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VALUE CREATION IN THE NORTH

Background, Challenges in International Cooperation, The High North Committee

The Barents Region – Where Gas meets OreFrode Mellemvik, November 17-18th, 2010

Director High North Centre for Business and Governance

Chairman High North Committee

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Background: Changes and Partnership

• Changes in the world (climate, financial, technology, demand for resources) call for new knowledge for developing the resources in the High North.

• Great opportunities for cooperation in joint development of resources in the High North:

• We are Arctic nations

• Accumulated competitive and complimentary knowledge

• Many similar needs, opportunities and challenges; e.g. in developing fossil and renewable energy resources, in energy saving and efficiency, in management of different resources, in maritime transportation, in developing knowledge about environment in the High North.

• Much to gain in partnership cooperation developing joint knowledge addressing value creation, sustainability, contemporary and future challenges.

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CHALLENGES IN INTERNATIONAL COOPERATION

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CHALLENGES IN INTERNATIONAL PARTNERSHIP

NATIONAL

CULTURES, NEEDS,

OPPORTUNITIES

INTERNATIONAL

CONTEXTINTERNATIONAL

PARTNERSHIP

COOPERATION

TWO FORCES :

NATIONAL FACTORS

INTERNATIONAL CONTEXT (Arctic nations & Global World)

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The High North is Norway’s

most important strategic priority area

Key premises:

Increased presence

Increased scope of activities

Increased knowledge

Key drivers:

Climate, Russia, Energy, Arctic Dimension

Norwegian High North Strategy: Launched Dec 1., 2006

New Building Blocks in the North: March 12, 2009

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The Risks threatening

Value Creation in the High North

Mandate

The Foreign Minister establishes the High North Committee for advices on how the opportunities created

as a result of development in the High North, can be used to safeguard Norwegian interests, especially with

a view to improve the basis for value creation in the northern regions.

Emphasis will be placed on cooperation possibilities in the Barents Region, with Nordic partners, the EU and

the coastal states bordering the Polar Ocean.

Theme groups

Identify new opportunities for

Norway as a result of the

development in the High North

as well as the new strategic

position of the High North

Propose actions and measures

to strengthen the foundation for

the Norwegian value creation

through cross-border contact

and cooperation

In addition to the Committee's

mandate, the following premise

underlying all theme groups:

Indigenous Interests

Climate and environment

The international context

Demographics

Theme Groups

Knowledge and competence

Hill-Marta Solberg

Jarle Aarbakke

Frode Mellemvik

Resources Hans Olav Karde

Øivind Silåmo

Gunnar Album

Logistics and Infrastructure Marit Helene Pedersen

Arvid Jensen

Kjersti Markusson

Culture/Tourism Ragnhild Dalheim Eriksen

Pia Svensgaard

Kari Jæger

Industrial Clusters / Value Chains

Trond Haukanes

Jørgen Bratting

Kjell Olaf Larsen

Partnership Kristine Offerdal

Gunn Ovesen

Odd Roger Enoksen

Knowledge and competence - Some tentative perspectives

•Knowledge and research as a driving force for value creation

• Strengthening knowledge institutions in the High North

• Stimulate the development of practice-oriented business

competence in the North

• Stimulate knowledge in primary and secondary schools on

opportunities and the national significance of the North.

• Development of Cross-border knowledge.

Industrial Clusters / Value Chains – Some tentative perspectives

Key issues:

• Free flow of labor.

• Policy measures to increase competitiveness.

Suggestions:

• Develop the local border traffic regime into an zone for economic cooperation

• Fisheries: Quota Year, the coastal fleet, the coastal fisheries, fish farming

• Biotechnology: Marine bioprospecting

• Petroleum industry: Criteria for exploration licenses. Stricter requirements for the regional

consequences. Public presence in Northern Norway of government organizations.

• The Northern Sea Route: Development of infrastructure

• Development of industries in northern Norway connected to:

Renewable energy, Gas, Ores, Minerals, Smelting Industry.

Strength education and research connected to these industries.

•Environmental requirements in focus

•Finances: Instruments and stimulations

Culture/Tourism - Some tentative perspectives

Action Areas – Culture

• Competence building - strengthening of cultural actors

• Strengthen the interaction between actors in the High North

• Cooperation in the High North region as a whole.

• Strengthen livelihoods of indigenous peoples.

Action Areas – tourism

• Joint marketing and sales.

• Improve accessibility; visa, transport and opportunities.

• Strengthen infrastructure, products, transport and accommodation.

• Competence development.

• Cooperation between actors – complete year-round products

Partnership - Some tentative perspectives

Definition:

A partnership is an equal collaboration between two or more actors that are of

interest to both / all parties.

Goals:

• Identify specific initiatives that either invite collaboration or are of a nature that

makes them attracts attention and interest in value creation.

• What could Norway offer and where could we add significantly in value creation

partnerships?

• What partnerships do not exist today, but should have existed? How can they be

establised/created?

• Stimulate innovative partnerships that promote value creation interaction between

public / public, private / private, public / private, regionally, internationally in

important areas in the High North.

Resources - Some tentative perspectives

Description:

• Natural resources: Significant both at sea and on land.

• Utilization: Has often been characterized by conflict.

• Lack: Skilled labor.

• Challenges: Developing relevant competence and handling conflicting interests.

• Finance: How to secure access to capital for infrastructure and investments?

Recommendations:

•Efforts to identify available resources both at sea and on land.

•Develop competence with the focus of innovation opportunities in the High North.

•Identify opportunities in marine sector.

•Research in aquaculture directed towards species not demanding much wild fish.

•Identify the opportunities in minerals.

•Create a state fund for exploration and development of mineral deposits?

•Invest in the development of electric power and clean renewable energy

•Intensify work to promote energy cooperation with Russia.

Logistics and infrastructure: Some tentative perspectives

Building infrastructure to the industrial and business clusters in the High North

Development needs across all industries

Transportation needs - Petroleum: Deepwater Quays

Transportation Needs - Industry: Upgrading of roads, expansion Port of Kirkenes

Transportation Needs - Mineral Industries

The northern sea route in operation five months a year

The railway connection Finland and Sweden

Improvement of Narvik harbor

Transportation Needs - Seafood Industry

"Fish planes" from Bodø, Evenes or Lakselv to Asia

Transportation Needs - Travel and Adventure

Airports with longer runways, evaluate the airport structure

Svalbard - Some tentative perspectives

Recommendations:

• Svalbard should be connected to the High North Policy

• Predictability for business and institutions

• Development of infrastructure in an international perspective

• Develop a business organization to identify opportunities and

cooperation

• Develop Svalbards participation in search and rescue operation.

• Increased scientific efforts in cooperation with University of

Svalbard.

• Review of roles and governance between actors in Svalbard.

Concluding comments

• An ambiguous project with enormous potential for value creation:

locally, nationally, globally:

• Knowledge is the key: Research and industry oriented

• Calls for coherent industrial policy and international partnerships

Visionary but Concrete and Measurable

Teambuilding: Locally, Nationally, Internationally

• Needs long-term commitment and robust decisions

Infrastructure and Industrial development

• Attract investors: Financial and Industrial

Models to build the new industries

• Many interests, tensions and challenges: Sustainability has to be in focus

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THIS WILL CREATE A NEW REALITY

Suggestions and ideas are appreciated

NordområdesenteretHigh North Center for Business and Governance

http://www.hhb.no/nordomrade

Handelshøgskolen i Bodø, Bodø Graduate School of Business

Arne O. Holm, sekretær

arne.o.holm@hibo.no