Lapland’s Arctic Specialisation Programme

Programme written by team: Kimmo Heikka, Kristiina Jokelainen and Jukka Teräs from The Regional Council of Lapland

Cover photos: Lapland The North of Finland www.onlyinlapland.com; Stora Enso; Agnico-Eagle, Kittilan kaivos

Other photos in order of appearance: Stora Enso; Detria.fi; Juha Pyhäjärvi; Lappset Group Ltd; Hotel & Igloovillage Kakslauttanen; Timo Ari; Agnico-Eagle, Kittilä mine; Lapland The North of Finland; Arctic Power, Kalle Junttila; Regional Council of Lapland, Lapland The North of Finland; Mikko Jokinen

Layout and graphic design: Markus Ylikoski / Reddo Partners Ltd

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Regional Council of Lapland

ISBN: 978-951-9244-72-3

Annals: A38/2013

Rovaniemi 2013

Lapland’s Arctic Specialisation Programme

Regional Council of Lapland, November 2013

Table Of ContentsForeword 7

Summary 8

1. Introduction 101.1 Finland’s Strategy for the Arctic Region2013 121.2 Definition of the Arctic operational environment 131.3 Global drivers of Arctic growth 14

2. Lapland: The Most Arctic Region In The European Union 152.1. Current state analysis: Lapland 2013 15

2.1.1 Viewpoints of Lapland’s economic actors concerning the Arctic 172.1.2 Lapland of industries - Arctic business 192.1.3 Lapland of innovations 232.1.4 Lapland of expertise 252.1.5 International Lapland 282.1.6 Sustainable Lapland 29

3. Vision And Strategy Of Lapland’s Arctic Specialisation 333.1 Vision 333.2 Six cornerstones of Arctic development in Lapland 343.3 Strategic Arctic priorities of industries in Lapland 36

3.3.1 Priorities of Arctic business in Lapland 373.4 Education and RDI as part of Lapland’s Arctic specialisation 40

4 Implementation Of Lapland’s Arctic Specialisation Programme 414.1 Implementation of selected priorities in 2014-2020 41

4.1.1 Refining Arctic natural resources 414.1.2 Utilising Arctic natural conditions 424.1.3 Cross-cutting development for Arctic growth 42

4.2 Detailed presentation of proposals for action 444.1.1 Refining Arctic natural resources 44

4.1.2 Utilising Arctic natural conditions 484.1.3 Cross-cutting development for Arctic growth 51

4.2 Roadmap 2014–2020 57

5. Programme Monitoring and Assessment 625.1 Introduction 625.2 Role of monitoring and assessment 625.3 Monitoring and assessment of the Arctic Specialisation Programme 63

ANNEX The streering group of the Lapland’s Arctic Specialisation Programme 67

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ForewordEverybody is today talking about Arcticness, emphasising either threats or opportunities, depending on the speaker and viewpoint. There are major global factors of change behind all this, ranging from climate change and fluctuations in the balance of power in global economy to the increased demand for natural resources. Climate change and the possible melting of polar ice may lead to opening up a new sea route to the Arctic Ocean and a new commercial route to Asia, which has gradually become the centre of power of the new global economy. Climate change will also facilitate the exploitation of minerals and natural resources in northern regions. It has been estimated that almost one fourth of the world’s unexploited oil and gas resources are located in Arctic regions.

In this change of the operational environment, Finland has begun to define its national position with regard to Arctic development prospects: the Council of State revised Finland’s national Arctic Strategy in August 2013. The revised strategy emphasises the increasing importance of the Arctic Region and the idea of whole Finland as an Arctic country.

As an action programme for Finland’s most Arctic Region, Lapland’s Arctic Specialisation Programme can be considered to specify Finland’s national Arctic Strategy. The programme takes the objectives of the national strategy to a more concrete level and brings Lapland’s role and importance in Arctic development prospects to the level it deserves. Furthermore, the programme is Lapland’s response to the European Union’s Smart Specialisation concept for the next programming period.

The programme highlights Lapland’s natural resources and natural conditions, their sustainable utilisation, and increasing value added. Lapland’s strong spearhead sectors are still tourism and the mining industry, and opportunities have also been

sought in bioeconomy. The key of the programme is the strong positioning of our region as part of national and international Arctic development. In the future, Lapland will be more distinctively profiled into an international centre of Arctic transport, information and telecommunications.

Lapland’s Arctic Specialisation Programme has been prepared jointly by Lapland’s regional actors. I wish to thank all the parties who have contributed to this programme for their committed efforts that show faith in the future. For us in Lapland, Arcticness shows as vast potential. The opportunities offered by energy, logistics and abundant natural resources are waiting to be exploited. Above all ordinary, it is safe to say that Lapland is the best Arctic region!

Rovaniemi 22.10.2013

Mika Riipi County Governor

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SummaryThe European Commission has introduced the Smart Specialisation1 policy concept in order to support the regions of the EU and to boost competitiveness and innovation. Smart specialisation strategies help regions integrate their development efforts through EU financing. Lapland’s Arctic Specialisation Programme focuses on the points of departure and opportunities of Lapland’s smart specialisation and on concrete draft proposals. The key target group in the programme is financing authorities and Lapland’s development organisations.

Arctic regions are important in global terms, so they also arouse international interest from the point of view of finance, expertise, education and research. Finland’s new national Arctic strategy also relies on this approach and the fact that Finland as a whole is part of the Arctic Region. Lapland, Finland’s northernmost region, is an essential part of Finland’s Arctic character, considering that of the people living to the north of the 60th latitude, almost every third is a Finn2.

The following development cornerstones have been identified in the preparation of Lapland’s Arctic Specialisation Programme: accessibility, the sustainable utilisation of natural resources and natural conditions, increasing value added, making more efficient use of the expertise already accumulated in Lapland, and Arctic pride. The programme recognises the role of Lapland as an Arctic living environment, in which development efforts are constantly pursued in close interaction with inhabitants and the Arctic nature. The key objective is to identify and develop Arctic fields of

1 http://ec.europa.eu/research/regions/index_en.cfm?pg=smart_spe-cialisation

2 http://valtioneuvosto.fi/tiedostot/julkinen/arktinen_strategia/Suomen_arktinen_strategia_fi.pdf

business whose sustainable utilisation will offer Lapland opportunities to exploit its commercial expertise in the short, medium and long term. Another aim is to offer employment to inhabitants and provide companies with preconditions for new business.

According to the vision of Lapland’s Arctic Specialisation Programme 2030, Lapland will enjoy a leading position in exploiting and commercialising Arctic natural resources and conditions. Lapland will also be the centre of international arctic transport, information and telecommunications. From the point of view of Lapland’s future, the aspects to be highlighted are the sustainable utilisation of natural resources and natural conditions and increasing value added. The most important Arctic spearhead sectors in Lapland are the mining and metal industry, tourism and bioeconomy. Although Lapland’s Arctic Specialisation Programme focuses on specific sectors, it also challenges others to innovate new, strong spearhead sectors. The expertise that has accumulated in Lapland will be utilised across several sectors. The unexploited draft innovations generated by companies, research institutes and educational institutions in Lapland will be investigated systematically.

Lapland’s Arctic Specialisation Programme contains proposals for action for the period 2014-2020. The proposals are divided into three main categories: the refining of Arctic natural resources, utilisation of Arctic natural conditions and cross-cutting development enabling Arctic growth. The programme contains some 50 specified proposals for action. The programme is linked with Lapland’s Arctic Specialisation roadmap, which sets out the phasing of the various actions for the period 2014-2020. In addition, the programme describes

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the structure of financing innovations and business in Lapland, within the framework of which the actions will be implemented. The proposals for action of the Arctic programme will be integrated with broader regional development work by means of a regional assessment and monitoring model.

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1. Introducti onThe promoti on of innovati on is one of the key prioriti es of the European Union’s regional policy for the next programming period (2014- 2020). The purpose of the Smart Specialisati on concept launched by the European Union3 is to help regions fi nd innovati on opportuniti es in their own sectors and services. In practi ce, smart specialisati on refers to specialisati on in which economic growth is based on uti lising competence structures to develop the regional business sector.

Smart specialisati on helps fi nd interacti on between and within diff erent sectors, services and technologies both in and between regions. Financial aid is allocated from structural funds on the conditi on that regional and nati onal Smart Specialisati on strategies have been prepared4 . One of the most important aims of the Smart

Specialisati on strategy is to assist regions in integrati ng their development eff orts with the EU’s fi nancial instruments and programmes in order to create mutually complementary proposals for acti on.

Lapland is Finland’s most Arcti c region, which is developed in view of the internati onal, nati onal and regional operati onal environment and its Arcti c special features. The enti re Lapland is an

3 htt p://ec.europa.eu/regional_policy/newsroom/detail.cfm?id=361&lang=en

4 htt p://ec.europa.eu/regional_policy/sources/docgener/infor-mat/2014/smart_specialisati on_fi .pdf

Arcti c Region, which requires combining public fi nancing and private investments and maximising the benefi ts of the inputs made in the region.

Lapland’s Arcti c Specialisati on Strategy under the theme ’Lapland - A Strong Arcti c Expert’ was prepared in an ERDF project by the Regional Council of Lapland between October 2012 and November 2013. The work largely followed the six-phase guidelines issued by the European Commission (Figure 1).

The Regional Council of Lapland assigned ‘Lapland’s Arcti c Specialisati on Programme’ the status of a Smart Specialisati on Strategy. The programme was prepared along with developing the 2014-2017 Innovati on Programme for the Lapland University Consorti um. The Arcti c Specialisati on Programme was integrated with the regional

operati onal programme and emphasises the most important regional drivers and emerging spearhead sectors.

The Arcti c Specialisati on Programme highlights in parti cular soluti on models that take account of the special features of the region. In additi on, perspecti ve is needed on how the inputs from diff erent fi nancing programmes and instruments can be channelled to joint development projects. At the same ti me, the eff ects of fi nancing can be maximised and effi cient use made of the diminishing resources. The increased internati onal interest shown

Figure 1: Phases of the Smart Specialisati on Strategy

Integration of monitoring

and evaluation mechanisms

Implementation,definition of a coherent policy mix, roadmaps

and action plan

definition of a coherent policy mix, roadmaps

Identification of priorities

Developing an overall vision of the

region’s futureoverall vision of the

Governance: Ensuringparticipation and

ownership

Governance: EnsuringAnalysis of regional context and potential

for innovation

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towards Arctic regions also calls for actions to manage Arctic knowhow and expertise in Arctic conditions.

The Regional Council of Lapland assigned

’Lapland’s Arctic Specialisation Programme’

the status of a Smart Specialisation Strategy.

Different types of analysis and planning methods have been used in the preparation of the programme in order to take account of the needs and views of a large group of actors. Interviews, workshops and regional hearings were arranged during the preparation process, peer evaluation was sought at the international level, and the progress of the work was presented at different venues.

A steering group consisting of several members was appointed to the project. The work was presented to the group

regularly and the group was consulted for feedback on the choices made in the priorities. A number of stakeholder meetings and workshops were arranged during the project, theme interviews were conducted with companies and economic stakeholders, and an electronic business survey was carried out. In addition, a broad consultation was arranged with the most important stakeholders towards the end of the programme preparation process. The authors of the programme participated in future workshops, which were organised as part of the regional operational programme work and by higher education institutions. Existing thematic strategies and programme documents were also used as background material. The integration of the Arctic Specialisation Programme with other regional development efforts was ensured through extensive stakeholder work and participatory actions.

A group of development priorities and values was selected for use as the basis and starting point of the Arctic Specialisation Programme, as shown in the figure below (Figure 2).

Figure 2: Lapland as an arctic expert and actor / Lapland’s Arctic Programme

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1.1 Finland’s Strategy for the Arctic Region520136

Based on the guidelines issued by the Finnish Government, Finland’s Strategy for the Arctic Region was revised by a working group, which published the document ’Finland’s Strategy for the Arctic Region 2013 - Decision in Principle of the Council of State 23 August 2013’ in August. According to the document, Finland’s revised Strategy for the Arctic Region 2013 is based on comprehensiveness and a broad-based approach. The Strategy comprises the following themes: vision, Finland’s Arctic population, education and research, Finland’s Arctic business,

5 Nordregio/J. Roto.

6 http://valtioneuvosto.fi/tiedostot/julkinen/arktinen_strategia/Suomen_arktinen_strategia_fi.pdf

stability and the environment, international Arctic cooperation, and the objectives and implementation of the programme.

According to the vision of the revised national Arctic strategy, Finland will be an active operator capable of sustainably combining environmental business opportunities through international cooperation. The revised strategy emphasises the increasing importance of the Arctic Region and the idea of Finland as an Arctic country. The strategy viewpoints describe Finland’s role in terms of four pillars: an Arctic country, an Arctic expert, sustainable development and environmental boundary conditions, and international cooperation.

According to the strategy, Finland can adopt a key role by opening up and innovating with new opportunities in cold-

Figure 3: Arctic environment5

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climate expertise, construction, technology, refining, product development, services and research. The aim is to promote growth and competitiveness, but only by respecting environmental values. The document also points out that the objectives of the national Arctic strategy with regard to tourism, renewable natural resources, mining and transport, for instance, are for the most part achieved in Lapland (Finland’s Strategy for the Arctic Region, page 10).

1.2 Definition of the Arctic operational environment

The Arctic region can be defined in a variety of ways. Geographically, the Arctic Region borders on the Arctic Circle (66° 33’N) and can also be defined in terms of temperature, the tree line, permafrost, the coverage of sea ice and different types of political agreements7.

Basic features of the Arctic region8

Major variations in cold and the amount of light are among the basic elements of the Arctic nature. The people, flora and fauna of the region have adapted themselves to cold weather in one way or another. In terms of the tree line, the Arctic Region begins from the transition zone between forest and the Arctic treeless tundra. Continuous permafrost prevails in the region if it covers at least 90% of the land area. In sea areas, the border of the Arctic Region is defined in terms of the period for which the sea remains covered by ice. Nature conservation areas make up some 5 per cent of the

7 http://www.arcticcentre.org/Suomeksi/TIEDEVIESTINTA/Arktinen-alue.

8 Arctic Centre, Conservation of Arctic Flora and Fauna (CAFF) 1996. Proposed Protected Areas in the Circumpolar Arctic 1996. CAFF Habitat Conservation Report No. 2, Arctic Flora and Fauna, status and conserva-tion (CAFF) 2001. Edita, Helsinki. ISBN 9979-9476-5-9.

globe’s surface area (7.9 million km²) and approximately 14% of the total area of the Arctic Region (2 million km²). Some 30% of the area of Lapland (approximately 35 000 km²) is protected under a nature conservation scheme.

The starting point of Finland’s Strategy for the Arctic Region 2013 is that Finland, crossed by the Arctic Circle, is an Arctic country. The Arctic Region arouses national interest from the viewpoints of economy, expertise, education and research, In the approach adopted in Lapland’s Arctic Specialisation Programme, the Arctic Region is defined according to Finland’s national strategy and based on the fact that Lapland is the most Arctic region in Finland and the EU.

People of the Arctic region

There are almost four million inhabitants in the Arctic Region, of whom some 10% represent indigenous peoples. The share of the indigenous population varies regionally from a few percentages to almost a hundred per cent. There are 19 million inhabitants north of the 60th latitude, most of them Finns. Therefore, Finland’s Arctic character is emphasised by the fact that almost every third person living north of the 60th latitude is a Finn9.

Expertise in Arctic conditions10

Expertise in Arctic conditions means that people, machines, equipment, companies and infrastructure, in fact the whole society, are capable of dealing with cold weather and sharp fluctuations in natural conditions. People, too, must be able to work efficiently and safely. Infrastructure, buildings, machines, equipment and industrial plants must function properly

9 http://valtioneuvosto.fi/tiedostot/julkinen/arktinen_strategia/Suomen_arktinen_strategia_fi.pdf.

10 K.Heikka & Digipolis Oy.

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even in 85°C temperature fluctuations (-50 – +35), in different types of rain (e.g. rain, freezing drizzle and snowstorm), wind, and in light and humidity fluctuations. Expertise in Arctic conditions means the ability to comprehensively control and utilise these aspects.

1.3 Global drivers of Arctic growth

To form the big picture, global forces of change must be examined as the starting points for Arctic growth, which, too, is based on international demand and change. According to Professor Laurence C. Smith (2011), there are four global forces that shape the Arctic Region and its growth: demography, the demand for natural resources, globalisation and climate change.

According to UN forecasts, the world’s population will reach its peak - approximately 10 billion (now around 7 billion) - during the current century. At the same time, people are packing in cities. It has been estimated that globally 10 000 people move from the countryside to cities every hour. Urbanisation also offers opportunities for prosperity, as urbanisation and growth in consumer demand will together translate into huge investments in buildings and infrastructure.

Population growth, urbanisation and gentrification have increased the demand for natural resources. In addition to exploiting known natural resources, people are constantly looking for new resources - also in Arctic regions. Nordic societies are politically stable and have a small country risk. Globalisation development (e.g. growth in international trade) in fact offers vast opportunities to the Arctic Region.

The development of energy technologies plays an important role in the Arctic regions. The advances made in biotechnology, nanotechnology and material sciences generate new demand for raw materials.

As a result of advances in technology, many natural resources can be utilised profitably and transported to the global markets. It should also be noted that there are major cross-border Arctic transport and logistics solutions. Therefore, new transport connections call for cooperation and rules.

Sustainable development has raised the safety of working environments, transport and people’s everyday lives to a new level. Arctic regions must have globally cutting-edge capabilities in productivity development to ensure that competitiveness can be developed favourably and the services of societies secured. Productivity development calls for an ability to act as a forerunner in the use of the latest technology.

Globally the most challenging force changing the Arctic Region is perhaps climate change, which seems to cause glaciers and permafrost melt at an accelerating speed. Larger areas of the Arctic Ocean remain without ice cover for longer periods, which will open up new ground-breaking opportunities to global logistics. The importance of maritime expertise will still be emphasised in spite of trends in Arctic climate.

Among other things, climate change may change growth conditions in Northern Europe considerably. This will make it possible to cultivate new plant species, but at the same time plant diseases and pests will spread to the north. There are abundant pure freshwater resources in Fennoscandia and elsewhere in the north. Water may become an even more valuable natural resource than oil when climate change dries up parts of Southern Europe.

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2. Lapland: The Most Arctic Region In The European Union

2.1. Current state analysis: Lapland 201311

What are the starting points of the current state and future of Lapland from the Arctic viewpoint? Lapland is the northernmost region in Finland and the whole EU, and the most Arctic region of Finland. The Arctic character is present throughout Lapland’s identity and activities. This chapter looks at the current state and future of Lapland from the Arctic perspective.

In the peer review meeting in Spain in February 2013, which is part of the

11 Source: Regional Council of Lapland.

EU’s Smart Specialisation Programme,12 international experts mentioned the following aspects, for example, which are related to the development of Lapland:

• Lapland is a unique region in Europe and globally

• In developing Lapland, one should not be content with plans and programmes that merely repeat the plans prepared for many other regions.

• Development programmes are limited by Lapland’s population base and demographic trends. On the other hand, opportunities are offered by Lapland’s international profile

12 http://s3platform.jrc.ec.europa.eu/6th-peer-review-7-8-feb.

Figure 4: Lapland’s regional structure and development corridors11

Statistical facts on Lapland:

• Land area 92 665 square kilometres, which is 25.7% of

Finland’s land area.

• 182 810 inhabitants, which is 3.4% of Finland’s

population (in August 2013).

• Largest residential centres: Rovaniemi (60 944

inhabitants), Tornio (22 399 inhabitants) and Kemi

(22 172 inhabitants)

• Six sub-regions: Rovaniemi region (Rovaniemi and

Ranua), Kemi-Tornio (Kemi, Keminmaa, Simo, Tervola and

Tornio), Eastern Lapland (Kemijärvi, Pelkosenniemi, Posio,

Salla and Savukoski), Northern Lapland (Inari, Sodankylä

and Utsjoki), Fell Lapland (Enontekiö, Kittilä and Kolari,

Muonio) and Torne Valley (Pello and Ylitornio).

• Employment: municipal sector 27.8% (whole country

22.5%), state and state-owned companies 10.8% (whole

country 8.8%) and private sector 49.2% (whole country

58.3%).

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and its location as the neighbour of many countries.

• To develop industry in Lapland, energy solutions play an important role especially in the use of natural resources. Energy solutions may also influence the image and brand of Lapland. It is also important to come up with sustainable energy solutions and present them to parties outside Lapland.

• Entrepreneurship offers a wealth of new opportunities to Lapland.

What is Arctic operation like from Lapland’s perspective? In the international EU Peer Review meeting in Spain, which was connected with the preparation of Lapland’s Smart Specialisation Programme, Lapland’s current situation, competitive advantages and key challenges were summarised as follows:

• The mining industry is undergoing strong growth in the industrial and business sector. The key sectors are tourism and the process industry (steel industry, forest industry). Arctic business opportunities related to climate change, for example, are opening up.

• Lapland’s competitive advantages are its effective transport connections and logistics. Additional strengths are the strong traditional industry, the use of information technology, expertise in international tourism, pure nature, high quality of living, excellent range of research and development services, and the availability of extensive educational services.

• Challenges are posed by long distances, Arctic conditions, increasing the number of SMEs, the small number of foreign companies and experts, maintaining Lapland’s image, a falling population trend, migration loss, and combining large-scale investments with living environments.

Finland’s Strategy for the Arctic Region 2013 document13 refers to the position, role and functions of Lapland as ’an essential part of

13 http://valtioneuvosto.fi/tiedostot/julkinen/arktinen_strategia/Suomen_arktinen_strategia_fi.pdf.

Finland’s Arctic character’ e.g. as follows:

• Lapland’s research and education expertise, e.g. the University of Lapland, Arctic Centre of the University of Lapland, Lapland University of Applied Sciences, Lapland’s research institutes, and the Sami Education Institute.

• Utilisation of Lapland’s natural resources (mining in particular)

• Tourism in Lapland • Northern transport and logistics

development needs• Lapland from the point of view of overall

safety and the environment • Position of the Sami in Arctic Finland• Position of Lapland in national and

international Arctic cooperation.

The Arctic Council plays an important role in the development of the region. Lapland is well positioned to apply the guidelines and priorities of the Arctic Council in the next few years. At the same time, the Council acts as a venue where Lapland can influence matters actively.

In its Kiruna Declaration of 2013 the Arctic Council emphasised the sustainable development of trades and decided to establish a task force to prepare a circumpolar business forum. In addition, it decided to set up a task force for coordinating Arctic research in the member states. Both the task forces offer Lapland a concrete channel for extending Arctic international activities and improving their efficiency further. Finland will be the chairing country of the Barents Euro-Arctic Council (BEAC) for a two-year period from autumn 2013 onwards. This will expand the international cooperation network and offer an opportunity to influence guidelines concerning Lapland.

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2.1.1 Viewpoints of Lapland’s economic actors concerning the ArcticThe preparation of Lapland’s Arctic Specialisation Programme involved interviews with companies, major economic actors and the representatives of development organisations. Workshops were also arranged, and thematic interviews and web surveys were used for companies, which varied from large-scale industrial enterprises to one-man firms. Below is a summary of the opinions that companies and their stakeholders had about Arcticness.

Large-scale Arctic projects

There are many broad investment projects in progress or pending in the Arctic regions. So far only few of Lapland’s companies have participated in large-scale projects. It should be noted that almost 80% of the respondents were interested in participating in large-scale projects in Arctic regions. Similar results were also obtained from the interviews and projects. Forty per cent of the respondents had participated in investment projects in the North Calotte and Northwest Russia, and one fourth had received invitations to tender for such projects directly from customers, as part of invitations to tender from mining companies, through other companies, and as raw material inquiries from equipment manufacturers.

Arctic business today and in the near future

From the point of view companies, Arcticness is understood as an everyday element broadly connected with business. Many of the replies suggested that the companies in Lapland consider practically all of their operations Arctic! The things regarded as special expertise include

basic knowledge of Lapland, logistics expertise and material knowledge for use in challenging conditions, winter construction, and knowledge of berries and wild game. The respondents wanted to enter into closer business cooperation in the Arctic Region both as partners and experts. Among other things, the aim with marketing efforts is to find contacts with the mining sector market in Arctic regions. There is also need to make more extensive use of web-based marketing.

Arctic tourism business

The interviews and workshops paid special attention to the question of what the key activities and attraction factors of Arctic tourism are. Of the respondents, slightly over 40% reported that they were engaged in Arctic tourism business in one way or another. In the near future, they would like to participate more closely in the international joint marketing of Arctic tourism and in utilising the opportunities offered by nature, for instance. In addition, they saw opportunities among other things in developing the interfaces between Arctic tourism, construction technology and the industrial sector. Experience services, natural conditions, such as northern lights, and snow and ice construction in particular, are utilised as Arctic attraction factors.

Arcticness is an attraction factor in tourism

Impediments to Arctic business

The lack of information on future investment projects is one of the greatest impediments to expanding Arctic business. In general, the overall lack of information was considered an impediment to business

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development. Furthermore, challenges in the recruitment of skilled personnel, and legislation, permit and contract issues, were taken up in some of the replies. Workshop participants in particular wanted more education and research that would support the development of business. Other impediments included the lack of courage to grasp Arctic opportunities and the lack of linguistic skills. Even ’the lack of faith in this Arctic flimsiness’ was mentioned as an impediment.

Lack of information as an impediment to Arctic

business

Arctic expertise, education and projects

Companies do not consider Arctic education a special need. Companies and business actors pursue some cooperation with research and sector research institutes and educational institutions. Important forms of cooperation are final papers and benchmarking journeys. Concrete needs were emphasised in Arctic expertise, such as continuously updating Russia-related practices and improving linguistic skills.

Expectations regarding cooperation with authorities

Most of all the companies hoped that authorities would increase the amount of relevant information, set up concrete networks and projects, and safeguard business interests. They would also welcome additional efforts related to infrastructure maintenance, the communication of information related to international transports and the implementation of

internationalisation programmes, for instance. Companies expected innovative public procurements, implemented by municipal snow and ice construction companies, for instance.

More information expected from authorities

Special expectations for Lapland’s Arctic Programme

The responding companies mentioned several development perspectives in view of Lapland’s Arctic Specialisation Programme. The main themes were:

• Concrete measures and taking account of the business viewpoint: It was insisted in many of the replies that the Arctic expertise available in Lapland (held by the University and the University of Applied Sciences, for example) should be linked with business more closely. ’Things are now done separately without setting business goals or having business expertise. Project goals should be specifically targeted at launching business.’

• Sustainable development and the combining of industries: ’Increasing cooperation and generating agreement between different sectors: tourism, mining, forestry, culture etc. Enhancing the opportunities of the sectors in a manner that will promote regional employment and economy without unsustainably over-exploiting nature...’

• Role of the public sector as a network actor and link between experts: ‘In my opinion, there should be a public network coordinator who would manage projects and get as many companies as possible involved in the activities. This would help the establishment of networks and doing things together and also promote regional well-being.’

• Special Arctic opportunities and challenges: ’Opportunities and requirements of the

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commercial adopti on of the North-East Passage.’ ’Tourism programmes, in which Chinese tourists, for instance, would be taken directly to Kirkenes by boat and to Rovaniemi by road.’ ’Year-around availability of nature trails.’ ’Monitoring large-scale projects, and matt ers related to their schedules.’

• Access to the internati onal markets, including large-scale Arcti c projects.

Companies want concrete results

2.1.2 Lapland of industries - Arcti c business

The key actors and operati ons in Arcti c business in Lapland are presented in the fi gure below (Figure 5).

It is challenging to defi ne what exactly is Arcti c business. Here, the basic criteria are the uti lisati on of Arcti c natural resources and conditi ons, use of experti se related to Arcti c conditi ons in products and services, and actual Arcti c products.

Arcti c business involves the uti lisati on of natural resources and experti se

related to Arcti c conditi ons in products and services

A mine or industrial plant, for example, does not automati cally pursue Arcti c business even if it operates in the north. However, companies do have to take Arcti c conditi ons into considerati on in their operati ons, which

Figure 5: Arcti c business in Lapland

Sustainability and Society

Customers of Arctic production and services

Arctic Extractive industriesLarge-scale Arctic projects

Customer / user needs Arctic Specialisation

Arctic Human Capital

Competence of Arctic

Research and EducationCom

pete

nce

of A

rctic

Au

thor

ity

Arctic knowledge networks and partnerships

Branches of Activities and Industries Experts to Operate in the Arctic Circumstances

Specific Arctic Issues, for example Indigenous people

Other industries using Arctic production and

services

20Photos: Stora Enso, Detria.fi, Juha Pyhäjärvi, Lappset Group Ltd.

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calls for special expertise and solutions. The same also applies to mining and industrial service suppliers, who must be able to deal with the prevailing conditions and have in-depth expertise in order to address customers’ needs.

The customers of Arctic business in Lapland comprise both large-scale projects (oil and gas industry in Norway and Russia, and the mining industry in the North Calotte) and other services and customers (e.g. Arctic construction and bioeconomy). Research institutes and educational institutions support Arctic business in Lapland, create preconditions and offer new opportunities. Business is controlled and regulated by authorities, who also possess extensive Arctic expertise. Business has networked regionally, nationally and internationally, and also takes account of special questions, such as indigenous peoples.

The average annual turnover of companies in Lapland totalled approximately EUR 10 billion in 2007-2011. Of this, 59% was generated in the Kemi-Tornio region, 23% in the Rovaniemi region and the rest in other parts of Lapland. The urban regions of Rovaniemi and Kemi-Tornio, which altogether have slightly over 120 000 inhabitants, can be considered the drivers of Lapland’s economy - the centres of services and industry. Thanks to tourism and mines, companies are increasing their turnovers considerably especially in Fell Lapland and Northern Lapland.

Large-scale Arctic projects are highly significant investments in areas where natural resources are utilised, and there are also major investments related to infrastructure, tourism and services. Several billions of euros are invested in the northern parts of Europe every year. The companies in Lapland have successfully participated in competition for investment projects in the region. They have also been successful in Northern Sweden, whereas only few of them have managed to benefit from the growth in the oil and gas industry in Northern Norway.

Large-scale Arctic projects utilise natural resources

There are abundant renewable natural resources in Lapland, such as forests, farmland, water and wild game. Lapland is part of the northern coniferous zone and has extensive forest resources. Currently commercial forests yield more wood than what is exploited. Wood is a renewable, low-carbon raw material and can be processed into a number of products and scaled into profitable business ranging from single carpenter-made items to industrial production worth of billions of euro. Lappish wood is already processed in a variety of ways into energy chips, sawn timber, playground equipment, houses, pulp, board and paper, for instance. The intention is to further increase the utility value of hard, slow-growth Lappish wood. In the future, it is important to find new products in wood processing, such as biofuels.

Bio waste from the industry and communities can also be used as bioeconomy raw material. In fact, Lapland is well positioned to become a model region in bioeconomy, which refers to economy that uses biological natural resources to produce food, products, energy and services. It seeks to reduce dependency on fossil energy, prevent the impoverishment of ecosystems and promote sustainable economic development.

The most high-quality and diverse tourism services in the Arctic regions can be found in Lapland, which has numerous fell centres, city-based tourism centres, and different types of natural and cultural attractions. Broadly understood, Lapland’s tourism is entirely based on the utilisation of Arctic conditions. The most important attraction factors are its harsh nature and conditions (eight seasons, landscapes, the cleanest air in Europe, snow, ice, water, the Polar night, northern lights and the midnight sun).

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The most high-quality tourism services in

the Arctic regions are available in Lapland

Arctic conditions also allow the provision of tourism experience services, such as glass-roofed igloos for admiring northern lights, different types of snow and ice constructions, ice-breaker cruises on frozen sea, visits to reindeer farms, husky and snowmobile safaris, and journeys to cross the Arctic Circle.

Perhaps the best example of systematic communications and brand-building is the localisation of Santa Claus at the Arctic Circle in Rovaniemi. Lapland alone has many places where Santa Claus lives, not to mention other alternatives found around the world. Rovaniemi has managed to profile itself as the ’most genuine’ home to Santa Claus, who is a good example also in the sense that the theme can be linked with the investigation of Arctic business as a whole.

Globally the most interesting example is the winter testing of vehicles. Most of the

testing in Europe takes place in Northern Sweden and Lapland. Companies operating in the sector mainly offer varied testing environments and related services (e.g. accommodation and restaurant services). In addition, the sector invests in better testing environments, in extending testing services and in developing year-around testing.

Most of the vehicle winter testing takes place in

Lapland and Northern Sweden

Lapland is situated in an area interesting from the point of view of receiving satellite materials. Testing operations can be extended further, thanks to the expertise available in the Lapland Meteorological Research Centre. New research and business related to weather services, for instance, are interesting from the point of view of Lapland.

An excellent example of Artic products is snowmobiles, which the Canadian Bombardier manufactures in its Rovaniemi plant - the only unit of this kind in Europe. Of course snowmobiles could be manufactured anywhere, but Rovaniemi has generated special design and manufacturing expertise in the course of decades and also provides outstanding conditions for snowmobile testing.

Special snowmobile expertise focused in

Rovaniemi

Photo: Hotel & Igloovillage Kakslautt anen

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Mining operati ons and the gas and oil industry have increased considerably in the Barents Region, which has resulted in broad transport and logisti cs development needs. Many of the surveys on the development of transport in northern regions (e.g. Transport Needs of the Mining Industry in the North 2013, published by the Finnish Transport Agency, and the Arcti c Railway 2012 prepared by the Northern Lapland Joint Municipal Authority for Regional Cooperati on) describe the developing transport needs of the north and their regional impacts. New transport connecti ons will also generate extensive service business and indirect jobs.

The size and growth potenti al of Lapland’s Arcti c business sectors are shown in Figure 6. However, uncertainty around trends in the global economy and the operati onal environment that may aff ect the mining industry, for example, must be taken into considerati on in the assessment..14

14 Source: Lapin Luotsi (adapted).

2.1.3 Lapland of innovati ons

Starti ng points of innovati on acti viti es

The purpose of Innovati on acti viti es is to create new products and services. Another aim is to introduce more effi cient producti on and acti on models, competi ti ve advantage and higher producti vity, which can be enhanced by uti lising new technology, improving experti se and specialising. Acti ve innovati on is the cornerstone of boosti ng competi ti veness and producti vity growth both in business and the public sector.

Producti on and value chains are broken down into smaller parts in the face of economic change and in the internati onal division of labour, i.e. specialisati on is gaining strength as a phenomenon. On the other hand, some actors are strengthening producti vity and their competi ti ve positi on by adding service elements to their industrial products, for instance.

Figure 6: Size (turnover) and growth potenti al of sectors related to Lapland’s Arcti c business14

Size

of i

ndus

try

in L

apla

nd

Growth potential of the sector highlow

large

small

Forestry industryMetal industry

Mining and industrialservice companies

Reindeer herding

Naturalproducts

Local food

Green construction industry

Biofuels

Arctictesting

MiningTourism

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The main economic sectors are traditionally divided into primary production, processing and services. However, this is a very rough classification and does not give a correct picture of the sectors or of their internal change. According to some estimates, as much as a half of international export industry jobs are classified as services related to the product, the customer or companies. The change in primary production has resulted in a transition to services through processing. This phenomenon is underlined by the consumer demand for organic and local food, which in turn has increased the economic importance of primary production.

Service processes have changed, due to fast information technology development and digitalisation. According to a traditional view, services are consumed almost at the same time as they are produced, whereas digital services can be consumed regardless of time and place. Trade, travel agencies, education and entertainment in particular have entered international information networks to stay.

Lapland’s Arctic innovations

The global economic change is also evident in Lapland. Transitions within and between primary production, processing and services provide the basic starting points for innovation activities in Lapland. International development suggests that specialisation is the path to improve productivity and competitiveness. In the international division of labour, companies in Lapland are, by their very nature, in the position to develop and specialise in the refining of Arctic natural resources (industry, mines and forests) and conditions (tourism) and to make use of the expertise they have in Arctic conditions. Lapland is by far the forerunner in developing tourism in the Arctic regions. The tourism industry has kept close eye on trends, of which the most recent one is wellness tourism that

offers Lapland the chance to combine its various sectors. The utilisation of expertise in natural products, for instance, will create innovations for use in wellness and health tourism products and services.

Lapland’s innovation activities are targeted at fields estimated to offer growth potential and impact. There are growth opportunities in several fields of expertise in Arctic business, and innovation investments should not be limited to technology only. According to the results of some surveys, the most important factors contributing to the growth of companies in any sector are15 the combinations of technological, marketing and organisational innovations. This finding should be one of the key points of departure when outlining Lapland’s and Arctic innovation activities.

Lapland’s research institutes and educational institutions provide a good basis for Arctic innovation activities. However, they should specialise more boldly in Arctic themes. This could strengthen the position of the institutions in the national division of labour between education and research. At the same time it would offer strong support to developing Arctic business in Lapland.

Lapland’s research institutes and educational

institutions should specialise more boldly

From the point of view of Arctic business and innovation activities, internationally interesting real-life testing and pilot environments, or living labs, have been set up in Lapland. Good examples of innovation environments of this kind are numerous tourism areas, urban centres, villages, transport infrastructure, areas used by the

15 ETLA uutta arvoa palveluista, http://www.etla.fi/wp-content/up-loads/ETLA-B256.pdf.

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Finnish Defence Forces, windfarms, and mining and industrial environments. One of the most interesting environments is connected with the testing of vehicles and tyres.

Lapland arouses international interest as a testing and pilot

environment (a living lab)

Lapland’s testing and pilot environments have opened doors to the testing business. At the same time, opportunities have emerged to develop, commercialise and conceptualise expertise in Arctic conditions into new business. Arctic conditions can be refined into a profitable business idea most naturally in tourism, in which the living labs provide continuous information on customers’ experiences and purchase decisions. In mining and industrial operations, Arctic conditions mainly impose challenges in construction and maintenance, for example. These challenges must be addressed in sustainable, cost-efficient ways that can also be multiplied and commercialised for use in other projects.

Arctic Design is an interesting, evolving sector contributing to Lapland’s profile. It will hardly change the balance of Lapland’s key industries, and its potential lies elsewhere. Arctic Design and its tools cut across many sectors. Design can act as an important instrument in the commercialisation and conceptualisation of expertise in Arctic conditions into new business. In the Design Finland programme (Ministry of Employment and the Economy/Ministry of Education and Culture 2012), the University of Lapland was ranked among the three centres of expertise in Finland whose potential field of expertise is Arctic design.

Arctic design is a future industry

Lapland has produced a number of Arctic innovations, such as solutions for the large-scale industry, new innovations for small firms, and Arctic innovations for the public sector.

2.1.4 Lapland of expertise

Expertise in Lapland rests on the network of higher education institutions, vocational institutes and sector research institutes, which cover the whole Lapland.

The higher education institutions of Lapland, the Kemi-Tornio University of Applied Sciences, the University of Lapland and Rovaniemi University of Applied Sciences have acted as pioneers developing regional cooperation in Finland by first establishing the Lapland Regional University and later the Lapland University Consortium. The purpose of the cooperation has been to ensure that the higher education institutions, which are among the northernmost in the whole of Europe, will also be able to offer educational and research services in the future. The Kemi-Tornio University of Applied Sciences and Rovaniemi University of Applied Sciences will be merged into Lapland University of Applied Sciences on 1 January 2014.

Since 2008, the consortium has had a joint Innovation programme, which has defined the priorities of research, development and innovation activities (RDI). As a result of the cooperation, two institutes have been founded together with vocational education:

• The Multidimensional Tourism Institute is a joint institute made up of tourism research at the University of Lapland, the tourism, hospitality management and finance degree programmes of Rovaniemi University of Applied Sciences, and Lapland Tourism College.

• The Institute for Northern Culture is a

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joint institute for the Faculty of Arts of the University of Lapland, Business and Culture at Kemi-Tornio University of Applied Sciences, and cultural education at Vocational College Lappia.

The University of Lapland, which has some 5000 degree students, provides education in science and the arts. According to its profile, it specialises in Arctic and northern themes and tourism research. In addition, there are three main multi-disciplinary priorities within the various profile areas: service design, northern well-being, changing work and sustainable development, and justice and fairness.

The fields of education and research covered include pedagogy, tourism and business, law, industrial art, social sciences, and northern and Arctic themes. The university promotes sustainable development, well-being and equality both regionally and globally. The University of Lapland also houses the Arctic Centre, which produces information for securing sustainable development in Arctic regions.

The University of Lapland, which has some 5000

degree students, provides education in science and the arts. According to its profile, it specialises in

Arctic themes.

The future Lapland University of Applied Sciences16 will be a driver of change

16 To be established on 1 January 2014 when Kemi University of Applied Sciences and Rovaniemi University of Applied Sciences are merged.

and growth in the Arctic operational environment. It will transform the strengths and opportunities of its changing Arctic operational environment into new vitality to address the needs of northern areas. Its strategic core is expertise in Arctic conditions. The strategic priorities of Lapland University of Applied Sciences are Arctic cooperation, expertise in northern borders, promoting the intelligent use of natural resources, management of distances, and security expertise. Entrepreneurship and business development are a cross-cutting theme in all the priorities.

The future Lapland University of Applied

Sciences will be a driver of change and growth

in the Arctic operational environment.

Lapland Vocational College is a vocational educational institution run by Rovaniemi municipal education and training consortium. It arranges vocational basic and adult education in all fields of education. Some 5000 students study in the college every year. Other sources of vocational education in the Rovaniemi municipal and training consortium are the Lapland Tourism College profit area, the Santa Sports Institute enterprise and the Lapland Apprenticeship Centre.

Vocational College Lappia is run by Kemi-Tornionlaakso municipal education and training consortium. The college has 2700 young students and some 1300 adult students. Basic degrees can be completed in five fields: well-being, culture, nature, social services and technology.

The Sami Education Institute is a unique

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educational institution, with Inari as its main place of operation. The aim of the institute is to increase the vocational expertise of the Sami, arrange education mainly for the needs of business in the Sami area, promote regional employment, and maintain and develop the Sami culture. It arranges basic vocational education, vocational continuing and supplementary education, and courses and semester-based education in Sami language and culture.

East Lapland Vocational College in Kemijärvi offers education in a variety of fields. Students can complete qualifications in services, production, social services and natural resources.

The research expertise base in Lapland is strengthened by extensive research into natural resources, which is pursued by separate regional units in the sector institutes.

The Arctic Centre of the University of Lapland specialises in multi-disciplinary Arctic research into global change, sustainable development, environmental and minority rights, and Arctic information structures. It communicates on Arctic issues through information services, a library, and science centre exhibitions. In addition, the centre acts as an expert for Finnish government in international politics regarding themes related to the Arctic Region. In fact, Finland will propose to the EU that an Arctic information centre should

be established at the Arctic Centre. The information centre would serve the Arctic information needs of the entire European Union.

The Geological Survey of Finland GTK is a leading European expert in the assessment, research and sustainable use of mineral resources. Its mission is to produce the geological information needed by the business sector and the society in order to promote the controlled, sustainable use of soil and natural resources. The GTK’s unit in Northern Finland specialises in services to the mining industry.

The Northern Finland unit of the Finnish Forest Research Institute Metla specialises in research into ecologically and economically efficient forest regeneration and cultivation methods. It also investigates the combining of different types of forest use and questions related to nature tourism.

MTT Agrifood Research Finland specialises in the cultivation of feed, food, ornamental and special plants and in the semi-cultivation and collecting production of natural plants under cold conditions. Research information is used to promote the availability of pure raw materials and the utilisation of northern quality in rural businesses.

The Finnish Game and Fisheries Research Institute RKTL has four units in Lapland, which specialise in research into reindeer husbandry, wild game monitoring

Lapland Vocational College, Lappia, the Sami Educational Institute, East Lapland Vocational College, the Arctic

Centre, the Finnish Forest Research Institute, the Geological Survey of Finland, Agrifood Research Finland, the Finnish

Game and Fisheries Research Institute and the Finnish Environment Institute are part of Lapland’s research and

education network.

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and research, the monitoring of fish stocks and fisheries, and research related to the most important lakes and rivers in Lapland, including the monitoring and investigation of Atlantic salmon, which calls for international cooperation17.

Finnish Environment Institute SYKE produces multi-disciplinary environmental research covering the area of Lapland. Important information on Lapland is also produced by the Centre for Economic Development, Transport and the Environment and the Regional State Administrative Agency as part of their official tasks.

The regional laboratory of the Radiation and Nuclear Safety Authority STUK in Rovaniemi is responsible for research into northern food chains and radio ecology, and the radio activity analysis of food and environmental samples in the provinces of Lapland and Oulu.

Lapland Meteorological Centre in Sodankylä is a versatile, highly sophisticated observation and research platform for projects, which are conducted by its own staff and visiting researchers. The centre produces a wealth of information on the effects of the layers of the atmosphere and vegetation, soil and snow. The measurement data are used to constantly develop new remote surveying and modelling methods for monitoring and predicting environmental changes.

Sodankylä Geophysical Observatory is a national institute that operates under the University of Oulu. The purpose of the observatory is to carry out running geophysical measurements for the needs of research and practice. It publishes measurement-related materials and pursues continuous research and development work. The measurements are part of Finland’s obligations in global research.

There are also other important research institutes in Lapland, such as the University of Helsinki’s Kilpisjärvi Biological Station and

17 METLA, MTT and RKTL will be merged as the Natural Resource Cen-tre at the beginning of 2015.

the University of Turku’s Lapland research institute Kevo.

2.1.5 International Lapland

Although Lapland is the northernmost region in the EU, and one of the most peripheral ones, the international dimension has always been part of the everyday lives of its people. Lapland is the only Arctic region in Finland that is surrounded by three other Arctic countries. In fact, Lapland is Finland’s most international region also known worldwide. Its location as the neighbour of Sweden, Norway and Russia has promoted internationalisation, which shows by nature in many daily contexts.

Cross-border cooperation in the North Calotte and the Barents Region has long, well-working traditions. The forms of cooperation are flexible enough to allow quick reaction to changing conditions and to find new operating models, as necessary. Arctic cooperation plays a key role in view of Lapland, considering that Arctic regions are evidently gaining in global importance. In addition, Lapland acts as the gateway of the whole EU to Arctic regions.18

Among other things, Arctic cooperation in Lapland is pursued by the Arctic Council, the Arctic University, the Northern Research Forum, the Arctic collaboration scheme of the Sami Education Institute, and the Northern Forum. The centre of Lapland is Rovaniemi, the largest and internationally the most well-known city. It plays an important role as the international centre for Arctic expertise and a place where people meet. It is also closely connected with the globally known Christmas and Santa Claus brands and acts as the centre for preparing the EU’s Arctic Information Centre.

The funding programmes available through Finland’s EU membership have encouraged one to develop Lapland’s

18 Lapland’s International Operation Strategy 2015/2030.

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international dimension further. The EU’s Interreg and Kolarctic ENPI programmes have strengthened international cooperation in education, research and different types of development activities.

The international mobility of university cooperation has developed education and research in global competition. Founded upon the initiative of the University of Lapland in 2001, the Arctic University network has generated strong expertise capital. The network brings together more than 130 actors from Arctic regions. The EU’s Arctic Information Centre has assigned the responsibility for running the centre to the Arctic Centre, which will strengthen Lapland’s international research expertise further.

Companies in Lapland are often characterised by a local international dimension. One of the most important industries in Lapland’s regional economy is tourism, the growth of which largely relies on foreign tourists. The globalisation of the tourism market and the increased use of the Internet have improved the visibility of Lapland on even broader international tourism markets.

Globalisation and vast natural resources have increased the interest of international large-scale industry in Lapland and other Arctic regions. Mining investments have promoted the internationalisation of SMEs in Lapland and also created a competence base for becoming established on the global market.

The backbone of Lapland’s economy is the large-scale industry, which relies on the processing of wood and metal and mainly focuses on the global market. In addition, there are SMEs in Lapland that specialise in different fields and whose customers are mainly global.

Although Lapland is an international region, internationalisation must be developed further so that it will bring distinct economic added value to the

business sector. The financing of education and RDI operations will also be more dependent on Brussels or the financial aid available from other international sources in the future.

Lapland is the most international region in

Finland

2.1.6 Sustainable Lapland

Lapland lives out its natural resources and natural conditions, so the ability to maintain balance in sustainable development is a key issue in view of its survival. It is challenging to maintain preconditions for sustainable development under Arctic conditions. Special challenges are posed by the broad international interest shown towards natural resources (especially minerals and metals). The mining industry is establishing itself in Lapland, which has aroused a lot of debate on how to reach a balance between economic interests, the environment, and social and cultural factors.

The mining industry will generate awaited investments in the region, which in turn will promote employment and development in cities and municipalities. On the other hand, one must make sure that mining economics is capable of living side by side with other industries, such as tourism, reindeer husbandry and industries based on renewable natural resources. The challenges posed by the need to combine different sectors (such as land use) are constantly evident in Lapland, too, and regional development work is based on compromises and taking account of the needs of different stakeholders.

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Lapland lives out of its natural resources and

natural conditions

In practice, sustainable development in Lapland means sustainable societal development. The cornerstones of societal development are economic, ecological, social and cultural sustainability, whose mutual balance creates preconditions for socially sustainable development and safe living. Efforts have been taken to ensure balanced development in Lapland, with a view to addressing the needs of the whole region.

The cornerstones of societal development are

economic, ecological, social and cultural

sustainability

Economic sustainability in Lapland refers to the utilisation of Arctic natural resources and conditions. The aim is to generate long-term balanced growth, which will bring

equal benefits to all parts of the region. Lapland of sustainable mining industry refers to policies that are consistent with the action plan ’Making Finland a Leader in Sustainable Extractive Industry’, which was published in 2013.

Ecological sustainability in Lapland refers in particular to the sufficient protection of sensitive nature and the maintenance of diversity and Arctic ecosystems. The idea is to promote actions through which the environmental loading caused by the society and other branches of industry can be controlled.

Social and cultural sustainability in Lapland creates preconditions for taking account of regional characteristics and special features, on which the balanced development of the region is based. Maintaining and utilising a strong competence base in production and in service development will promote the social development of the region.

Factors creating the basis for socially sustainable development in Lapland are presented in the figure below. The basic pillars of sustainable development consist of features and background elements characteristic of Lapland, combined with general global needs (e.g. safety, maintenance of expertise and business development).

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19

19 Based on the EU’s sustainable development strategy and nati onal sustainable social commitment. The fi gure is based on the presentati on of ‘Internati onal Insti tute of Sustainable Development’.

Figure 7: Basic pillars of sustainable development in Lapland19

Integration between economic sectors

Industry based on natural resources and conditions

Socialand cultural

sustainability

Sustaining the diversity of the nature- Ecosystems typical for the Lapland- Balanced utilisation and preservation

Recognising the originality and characteristics- Lappish rural villages- Sami people –arctic experts- Lappish identity

IndustrialLapland

Development of service economy

Sociallicensing

Sustaining the vitalityof the region

Viable knowledge and skills

Social capital

People’s Lapland

Secure future

Fragilenature

Managing theenvironmental

stress

Ecological sustainability

Economic sustainability

Sustainable development

32Photos: The Regional Council of Lapland, Timo Ari, Agnico Eagle / Kitti lä mine, Lapland The North of Finland

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3. Vision And Strategy Of Lapland’s Arctic Specialisation

Arctic expertise is an everyday element in all spheres of life in Lapland. The local people have adapted their activities to the surrounding sensitive nature and want to develop their capabilities as the inhabitants of the most Arctic region in Finland to become leading experts in sustainable development. For the local people, international cooperation, too, is a natural part of their everyday lives, as shown in Section 2.1.4. As a result, it is safe to say that Lapland is already there where others want to be! However, Lapland also wants to make sure that it will remain an active, competent Arctic expert in the future as well.

3.1 Vision

Vision 2030: Lapland will enjoy a leading position in the utilisation of Arctic natural resources and Arctic conditions. As the most Arctic part of Finland, Lapland will commercialise its Arctic expertise and make sustainable use of Arctic business opportunities. Lapland will be an active Arctic player and an important international centre of Arctic transport and knowledge. Lapland will act as a link between the Arctic Region and the European Union and offer its inhabitants an original, attractive place for living.

The vision of Lapland’s Arctic Specialisation Programme is a future-oriented description reflecting a distinct

mindset and target state and outlining the objectives of Lapland as an Arctic Region. It also sets out the priorities that Finland as an active player wishes to focus on in Arctic operations and interaction in future. Lapland does not to want to be a mere onlooker in the development of the Arctic Region.

Lapland does not want to be a mere onlooker

A key element in the vision of Lapland’s Arctic Strategy is the sustainable utilisation of Arctic opportunities also commercially. Lapland and Rovaniemi, the centre of Lapland, share a long history and play an important role in the Arctic policy and the international cooperation process. Lapland’s special Arctic position and expertise must be taken into consideration and utilised nationally. Arctic regions and their natural resources are attractive globally.

Lapland is active

Lapland’s industrial vision for 2030: Lapland grows by nature.

• The cornerstone of industry in Lapland is the refining of natural resources based on the principles of sustainable development.

• The industry and operating environment in

Lapland is already there where others want to be!

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Lapland have reached a level where Lapland att racts new companies and employees by nature.

• Lapland’s industrial actors are internati onally desired network partners.

• Lapland’s industrial growth stems from innovati veness and Arcti c experti se.

Lapland grows by nature

3.2 Six cornerstones of Arcti c development in Lapland

Six cornerstones of Arcti c development have been recognised in the preparati on of the Arcti c Programme, on which Lapland’s Arcti c Specialisati on Programme can be built.

Accessibility is absolutely essenti al for the development of peripheral areas, such as Lapland. It is fundamental to ensure the cost-effi cient mobility of people, raw materials and products, and the availability of suffi cient transport connecti ons (including telecommunicati ons connecti ons) so that Lapland can also be developed from the Arcti c viewpoint.

The sustainable refi ning of natural resources and natural conditi ons now and in the future is the cornerstone of Lapland’s Arcti c Programme. The role of Arcti c natural resources has become more important in Lapland in the last few years parti cularly

Photos: Arcti c Power, Kalle Juntti la

2013 2020 2030

LAPLAND’S ARCTIC SPECIALISATION

PROGRAM

Currentsituation

Midtermobjective

Vision

Figure 8: Lapland’s Arcti c Specialisati on Programme: Vision 2030 and intermediate target 2020.

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as a result considerable increase in mining operati ons. Lapland is a nati onally and internati onally important region in terms of both non-renewable and renewable natural resources.

Increasing value added has become an important cornerstone in the preparati on of Lapland’s Arcti c Programme. This aspect is oft en closely connected with the availability and price of energy. Increasing value added should not only be understood as the intenti on to increase raw material processing in Lapland but should also be extended to all economic acti viti es. Lapland’s forest and farmland resources should be processed much further in the processing chain within the boundaries of the region. Lapland’s natural products are processed in the region more extensively than earlier.20

More extensive use must be made of Lapland’s Arcti c experti se. At the concrete level, this means new products and services based on and uti lising the vast Arcti c experti se that has accumulated in Lapland.

20 Strengthening ground, growing spearheads and ferti lizing weeds, Sotarauta & Kosti ainen 2008.

It must also be ensured that diverse Arcti c research and educati on is pursued in Lapland in the future. The Arcti c experti se of research insti tutes and educati onal insti tuti ons must be commercialised. In additi on, experti se in ’Arcti c everyday life’ must be commercialised into products and services. The public data resources opening in the public sector, for instance, also off er new opportuniti es for commercialising Arcti c experti se.

Targeted innovation policystrategies – focusing– exceptional ability

Common innovation policyCommon knowledge – multidisciplinary – generic ability

Spearheads of development and progress

Exploratory Innovation policyPotential new and unexpected spearheads

Figure 9: Innovati on and development policy investi gati on model20

Phot

o: R

egio

nal C

ouncil

of Lapland

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Sustainable Arcti c policies are and will remain essenti al cornerstones in the Arcti c success of Lapland. Lapland’s vulnerable, slowly renewing Arcti c living environment places high environmental requirements, which must be addressed using the best technologies available and with an atti tude that respects the environment.

Arcti c pride is the sixth cornerstone of Lapland’s future success. A positi ve Arcti c atti tude, faith in the future and pride about the unique Arcti c living environment make up a sustainable base for planning and implementi ng the future Arcti c Lapland at the level of citi zens.

3.3 Strategic Arcti c prioriti es of industries in Lapland

The investi gati on model of Sotarauta and Kosti ainen (2008) is used to identi fy and

select strategic prioriti es in Lapland’s Arcti c Programme. The model seeks to ensure balanced development between three main enti ti es (see Figure 9). The general innovati on and development policy ensures long-term operati ng preconditi ons for all actors. The targeted innovati on and development policy is focused on a specifi c sector or cluster. An experimental innovati on and development policy provides a basis for growth for randomly generated innovati ons. It also seeks to look for new ideas by encouraging people to experiment and take risks (Sotarauta 2009).

Lapland’s Arcti c development spearheads and the related close and supporti ve branches are presented in Figure 10. The leading principle is the sustainable uti lisati on of natural resources and conditi ons. Instead of a simple division between branches, the aim is to fi nd cross-cutti ng Arcti c business opportuniti es across sectoral boundaries.

Thematic spearheads of the regional economy

Mining andmetal industries Bioeconomy

Tourism andrelated industries

SME Services and Industriesarising from the needs of

large industries

SME refiningnatural resources Independent

or new industries

In Lapland we’re looking for the functional spearheads supporting

the development diversely

Stimulating and nurturing next generation’s industries

- strengthening and sustaining the basic industries- Generating new industries

Education, research and development betterintegrated in the refining new products and services

Figure 10: Lapland’s Arcti c Specialisati on Model: spearheads, new emerging branches and supporti ve infrastructure

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The leading principle is the sustainable uti lisati on of natural resources and

Arcti c conditi ons

3.3.1 Prioriti es of Arcti c business in Lapland

From the point of view of Lapland’s future, aspects to be highlighted are the sustainable uti lisati on of natural resources and conditi ons and increasing value added. The driving sectors related to Arcti c natural resources in Lapland above all rely on the uti lisati on of the extracti ve industry and forests and on infrastructure based on a vital village network. On the other hand, Arcti c natural conditi ons create the foundati on for developing the tourism business and testi ng acti viti es.

A globally very interesti ng and

commercialisable fi eld of experti se is the socially, ecologically and economically sustainable combinati on of diff erent business operati ons. Experti se in the multi ple use of Lapland’s Arcti c nature is an export product.

One of the key goals is to develop the existi ng and future mines in Lapland into Arcti c examples of sustainable development. The key issues are overall resource effi ciency, the minimisati on of residue, taking account of other branches, and social acceptability. It is also important to uti lise deep-lying ore (ore resources not visible on the surface) and to develop ore prospecti ng methods suitable for use in sensiti ve natural conditi ons. Geoenergy off ers research, innovati on and business opportuniti es in the Arcti c environment.

Mineral processing involves large-scale energy and capital intensive operati ons. It is in the interest of people living in Lapland to promote soluti ons that allow the further processing of minerals in the region. This calls for eff orts to enhance experti se,

ARCTIC NATURAL RESOURCES

SME industry

SUSTAINABLE SOCIETY

ARCTIC BUSINESS EXPERTISE

Arctic knowledge networks and partnerships

ARCTIC NATURAL CONDITIONS

Customer/User Needs

InternationalisationEnablingtechnology

Proficient arctic authorities

Arctic education and research

Arctic products and services

Arcticknowledgeresources

Figure 11: Arcti c natural resources and natural conditi ons in relati on to the network of actors in Lapland Refi ning natural resources

38Photos: Lapland The North of Finland, Mikko Jokinen

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accessibility and energy (energy price). The utilisation of natural resources

essentially involves mining and industrial service companies. World-class mining and industrial actors create constant demand for specialised services, such as maintenance services, at the investment stage and over the long term. Resource efficiency, the minimisation of residue and the development of new symbiosis products combined with expertise in Arctic conditions will offer specialised service suppliers new, unrecognised business opportunities.

Industries based on bioeconomy21 will continue to play an important role in the history of Lapland’s economy in the future, too. Lapland’s forests offer opportunities for diverse business. New volume products, such as biofuels, are needed to supplement the main forest utilisation line (wood, paper and board). New local energy solutions can be adopted, thanks to abundant energy wood resources. Energy-efficient, low carbon timber construction is also part of Lapland’s development.

The utilisation of natural resources and the further processing of foodstuffs are smaller scale operations in which hundreds of small companies and thousands of local people in Lapland are engaged. The natural resource sector and farm products, reindeer, wild game, fish, berries, herbs and mushrooms are part of the Arctic business, offering vast development potential.

Large-scale Arctic projects offer overseas mining and industrial service companies broad opportunities, though they also involve challenges. As a rule, the companies in Lapland are too small to operate alone in the offshore projects of Northern Norway. However, infrastructure investments in the mainland also offer opportunities to smaller actors. Companies need solutions that promote cooperation in order to take advantage of the Arctic investment boom.

21 Bioeconomy refers to economy that uses biological natural resources to produce food, products, energy and services. http://www.biotalous.fi/biotalouden-askelmerkit/biotalous-lyhyesti/.

Utilisation of natural conditions

Global tourism is being reshaped. Europe is losing its market share, whereas Asia is gaining in importance in terms of arrivals and departures. Lapland and other Arctic regions will be attractive destinations for new and growing markets. Success in global competition requires attractive tourism centres that act as drivers of developing tourism. Competition also calls for networking with small companies, whose strengths usually are authentic, customised tourism services.

The competitiveness of Arctic tourism relies on the utilisation of natural conditions, the sustainable use of nature, cooperation between actors, service quality, innovative product development, and efficient communications and marketing, for instance. It can be said that tourism companies are refining Lapland’s nature and Arctic conditions into experiences and services.

Growth in Arctic tourism could be triggered through small investments if the sector is capable of developing year-around tourism activities instead of only relying on seasonal services. In addition to improving accessibility, this is one of the most important goals in tourism development. At the same time new products and services must be identified and processed. Digitalness and global information networks allow Arctic experiences in Lapland to be communicated, marketed and sold in a cost-efficient manner. Utilising the preconditions for intelligent transport, and tourism and service chains, for example, will improve digital accessibility and the adoption of applications.

Snow and ice in different forms are an essential part of Arctic experiences. Therefore, investments should be made in snow and ice construction. In addition, new-generation products are needed that can be implemented as experiences in an energy-efficient manner throughout the year.

Expertise in Arctic conditions has also

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emerged in Lapland in the preparation of forecasts for lakes and rivers and in related construction. Forecasting floods, for instance, could offer major international business opportunities, because other countries, too, have to struggle with melting snow and ice causing floods that are difficult to predict.

Arctic vehicle testing is an excellent example of refining natural conditions into high-quality business. Most of the testing operations in Finland are already carried out in Lapland and offer international growth opportunities. Basically, there are three development directions: 1) proceeding in the value chain and offering even broader testing services, 2) developing testing environments and seeking to offer year-around services and 3) offering broader, more high-quality supplementary services (e.g. accommodation, restaurants and experiences). New business opportunities are also available through extending testing services to new customer groups.

3.4 Education and RDI22 as part of Lapland’s Arctic specialisation

Lapland’s Arctic Specialisation Programme is Lapland’s response to the demand of the European Commission for smart regional and national specialisation strategies. The point of departure was to determine the economic strengths and development spearheads of Lapland for the programming period 2014-2020. The programme should act as an instrument helping one to find regional solution models and answers to challenges related to stable development. The guideline is to follow a user-oriented innovation policy in which research and education are based on the needs of the region’s industries. In addition, broad cooperation ensures the best possible regional and economic effectiveness.

22 Research, development and innovation activities

Education and RDI operations play an important role in view of regional development. Based on the principles of smart specialisation, the planning work focused on finding the interfaces through which the best possible outcome can be achieved through cooperation between business, education and RDI actors.

The thematic spearheads selected in the Arctic Specialisation Programme for economic development will be used as the drivers of regional growth during the programming period. The recommendations and concrete proposals for action presented are based on economic needs. The precondition for economic growth is the availability of skilled labour, cooperation in the development of new innovations and the sufficient availability of information to support decision-making. To implement these preconditions, the role and importance of different actors must be considered with regard to different measures. Education and RDI activities play a crucial role in the actual implementation of the programme in order to fill the expertise and knowledge gap. The achievement of the goals of the programme is based on close, fluent cooperation between the business sector and education and research organisations in Lapland.

Most of the research in Lapland takes place in universities and the units of research institutes. The role of education and RDI activities varies according to proposal, though it can be envisaged at the same time that the work will not succeed without strong inputs from these two parties.

Regional education and RDI development needs were also recognised during the preparatory work, and solutions were sought to them. In addition, needs must be identified and a knowledge and expertise base outlined for supra-regional, national and international networking.

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4 Implementation Of Lapland’s Arctic Specialisation Programme

4.1 Implementation of selected priorities in 2014-2020

The following chapters discuss implementation of Lapland’s Arctic Specialisation Programme in 2014-2020. The focus is on three chosen priorities: refining Arctic natural resources, utilising Arctic natural conditions and pursuing cross-cutting development enabling Arctic growth.

The refining of Arctic natural resources includes the spearheads of sustainable Arctic mining, Arctic bioeconomy, large-scale Arctic projects, and the small and medium-sized industry.

The utilisation of Arctic natural conditions includes sustainable tourism, low-carbon Arctic construction, Arctic innovation research and testing environments, and the spearheads of the tools utilised in Arctic conditions.

Cross-cutting development for Arctic growth includes the following spearheads: the accessibility programme, new business from Arctic innovations, cross-cutting Arctic research and education, digital Arctic solutions and securing international financing.

The spearheads of each priority and their proposed actions are presented in the summary below. Single proposals for action are discussed after the summary in Sections 4.1.1. - 4.1.3.

4.1.1 Refining Arctic natural resources

Objectives: • To refine Lapland’s renewable and non-

renewable Arctic resources in Lapland, ensuring as high value added as possible.

• To ensure that industry and mines refining natural resources follow the principles of socially and ecologically sustainable development as ecoefficiently as possible.

• To develop and internationalise Lapland’s ecoefficient solution suppliers who offer industrial and mining services and master Arctic conditions. To multiply the business of Lapland’s service companies in large-scale Arctic projects.

• To ensure that the refining of natural resources will also offer opportunities for smaller scale business - a separate programme for SMEs for the refining of Arctic natural resources.

Spearheads and proposals for action:

New sustainable Arctic industry and mines • Ecoefficient, low-carbon industry and mining• Reforming industrial and mining service

companies• Future mining research programme • Arctic natural resource knowledge and

innovation community

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Arctic bioeconomy• From bioeconomy into business • Increasing cooperation between bioenergy

actors in Lapland • Bioterminals• Utilisation of ash

A large-scale Arctic project programme• Concrete exports to large-scale projects in

Northern Sweden, Northern Norway and Northwest Russia.

• Further processing investigations related to large-scale Arctic projects.

• New business opportunities of Arctic logistics

An Arctic natural resource refining programme for SMEs• Investigations into refining from the point

of view of SMEs• Commercialising new innovations in the

natural resource sector • Developing refining in SMEs

4.1.2 Utilising Arctic natural conditions

Objectives: • To make Lapland a forerunner in the

development of diverse tourism activities in northern regions. To create new internationally attractive tourism products and services based on natural conditions and natural phenomena.

• To pay special attention to safety in Arctic tourism and to socially and ecologically sustainable activities.

• To develop multi-sector research and testing environments and related business based on Lapland’s Arctic conditions.

• To set up tools for expertise in natural conditions for the business sector and developers in Lapland.

• To make Lapland an expert in Arctic conditions, whose know-how is sold globally.

Spearheads and proposals for action:

Sustainable Arctic tourism• An Arctic tourism product and service

development package• Future tourism; an education and research

programme• New-generation snow and ice construction

products• Developing Arctic recreational environments

Arctic innovation research and testing environments • An expert group of Arctic testing business,

education and research • Living Lab networks for Arctic testing • Promoting the use of non-emission vehicles • Intelligent low-carbon Arctic construction

Tools for utilising Arctic conditions• Shaping expertise in Arctic conditions into

new products and services • Material databank on Arctic conditions • Quality manual for Arctic conditions

4.1.3 Cross-cutting development for Arctic growth

Objectives: • To ensure that growth-inducing, cross-cutting

actions support fields of specialisation related to the refining of natural resources and the utilisation of natural conditions.

• A critical aspect with regard to the development of the whole Lapland is good accessibility. Lapland must be developed into the hub of Arctic transport, which will open up new business opportunities.

• Digital solutions are part of accessibility, service solutions for sparsely populated areas and new business opportunities (e.g. data centres).

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• Lapland’s innovation system must be enhanced considerably. New ideas, innovators and entrepreneurs are scarce resources.

• To assign resources to multisector Arctic education and research, which are the foundation of business and the society and the enabler of growth. Arctic education, research and development services will be rendered internationally attractive.

• Increasing international EU funding will expand research and development activities. This will also result in new networks and opportunities in view of the economy.

Spearheads and proposals for action:

Accessibility programme• Opening northern airports • Connections between Lapland and the Arctic

Ocean• Construction of road and railway

infrastructure under Arctic conditions

New business from Arctic innovations• Arctic Innovations Oy• Specialised Arctic business services• Recognising Arctic innovations• Cluster of expertise for Arctic design• Arctic capital investment solutions • TEAM Arctic• Arctic brand work• From Arctic indigenous industries to an

innovation• Sodankylä innovation centre

Arctic digital solutions• Utilising Arctic public data resources• Arctic cloud service• Remote multi-sector health and well-being

innovations • eLappi Campus – a need-based expertise

development environment• Digital services into a competitive element

Cross-cutting Arctic education and research and development activities • A cluster of top-flight expertise in Arctic and

northern research• An Arctic education, research and

development commercialisation programme • The UArctic network and business contacts• Arcticness as part of education • Development and commercialisation of

Arctic safety expertise (tourism, industry and natural resources)

• Promoting the acquisition of international EU funding for Arctic growth

• Strengthening the operation of the Arctic information centre

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Spearhead: New sustainable arctic industry and mining

The aim is to refine Lapland’s Arctic natural resources in a socially and ecologically sustainable manner, seeking to generate as high value added as possible in the region. Industrial and mining service companies will be reformed and internationalised. A specific refining programme will be prepared for SMEs.

Proposal for action 1: Ecoefficient, low-carbon industry and mining

The aim is to implement the BAT principle (Best Available Technology) in processes and policies throughout the delivery chain, based on the lifecycle approach. A multiphase entity in which the existing industrial and mining companies are developed. In addition, networks will be created through innovation platforms operating in real-life environments and allowing analysis, testing and piloting.

Proposal for action 2: Reforming industrial and mining service companies

The idea is to develop new business concepts for Lapland’s industrial and mining service companies capable of dealing with Arctic conditions. In addition, the creation of new products and services and their inclusion as brands in Lapland’s image will be promoted. Another aim is to set up a network of ecoefficient, low-carbon industrial and mining service companies.

Proposal for action 3: Future mining research programme

The programme is based on the idea that mines have several lifecycles (before, during and after mining operations). Their impacts will be investigated within the framework of the region’s economic, environmental, social, legal, technological and cultural contexts and ramifications. Another topic of interest is the formulation of new alternative processes in a closely networked national and international operational environment. The technological and scientific field of research in the programme is the development of ore prospecting methods suitable for use under sensitive Arctic conditions, and opportunities to utilise deep-lying ore resources.

Proposal for action 4: Arctic natural resource knowledge and innovation community

The aim is to promote the profilation of natural resource research in Lapland in a national and international operational environment. This will be enhanced by developing a cluster for regional research into natural resources. In addition, a broader Lapland expertise and innovation community will be established, which will focus on nature resource education and RDI activities. The aim is to turn Lapland’s actors into internationally recognised RDI actors in their fields of expertise, based on the sustainable use and refining of natural resources.

4.2 Detailed presentation of proposals for action

4.1.1 Refining Arctic natural resources

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Spearhead: Arctic bioeconomy

Lapland has traditionally had versatile business that is based on bioeconomy. The role of bioeconomy will become even more prominent in the future, and Lapland is well positioned to become a model region for Arctic bioeconomy.

The aim is to identify and boost strong, rising bioeconomy fields that promote and combine business diversely based on renewable natural resources.

Proposal for action 1: Bioeconomy into business

Identifying emerging bioeconomy-based branches in Lapland and making important strategic choices for the region. Ensuring that Lapland is linked with the implementation of the national bioeconomy strategy and action programme and that its viewpoints are taken into consideration in these. Support measures are related to promoting business that is solely based on bioeconomy and to improving expertise and enhancing product development.

Proposal for action 2: Increasing cooperation between bioenergy actors in Lapland

The aim is to introduce a cooperation model between forest and energy sector entrepreneurs, forest owners and other actors in order to improve the supply, refining and end use of roundwood and wood energy. This calls for the building of new forms of cooperation and networks.

Proposal for action 3: Bioterminals

The aim is to promote the building of a suitable bioterminal network for Lapland in order to support the versatile use of wood and the comprehensive utilisation of raw material (currently too expensive). Complete operation models (harvesting and logistics chains) and research-based information for use in project work, for instance, are not available for setting up small bioterminals in the conditions prevailing in Lapland. Bioterminals could be used to collect, process and store wood and other materials.

Proposal for action 4: Utilisation of ash

One of the aims is to create a practice for utilising ash from power plants in Lapland. Very little use is currently made of ash as a residue product. The themes to be investigated in Lapland are the amount and quality of ’waste’ ash, the types of existing processing operations, costs between different utilisation opportunities, income opportunities, legislative guidelines and transforming the use of ash into business.

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Spearhead: Large-scale Arctic projects programme

Several broad investment projects are currently in progress in the Barents Euroarctic Region, which also offers vast business opportunities to Lapland. The support needed by Lapland’s companies will be promoted in order to help them participate in major Arctic investments. Special marketing efforts will be focused on large-scale projects in Northern Sweden, Northern Norway and Northwest Russia, which are related to the utilisation of natural resources, development of infrastructure and other construction.

Proposal for action 1: Concrete exports to large-scale projects in Northern Sweden, Northern Norway and Northwest Russia.

The aim is to help Lapland’s companies access large-scale Arctic projects, in which market information, the right types of cooperation networks, export-promoting financing, strong physical presence and visibility, and experienced experts in the Arctic markets are needed. Special attention will be paid to supporting their export efforts through financing and expert work. Offshore business will be investigated as a separate sub-field and cooperation opportunities with international offshore actors outlined.

Proposal for action 2: Further processing investigations related to large scale Arctic projects

The aim is to produce a comprehensive analysis and assessment of Lapland’s opportunities to significantly increase further processing in the region. The Arctic environment places special boundary conditions on investigations, which must be updated sufficiently often.

Proposal for action 3: New business opportunities of Arctic logistics

The aim is to outline the opportunities offered by Arctic development to new logistic business. Investigations will be drawn up of the new opportunities available in the growing refining of natural resources, large-scale projects pursued in the neighbouring countries, possible railway routes to the Arctic Ocean, and the opening of the Northern sea road.

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Spearhead: Arctic natural resource refining development programme for SMEs

The precondition for economic development in Lapland is a stable, diverse SME sector that promotes stable development in the region. Special measures are needed in order to encourage SMEs to expand their business in the refining of natural resources.

The rich renewable natural resources in the north offer vast potential to innovative product and service production based on their use. There is also demand for such products and services on the global market.

Proposal for action 1: Investigations into refining from the point of view of SMEs

The aim is to provide an exhaustive account of opportunities and needs for further processing from the point of view of SMEs. The focus in the work will be on small and medium-sized solutions instead of large-scale projects. Opportunities can be explored with regard to the use of industrial residue, for example. The Arctic environment places special boundary conditions on the investigation.

Proposal for action 2: Commercialising new innovations in the natural resource sector

The abundance and purity of renewable natural resources in the Arctic Region and their concentrations of active substances offer vast potential to innovative product and service production based on their use. There is also demand for such products and services on the global market. The production is based on ecosystem services and also involves natural and cultivated herbs, berries, primary and secondary products from trees, and products made of reindeer and sheep, which are used to prepare food, drink, ailment, medication and refreshment products and services.

Proposal for action 3: Developing refining in SMEs

Investigations into the further processing opportunities available to SMEs and the commercialisation of new innovations also require further actions that will ensure the launch of further processing activities. The challenge in development efforts is to develop sustainable production technology and logistics that meet the needs of SMEs and to strengthen business expertise, especially the commercialisation of products and services. In addition, product development support measures and the development of expertise will be taken into consideration.

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Spearhead: Sustainable Arctic tourism

Sustainable Arctic tourism is looking for new sustainable growth guidelines especi-ally from the point of view of Arcticness. A lot has already been done in Lapland to develop tourism, and the opening up of new Arctic opportunities, such as transport routes, will offer new opportunities to tourism, too. Tourism safety and environmental factors play an important role in the programme.

Proposal for action 1: An Arctic tourism product and service development package

Account will be taken of customers, stakeholders, employees, responsibility, proac-tive product development, sustainable products and services, customers’ changing habits and the operating environment used in providing services. In addition, use will be made of social, cultural, sense-based aspects and elements related to nature and the built-up environment.

Proposal for action 2: Future tourism; an education and research programme

The aim is to strengthen expertise and knowledge under the following themes: Accessible and safe Arctic tourism (taking account of changes in tourist profiles), A learning tourism region (taking account of developing tourism region action and cooperation models) and Foresight (promoting the introduction of a proacti-ve policy to serve development and decision-making in the production of future tourism services).

Proposal for action 3: Next-generation snow and ice construction products

The aim is to develop next-generation snow and ice construction solutions and new experience-based structures and to investigate how they can be implemented and maintained in a resource-efficient manner. Another sub-area is to develop resource-efficient solutions of different scale in order to implement year-around snow and ice structures.

Proposal for action 4: Developing Arctic recreational environments

The aim is to market and establish a brand for cutting-edge Arctic expertise, edu-cation, research, development and innovation activities, companies, the public sector and the whole recreational environment. The opportunities of Arctic design lie in the combination of international expertise, research and business. Arctic de-sign is not confined to any particular branch but there is a built-in demand for it in different business models. Companies can find new business potential through the Arctic Sustainable Art & Design theme network.

4.1.2 Utilising Arctic natural conditions

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23

23 The Living Lab concept was first introduced in the United States where it referred to a housing research laboratory. The Living Lab concept has been elaborated in Finland and extended for use as a product and service development action model. The action model is currently being commer-cialised into an international export product. http://publications.theseus.fi/handle/10024/6772

Spearhead: Arctic innovation research and testing environments

Arctic innovation research and testing environments act as a venue for determining the necessary research centre infrastructure, purchase of testing infrastructure, reduction of product and service lifecycle costs, basic investments, and testing in Arctic conditions in Open Innovation development environments.

Proposal for action 1: An expert group of arctic testing business, education and research (consortium)

A unit of experts will be set up, at first for a fixed period, who will launch RDI projects related to expertise and business connected with Arctic conditions. The purpose of the group is to build national and international networks, Arctic expert consortia, and RDI and testing environments. A consortium will be established, after which new members will be added and changes made to the group as needed. Examp-les of the implementation of the consortium are targeted innovation centres, and research, education and product development centres for Arctic vehicle testing.

Proposal for action 2: Living Lab23 networks for Arctic testing

The aim is to create an Arctic testing operations network in order to support the expertise and knowledge available in Lapland. The idea is to promote the evolve-ment of Living Lab testing environments in different parts of Lapland, which has the best and most natural conditions for arranging Arctic testing. Lapland offers testing opportunities to national and international customers, who in addition to laboratory testing need real-life Arctic conditions for a sufficiently long annual testing period.

Proposal for action 3: Promoting the use of non-emission vehicles

The aim is to focus on developing non-emission technologies in Arctic conditions. The work will set out from piloting the selected target, after which attention will be paid to infrastructure development, charging systems, service supply, safety and the application of rules. Good examples of this are electric snowmobiles and fuel cell technology.

Proposal for action 4: Intelligent low-carbon Arctic construction

The aim is to develop ecoefficient low-carbon timber construction, new wood element solutions, research, development and innovation activities, and com-mercialisation. New business environments in industrial timber construction call for specialised overall management skills from companies, consumers and mu-nicipalities. Attention will also be paid to timber construction as part of tourism construction projects.

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Spearhead : Tools for utilising Arctic conditions

The following tools are proposed to support commercialisation in order to make use of Arctic conditions in Lapland’s companies and development organisations.

Proposal for action 1: Shaping expertise in Arctic conditions into new products and services

Lapland’s companies have built-in Arctic expertise, which has often not been com-mercialised separately. Tourism companies are an exception, however, as the whole sector mainly relies on the attraction of Lapland’s Arctic conditions. The expertise that companies have in Arctic conditions must be recognised, commercialised, conceptualised and shaped into Arctic products and services.

Proposal for action 2: Material databank on Arctic conditions

Knowledge of materials suitable for use in Arctic conditions must be increased, and feedback and user experiences collected for material developers. The material databank would also include information on the types of materials that can be used, the changes taking place in material properties in cold, the interpretation of standards, and real-life experiences.

Proposal for action 3: Quality manual for Arctic conditions

The idea is to introduce a consistent action model that can be linked with the quality systems of Arctic mining and industrial service suppliers, and process, energy and mining industry production plants. The manual for mining and industrial service suppliers will cover topics such as competitive advantage, the availability of custo-mer processes, energy efficiency and the marketing benefits offered by expertise in Arctic conditions. Important themes in the action model for industrial, mining and energy actors are the verification of the service supplier’s expertise in Arctic conditions, procurement guidelines and auditing.

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Spearhead: Accessibility programme

Accessibility is one of the most important criteria for Lapland’s success. It is funda-mental to ensure the cost-efficient mobility of people, raw materials and products and the availability of sufficient transport connections (including telecommunications connections) in order to develop Lapland. Aspiring towards large visionary solutions should not overrule the development of the existing infrastructure (e.g. revamping the ports of the Bothnian Bay).

Proposal for action 1: Opening northern airports!

This is connected with accessibility, which is one of the cornerstones of Lapland’s Arctic Programme. What are the preconditions and boundary conditions on which as many airports in Lapland can be kept open in the coming years? What is re-quired from different actors? What models can be found abroad? What concrete measures can the actors take in order to promote the operational preconditions of airports in Lapland?

Proposal for action 2: Connections between Lapland and the Arctic Ocean

Lapland needs working connections to the Arctic Ocean. There are several alter-native routes for the Arctic railway line. A sufficiently exhaustive description must be provided of the new business opportunities and indirect effects of the railway and other transport routes.

Proposal for action 3: Construction of road and railway infrastructure in Arctic conditions

Public sector cuts have impaired the construction and repair of the road network in Lapland. The aim is to support actions to reduce road lifecycle costs (e.g. the minimisation of frost damage). Promoting the lifecycle approach is also important in order to reduce costs.

4.1.3 Cross-cutting development for Arctic growth

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2425

24 Measures have been taken in different parts of the world to utilise unexploited draft innovations through development projects and programmes. A good example is the Innovation Mill programme, which is based on Nokia’s inventions and seeks to generate new business from Nokia’s unex-ploited ideas.

25 In the Design Finland programme, Lapland is ranked among the three clusters of design expertise in Finland, with Arctic design as its field of expertise.

Spearhead: New business from Arctic innovations

The basic idea in the economic development of Lapland is to support and promote the commercialisation of the innovation capacity of regional actors. Regional special features also require new approaches and shifting the focus from growth centres to other parts of the region. In addition, there are unexploited Arctic ideas in Lapland’s companies and research and education organisations, which can be commercialised but only with special support.

Proposal for action 1: Arctic Innovations Oy

Arctic Innovations Oy is responsible for the implementation of a decentralised inno-vation model in Lapland and is actively engaged in strong national and international networks. The company receives its basic funding from cities and municipalities based on the customer-producer model. Its operation is not confined to any particular sector.

Proposal for action 2: Specialised Arctic business services

The aim is to draw up a consistent development programme for innovative start-up and growing companies. It must be investigated how the latest information can be transferred from the university network to companies. It is also important to promote entrepreneurship among young people and find out how companies’ needs and RDI activities can be combined more efficiently. The aim is to support the piloting of innovative start-up and growth companies. Specialised business services should be established.

Proposal for action 3: Recognising Arctic innovations

The programme for recognising and utilising Arctic innovations has been planned in order to highlight new business ideas and drafts, which are the unexploited parts of business and research ideas, for example24. The development of new products, services and markets is boosted by working environments (innovation platforms) that are coordinated by Lapland’s universities and vocational education establish-ments together with the business sector. In addition, standardised action models and processes will be generated for transforming ideas into competitive business.

Proposal for action 4: Cluster of expertise in Arctic design

The aim is to create a cluster of expertise in Arctic design in Lapland25, consisting of two development phases. Phase one will see the establishment of a centre for top Arctic design expertise that will introduce design in companies operating in Arctic fields, promote the establishment of new companies and create contacts with Arctic research. Phase two will involve measures to support the foundation of a business incubator, in which national and international parties will provide coaching assistance to companies.

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In addition, support will be provided to Arctic design research and development activities based on business needs and to companies’ commercialisation efforts. The Arctic Design week action model will be established as a cooperation venue between the region’s companies and educational institutions.

Proposal for action 5: Arctic capital investment solutions

The aim is to create an action model for making more efficient use of the existing capital investment solutions, taking account of public and private investments. The government has supported private actors and the capital investments that it has made in innovative growth companies. Business angels will be encouraged through tax reliefs. New funding to start-up companies will be channelled through Tekes, and a growth fund established through Finnish Industry Investment. In addition to state measures, the needs and opportunities of Arctic capital investment activities will be outlined.

Proposal for action 6: TEAM Arctic

Team Arctic is a special application in the Team Finland scheme, the purpose of which is to promote exports. The special features of Arctic business and focus on the Arctic operational environment stress the need for specialised expertise. Team Arctic operates in close cooperation with Team Finland.

Proposal for action 7: Arctic brand work

There are vast opportunities in communications related to Lapland’s Arctic exper-tise, but also challenges. Especially the tourism sector in Lapland has succeeded superbly in increasing its international visibility (e.g. CNN), whereas Lapland’s Arctic expertise has not been highlighted sufficiently. More Arctic emphasis must be given to brand work in Lapland. Lapland is known as a unique holiday destination, but its opportunities to business and sustainable industry are not known.

Proposal for action 8: From Arctic indigenous industries to an innovation

The aim is to create an action model and concept (innovation centre) in order to support the commercialisation of the industries of indigenous peoples. Their traditional knowhow, combined with the use of modern technology, will open up new opportunities and innovations for technical solutions in housing, transport and adapting to weather conditions, for instance. The action model is closely integrated with education and RDI activities in the Sami area.

Proposal for action 9: Sodankylä innovation centre

The aim of the centre is to enhance the commercialisation of research expertise in Lapland and the creation of new innovations. It will also strengthen cooperation between research and business actors in the region and support the participation of regional actors in joint national and international projects. The building of the centre for innovation and its environment in Sodankylä will promote the balan-ced development of the region. An action model will be set up in the centre for commercialising innovations (start-up companies and large and medium-sized companies), together with expert services and a contact network.

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Spearhead: Arctic digital solutions

The latest information technology and digitalisation will open up vast new opportu-nities for utilising Arctic expertise. Lapland will invest in the development of digital society services and contents through bold, pioneering solutions. It will also support the development of knowhow and digital solutions in SMEs.

Proposal for action 1: Utilisation of Arctic public data resources

There has been debate on the use of Arctic data resources on several forums after the Finnish Government decided to promptly open public data resources for use by citizens and companies. The data resources offer opportunities to exploit natural resources and climate conditions. Lapland’s actors should quickly make sure that most of the Arctic expertise connected with the opening of public data resources will accumulate in Lapland.

Proposal for action 2: Arctic cloud service

The Finnish government has plans to introduce new major solutions with regard to the national data network and its international routing. According to the plans, there will be new trunk routes via the Baltic Sea to Central Europe and via the Northeast Passage to Asia. These international routings would substantially impro-ve the possibilities of Internet cloud service companies to establish themselves in Finland. There are plans to introduce an Arctic cloud service programme in order to help companies in the field to become established in Lapland.

Proposal for action 3: Multi-sector remote health and well-being innovations

Technological applications will be adopted with the aim of developing services based on customers’ needs. In addition, patients and customers will be given the opportunity to run errands digitally with the help of secure systems. Remote techno-logical innovations will be used to support the participation, learning and activeness of citizens and help them take responsibility for their health. Information will be collected on the existing remote technology solutions and their deployment will be promoted. Interactive technology environments will be adopted in monitoring health and well-being, for example.

Proposal for action 4: eLappi Campus – a need-based expertise development environment

The aim is to create action models in which physical, social and virtual learning and RDI environments are merged. This requires the development of eLearning methods, tools, policies, contents and support services. Lapland’s strong eLearning expertise will be developed further in an agile, flexible manner in order to address the needs of the business sector.

Proposal for action 5: Digital services into a competitive element

The theme will link the Arctic Specialisation Programme with Lapland’s digital strategy by strengthening the implementation of company-based solutions. The aim is to support the development of expertise in companies in the use of digital solutions (e.g. Arctic eBusiness and marketing).

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Spearhead: Cross-cutting Arctic education and research and development activities

An important sub-area in the implementation of Lapland’s Arctic Specialisation Programme is to strengthen diverse regional educational and RDI activities that must be capable of addressing the needs of regional actors.

Proposal for action 1: A cluster of top-flight expertise in Arctic and northern research

The aim is to ensure that multi-disciplinary basic and applied research into Arctic and northern themes can be pursued in Lapland. In addition, a cooperation forum for Lapland’s Arctic researchers will be established. The purpose of the Arctic research network is to draw up the Arctic and Northern Research Programme 2014-2020, the aim of which is 1) to produce information on Lapland’s Arctic and northern character in a number of fields for use by the academic scientific community and in the everyday operational environment, 2) to deepen and expand expertise in issues related to the Arctic Region, 3) to promote scientific, social and economic effectiveness with regard to Arctic issues and 4) to create new interdisciplinary and international cooperation networks across scientific and artistic fields. The themes of the research programme include Arctic culture, well-being, tourism and design, northern environment, Arctic rights, and learning and Arctic information.

Proposal for action 2: An Arctic education, research and development commercialisation programme

Lapland’s universities, sector research institutes and secondary educational institutions (education, research, development and innovation services) will be developed into need-based, commercialisable service entities together with the region’s companies. Services will be piloted in Lapland and developed further into export products suitable for Arctic regions in particular. Student groups will participate actively in the development work.

Proposal for action 3: UArctic network and business connections

The aim is to develop a cooperation model between the uArctic network and business actors, in which the Arctic expertise of the education and research network will also serve the needs of the business sector in Lapland. At first the existing Arctic sources of business information and the need for cooperation networks will be investigated, and attention will also be paid to the boundary conditions of the uArctic network and opportunities to promote the establishment of the Arctic commercial network.

Proposal for action 4: Arcticness as part of education

Educational cooperation in Arctic regions must be based on developing the sustainable consumption of natural resources and supporting the industries, language and cultures of communities and local people in Arctic regions. The educational organisations in Lapland will together develop practice-oriented educational programmes that address the needs of the local nature and people.

The content and models of education will also be developed so that they will support the setting up of top-flight Arctic expertise clusters in Lapland. Diverse multi-sector education will be developed in the same thematic fields in order to secure the establishment of leading Arctic expertise clusters in Lapland that support both education and research (design and Arctic research).

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Proposal for action 5: Development and commercialisation of Arctic safety expertise

Finland and Lapland have broadly profiled themselves as safety experts. This expertise is also identified and recognised in Finland’s national Arctic strategy. Safety has been highlighted as a cross-cutting theme in Lapland’s Smart Specialisation Programme (tourism, industry and natural resources). Important Arctic safety sub-areas include the development of industrial risk management expertise and the multisector development of safety expertise.

Proposal for action 6: Strengthening the acquisition of international EU financing for Arctic growth

The development of Arctic products and services often requires extensive financing and an expertise network. To increase international financing, use must be made of the opportunities offered by EU programmes and the international network, for example.

Support will be allocated to selected Arctic specialisation flagship initiatives in order to strengthen the creation of synergy between different funding channels and to support international networking. The initiatives may include projects to establish top-flight expertise clusters and allow the networking of the clusters nationally and internationally.

Proposal for action 7: Strengthening the operation of the Arctic information centre

The role of Lapland as the producer and conveyer of Arctic information will be strengthened. This will be done among other things by enhancing the role of the Arctic Centre in the conveyance of information. An important sub-area will be the development of regional effectiveness and added value.

When implemented, the EU’s Arctic Information Centre will underline the role of the region and its participation in innovative ways.

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4.2 Roadmap 2014–2020

It is in line with the smart specialisati on principle to create broader development concepts, in which implementati on is based on the use of diff erent fi nancial instruments and programmes and the fi nancial synergies that they off er26. One wants to maximise the eff ecti veness of EU fi nancing in order to ensure the best possible outcome from development and innovati on acti viti es.

The idea is to promote internati onalisati on by linking regional RDI acti viti es with broader global operati onal environments. The role of structural and investment funds (ERI) is to develop regional structures, capacity and capabiliti es. Correspondingly, programmes providing fi nancial support to RDI acti viti es and educati onal cooperati on2728throughout the EU are means of presenti ng regional development work in the internati onal context. It is hoped that projects are set up that receive part of their fi nancing from ERI programmes and part from the internati onal

26 Synergies between European Structural and Investment Funds, Horizon 2020 and other EU programmes related to innovati on, Guide for policy-designers and implementers, draft August 2013.

27 Horizon 2020, Cosme, Erasmus+.

28 Source Katja Reppel, Head of Directorate General for Regional Development.

level. The synergy between the various fi nancing programmes is shown in the fi gure below (Figure 12).

As shown in the fi gure, the implementati on of the proposals for acti on in the Arcti c Specialisati on Programme also requires fi nancing from outside regional development programmes. The matrix below describes the strategies and programmes that infl uence the Arcti c Specialisati on Programme, and the fi nancing channels enabling its implementati on.

Aft er the fi nancing matrix the programme provides a preliminary account of the planned ti meframe of the spearheads and proposals for acti on in each priority with regard to the durati on of the programming period (Figures 14-16). In additi on, the fi nancial framework will be specifi ed so that indicati ve ERI fi nancing for the spearheads and proposals for acti on can be defi ned, together with recommendati ons for fi nding synergies with other forms of fi nancing.

ESI

National funds

Utilising enablingtechnology

Servicedevelopment

ESI

National funds

Utilising enablingtechnology

Servicedevelopment

Upstream (monitoring) Downstream (applying)

Demonstrations and pilots

Transregional/nationalcollaboration

Erasmus+ CreativeEurope

Horizon 2020

Cosme

Demonstrations and pilotsDemonstrations and pilots

Staircase to excellentNational and regional

RDI environments Excellent RID Regional innovations

Structure and capacitydevelopment

Research and developmentRegional Policy

Innovations Market

Figure 12: Synergy between the EU’s fi nancing programmes and desired impact28

58

Figure 13: Financing matrix

Level of operations Strategic programs Operational programs Funding

EU Innovation unionSustainable resource

management; raw materials, bioeconomy

EU Strategy for the Baltic Sea Region

EU Digital strategyCohesion policy

European regional collaboration

Support for research and innovations

Education developmentPartnership instruments

Interreg programsH2020 and Cosme

Programme for Social Change and Innovation

Creative Europe and Erasmus+

other EU funding instruments and programs

National National competitiveness and employment program

National partnership agreements for ESI

National smart specialisation strategy

National bioeconomy strategy

Finland’s national Arctic strategy

ESI programsKnowledge and innovations

programsTEKES programs

Academy of Finland research programs

Finland’s minerals strategy, action plan -

Investment funds, ESI funds

TEKESAcademy of Finland and

special programsSITRA

Funding from ministries EU funding instrument

Regional Regional operation programme

Cross-border collaborationLappi agreement

Regional strategies for example tourism, industry

development

East and North Finland operation programme

Regional operation programme

Regional growth programmeArtic Specialisation

programme Strategy for culture and

creative industriesClimate and energy strategy

ESI funds, Regional development

resourcesEconomy/Business

Business Funding from ministriesEU funding instruments

Municipalities/cities

Development agencies/

Education & research

Local development programsMunicipalities’ and towns

‘strategiesStrategies and development

programs of the actors

Growth programs of the municipalities and cities

Local business development programs

Like above

59

2014 2015 2016 2017 2018 2019 2020

New

sus

tain

able

Arcti

c in

dust

ry a

nd m

ines

Arcti

cbi

oeco

nom

yA

larg

e-sc

ale

Arcti

cpr

ojec

t pro

gram

me

An A

rctic

nat

ural

reso

urce

re

finin

g pr

ogra

mm

efo

r SM

Es

Future mining research programme

Arctic natural resources knowledge and innovation community

Reforming industrial and mining service companiesReforming industrial and mining service companies

Ecoefficient, low-carbon industry and mining

Utilisation of ash

Bio terminalsBio terminals

Bioenergy actors’ collaborationsBioenergy actors’ collaborations

From bioeconomy into business

Concrete export to large scale projects in Northern Sweden, Norway and North-West Russia

New business opportunities in Arctic logistics

Further processing investigations

Further processing investigations (update)

Arctic BAR solutionsInnovation platforms I

Innovation platforms and piloting II

Developing refining in SMEs I

Commercialising new innovations in the natural resource sector, (integration with Arctic bioeconomy)

Investigations into refining from the point of view of SMEs (update)

Investigations into refining from the point of view of SMEs

Developing refining in SMEs II

New businessesProduct and service branding Sustaining development

Network development

Research cluster of natural resourcesCreation of knowledge and innovation community

New business possibilities Business development platforms IIBusiness development platforms I

Feasibility study Bio terminal piloting

Refining Arctic natural resources

Figure 14: Roadmap for the refi ning of natural resources

60

Figure 15: Uti lisati on of Arcti c natural conditi ons

2014 2015 2016 2017 2018 2019 2020

Sust

aina

ble

arcti

c to

urism

Arcti

c in

nova

tions

rese

arch

and

testi

ng e

nviro

nmen

tsTo

ols

for u

tilisi

ngAr

ctic

cond

ition

s

New-generation snow and ice construction products

Developing arctic recreational environments I

New-generation snow and ice construction products

Future tourism; and education and research programmeNeed based , new methods, service experienced Future tourism; and education and research programme

An arctic tourism product and service development packageTourism development and innovation platform to support industry

Material databank of Arctic conditions

Shaping expertise in Arctic conditions into new products and services

Utilising Arctic natural conditions

Snow- and ice construction RDITesting and piloting innovationsTesting and piloting innovations

Developing arctic recreational environments II

Intelligent low-carbon Arctic constructionIntelligent low-carbon Arctic construction

Living lab network for Arctic testingLiving lab network for Arctic testing

Promoting the use of non-emission vehiclesImplementing arctic testing and piloting

Constructing arctic piloting environmentArctic piloting destinationsPromoting the use of non-emission vehicles

An expert group of Arctic testing business, education and research

Arctic testing unit of expertArctic testing industry and RDI consortium

Quality manual for Arctic conditions I

Quality manual for Arctic conditions 2

61

Figure 16: Cross-cutti ng development for Arcti c growth

2014 2015 2016 2017 2018 2019 2020

Acce

ssib

ility

prog

ram

me

New

bus

ines

s fr

omAr

ctic

inno

vatio

nsAr

ctic

digi

tal

solu

tions

Cros

s-cu

tting

Arc

tic e

duca

tion,

rese

arch

and

dev

elop

men

t

Cluster of expertise for Arctic desing

Arctic capital investment solutions Arctic capital investment solutions

Specialised Arctic business services

eLappi Campus –a need based expertise development environmantseLappi Campus –a need based expertise development environmants

Remote multi-sector health and well-being innovations

Arctic design business incubator

Cross-cutting development for Arctic growth

Connections between Lapland and the Arctic Ocean

Opening northern airports

Construction of road and railway infrastructure under Arctic conditions

Specialised Arctic business services

Team ArcticTeam Arctic

Arctic Innovation OyRecognising Arctic innovations

Innovation platforms Operational models in practise

RDI infrastructure

Young entrepreneurshipStart up business programme Stabilising business

services

Cluster of expertise for Arctic desing

Arctic capital investment solutions

From Arctic indigenous industry to an innovations

Centre of expertisefor Arctic design

Arctic cloud service

Remote multi-sector health and well-being innovations

Utilising Arctic public data resources

Technology platforms; development and upgrading I&II

Improved used of technology platforms

eLearning platforms solutions development

Content development I

Digital services into a competitive element

Development and commercialisation of Arctic safety expertise Development and commercialisation of Arctic safety expertise

UARCTIC and business contactsUARCTIC and business contacts

A cluster of top-flight expertise in Arctic and northern research

Arctic and northern research programme I&IINetwork of arctic research Cluster of top-flight expertise

Arcticness as part of education– need –based development actions

Content development II

Arcticness as part of education

Strengthening the operations of the Arctic information centreStrengthening the operations of the Arctic information centre

Promoting the acquisition of internationalEU funding for Arctic growth

Development and commercialisation of Arctic safety expertise

Promoting the acquisition of international

Arctic education, research and development commercialisation programme

Sodankylä innovation centre

for Arctic design

Sodankylä innovation centreArctic brand work

62

5. Programme Monitoring and Assessment

5.1 Introduction

The new EU programming period 2013-2020 will place more specific conditions on EU-financed project activities in order to ensure productivity and compliance with the goals set. The idea is to make sure that financing programmes generate the required added value for the Europe 2020 objectives. Therefore, the implementation of the various financing programmes and projects will be monitored and assessed more carefully. To support this, the various directorates general of the European Commission and the administrative authorities of financing programmes have together drawn up guidelines and manuals for developing monitoring and assessment practices at the programme and project level. At the next phase of the regional programme work, it is important to find the most suitable practices for use in Lapland’s operational environment in order to promote the implementation of the Arctic Specialisation Programme.

The productivity of financing is monitored and impacts are assessed by collecting information systematically, applying suitable methods and using indicators determined beforehand. Another very important sub-area is the anticipation of risks and threats, the adoption of precautionary measures, and the availability of procedures to overcome them.

Although guidelines and definitions for project monitoring are assigned from above, weight is given to monitoring and assessment carried out from the point of view of stakeholders and beneficiaries. The general EU policy, strategies and

programmes29 provide a framework within which projects can be implemented. Cross-cutting themes (e.g. ecoefficiency and supporting innovations) largely guide the types of concrete measures that should be focused on during the financing period. As part of planning the future EU programming period, measures have been prepared in the programme through which Lapland will specialise into an Arctic expert capable of influencing matters.

5.2 Role of monitoring and assessment

The purpose of monitoring Lapland’s Arctic Specialisation Programme is to produce observation-based reporting (in relation to given criteria and indicators) on the achievement of the results and outputs defined for project activities. Monitoring supports management and decision-making. It also includes corrective measures if the planned result or output has not been achieved. Project and programme monitoring focuses on current issues. The question at the project level is of result-based monitoring.

The purpose of assessing Lapland’s Arctic Specialisation Programme is

29 Europe 2020 provides a general objective at the level of the EU, which has been specified with seven flagship programmes (strategies), e.g. Innovation Union, Resource Efficient Europe, Digital Strategy and Youth on the Move. More specific EU level objectives in the flagship programmes will be put into practice through specific initiatives, financ-ing instruments and programmes. The Smart Specialisation Initiative, for instance, directs the operation of structural funds and to some extent also of other programmes so that these take account of the ob-jectives of the Innovation Union. The idea is to find synergies, remove overlapping elements and generate need-based activities.

63

Figure 17: Monitoring and assessment concepts

Reso

urce

s/m

eans

Sustainability What are the positive effects after the project has come to an end?

RELEVANCE Is the project in line with the needs anddesires of the beneficiaries

IMPACTIs project purpose influencing in theachievement of the overall objective?

EFFECTIVENESS How well the project results are supporting theachievement of the project purpose?

EFFICIENCY How well the project is converting resources and meansinto the results? (cost-effectiveness)How well the project is converting resources and meansinto the results? (cost-effectiveness)

Activ

ities

Resu

lts

Imm

edia

teob

jecti

ve

Ove

rall

obje

ctive

(s)

What kind of means will be

used?

What will be done?

What will be achieved?

What is the purpose of the

project?

What kind of changes are

wanted?

to investi gate how well the project (or programme) addresses the need for which it was originally launched. Assessment is a systemati c method and objecti ve analysis of the project, programme or policy and its planning, implementati on and results. It should produce useful informati on that can be used as feedback in future decision-making.

Monitoring and assessment are interdependent. Both of them emphasise specifi c basic concepts (e.g. effi ciency, producti vity, eff ecti veness, purpose and sustainability), of which the latt er two are stressed in the assessment. The mutual relati onship and level of the basic concepts of monitoring and assessment are outlined in the fi gure below.

5.3 Monitoring and assessment of the Arcti c Specialisati on Programme

Monitoring and agreeing on assessment practi ces according to region and actor are an important sub-area in creati ng the European Commission’s smart specialisati on strategies and programme. The Arcti c Specialisati on Programme (Lapland’s Smart Specialisati on Strategy) produces content for Lapland’s regional programme and for preparing the future programming period. The focus of the Arcti c programme is on pursuing business-based development work, supporti ng educati on that promotes such work and enhancing RDI acti viti es.

64

The implementati on of the Arcti c programme will be monitored and assessed as follows:

• the needs of diff erent target groups and benefi ciaries of the proposals for acti on, and strategic objecti ves, are taken into considerati on,

• monitoring the fi nancing programmes used in the implementati on; assessment practi ces.

In practi ce, measures will be carried out as joint projects between companies, business sector developers, municipaliti es, educati onal insti tuti ons and other public agencies. The above points of departure and needs must be taken into considerati on when introducing monitoring and assessment practi ces for the implementati on of the Arcti c Specialisati on Programme.

The Arcti c Specialisati on Programme will be implemented as part of the future regional programme. This will already ensure that the programme will not remain

a ’fl oati ng’ recommendati on. A disti nct monitoring and assessment model must be prepared for the regional programme in order to produce systemati c, relevant informati on for decision-making at diff erent levels. In practi ce, this means that joint objecti ves, exact indicators and their sources improving the accuracy of future project planning will be defi ned for project and programme acti viti es in Lapland. The aim is to achieve realisti c, disti nct results and objecti ves.

There will be stricter demands about projects really achieving their promised permanent eff ects. This will place new requirements on project implementers and fi nancial authoriti es. It is proposed at this stage that more accurate regional indicators should also be defi ned upon the preparati on of the regional programme in order to support project acti viti es. At the same ti me, the parti es using project fi nancing must establish disti nct strategic objecti ves as to when and for what purpose they wish to apply for project fi nancing.

Desired change

Impact (Long term influence)

Results (Direct/indirect influences)

Project outcomes (services, products, etc.)

Project activitiesMeans

Funding Need-based projects supporting Arctic specialisation programme

Overall objectives

Project objective/purpose

Operational objectives

Regional Operational programme, Arctic

Specialisation programme and Funding programme

objectives

Figure 18: Project acti viti es in relati on to programme work

65

The objectives of programmes representing different focus areas must coincide in order to generate the desired added value. Monitoring and assessing the implementation of these interfaces based on correct criteria will produce the necessary information for right decision-making in development matters. The idea is to find mutual dependency and effectiveness between the results, outputs and objectives of different measures. Multi-level monitoring and assessment is required to support this.

The relation between project activities and the implementation of the Arctic Specialisation Programme is described in the Figure 18.

66

67

ANNEX The streering group of the Lapland’s Arctic Specialisation Programme

Members:

• Mika Riipi, Regional Council of Lapland (chair)• Maiju Hyry, Regional Council of Lapland (vice-chair)• Eija Virtasalo, Lapland Centre for Economic Development, Transport and the Environment

(deputy member Kari Ruokonen)• Timo Rautajoki, Lapland Chamber of Commerce• Viljo Pesonen, Municipality of Sodankylä• Esko Lotvonen, City of Rovaniemi (deputy member Erkki Kautto)• Minna Uotila, University of Lapland (deputy member Jorma Puuronen)• Liisa Holmberg, The Sámi Education Institute• Tapio Piirainen, City of Kemi (deputy member Tero Nissinen)• Erkki Parkkinen, Municipality of Pelkosenniemi• Reijo Tolppi, Kemi-Tornion University of Applied Sciences (deputy member Eero Pekkarinen)• Martti Lampela, Rovaniemi University of Applied Sciences• Virpi Alenius, Finnish Forest Research Institute

Other specialists:

• Mervi Nikander, Regional Council of Lapland• Olli Pohjonen, Regional Council of Lapland• Ari Konu, Lapland University Consortium• Kristiina Jokelainen, Regional Council of Lapland• Kimmo Heikka, Regional Council of Lapland• Jukka Teräs, Regional Council of Lapland• Kaarina Mäcklin, Regional Council of Lapland (secretary)