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Baltic Rim Economies Quarterly Review Baltic Rim Economies Quarterly Review ISSUE NO. 3, 23 MAY 2013 EXPERT ARTICLES: Joaquín Almunia: Government subsidies and the internal market – another evolutionary step for Europe’s State aid policy Page 1 Jari Koskinen: Finland will meet the renewable targets with forest energy Page 2 Urmas Paet: NATO and the Baltic Sea Region – an Estonian perspective Page 3 Viktor Mayko: Ukraine – in search of success in the modern world Page 4 Romana Jordan: The role of nuclear energy in European sustainable energy mix Page 5 Sampo Terho: The Baltic Sea: stable and safe – for now Page 6 Vilja Savisaar-Toomast: Rail Baltica and Baltic-Adriatic Growth corridor influence to the regional cohesion policy Page 7 Nils Torvalds: In a sea of challenges Page 8 Tom Packalén: Security policy in the north Page 9 Arto Satonen: Tuition fees in Finland for foreign students outside of EU/EEA -area Page 10 Janusz Niesyto and Jari Vilén: Baltic Sea region at the heart of Poland's and Finland’s foreign policy Page 11 Arthur König: Greifswald and its international activities within the Baltic Sea Region Page 12 Sverker Göranson: Security in the Baltic Sea region Page 13 Jaakko Kaukanen: The Baltic Sea countries are fore-runners in cooperation in coast guard functions Page 14 Arunas Molis and Florinda Giacomelli: Operational energy security in NATO context – looking to the future Page 15 Claes Levinsson: Baltic security – a word of caution Page 16 Slava Khodko: The Baltic Sea Region – strategies, projects and cooperation Page 17 Kai Paananen: Opportunities for Finland – the Arctic and Russia Page 18 Esko Mustamäki: The Arctic shipbuilding market – a real opportunity or a distant dream? Page 19 Kari Liuhto: The Nordic Countries on the top of the world in snow-how Page 20 EXPERT ARTICLES CONTINUED ON NEXT PAGE To receive a free copy, print or register at www.utu.fi/pei Baltic Rim Economies Quarterly Review ISSUE NO. 3, 23 MAY 2013 EXPERT ARTICLES CONTINUED: Carsten Ørts Hansen: Shipping in the Baltic Sea – stormy waters ahead? Page 22 Olli-Pekka Brunila and Anni Anttila: Green co-operation in the eastern Gulf of Finland Page 23 Juha Kalli: Baltic maritime transport on rough sea Page 24 Marc Auboin: The WTO Academic Programme and Saint-Petersburg State University Page 25 Fredrik Erixon: Russia in the World Trade Organisation – improving the chances of success Page 26 Sergey F. Sutyrin and Olga Y. Trofimenko: Does Russian accession to the WTO matter for the competitiveness of domestic companies? Page 27 Vladimir Salamatov: Evolution of regulatory measures – from tariff to non-tariff Page 28 Ihar Hancharonak and Tatyana Prannik: Educational integration for sustainable economic development Page 31 Sergey Kizima: Chinese vector of Eurasian integration Page 32 Olga S. Shimova: Environmental economics for sustainable development Page 34 Eduard Simchanka: Small and medium enterprises in Belarus – status and problems Page 35 Elena Dadzerkina and Maria Usik: Status and prospects for development of rail transport in Belarus Page 36 Daria Lipatova, Pekka Viljakainen, Evgenia Mayer and Sergey Blintsov: Russian startup tour – bringing international experience to Russian regions Page 38 Ilkka Linnakko and Tomas Rosin: The TRIPADA concept – a road map for concretely turning Russian innovations to local and global benefits! Page 39 Tero Piispanen: Early stage growth financing is needed in the growing Life Sciences sector Page 40 Sari Autio-Sarasmo: Technology transfer between East and West and Russia’s economic modernisation Page 41 Nikolay M. Megevich and Simon J. Chernyak: Cross-border innovation strategies – Russian-Finnish experience Page 42 Arkady Ryabichenko: Russian innovative ambitions as positive factor for country image in Nordic Page 43 EXPERT ARTICLES CONTINUED ON NEXT PAGE To receive a free copy, print or register at www.utu.fi/pei Baltic Rim Economies Quarterly Review ISSUE NO. 3, 23 MAY 2013 EXPERT ARTICLES CONTINUED: Vlad Ivanenko: Is the price of Russian natural gas inflated for the Baltic Rim? Page 44 Venelin Tsachevsky: Energy development in South-East Europe and the Baltic Sea region – similar problems, similar prospects Page 45 Gennady Kretinin: On the perspectives of building nuclear power plant in Lithuania Page 46 Elena Paltseva: Supply diversification and allocation of bargaining power in the EU-Russia gas relationship Page 47 Vladimir Feygin: On interactions between energy markets Page 48 Pekka Hakanen: Russian roulette with gas Page 49 Simonas Klimanskis: The Baltic Sea Region – the positive steps towards ensuring energy security Page 50 Romas Švedas: Energy in Baltics – the last phase of Eurointegration Page 51 Mihails Rodins, Aleksandr Gaponenko and Inna Dovladbekova: Lithuania's energy sector – trends and problems of development Page 52 David Dusseault: Global energy markets – the view from Espoo Page 53 Nikolay Dobronravin: Energy politics in the Baltic Sea Region – new Russian perspectives? Page 54 Jack Sharples: Gazprom and the development of spot-pricing on the EU gas market Page 55 Juho Rahkonen: Visa-free travel between EU and Russia might be true in the near future Page 56 Andrei Yakovlev: In search of new mechanisms for state-business interaction Page 57 Kalman Kalotay: The 2013 Cyprus bailout and the Russian foreign direct investment platform Page 58 Wladimir Andreff: Russian multinational companies and state capitalism Page 60 Morten Hansen: Joining the Eurozone – Latvia’s destiny? Page 61 Timo Hellenberg: From enlargement to enhancement – towards a civil security financial instrument of the Baltic Sea Region? Page 62 Marek Dabrowski: Inflation and monetary policy in CIS countries Page 63 Erkki Laukkanen: Corruption line in Baltics – the key differences between key countries Page 65 Lars Johannsen: Bumps ahead Page 67 Stanisław Bieleń: The chances for reconciliation between Poland and Russia Page 68 EXPERT ARTICLES CONTINUED ON NEXT PAGE To receive a free copy, print or register at www.utu.fi/pei Baltic Rim Economies Quarterly Review ISSUE NO. 3, 23 MAY 2013 EXPERT ARTICLES CONTINUED: Johanna Reiman: 15 years of support for cities’ urban health planning in the Baltic Region Page 69 Helmut Klüter: Rural areas of Eastern Germany Page 70 Ivan Gumeniuk: The Interreg IIIB BSR programme as a tool for developing a unified transport system in the Baltic macroregion Page 72 Anatoly Anishenko and Aigars Rostovskis: Promoting business education in the Baltic Sea Region – the case of the Latvian-Russian cooperation Page 73 Gennady Fedorov: New opportunities for Kaliningrad in the development of Russia-EU relations Page 74 Vladimir Balobaev: Possible strategies for the Kaliningrad region 2013 Page 75 To receive a free copy, print or register at www.utu.fi/pei Expert article 1250 Baltic Rim Economies, 23.5.2013 Quarterly Review 3▪2013 Government subsidies and the internal market – another evolutionary step for Europe’s State aid policy By Joaquín Almunia A short history of State aid policy growth and jobs in the future. Spending and tax policies are Five years after the Schuman declaration of May 9, 1950, the among the levers that governments have to create the six members of the European Coal and Steel Community conditions for a sustained and sustainable period of started to discuss in earnest the creation of a common expansion. To help government authorities cope with this market. They set up the Spaak committee – named after its situation, I have launched a complete overhaul of State aid chairman, the then foreign minister of Belgium – which ended policy – the State aid modernisation strategy. its work nine months later. Alongside the provisions that The main goal of the reform is to help national would keep the future internal market free from anti- governments do more with less; that is, to make more competitive business practices, the report devoted a section efficient use of increasingly scarce resources. The reform will to “financial assistance granted by the states”, stating that it promote well-designed aid that fixes market failures and must not favour individual enterprises or types of production. pursues common European objectives, such as promoting The rationale was that government subsidies could distort innovation, green technologies, and the development of competition and undermine the integrity of the Single Market human capital. The reform will also promote the incentive just as much as cartels and monopolistic positions of private effect of public aid, which should not replace but complement enterprises. private investment. Subsidising activities that would have This historical reference speaks to the political and been carried out anyway does not serve the common interest institutional acumen of the early architects of the European and, in any event, has become unaffordable. Another form of Union, who would soon give to an independent authority – wasteful expenditure the new regime will discourage are the the European Commission – the power to control certain subsidies to unviable companies which, in some cases, can forms of support granted by national authorities to private that keep them on life support for a very long time. In companies. The so-called State aid articles – numbers 107 addition, the new regime will respond to the growing and 108 in the Lisbon Treaty – have not changed since the disparities in the fiscal capacities of different EU countries; a Treaty of Rome. These provisions have no equivalent fact that can fragment the internal market. Finally, the anywhere else in the world. For almost six decades, their modernisation of State aid rules is an excellent opportunity to implementation has underpinned Europe’s economic and use information technology to introduce more transparency social integration. into the system. State aid policy is ultimately about the use of However, if the principles have remained unchanged, the taxpayers’ money and the people have a right to know who is State aid legal framework has been updated regularly. The receiving aid, how much and why. European Commission’s control over government subsidies To conclude, the reform process will renew the EU State has adapted to the growth of the public sector in Europe over aid regime across the board over the next months.
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