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Mining Regions and Cities Case of Västerbotten and Norrbotten, Sweden OECD Rural Studies

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Mining Regions and Cities Case of Västerbotten and Norrbotten, Sweden OECD Rural Studies OECD Rural Studies OECD Rural Studies Mining Regions and Cities Case of Västerbotten and Norrbotten, Sweden OECD Rural Studies Sweden’s northern region, Upper Norrland, is one of the most important mining regions in Europe and has the potential to become a global leader in environmentally sustainable mining. With the largest land surface and the lowest population density in Sweden, Upper Norrland contains two sub regions, Västerbotten Mining Regions and Cities and Norrbotten. Both sub regions host the greatest mineral reserves in the country, containing 9 of the country’s 12 active mines and providing 90% of the iron ore in the European Union. Upper Norrland has the potential Case of Västerbotten to become a global leader in environmentally sustainable mining due to its competitive advantages, including a stable green energy supply, high‑quality broadband connection, a pool of large mining companies working closely with universities to reduce the emissions footprint across the mining value chain, and a highly skilled and Norrbotten, Sweden labour force. Yet, the region must overcome a number of bottlenecks to support a sustainable future, including a shrinking workforce, low interaction of local firms with the mining innovation process and an increasing opposition to mining due to socio environmental concerns and land use conflicts. This study identifies how Västerbotten and Norrbotten can build on their competitive advantages and address current and future challenges to support a resilient future through sustainable mining. Mining Regions and Cities Case of Västerbotten and Norrbotten, Sweden PRINT ISBN 978-92-64-56068-0 PDF ISBN 978-92-64-93868-7 9HSTCQE*fgagia+ OECD Rural Studies Mining Regions and Cities Case of Västerbotten and Norrbotten, Sweden This document, as well as any data and map included herein, are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. Please cite this publication as: OECD (2021), Mining Regions and Cities Case of Västerbotten and Norrbotten, Sweden , OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/802087e2-en. ISBN 978-92-64-56068-0 (print) ISBN 978-92-64-93868-7 (pdf) OECD Rural Studies ISSN 2707-3416 (print) ISSN 2707-3424 (online) Photo credits: Cover Illustration © Jeffrey Fisher. Corrigenda to publications may be found on line at: www.oecd.org/about/publishing/corrigenda.htm. © OECD 2021 The use of this work, whether digital or print, is governed by the Terms and Conditions to be found at http://www.oecd.org/termsandconditions. 3 Foreword The mining sector is relevant for the economic development and well-being of countries and regions. Raw materials are essential for the production of goods and services and the development of new technologies. They can also play an important role in the global transition towards a zero-carbon economy. The subnational dimension is critical to delivering better policies for economies specialised in mining activities. Unlike other industries, mining is geographically concentrated in those areas where the deposits lie, creating particular interactions with local communities and the environment. Mining specialisation generates a number of opportunities, including greater investments, technological innovation and higher-wage jobs. Yet, it also brings challenges, including vulnerability to external shocks, and environmental and social impacts. These positive and negative impacts are amplified at regional and local scales. Sweden’s northern region, Upper Norrland, is one of the most important mining regions in Europe and has the potential to become a global leader in environmentally sustainable mining. With the largest land surface and the lowest population density in Sweden, Upper Norrland contains two sub-regions, Västerbotten and Norrbotten. Both sub-regions host the largest mineral reserves in the country, containing 9 of the country’s 12 active mines and providing 90% of the iron ore in the European Union (EU). Amongst the two, Västerbotten is more densely populated and has a more diversified economy, while Norrbotten is larger in terms of land surface and more specialised in mining, concentrating most of the active mines and production volumes in Sweden. Upper Norrland has the potential to become a global leader in environmentally sustainable mining due to its competitive advantages. These include a pool of large mining companies working closely with research centres and universities to reduce the emission footprint and waste production across the mining value chain, together with a highly skilled labour force to drive innovation. The region also has a stable supply of green energy from hydropower and high-quality broadband coverage. Fully unlocking this potential will contribute to global climate agendas and the EU’s self-sufficiency strategy of raw materials. Yet, the region must overcome a number of bottlenecks to support a sustainable future. They include a shrinking workforce, low interaction of municipalities and small businesses with the mining innovation process, lack of preparation of the workforce for future technological changes, as well as increasing opposition to mining due to socio-environmental concerns and land use conflicts. This study identifies how Västerbotten and Norrbotten can build on their competitive advantages and address current and future challenges to support a resilient future through sustainable mining. To this end, Sweden’s national government needs to update the national mining strategy, define mechanisms to help the region capture greater value from mining ventures and improve the efficiency, predictability and transparency of the regulatory framework for mining. Both sub-regions need to enhance their innovation ecosystem, the local business environment, and internal and external co-operation. This study is part of the OECD Mining Regions and Cities Initiative, which supports countries in implementing better regional development policies in a mining and extractive context. MINING REGIONS AND CITIES CASE OF VÄSTERBOTTEN AND NORRBOTTEN, SWEDEN © OECD 2021 4 Acknowledgements This publication was produced by the OECD Centre for Entrepreneurship, SMEs, Regions and Cities (CFE), led by Lamia Kamal-Chaoui, Director, as part of the programme of work of the Regional Development Policy Committee (RDPC). The report has been conducted in close collaboration with the regional governments of Norrbotten and Västerbotten. Special thanks are due to Åsa Johansson, Strategist, and Carl Rova, Senior Advisor, from Region Norrbotten, as well as to Jonas Lundström, Head of Business and Community Building, and Marta Batha Teclemariam, Co-ordinator, from the Region Västerbotten, for their support throughout the process. The OECD/CFE team elaborating the report included Chris McDonald, project co-ordinator, with Andres Sanabria and Lisanne Raderschall, Policy Analysts, under the supervision of Jose Enrique Garcilazo, Head of the Regional and Rural Policy Unit in the Regional Development and Tourism Division, led by Alain Dupeyras. Fernando Riaza and Andres Sanabria drafted Chapter 2; Andres Sanabria drafted Chapter 3 and Lisanne Raderschall Chapter 4. The review benefitted from comments by other OECD colleagues, including Laura Springare (GOV), Ana Moreno Monroy, Rafael Trapasso, Isabelle Chatry and Antti Moisio (CFE), Economists and Policy Analysts. Jeanette Duboys and Saliha Beaumont managed the editing process and Pilar Phillip (CFE) led the publication process. Special thanks are due to the external peer reviewers of this report: Ian Wood (City of Greater Sudbury, Canada), Kristiina Jokelainen (Regional Council of Lapland, Finland) and Juuso Hieta (Outokumpu Industrial Park, Finland) for their valuable input and comments, as well as for accompanying the team in the development of the review. The OECD is also grateful for comments and support received by Maria Ahlsved (Ministry of Enterprise and Innovation, Sweden), Eva Jonsson (Region of Norrbotten), Anna Lidbom (LKAB), Bo Krovig (LKAB), Pierre Heeroma (LKAB), Christina Allard (Luleå University of Technology), Karin Beland Lindahl (Luleå University of Technology), Runar Brännlund (Umeå University), Åsa Bergqvist (Ministry of Employment), Mattias Berglund (Avki, Gällivare), Robert Bernhardsson (Jokkmokk Municipality), Brita Iren Thomasson (Sami Parliament), Lars-Ove Sjain (Swedish Sami organisation in Jokkmokk), Roger Hansson (CEO, Gällivare Municipality Business Corporation), Kurt Budge (Beowulf Mining), Erik Länta (Jåkkåkaska Sami Village), Ulf Hägglund (CEO Jokkmokk Municipality Business Corporation), the Geological Survey of Sweden, Skellefteå Municipality and the Swedish Lapland Visitors Board. MINING REGIONS AND CITIES CASE OF VÄSTERBOTTEN AND NORRBOTTEN, SWEDEN © OECD 2021 5 Table of contents Foreword 3 Acknowledgements 4 Abbreviations and acronyms 9 Executive summary 11 1 Assessment and recommendations 15 Assessment 15 Recommendations 19 2 Strengths and challenges in the regional development of Västerbotten and Norrbotten 23 Introduction 27 Megatrends affecting regions specialised in mining and extractive activities 29 Upper Norrland, the mining region of Sweden 31 Settlements patterns have low density and are shrinking 37 Regional economic trends 47 Enabling factors for development 60 Annex 2.A. Selected OECD TL2 mining regions 68 References 69 Note 71 3 Unlocking development opportunities with an enhanced mining ecosystem for Västerbotten
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