European Forum in a time of challenges for the EU

The world is changing rapidly, and Europe with it. How does the new reality affect developments in northern Sweden? The turbulent times we live in made a big impression on this year's Europaforum conference.

Around 3 participants gathered at Storliens Högfjällshotell on 4-130 April to address issues such as geopolitics, cohesion policy and the bio-based economy. Decision-makers from national level, the EU, NATO and OECD were present. They met regional and local politicians from northern Sweden.

We have a new European Parliament, a new EU Commission and a new EU budget is on the way. What is at stake for the EU in a troubled world? On hand to provide insight was Göran von Sydow, director of Sieps (Swedish Institute for European Policy Studies). In addition to the war in Ukraine, the weakened transatlantic link and geopolitical tensions, he mentioned economic uncertainty. We are coming from a situation with high inflation, there are challenges around growth and now uncertainty around US trade tariffs.

“Extremely unsafe”

"It is an extremely uncertain global situation. The transatlantic link that has been the basis of our security architecture is now largely in question," said von Sydow.

Göran von Sydow noted that historically the EU has always had the ability to move forward and adapt in tune with the present. Now that shift is largely focused on ensuring resilience and building up defense and security policy capabilities.  

The peace bubble we have lived in has burst, was the message from Norway's Colonel Arvid Halvorsen.

Colonel Arvid Halvorsen, deputy head of the Norwegian military delegation to NATO headquarters in Brussels, was on site in Storlien to give his view of the geopolitical situation. 

– We have a new security policy paradigm. The method we used before is not suitable now. We have to reevaluate everything anew, said Arvid Halvorsen.
– The peace bubble we have lived in has now been punctured. Sweden is a small state geopolitically, and is completely dependent on a functioning world order. 

For northern Sweden, this requires investments in infrastructure, increased military mobility, competitiveness and supply chains.

– The three areas that are most important for local and regional levels are competence and personnel, all European countries have too few military personnel. Logistics and transport, and military production capacity are of utmost importance now, said Halvorsen. 

“Not a grocery store”

There is concern about the future of cohesion policy – ​​the EU's regional policy – ​​in the new reality we have to deal with.

Mikael Janson, Director of the North Sweden European Office, explained how northern Sweden must show why the region is interesting in order to gain interest from the EU, not least continued regional support. These are being questioned in the EU as the focus shifts to investments in competitiveness and security policy.

Mikael Janson said that Europe's competitiveness is declining and that the EU is under pressure in the global arena in many ways. In the new geopolitical situation that has arisen, northern Sweden is becoming increasingly interesting. 

– We are interesting because we have raw materials, minerals, forests, but we don't want to be a raw materials store, said Janson.

If the EU backs down, the Swedish state must step forward, said Mikael Janson, director of the North Sweden European Office.

He sees a need for strengthened state involvement if the EU backs down from regional policy commitments.

– We still have problems with not seeing ourselves as a common Sweden AB. If the support from the EU declines, we need to see state efforts. Previously, the EU was clearly our friend, they understand us much better and what we can offer. But with the tug-of-war over resources also in the EU arena, we have a challenge in both the EU and the Swedish level, said Janson.

Annika Wäppling Korzinek, Head of the European Commission in Sweden, provided a more in-depth look at the new challenges that are putting pressure on the EU's next long-term budget. The European Commission will present a proposal for the budget this summer. 

"We face completely new challenges: competitiveness, defense, preparedness. It also creates strong expectations for the EU that we have not seen before," she said.

Annika Wäppling Korzinek said that the new budget will cover established policies, finance new priorities, repay loans for the pandemic, and unforeseen challenges. 

A new OECD study that has been produced shows the challenges and opportunities that exist for the regions in northern Sweden, Finland and Norway within the Northern Sparsely Populated Areas (NSPA) collaboration.

Stefano Barbieri, who led the OECD study, was on site. Among the challenges, he mentioned a shrinking and aging population, difficulties in scaling up small businesses, and a lack of infrastructure. Opportunities lie in productivity, innovation, and renewable energy. The study results in 115 recommendations. They are aimed at local, regional, national, and EU levels. The recommendations in the report provide reasons for the national level to step forward much more.

Isak Utsi (S), municipal councilor in Arjeplog municipality, said that the recommendations must be filled with content.

– We need to think about what reforms we want to see and refer to the OECD, that is the big gain of the report. The first recommendation is that welfare must work and we need solutions in collaboration between municipality, state and region. Welfare is the basis for people to move here, so we need a reform idea. The recommendations are a toolbox that we should fill with wise ideas. They are not worth much unless we come up with some kind of demands.

Isak Utsi understands that Swedish governments think regional support is important and should remain. But how? "The EU should do more while not opening up the stock market. I see no other alternative than for the Swedish state to provide more money."

Anders Öberg (S), regional councilor in the Norrbotten Region, said that the new geopolitical situation provides new reasons to invest in northern Sweden.

– We will make ourselves more independent. Think of LKAB's development with critical minerals, phosphorus that will become fertilizer. Today, the EU extracts zero percent of the critical raw materials we need. We produced our own report in Norrbotten that showed that our investments alone have the potential to increase Sweden's GDP by 2-3%, equivalent to a defense budget. We can solve some of the challenges that Sverige AB has.'

Important to understand EU climate policy

As the final part of the forum, the focus shifted to the bio-based economy. How can EU policies shape a sustainable and competitive future for northern Sweden?

Climate policy analyst Magnus Nilsson outlined the larger context of EU climate policy and how its complex regulatory framework is interconnected – from legislation to support programmes. His message was clear: climate policy is now an integrated part of almost all policy areas within the EU, and it is important for both public actors and companies to understand and exploit this to stay at the forefront.

Lillian Strand from neighboring Trøndelag County was also on hand to talk about the region's investments in industrial symbiosis and how they have used Interreg projects in the EU and research collaborations to strengthen the local industry's ability to adapt. 

Lilian Strand contributed perspectives from our neighboring country, Norway.

MEP Jonas Sjöstedt (V) emphasized that the climate issue is not only technical, but also geopolitical and social, and that a fair distribution policy is required for the transition to be truly successful.

– There is a very rapid change in geopolitics and of course it also affects how the EU acts in the future. We need to do more together with like-minded countries, even if the US is now contributing less to solving the climate issue, we other countries will continue to work intensively on this, the technological transformation is not slowing down. However, the EU needs to invest even more in the transition and also combine climate benefits with good distribution policies, concluded Sjöstedt.

Text: The communicators within the EFNS network
Photos: Sara Gardegard