A p r i l 2 0 1 4 I S S U E n o . 2 Siim kallas Rail Baltic – a vital transport link to connect East and West S i g m u n d u r D a v í ð Gunnlaugsson Together we stand stronger – the importance of regional co-operation To receive a free copy, register at www.utu.fi/pei The Pan-European Institute publishes the Baltic Rim Economies (BRE) review which deals with the development of the Baltic Sea region. In the BRE review, public and corporate decision makers, representatives of Academia, and several other experts contribute to the discussion. The Pan-European Institute gratefully acknowledges the contribution of Russian Venture Capital (RVC) in receiving the articles dealing with innovations in Russia for this issue. Pan-European Institute ISSN 1459-9759 Editor-in-Chief | Kari Liuhto (responsible for writer invitations) Technical Editor | Saara Majuri University of Turku Turku School of Economics Pan-European Institute Rehtorinpellonkatu 3 FI-20500 TURKU, Finland Tel. +358 2 333 9567 www.utu.fi/pei 29.4.2014 Baltic Rim Economies ISSUE # 2 expert articles Siim kallas 5 Pekka Mattila 22 Alexander Khasin 40 Rail Baltic – a vital transport link to Building a Nordic hub for leadership MedStart – helping biomedical start-ups connect East and West and organizational development succeed Sigmundur Davíð Gunnlaugsson 6 Igor kogut 24 Alexey Kostrov 41 Together we stand stronger – the Political prospects of Ukraine in the Moscow Seed Fund – increasing importance of regional co-operation context of “Revolution of Dignity” start-up investments in the region Joachim Zeller 7 Arseniy Svynarenko 25 Anastasia Tyurina 42 Giving up Russia? Ukraine after Euromaidan – country on Sustainable development of Russian technology parks – next step in the way Kristiina Ojuland 8 the path of reforms in the conditions of deep economic and political crisis EU-Russia relations – on the verge of Andrew Vvedenskiy 44 breaking Niklas I.M. Nováky 27 Innovation infrastructure as the key element of sustainable venture Carl Schlyter 9 EU military crisis management – the need for common funding ecosystem in Russia Time to focus on human growth instead of economic growth Minna Jokela 28 Artour Baganov 46 Surviving the “Valley of Death” Henrik Normann 10 Border security as a field of practice between Finland and Russia – start-up acceleration programs NIB – supporting sustainable growth in the Baltic Sea region Jukka Manner 29 Denis Sosnovtsev 47 Towards a smarter planet Ari Korhonen 11 From IT security to cyber security – bits destroying our physical world A crucial time for Europe Dmitry Chikhachev 49 Jacek Bełdowski & Jan Fidler 30 Developing Russian venture industry Anita Lehikoinen 12 Danger remains from World War II in Strong internationalization safeguards Elena Kasimova 50 our shared waters quality of higher education Biotech funds – achieving the maximum Helena Kyster-Hansen 31 results Ilpo Kokkila 13 Baltic Transport Outlook 2030 Paving the way for more business with Evgeny Kuznetsov 51 Russia Karlis Bukovskis 32 Innovation ecosystem in Russia – entering the global competition Alexander Y. Panychev 14 The lost and found for Latvia – 10 years of European Union membership High speed rail lines as a factor of Gulnara Bikkulova 52 development of science, innovative Ivars Ijabs 33 Business of Innovative Technologies technologies and education Geopolitics of a minority – Latvian (BIT) – the largest innovation contest in Russia Mika Joukio 16 Russian-speakers in the shadow of Crimea Metsä Tissue seeking for strong growth Igor Rozhdesvenskiy 53 in Poland Daina Ruduša 34 Business incubators and technoparks – connecting the elements of the Mikko Söderlund 17 A positive force majeure of culture in Rīga 2014 innovative ecosystem Finnish real estate investment vehicles in St. Petersburg Pavel Cheshev & Virpi Herranen 35 Konstantin Fokin 54 Flying with the wings of business Aleksei Novitsky 18 Finnish-Russian innovation cooperation – growing on angels GEK Insights – Natural Gas Outlook 2014 tomi m. virtanen 37 Maria Podlesnova 55 RusBase – single point of entry to the Alexander Starchenko 19 Finnish technology startups and traditional manufacturing industry Russian technological media space Distributed generation in Russia – menace or opportunity? Aleksandr Loktev 38 Michael Kharuzin 57 RVC Seed Fund – sawing into success Elisa Markula 20 Soft infrastructure for the innovative companies Paulig – promoting the role of coffee in Natalia Polyakova 58 the Baltic Sea region Alexander Galitsky 39 Intellectual property in technology development in Russia Pekka Heikonen 21 Public-private partnerships – fostering innovations in Russia Baltic welding companies to reach competitiveness through automation 3 www.utu.fi/pei 29.4.2014 Baltic Rim Economies ISSUE # 2 Renat Garipov 60 Kaja Tampere 69 Alexander Fehér 78 Russian Startup Rating – ranking the Strategic Communication Management A BUP motivated system of education success stories (CM) in the post-communist Baltic Sea for sustainable development in region Slovakia Victor Sidnev 61 Regional innovative cluster – Troitsk Jari Kaivo-oja 70 Visvaldas Varžinskas 79 Innovation Center Cross external debt position analysis Kaunas University of Technology in the Nordic and in the Baltic Sea – steps towards sustainable university Stanislav Babich & Dmitry Vasilenko 62 countries – quartiles 2011Q4-2013Q3 The perspectives of the Russian-EU Remigijus Čiegis & Linas Kliučininkas 80 cooperation in the field of use of the Joanna Żukowska 72 Assessment of sustainable university LNG as motor fuel in the Baltic Sea Modern marketing communication on development region the Polish market Thomas S. Grindsted, Kaisu Sammalisto & Tove Alexey Kuznetsov 63 Małgorzata Ludwiczek 73 Holm 81 The Russian FDI in the Baltic Sea The future of youth cooperation in the ESDAN – with quality management region Baltic Sea region systems towards sustainability Anna Beitāne 64 Marcin Chełminiak & Wojciech Kotowicz 74 Murat Zh. Nurushev & Dana Aikio 82 The soft power dimension of Russia’s Local border traffic between Development prospects for trade foreign policy towards the Baltic States Poland and the Kaliningrad region and economic relations between – international and cross-border Kazakhstan and Finland in a short run Andrey Makarychev & Alexander Sergunin 65 determinants Russia’s Baltic policies – what kind of Irina Lyutomskaya 84 soft power? Walter Leal Filho 76 Durham and St. Petersburg Fostering sustainability and university – university partners Juhana Lounela & Tapio Riihinen 66 networking – a case study from the Western companies promoting kari liuhto 85 RCE Hamburg and Region transformation of leadership culture in Despite the NATO membership of the Russia Piotr Masiukiewicz 77 Baltic States their exports to Russia Crisis taxes – threats and opportunities grown faster than those of Finland Yury Zverev 68 between 2004 and 2013 The Kaliningrad region – a search for a new model of economic development 4 www.utu.fi/pei 29.4.2014 Baltic Rim Economies ISSUE # 2 Siim kallas Rail Baltic – a vital transport link to connect East and West Expert article • 1477 ne of the main aims of EU transport policy is to bring our When examined in a wider geopolitical context, the business case peoples and economies closer together. We need trans- is even stronger. port to access a huge market: the unified trading space Take Finland, which - along with Poland - forms part of Rail Bal- of Europe’s 500 million consumers. tic’s wider catchment area. But this vast area is not always well connected, espe- One of the shortest ways to move freight from Asia to Europe is Ocially between East and West. across the Arctic Sea and then into Finland and the Baltic States. Many people and businesses are losing out, particularly on the While this isn’t the usual shipping route taken through the Suez Ca- economic advantages offered by the single market. nal, it now competes as an Asia-Europe freight route since melting ice For countries on the edge of Europe, like Finland and the Baltic caused by global warming allows the Arctic Passage to open up for States, to have good transport links to Europe’s heartland is a political more months of the year. and economic lifeline. This potentially cuts journey times by two weeks, reducing ship- It is why Rail Baltic should be built as soon as possible, to link ping costs. these countries with the rest of Europe. At the moment, however, it In the nearby Barents Region, Finland, Sweden, Norway and is one of Europe’s six major missing cross-border links, as recently Russia are working together to develop an efficient transport system identified by the European Commission. to increase access to Europe’s richest region for natural resources. With the revised policy guidelines for the Trans-European Trans- This area has large deposits of minerals and precious metals, an port Network and the Connecting Europe Facility (CEF) funding in- abundance of forestry and fish products and a vast export potential for strument now in place, we can begin to transform today’s patchwork oil and gas resources. of national parts into a smooth-running network. Linking our own Trans-European Transport Network to the future These two new regulations represent the future of EU transport Barents Euro Arctic Transport Area would be immensely beneficial for infrastructure, shifting the focus from individual projects to a core net- trade. In fact, with the Rail Baltic gateway ready to receive cargo via work of nine strategic integrated corridors. Finland and send it on into the heart of Europe, I can only see trade Rail Baltic will form the northern section of the North Sea-Baltic and economic advantages for Europe as a whole. corridor, adding a vital north-south link to complete the high-quality Finnish timber and paper products could be sent by rail to Central transport links around the Baltic Sea area that are already creating Europe; in the other direction, Rail Baltic could be a useful export regional trade and economic growth following the financial crisis. route for Czech and Slovak cars and trucks.