranked 4, below the Netherlands, the United States of America and China.64 The import to Murmansk Region from Norway was worth 88 million USD in 2012 (14% of the total import of the region). In 2012 the total export from the three North Norwegian counties (there is no statistics for Finnmark only) to Russia was worth 400 million EUR. Seafood products accounted for as much as 80 % of this export.65

Inertia marks the Russian-Norwegian economic CBC within the border region today. Some years ago the CBC in the region was somewhat more intense, due to the great anticipation of the development of the Shtokman gas field. During the early 2000s several Norwegian companies established offices in Murmansk. The majority of these companies specialized on supplies and services to the oil and gas sector. As the Shtokman project was indefinitely postponed many of these companies pulled out, however. The number of Norwegian companies with employees in the Russian parts of the Barents Region has decreased by 25 % since 2006. Today 30 Norwegian companies with a total of 945 employees are active on the Russian side. The Norwegian companies are mainly involved in banking, real estate, hotels, consultancy services and fisheries (Rautio, Bambulyak & Hahl 2013). All Norwegian companies on the Russian side operates from Murmansk. There is, perhaps surprisingly, not a single Norwegian company operating in the border municipality of Pechenga.

There are only 14 active Russian companies in all of Northern Norway (the counties of Nordland, Troms and Finnmark). These companies are small, employing less than 30 people altogether. The

62 Norwegian-Russian Chamber of Commerce (NRCC): www.nrcc.no 63 Nord-news.ru. 27 May 2013: http://www.nord-news.ru/news/2013/05/27/?newsid=49078 64 Barents Monitoring, Murmansk Region 2011, page 10. 65 Statistics Norway: www.ssb.no 52

Russian companies in Northern Norway are mainly involved in the sectors of fisheries, aquaculture and tourism. The investors are mainly from Murmansk (Ibid.). Russian investments in Northern Norway are considerably smaller than in the southern parts of the country.

For Norwegian companies CBC with Russian partners is generally not considered to be an asset. Cooperation with Russian partners is regarded as much more difficult and more challenging than cooperation with partners from Sweden and Finland, or from other EU countries.

Within the framework of the twin town cooperation between Sør-Varanger and Pechenga a few seminars intended to stimulate CBC between companies from the two border municipalities have been organized. The Association of Businessmen of Pechenga and Kirkenes Næringshage have been taking part in these seminars. The seminars have, however, not resulted in any concrete plans or strategies. In the town of Kirkenes local business actors do not see the need of cooperating with partners from Pechenga, except for cooperation that could increase the number of Russians available for work in Norway. The Pechenga enterprises are regarded as being too weak to become true business partners.

8.3 Informal and illegal trade in the border region

Informal and illegal cross-border trade is not very prevalent in the Russian-Norwegian border region. There are currently no major social problems (prostitution, drugs et cetera) related to the border traffic. The criminality in the region is not related to the proximity of the border.

In the 1990s Russian prostitutes were active on the Norwegian side of the border. Today, due to stricter regulations on the Norwegian side and a comparatively much better living standard on the Russian side, prostitution has almost disappeared from the borderland. Smuggling of drugs and other illegal products has, according to the Norwegian and Russian police, never been a big problem along this border. The lack of illegal trade across the Russian-Norwegian border can be explained by three factors. First, the border is located in a peripheral area, far away from any big city with a great demand for illegal products like drugs. Secondly, the border is not easy to penetrate illegally due to the many barriers (fences, sand traps et cetera) and the extensive surveillance on both sides. Secondly, the border guards and custom officers on both sides act professionally and communicate well with each other.

A certain informal cross-border trade has existed since the early 1990s. Russian trader-tourists regularly cross the border to buy large quanta of goods that there is a special demand for on the Russian side (for instance diapers, special brands of coffee and tea, ice cream, sports gear, and various luxury goods). The goods are brought into Russia in private cars or minibuses where they are sold through various networks (Tvedt & Sørensen 2013). The importance of this trade is hard to assess but it is probably not very significant for the overall economy of the border region.

8.4 The labour market

The Russian-Norwegian border region is neither destination for nor origin of any significant labour movement. This may, however, change if major industrial developments (either in the petroleum sector or in the mining industry) take place.

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There is currently a labour shortage in the border region. On the Russian side there is a lack of skilled as well as unskilled workers. On the Norwegian side, where the unemployment is extremely low, there is a lack of workers in most fields. On both sides of the border “brain drain” is a problem. Young specialists and graduates tend to leave for the south.

The labour market on both sides of the border is generally well regulated. The scale of illegal working is very low on the Norwegian side of the border. On the Russian side illegal labour is more widespread. The most common type of illegal labour is unregistered free-lance work.

There is hardly any labour commuting taking place across the Russian-Norwegian border. Owing to the lower salaries in Russia and the low unemployment at home, Russia is hardly an option for Norwegian workers. Some Russians (mainly men) from Murmansk Region go to Norway to work, either in the petroleum industry (usually far away from the border region) or in the fishing processing industry in one of the coastal towns of Northern Norway. In some places, like the town of Båtsfjord in Finnmark, the Russians workers have contributed significantly to local economy during the last decades. Kimek in Kirkenes, which offers services in the fields of ship repair and ship services, have actively been training and recruiting around 60 Russian welders for jobs on installations in Norway as well as abroad.

The interest among Russians in finding work in Norway is, unfortunately, exploited by criminals. Reportedly, fake agencies that promise their customers assistance in finding jobs in Norway have been set up in Murmansk Region.

Work permit regulations are the main obstacle for labour mobility across the border. EU regulations make it very difficult to employ Russian workers in Norway. In 2009 Norway started, however, to issue two-year work permits for unskilled workers from the Russian parts of the Barents Region (including Murmansk Region). Work permit rules for skilled workers have also been eased in recent years. Russia’s rather complicated regulations for work permits continue to cause troubles for Norwegian companies operating there. The situation has, however, improved here too after Russia in 2010 introduced a simplified application system for foreign skilled workers.

The need to increase labour mobility across the border has been acknowledged by the municipal authorities of Sør-Varanger and Pechenga. Since 2006 the labour and welfare administrations of the two municipalities have cooperated actively and several joint planning meetings have been organized. NAV (the Norwegian labour and welfare administration) in Sør-Varanger has introduced a special trainee program for recruitment of school or kindergarten teachers from Pechenga (see section 6.7). There is also an ongoing cooperation on regional level between NAV and the State Employment Service Department of the Murmansk Region.

8.5 Tourism

The Russian-Norwegian border region is, in a European context, not an important destination for mass tourism. In 2013 the number of nights spent in Finnmark by all visitors was. 379.958. For Murmansk the number was 537.087.66 Finnmark and Murmansk receive a much lower number of

66 See Patchwork Barents: www.patchworkbarents.org 54 tourists than the neighbouring Finnish region of Lapland (2.403.104) or the Swedish county of Norrbotten (2.152.202). Only few destinations, like North Cape in Finnmark and the alpine resort of Kirovsk in Murmansk Region, attract a considerable number of tourists every year.

The tourists visiting the Russian part of the borderland are mainly from Russia, while those visiting the Norwegian side come from all over the world, including Russia. Since 2005 the number of Russian visitors to North Norway has increased nearly four times.67 From 2011 to 2012 the number doubled. In 2012 Russian tourists stayed 28 000 nights in North Norway. Still, the number of Russian tourists in Norway is only about one tenth of the number of Russian tourists visiting neighbouring Finland. Russian visitors are most prevalent in Kirkenes. The town has become an important destination for Russian cross-border shoppers from all over Murmansk Region. On the Russian side of the border, in Pechenga, tourism is not very developed. Currently there are, however, plans to build a tourist village here. The complex, called Russkaya Sloboda, will be located on the shore of a small lake only a few kilometres from the Norwegian border.68 The village will, if realized, become the biggest investment project in the area. The project has a private investor but it also get financial support from the Murmansk Regional government.

So far CBC within the field of tourism has not been very much developed. In 2012, during the meeting of the Russian-Norwegian Commission on Economic, Industrial and Scientific Cooperation in Moscow, the Russian Federal Agency for Tourism and Innovation Norway’s tourism department signed, however, a joint action plan for tourism. The plan includes fields such as tourist exchange, tourism promotion, tourism legislation, tourism investments and tourism safety.69 Tourism is, on both sides of the border, seen as a field of potential for future CBC on a bilateral level.

The twin city cooperation agreement between Pechenga and Sør-Varanger refers to common tourism development as a “field of priority”. There is currently some cooperation between Radius, one of the tour operators in Kirkenes, and Barents Travel, a tour agency in Pechenga. Radius brings tourists across the border, either for a snowmobile trip or for a visit to a typical Russian “dacha”. On the Russian side Barents Travel takes care of all the practicalities. Both partners are so far very satisfied with the cooperation and express a wish to develop it further.

For some time there have been discussions about establishing a regular cruise line connection between Norway and Russia (see section 3.4). The Ministry of Transport and Communications of Murmansk Region and the Federal Agency of Sea and River Transport, together with private investors, are now working to realize the project “Arctic Harbour” which will facilitate for cruise ship traffic to Murmansk. According to the plans the pier for long-distance cruise liners should be ready to accommodate vessels with a length up to 160 meters by 2016.70

67 Statistics Norway: www.ssb.no 68 BarentsObserver 12 November 2012. 69 Joint Action Program for the period 2012-2014 between Innovation Norway (the Kingdom of Norway) and the Federal Agency for Tourism (Russian Federation) on the cooperation in the sphere of tourism: http://www.regjeringen.no/upload/NHD/HP-temaside- int/Russland/Samarbeidsprogram_for_reiseliv.pdf 70 Flashnord.com: “Pervy parom iz Kirkenesa mozhet zaiti v port Murmansk v 2016 godu” [The first cruise liner from Kirkenes can visit the Murmansk harbor in 2016]. 2 February 2013: http://flashnord.com/news/pervyy- parom-iz-kirkenesa-mozhet-zayti-v-port-murmansk-v-2016-godu-kovtun 55

Tourists visiting the Norwegian part of the borderland rarely cross the Russian border, even if they would very much have liked to do so. The border itself represents a considerable barrier for tourism development. First, the visa regime makes border-crossing a cumbersome and costly process. Secondly, the entire Russian border zone is a restricted area, accessible only with special permits from the FSB. This regulation makes cross-border tourism along the borderline difficult, if not impossible.

8.6 Fisheries and hydroenergy – two success stories

Economic cooperation in the borderland seems to work best when there is a clear and uncomplicated win-win situation for both parties. Two fields where we observe such a mutual benefit are hydroenergy and fisheries.

Hydroenergy is another field where Russian-Norwegian economic CBC has been successful. Norway and the Soviet Union signed an agreement for joint utilization and development of the hydropower of the Pasvik River as far back as in 1959. During that time there was an increasing need for energy on both sides of the border. The hydropower development began in the 1960s. Over two decades no less than seven power plants were built in the Pasvik river system.71 The two sides agreed to share and jointly distribute the energy produced by the plants. Today, two energy companies – the Russian TGK-1 (a daughter company of “Gazprom”) and Norwegian “Varanger Kraft” cooperate in running the hydroelectric plants along the Pasvik River.

Figure 13. Skogfoss power station on the Pasvik River on the Russian-Norwegian border. (Photo: Pasvik kraft)

71 Pasvikelva.no: “Two rivers- three states”: http://www.pasvikelva.no/index.php?article_id=75&page_id=3&lang_id=2 56

The Russian trawler fleet has, since the 1990s, been delivering fish to Norwegian port facilities and used them as places for repair. Norwegian ports are considered to be more cost-effective and they have a less bureaucratic regime than the Russian ones. The deliveries from the Russian fleet have been important for several smaller ports along the coast of Finnmark. Russian customers have been crucial for the economic development of Norwegian companies specializing in port related services.

8.7 Barriers for economic cross-border cooperation

Many stakeholders mention poor infrastructure as the main barrier for economic CBC. There is a need for improved cross-border infrastructure and transport links; better roads, a border-crossing point with increased capacity, regular cross-border flights or regular public transportation between Sør-Varanger and Pechenga.

Another barrier that is often mentioned is the current legislation on work mobility in the two countries. Norwegian companies in the borderland would like to see the law changed so that Russian citizens can freely commute across the border, live on the Russian side and work in Norway.

Stakeholders repeatedly mention differences in regulations and laws, business climate and business culture as reasons for the current lack of economic CBC. The differences are indeed great and they make it very challenging to do business on the other side of the border. According to interviewees it “takes years of practice and failing” to get to know how things actually work on the other side. Legal requirements for establishing an enterprise in Russia are, according to Norwegian actors, too demanding and bureaucratic. Russians say the same about the Norwegian system. On both sides there is generally very little knowledge about each other’s system.

Corruption is not a big problem in Norway but on the Russian side of the border it seems to be an obstacle for foreign investors. Norwegian companies frequently complain about the “unpredictability”, “lack of transparency” and “lack of a rule of law” on the Russian side. Ironically, the unpredictability of the Russian side may in fact encourage Russian companies to establish themselves in Norway. One Russian businessman we spoke to mentioned that the lack of security on the Russian side was the main reason for his decision to move some of his business activities to the Norwegian side.

Language is another major obstacle. There is a considerable language gap between the two sides. Russians lack the necessary knowledge of English and very few Norwegians command Russian well enough to use it professionally. For larger companies these challenges can of course be overcome, but for small enterprises they represent a considerable barrier.

The business structure of the region is another obstacle for fruitful cross border economic development. In the border region we find very few large and resourceful companies. Most companies (on both sides of the border) are small or medium-sized enterprises which lack the know- how and resources that are necessary for successful internationalization.

Lack of funding is rarely mentioned as a reason for the lack of economic CBC. A recent report on economic CBC in the Barents Region concludes that “with an average of 900 000 EUR per year

57 directly to commercial enterprises, and 1.5 million EUR per year to promote Norwegian business and cross-border business cooperation in the Northwest Russian market, the situation for Norwegian businesses can hardly be considered as very difficult.” (Rautio, Bambulyak & Hah 2013). According to the same report the Norwegian companies which are most active on the Russian side of the border have (with few exceptions) received little financial support from the public funding mechanisms. Economic CBC has been encouraged through several Norwegian funding programs. During the last few years the funding instruments of the Norwegian Ministry of Foreign Affairs, the Norwegian Barents Secretariat, Innovation Norway, Kolarctic ENPI, and the Norwegian counties have spent about 24 million EUR financing 476 business development projects, including 171 commercial ones in the Russian part of the Barents Regions (ibid.). Furthermore SIVA72, the Industrial Development Corporation of Norway, has established a branch in Murmansk that aims to increase Russian- Norwegian economic cooperation in the border region. The corporation has organized so-called “business safaris” for Russian companies to Northern Norway and organized “matchmaking events” for companies from both sides of the border.

On the Russian side of the border the situation is very different. Here there are no available funding mechanisms for companies seeking internationalization. The only financial support from the Russian side goes through the country’s financial contributions to the Kolarctic ENPI. Thus, Russian enterprises depend unfortunately to a large extent on Norwegian support, if they want to develop cross-border economic ties. Consequently, Russian companies involved in CBC have to rely on the support their Norwegian partners can get access to.

8.8 The future of economic cross-border cooperation

Russian-Norwegian economic CBC, because of its poor state, is more often referred to in terms of potentiality than reality. The long-term hopes for development rest, to a large extent, on the development of so-called “mega projects”, particularly of petroleum development projects and the Northern Sea Route.

The Treaty on Maritime Delimitation and Cooperation in the Barents Sea and the Arctic Ocean is considered an important step towards an exploitation of the rich deposits of petroleum in the Barents Sea. The development at sea will also have an effect on land as there will be a need for supply ports and transport infrastructure along the shore. Petroleum is a field where Norway and Russia would have a lot to gain from cooperating and the treaty itself in fact encourages such cooperation. It will, however, take a long time (10-20 years) before full production can be instigated in the area. The Northern Sea Route represents another opportunity for the future, but it is still uncertain if the route will ever be realized.

The mining industry is developing rapidly on both sides of the border. The need for effective transshipment of extracted minerals could lead to a more efficient cross-border infrastructure in the High North.

Finally, tourism, and particularly cross-border tourism, is frequently mentioned as an economic sector which could grow significantly in the future. Tourism development faces, however, many

72 SIVA: http://siva.no/english 58 challenges, like lack of infrastructure, cumbersome visa-regimes, inaccessible border zones, et cetera.

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9. Perceptions of the border, the border location and regional development

The border location is generally perceived as something favourable, providing the region with special opportunities for development and for economic, cultural and institutional CBC. From a Russian point of view the border location is favourable because it provides easy access to Europe. The proximity of the Norwegian border also, at least according to some Russian stakeholders, helps to make the Murmansk Region more “European” (which here is to be understood as “civilized”, “modern” and “developed”). On the Norwegian side the border location is referred to as something exciting and exotic, which makes the region attractive. People we have interviewed see opportunities both for cooperation and/or consumption on the other side of the border. The border location gives a unique access to the neighbouring country’s goods and services, and offers special opportunities for economic, cultural and institutional CBC. According to our informants the border location is a factor that makes life richer and more interesting. The proximity of the border makes it possible to “enter another world just outside your doorstep”, as one informant put it.

Stakeholders perceive the border as a bridge, but they also acknowledge that it has divisive functions. Stakeholders do not fail to mention the cumbersome visa regime, the long and thorough control on the border, and the fact that the Russian border zone is closed. Still, our informants generally see the border as an opportunity rather than a hindrance. In Kirkenes the proximity of the border is often mentioned as an asset in the competition with other towns for tourists and workers.

No major negative aspects of border location have been identified. On the Norwegian side some stakeholders express a concern for the pollution (including radioactive pollution) on the Russian side and worry about the current political development in Russia.

Some people, on both sides of the border, do feel more insecure after the border was opened. On the Russian side of the border, in Pechenga in particular, some informants expressed a certain nostalgia for the time when the border was closed. At the time there were “no drugs and crimes” in the town, it was “nice and quiet”, they claimed. In Kirkenes too, such attitudes are sometimes expressed, especially among elderly people.

On the Norwegian side some people involved in CBC worry about the political development in Russia which many claimed have taken an “authoritarian” turn. Some fear that this may lead to a re- securitization of the border regime. There are also fears of pollution (including radioactive pollution) from the Russian side. A few informants also express worries about the petroleum development that may harm the fragile environment of the region.

Borderlanders perceive the border in a more positive way now than five years ago, and certainly in a more positive way than 20 years ago. The image of the border as a “bridge” has been strengthened. During the last years the liberalization of the visa regime (the introduction of special visa regulations for citizens of Murmansk oblast (Pomor Visa), the establishment of the BTZ and new visa centres in Kirkenes and Murmansk have had a positive effect. The twin town agreement between Nikel and Kirkenes has also had an important symbolic effect. The European integration may indirectly be considered a factor. The transnational integration and region-building in the north, particularly the establishment of the Barents Euro-Arctic Region in 1993, was very much inspired by parallel region- building processes instigated by the EU.

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Informants on both sides of the border believe that a more open border, perhaps an extended BTZ, will stimulate CBC. Several informants described a common Russian-Norwegian labour market as a desirable possibility. Much of the regional development depends on the political support for cross- border cooperation as well as on bilateral dialogue and negotiations. There is therefore a hope for continued interest and support from national as well as regional and local authorities.

Our informants referred to the border as an asset and an opportunity in strategic documents on regional level on both sides of the border. In the current investment plan of Murmansk Region the proximity of the border is, for example, mentioned as the foremost advantage and most attractive feature of Murmansk Region.73 Both the Norwegian and Russian governments acknowledge that they must enhance economic cooperation with each other as well as globally. There is a hope to turn the border region into a hub for shipping on the Northern Sea Route from Europe to Asia as well as into a petroleum province of global importance. These developments are expected to be sparked by and, in turn, spark CBC.

73 The Economic Development Strategy of the Murmansk region. 61

10. The role of the European Union in the borderland

Membership in the European Union is now and for the near future highly unlikely for Russia as well as for Norway. The support for membership is very low in both countries and neither Norway nor Russia has any plans for joining the union. The role of the EU is therefore also very limited in the Russian-Norwegian border region. Bilateral (Norwegian and Russian) polices are much more important than EU policies for regional development.

The Barents Euro-Arctic Region is (by far) the most important framework for cross-border cooperation in the Russian-Norwegian border region. A large number of smaller CBC projects are financed through the Barents cooperation, mainly by the Norwegian Barents Secretariat. The EU plays, however, a certain role as a facilitator for regional cross-border cooperation through the Kolarctic ENPI program. The Kolarctic is one of the ENPI financing instruments of the EU that are being implemented along the external borders of the union. The Kolarctic program area roughly corresponds to the Barents Euro-Arctic Region. Kolarctic ENPI has granted financing to a total of 50 projects during the program period 2007-2013.74 The program supports public and private organizations involved in CBC within a wide range of fields. During the last program period three project priority areas were defined: “economic and social development”, “people-to-people cooperation and identity building” and “common challenges”.75

The Kolarctic initiative has had a limited but positive effect on CBC, making it possible to realize several larger and important CBC projects in the region. It has been a successful instrument for increasing CBC, particularly among actors such as research institutions.

To this date the Kolarctic program has been mostly relevant for CBC practitioners of a certain size and importance who cooperate on a regional level. These partners are usually not from the near borderland, but from the larger cities of the wider Russian-Norwegian border region, like Murmansk, Arkhangelsk, and Apatity on the Russian side, or Bodø and Tromsø on the Norwegian side. All Russian-Norwegian Kolarctic projects have to involve an EU (Swedish or Finnish) partner as well. Kolarctic projects are therefore more complicated to initiate than projects that just involve Russian and Norwegian partners.

On the municipal level EU-funding has very little (if any) effect. On the Russian side actors tend to have very little knowledge about the possibilities of taking part in EU-funded projects. Some of them are not even aware of these possibilities. On the Norwegian side the knowledge about these forms of funding is slightly better and a few people even have experiences in applying for them, but the capacity and expertise in applying for and winning funding is low, especially when compared with our Finnish neighbours.

Since 2001 Norway has been part of the . The Russian-Norwegian border is thus currently a Schengen border. The Schengen agreement limits, to a certain extent, the possibilities for a pragmatic border regulation that take local and regional interests into account. Many local actors would, for instance, like to see a more free flow of labour across the border and believe that this would lead to a good development for the region as a whole. The Schengen regulations are criticized

74 The Kolarctic ENPI program: http://www.kolarcticenpi.info/en 75 Ibid. 62 by some stakeholders for hampering cross-border integration (i.e. work migration and free movement across the border).

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11. Policy Options

These recommendations are based on our findings and interviews with CBC practitioners in the borderland:

 Border-crossing in both directions should be made more smooth and effective. The waiting time for travellers crossing the border should be reduced. The capacity of the border- crossing point should be increased.

 Many CBC stakeholders mention the need for improved cross-border infrastructure and transport links; better roads, a cross-border railway from Russia to Kirkenes, regular cross- border flights, and regular public transportation between Sør-Varanger and Pechenga. The infrastructure in the border region (border infrastructure, road, air, planes, and sea routes) should be improved in order to facilitate for further CBC.

 There is a need for a de-securitisation of the near borderland. The closed zones surrounding the border should be removed. This will encourage increased cross-border activities, including tourism.

 CBC actors tend to refer to the visa regime as the main obstacle for cross-border contacts. Many of them express a wish for a lifting of the visa requirement. The authorities on both sides of the border should strive to make the visa application process as efficient, inexpensive, and as easy as possible. The visa-free BTZ should ideally be expanded to include all of Finnmark County and Murmansk Region.

 There is a need for a more pragmatic labour market regime in the border. Several CBC actors would like to introduce a common Russian-Norwegian labour market or, alternatively, a more restricted common labour market within the BTZ.

 Currently, Norwegian-Russian CBC is, to a large extent, funded solely by the Norwegian side (i.e. the Norwegian MFA through the Norwegian Barents Secretariat). Increased Russian contributions to CBC projects would ensure more symmetric cross-border relations. Russian informants would like to see a better integration of the CBC programs with regional and federal funding programs.

 There is a need for a more intensive economic CBC in the region. Funded programs and projects focusing on economic CBC should be encouraged by private businesses as well as public institutions.

 EU involvement in the region should be increased (as for now it is minimal). The ENPI Kolarctic program is a good starting point for further EU involvement. The EU should become more visible and active in the region.

 There is relatively little knowledge about the EU in the border region. The awareness about EU programs and policies among CBC actors in the region should be raised.

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 CBC actors on both sides of the border lack the knowledge and skills necessary for applying for EU funding and thus for participating in EU projects with EU partners. Competence- and capacity building among active CBC participants should therefore be prioritized.

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