Economic "renaissance" awaits Baltic region

  • 2002-10-10
  • Paal Aarsaether

Some 150 leading academics and government officials wrapped up a two-day conference on Oct. 4, concluding that an enlarged European Union will give a significant boost to the Baltic Sea area.

"The EU's enlargement eastwards will bring an economic renaissance to the Baltic Sea region," Secretary of State Antti Satuli, the top-ranking civil servant in the Finnish Foreign Ministry, said at the conference. "It's now safe to assume that the three Baltic states — Lithuania, Estonia and Latvia — and Poland will be invited to join the union at the EU summit in Copenhagen this December," Satuli said.

This will give a significant boost to EU's cooperation with Russia and serve as a catalyst for the further development of trade and political relations between the two, he pointed out.

EU enlargement will also cause the appearance of more "dynamic growth centers," like the one joining the Danish capital with the Swedish city of Malmo across the Straits of Oeresund, and the Estonian capital Tallinn and Helsinki, separated by the Gulf of Finland, Satuli said.

The EU's enlargement will mean that the Baltic Sea, except for Russia, is surrounded by EU countries, bringing together 100 million people living on its rim in nine EU member states, said Timo Maekelae, head of the EU commission's delegation in Helsinki, which organized the conference.

The enlargement will also give a boost to the new member countries' relations and exports to their main trading partner, Germany, which typically receives one-third of their exports, said Claus Vastrup, professor of economics at Aarhus University in Denmark.

Satuli said enlargement would put a final end to the "unnatural division" of the region caused by the Cold War. But he rejected Swedish Prime Minister Goeran Persson's vision of joining the Baltic Sea region into a single bloc within the EU, saying the countries' interests are too diverse.

The countries to gain most from enlargement are the Baltic states and Poland, Vastrup said. Their purchasing power currently stands at about 30 percent of the EU average, but could reach 75 percent within 10 to 15 years, he predicted.

But help from increased farm aid and regional EU subsidies would only last for a couple of years, and subsequent economic growth would depend on the nations' skills at exploiting new opportunities, Vastrup said.

Satuli rejected the notion that the EU's ongoing visa dispute with Russia over the country's Baltic enclave of Kaliningrad could endanger the time-schedule of the Union's eastward enlargement.

"The EU arrives on Russia's border in 2004 anyway, no matter if they want it or not," he said, adding Russia could be one of the main beneficiaries of the enlargement.

"The growth potential of the Baltic Sea area in this decade looks so overwhelming that Russia will surely make its best efforts to engage itself with that development," he concluded.