1 Introduction

The High North has been important for Norway for hundreds of years in terms of business opportunities and resources, and interest in these areas is growing rapidly today. Technological advances have opened up many new opportunities for making use of the resources in this area, and other countries are also taking more interest in the region. Thus the High North presents great opportunities for Norway.

Norway’s territorial waters cover a very large area and the country possesses very considerable natural resources in relation to the size of its population and the extent of its political influence. This gives rise to a number of very important foreign policy issues. Thus the High North also poses great challenges for Norway.

In its new, comprehensive policy on the High North, the Government aims to take advantage of the opportunities and meet the challenges through bilateral and multilateral co-operation and through closer dialogue on the High North with the relevant countries. By clarifying goals and instruments, the Government wishes to formulate a coherent and offensive High North policy that strikes a balance between different interests and sustainable development considerations.

In March 2003 the Government appointed a committee of experts on the High North to identify the new opportunities and challenges Norway is facing in the North and to evaluate from an overall perspective how Norwegian interests in this region can best be safeguarded.

The committee’s report was published as NOU 2003:32 (Official Norwegian Report), entitled Look North! Challenges and opportunities in the northern areas, and was circulated for comment to a wide range of institutions whose work is concerned with the High North.

The committee’s report, the ensuing debate and the consultative comments, together with the report on the High North by the Executive Committee for Northern Norway, have been given considerable weight in the deliberations and priorities that are described in the present report.

In the following emphasis is given to the foreign policy aspects of the High North policy. In drawing up the policy other factors will also have an impact, such as defence issues and the framework conditions for business activities, but the Government has proceeded on the assumption that these factors will be taken up in other contexts.

1.1 Opportunities

For forty years developments in the High North were dictated by the logic of the Cold War. The large Soviet military build-up in the North  was a source of concern, and although it was not primarily aimed at Norway, it dominated Norwegian security policy.

The situation was one of mutual scepticism and mistrust, and there was little contact between the people on either side of the Norwegian-Soviet border. Co-operation was confined to practical issues like the management of common fish stocks.

Today the situation in the High North has changed. Although there remain some difficult and complex challenges, the emphasis now is on the opportunities offered by the region.

Until recently the focus was on the abundant fishery resources in the area. The Barents Sea is shallow and rich in nutrients, and biological production is high. The warm waters of the North Atlantic Drift transport nutrients and juvenile fish of important species to the nurseries in the Barents Sea. These fish stocks have been harvested for thousands of years, and we will be able to continue harvesting them for many more thousands if they are managed in a sustainable way.

The new opportunities that have opened up are related to the large oil and gas resources that are thought to exist under the sea bed. The exploitation of these resources will influence developments in the region for decades to come. In fact the High North may in the long term become Europe’s most important petroleum province. Northern Russia already has large-scale onshore production, and in a few years’ time both Norway and Russia will begin offshore production.

The development of petroleum resources in the High North is taking place at a time when production on other parts of the Norwegian continental shelf is reaching its peak. This makes it especially important to develop production in the High North. This will help safeguard our prosperity and welfare as production further south is phased out, and ensure that Norway’s technological and other expertise and experience in this field are made use of and further developed, and that existing jobs in the industry are maintained.

These factors are creating new opportunities, especially for those living in the North. The most important aspect of this development for Norway is the activity on the Norwegian continental shelf, but it will also be important to promote the use of Norwegian offshore technology and experience in the Russian part of the continental shelf. Proximity to the oil and gas resources in northwestern Russia will give the people and business sector in North Norway an advantage.

Furthermore Russian immigration is a source of qualified labour that can contribute to private sector development in North Norway.

The development of petroleum resources in the North will also make Norway an interesting partner for other countries. This will provide new opportunities for closer co-operation in a wide range of fields, including research and the environment. Greater international political focus on the High North could enhance the importance of the Barents Council and the Arctic Council as co-operation fora.

1.2 Challenges

One of the main challenges in the North is to combine petroleum production with protection of the vulnerable marine environment. This will require that petroleum production is carried out in a way that takes account of the marine environment. There are a number of activities taking place in northern waters that affect or that could affect the marine environment and living resources. The effects of the various activities must be weighed against each other so that a coherent ecosystem-based management regime can be established that will safeguard the quality of the environment and ensure that the resources are exploited in a sustainable way.

It is important that the people of North Norway benefit from the exploitation of resources in the North. The development of these resources coincides with great changes in parts of the traditional industrial structure in this part of the country.

Another challenge is to take advantage of the new opportunities offered by the reforms and growth in the Russian economy in terms of jobs and value creation in Norway’s northernmost counties. Commercial co-operation between North Norway and northwestern Russia has not increased as much as it was expected to after the new opportunities for co-operation arrangements opened up in the early 1990s. However, Norwegian investment in northwestern Russia is now on the rise and trade has grown considerably during the past two years. An effective High North policy must include measures designed to encourage this trend.

A more effective High North policy must also include measures that will enable North Norway to make better use of its position as a gateway to northwestern Russia. The close contacts that have been established across this border could also be useful to the Norwegian petroleum industry in its efforts to develop co-operation with the Russian petroleum industry.

There are also a number of major challenges in the region in connection with the environment and nuclear safety. The Cold War left a legacy of inadequately secured nuclear facilities, decommissioned submarines and radioactive waste, which are a threat to the environment. There is also a danger that radioactive material from these facilities could fall into the wrong hands. The environment in Norway and the northern waters is becoming heavily polluted by industrial installations on the Kola Peninsula and in the area around Archangel. Long-range transport of pollutants by air and sea currents from areas further south is also creating health and environmental problems in the North.

Svalbard is the site of one of the last large untouched wilderness areas in Europe. It is very important to preserve this unique natural legacy for present and future generations and to ensure that all activities on the archipelago are carried out in accordance with the rules established by Norway under the Treaty concerning Spitsbergen.

According to the findings of the Arctic Climate Impact Assessment, anthropogenic climate change could have considerable consequences for the region and for the exploitation of resources there. This underlines the need for a reduction in greenhouse gas emissions and for strategies for adapting to climate change in the North.

The security policy situation in the High North is completely changed now that the Cold War has ended. Russia is becoming a partner in international co-operation structures such as the NATO-Russia Council and in a number of European institutions.

Today safeguarding Norwegian interests in the North is increasingly becoming a matter of the sustainable use of natural resources and monitoring the environment. Developments in the law of the sea since the early 1970s have given Norway jurisdiction over large sea areas. This imposes a considerable responsibility on Norway to manage the resources in these areas in a sound way. A sound environmental and resource policy requires resources and environmental monitoring and supervision of industrial activities to ensure compliance with the relevant legislation.

Because the marine environment knows no boundaries and because the fish stocks in these waters are fished by a number of countries, it is important for Norway to further develop the practical co-operation arrangements that have been established between Norway and Russia, and Norway and other countries.

There are also major challenges in the foreign policy field. Other countries are showing a growing interest in Norwegian and Russian petroleum resources. This is partly because these resources are located in politically stable areas, and many countries are concerned about securing their energy supplies. This makes the High North more interesting than many other areas that are rich in energy sources.

Periods when there is an insufficient supply of energy may give rise to high expectations and political pressure. It cannot be taken for granted that Norwegian interests will always coincide with those of key partners. It is therefore important to ensure that Norway’s interests continue to determine developments in the Norwegian part of the High North.

The indigenous institutions in Norway have a strong position internationally, and their role therefore extends beyond Norway’s borders. The indigenous dimension is thus an important part of our High North policy.

The outstanding international law issues in the High North pose a particular foreign policy challenge. Unresolved delimitation issues between states can lead to a conflict of interests, and so can disagreement on the basis for jurisdiction over sea areas.

The Government gives very high priority to the efforts to settle issues of international law. The issue of the delimitation of the continental shelf and zones in the Barents Sea can only be resolved through political agreement between Norway and Russia.

Thus there are a number of challenges that must be dealt with before a coherent High North policy can be formulated. During the Cold War Norway’s High North policy was shaped by security policy considerations. This made it easier to pursue a coherent policy that incorporated the individual sectors. Since the end of the Cold War, however, the High North policy has become fragmented between the various sectors, without sufficient co-ordination.

Thus we must ensure that the working methods used in the formulation of the new High North policy will result in a coherent policy that is expressed in a consistent way. It is also important that the policy has broad political support in Norway. This will give Norway more influence internationally.

1.3 Goals

The principal goals of the High North policy are to ensure political stability and sustainable development in the North.

Political stability is essential for the development of the resource-rich High North. Because so many countries have an interest in the region, and because of the outstanding issues, Norway needs to make political stability an overriding objective.

Sustainable development in the North can be ensured by sound resource management and the conservation of biodiversity. The Government will deal with the environmental challenges by imposing stringent environmental requirements and setting high standards for the use of resources and other activities in the North.

The safeguarding of Norwegian interests is also an important policy goal. However considerable efforts are required to deal with the many challenges related to the control and management of the natural resources in these vast sea areas.

Another goal of our High North policy is to involve Norwegian businesses actively in the co-operation with Russia in the North. This will both promote development in northwestern Russia and lead to growth and new jobs in Norway. The development of the Russian part of the continental shelf is particularly important in this connection. Norwegian-Russian co-operation in this area will pave the way for the use of the advanced, environmentally friendly Norwegian offshore technology that has been developed to meet the needs of petroleum production in the harsh weather conditions of the North Sea.

A further goal is to ensure that the indigenous peoples of the region take a real part in the decision-making processes that are concerned with the protection and development of their history, culture, livelihoods and society.

Enhancing our cultural co-operation with Russia is both a means and an end in itself. Cross-border cultural co-operation makes a significant contribution to the development of people-to-people relations in the region, and provides fora where people can meet on an equal basis and form contacts and networks.

Since the beginning of the 1990s North Norway has contributed to network- and confidence-building across the divide that formerly separated Norway and Russia. The Government will encourage this positive trend by strengthening the efforts to promote knowledge about the Russian language and culture in North Norway.

1.4 Means

The Government will seek to promote understanding and knowledge of the conditions specific to the High North through bilateral dialogues with key countries that have interests in the North. The dialogues will include issues related to the marine environment and resource use. At the same time it is important that Norway safeguards its interests and gains acceptance for its views and assessments on other issues. By these means Norway will be able to present a coherent picture of High North issues at the national and international levels.

Energy issues will occupy a central place in several of these dialogues, which will provide an opportunity for these issues to be discussed in the broader context of foreign and environmental policy. These broader bilateral dialogues could be a supplement to the energy dialogue Norway already conducts with Russia, and to those that the USA, France, Germany and the EU conduct with Russia.

Norway’s bilateral co-operation with Russia will continue to occupy an important place in its High North policy. This co-operation is essential for ensuring the sound and sustainable management of the fish stocks in the Barents Sea and for solving the environmental problems in the North. The Norwegian authorities and business sector will also benefit from close co-operation with Russia in connection with petroleum production in the High North and investment in onshore industries. The Government’s goal is to ensure that there are strict environmental and safety requirements for petroleum activities in the whole of the Barents Sea. Close co-operation with Russia on safety at sea and an oil pollution emergency response system will also be important in the light of the increasing volume of maritime transport in the High North.

People-to-people co-operation across the Norwegian-Russian border provides a sound foundation for the development of good relations with Norway’s largest neighbour, and has been very successful in the Barents Region. The North Norwegian county administrations and the Barents Secretariat have played an important role in this connection, and it is due to their efforts that the Barents Co-operation has become such a vital instrument in Norway’s High North policy. The Barents Co-operation has also become an important forum for Norwegian-Russian co-operation. Norway has invested almost NOK 3 billion in co-operation with Russia in the North and this has resulted in mutual openness and trust and co-operation in a wide range of fields.

However, the Barents Co-operation can be made more effective and up to date. The Government will therefore take the initiative for an evaluation of this co-operation, including the question of whether an international secretariat should be established and whether the co-operation has been able to identify the new issues that must be resolved in the region.

The Arctic Council is another valuable instrument, and a forum for the discussion of broad circumpolar issues, including indigenous issues and environmental issues, particularly pollution and climate change.

Norway will take over the chairmanship of the Council in 2006. This will give the authorities a good opportunity to take initiatives that will enhance circumpolar co-operation and the Council’s role.

The integrated management plan for the Barents Sea that is being drawn up will provide guidelines and a framework for activity in  the northern waters over which Norway has jurisdiction. The plan will establish framework conditions that will make it possible to strike a balance between the commercial interests related to the petroleum industry, maritime transport and fisheries, and sustainable development.

1.5 Intensified efforts in the High North

In the present report the Government proposes a number of measures for strengthening Norway’s High North policy. Some measures are specific to individual policy areas and others are related to co-ordination of issues related to the High North.

The Government wishes to strengthen project co-operation with Russia and the other CIS countries and will submit concrete proposals for allocations to the Storting at a later date. It intends to increase support for the Barents Secretariat.

The Government also intends to propose to the Storting that funds are set aside for co-operation projects that will be initiated during Norway’s chairmanship of the Arctic Council in 2006-2008.

The Government will propose to the Storting that funds are set aside for national knowledge-building in the marine field, including an active presence in the High North.

The Government will facilitate closer research co-operation in the North, especially in Svalbard and with Russian scientists, and will propose to the Storting that funds are set aside for this purpose.

The Government will take the initiative for an international research fund for the High North under the auspices of the Arctic Council and will advocate that the fund’s administration should be located in Tromsø. The fund should focus particularly on the impact of climate change on the environment and natural resources, and indigenous issues. The Government will urge the members of the Arctic Council to contribute to the fund and will submit a proposal concerning Norway’s contribution to the Storting at a later date.

The Government wishes Norway to continue to play a leading role in the international nuclear safety co-operation with Russia within the framework of the Plan of Action for Nuclear Safety Issues. The Government will submit a specific proposal to the Storting concerning allocations for this purpose at a later date.

The Government will continue to give high priority to co-operation with Russia on environmental issues, particularly co-operation on the management of the marine environment.

In the light of the new opportunities for Norwegian-Russian co-operation in the North, especially in connection with oil and gas production in the Barents Sea, the Government will, in co-operation with Innovation Norway, seek to establish a new position for a commercial officer at the consulate general in Murmansk as a trial arrangement. In co-operation with the Norwegian Confederation of Business and Industry, the Government will create opportunities for Norwegian, especially North Norwegian, companies to present themselves in northwestern Russia. The Government recognises the importance of promoting co-operation between the social partners in connection with private sector development in Norway and Russia.

In the light of the increase in the transport of goods and services across the border with Russia in Sør-Varanger, the Government will propose to the Russian authorities that the opening hours be extended and customs procedures expedited at both countries’ border control stations at Storskog.

In order to enhance international co-operation in the field of reindeer husbandry, the Government has decided to establish an international reindeer husbandry centre in Kautokeino. The centre will promote the publication and exchange of information, and co-operation between reindeer herders, the authorities and research and academic communities at the national and international levels.

The Government wishes to strengthen the co-operation on contingency planning in the High North. The Barents Rescue 2005 exercise, which will be carried out in autumn 2005, is a joint alarm and field training exercise with participants from the Nordic countries and Russia. When the exercise has been completed, the Government will consider how the co-operation on contingency planning can best be strengthened, using the lessons learned from the exercise and on the basis of the co-operation Norway already has with Russia, for example in connection with coast guard activities and contingency planning.

Norwegian-Russian co-operation was intensified in 2003 with a view to improving safety at sea and further developing the oil pollution emergency response system in the Barents Region. The Government will further develop this co-operation with Russia.

With a view to enhancing the effectiveness of our High North policy,  the Government will assign responsibility for co-ordinating the work on issues related to the High North to a state secretary in the Ministry of Foreign Affairs. An inter-ministerial co-ordinating committee will also be established, and a liaison committee for the High North with broad representation whose mandate will be to promote closer contact between the central government administration, the regional authorities, the business community and NGOs.