Minister Sasi: The Northern Dimension

THE NORTHERN DIMENSION Baltic Sea Ministerial Conference in Bergen, 8 February 2000 Mr Kimmo Sasi, Minister of Foreign Trade, Finland

The Northern Dimension in the policies of the EU builds upon the recognition of growing economic interdependence among the enlarging European Union, Russia and the other states of the Baltic Sea Region. It considers it important to involve in the already deepening economic integration also those countries of the region that are not members of the EU. Therefore, the applicant countries Estonia, Latvia, Lithuania and Poland, the EEA countries Iceland and Norway, as well as Russia are invited to participate in the process as partners within the Northern Dimension.

In November 1999, the Finnish Presidency of the EU organised, in partnership with the European Commission, the Foreign Ministers´ Conference on the Northern Dimension in Helsinki. The Conclusions of the Conference established the first common political platform on the issue for not only the EU and its member states but also for the aforesaid partner countries in the European north.

The Conclusions stress the role of the Northern Dimension in facilitating preconditions for private investment and foreign trade, paying special attention to support for small and medium-sized enterprises. Contributing to that end are the proposed efforts to stabilise the legal environment and develop the administration in transitional economies as well as measures to improve border crossings and harmonise transport regulations.

A deepening normative divide between Russia and the EU was seen as a tendency that could detrimentally affect the utilisation of the economic potential of the whole region. Stable and non-discriminatory regulatory frameworks are preconditions for private sector investment in such areas as information technology and in the high technology sector more generally.

The Northern Dimension reinforces the interests of international finance institutions in the region. At the Foreign Minister´s Conference the pertinent international finance institutions expressed their willingness to participate in project funding. With the EBRD in the vanguard, they have begun to treat the Baltic Sea area as a regional entity and are preparing corresponding regional approaches.

Respectively, the Northern Dimension has already affected the priorities of Tacis and Phare as well as other EU programmes and strategies. The Northern Dimension emphasises the interoperability and co-ordination of EU programmes with a view to enhancing the capability of Phare, Tacis and Interreg to finance cross-border projects.

Following the recommendation of the Foreign Ministers´ Conference, the European Council in Helsinki, in December 1999, invited the Commission to prepare an Action Plan for the Northern Dimension with the intention of having it endorsed in Portugal in June 2000. The action plan will be prepared in collaboration with the Council and the partner countries will be consulted in this process. The regional bodies (the CBSS and the BEAC) could serve as suitable instruments in involving the partner countries in the preparation of the Action Plan. The Council of Baltic Sea States in particular should have an important role, since all the countries of the Northern Dimension region, as well as the Commission, participate in the CBSS cooperation.

The strong commitment of the Commission to prepare an Action Plan is particularly encouraging since the Commission has a key role in turning the initiative into concrete reality. As Commissioner Chris Patten put it in his speech at the Foreign Ministers´ Conference, "The Commission is determined to play an active part both in preparation and implementation of the action plan that will be needed to take forward this important initiative".

Commissioner Patten also called for active guidance from future Presidencies, which indeed responded positively. The current and following Presidency holders, Portugal and France, have given assurances of their willingness to give high priority to the Northern Dimension. Sweden, which will take over the Presidency after France, has announced its intention to hold a high-level follow-up meeting during its Presidency.

As part of the process, Denmark is planning to organise a conference on Kaliningrad in Copenhagen this spring.

The Conclusions adopted by the European Union Council on 31 May last year form the basic policy paper prepared by the EU member states. The Conclusions of the Foreign Ministers Conference were jointly prepared by the EU members and partner countries. These two documents constitute the guidelines for the development and implementation of the Action Plan.

The implementation of the action plan will start during the French Presidency, in the second half of this year, if Portugal´s ambitious schedule can be kept. However, the Northern Dimension has already germinated concrete projects or initiatives in the fields of energy, environment, forestry and public health, to mention a few examples. That is to say, the implementation of the Northern Dimension does not depend only on the forthcoming action plan.

In the energy sector, for example, the achievements of the Conference of Ministers of Energy in Helsinki last October, the Commission’s communication entitled "Strengthening the Northern Dimension of European Energy Policy" and the conclusions of the Energy Council on that communication already provide excellent guidelines for the Action Plan and further action.

The Northern Dimension and the corresponding initiatives and policies of the United States and Canada share many common goals, which makes it possible to seek synergies through parallel or joint activities. The value of transatlantic cooperation was discussed at the EU-Canada and the EU-USA Summits in December.

What then could be the role of the regional bodies in the further development and implementation of the Northern Dimension? First of all, it should be recognised that, to a great extent, the work already done within these regional councils is part of the implementation of the Northern Dimension goals. The Foreign Ministers’ Conference in its conclusions rightfully reflected this fact. The European Union has a wide range of projects and programmes under implementation as well as potential for future action.

Many of these projects and programmes cover sectors in which regional bodies are actively involved. The Commission is taking part as diligently as possible in the work of the CBSS and BEAC, but the increased involvement of Commission experts in the working groups of these bodies would streamline and increase the effectiveness of the work. In this context I would like to quote from the conclusions of the Commission´s Inventory documents: "The Northern Dimension concept is intended to be implemented to a large extent through existing forums such as the BEAC and the CBSS. Added value may be provided by the closer co-ordination of respective work programmes as well as concentration on central topics regarded as priorities under the Northern Dimension. The Commission will continue to contribute actively to the work of the pertinent regional bodies, in particular the CBSS and the BEAC."

In its ambitious schedule for preparation of the Northern Dimension Action Plan, the European Commission is planning to open discussions in April with partner countries and to present the draft Action Plan to the regional bodies as well as to IFIs and business forums. This is the final opportunity to influence the content of the Action Plan. The EU-member countries of the Northern Dimension region can and should before that influence the preparations through their contacts with the Commission’s sectoral services. This would also be a channel to reflect the work initiated and done in the various working groups of the regional bodies.

It is clear that the regional bodies can not cover all the interests of the countries of the region. The position papers presented by the partner countries prior to the Foreign Ministers’ Conference form a basis that should also be reflected in the preparation work of the Commission. Moreover, the partner countries should prepare themselves well for their forthcoming bilateral discussions with the Commission.

In its Inventory of Current Activities, presented to the Foreign Ministers’ Conference, the Commission identified several barriers to trade and investments. After careful political preparation the Northern Dimension is now moving towards an intensified phase of action. The Action Plan should be an instrument and guideline for this next phase. In addition to legal and institutional development, the Northern Dimension calls for considerable investments, both public and private.

These investments, for their part, call for new financing arrangements, and, closely connected with that, for new thinking on risk management.

From the very beginning in developing the Northern Dimension concept, it was clear that closer cooperation and co-financing with the EU-instruments, international finance institutions and private investors was needed. This cooperation should now be reinforced. This work cannot, however, be done without the active participation of the Northern Dimension partner countries in the risk management of these considerable investments. This need should be appropriately reflected in the Action Plan. Without adequate financing the Northern Dimension will not achieve its full potential.