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Photo: Petri Jauhiainen / Rodeo

Arctic business and research, development and innovation activity in Northern Ostrobothnia


Photo: Tero Sivula / Rodeo

Background The arctic areas are the direction of growth in the future. Activities are strongly defined by natural resources and their location. Especially gas, oil and mining industry serve as big drivers of growth. In addition to these updating the power grid, tourism, transport and logistics, fishing industry and marine transports create new possibilities of growth. The arctic area attracts a considerable number of investments from around the world which also means demand for Finnish arctic know-how. According to the estimate of the Chamber of commerce of Lapland (Arctic Business Forum 2015) investments worth 50-80 billion are started in the Barents region during the next 5 years. Political focus towards Arctic regions is strong at global and EU level. Arctic counties have their own arctic strategies and co-operation is developing. Finland’s Strategy for the Arctic Region (2013) states that Finland possesses diverse Arctic expertise and interest in being involved in the development of the arctic region.

DEFINING THE ARCTIC ARCTIC CONDITIONS:

Arctic business NEEDS

Opticality – light related phenomena - darkness, fog, northern lights Variation of temperatures – the cold, snow, ice, permafrost, windiness, sensitive nature, fast changing weather conditions Natural resources – forest, minerals, oil, gas, natural products, water, game animals (reindeer, fish) Activity and culture – long distances, settlements, arctic cooperation, indigenous people ARCTIC AS A LOCATION: Norway: Nordland, Troms and Finnmark Sweden: Västerbotten, Norrbotten Finland: Oulu Region, Kainuu Region, Lapland Russia: Murmansk Oblast, Arkhangels Oblast, Nenets Autonomous Oblast, Republic of Karelia, Republic of Komi, Yamal-Nenets Autonomous Okrug US (Alaska) Canada (Yukon, Northwest Territories, Nunavik, Nunavut, Labrador) Denmark (Greenland, Faroe Islands) Iceland

ARCTIC BUSINESS INTERFACES • Oil & Gas • Renewable energy • Mining industry (onshore / offshore) • Metal industry • Marine industry and logistics • Bioeconomy • Construction • Infrastructure • Cleantech • ICT • Tourism • Human (living / working)

ARCTIC BUSINESS DIVISION 1) utilizing arctic resources 2) making utilizing arctic resources possible 3) improving profitability, new business

ARCTIC JUSTIFICATION AS A CRITERION: Investment projects The advantages of the area to provide a solution • Absolute advantage: cannot do elsewhere or no reason to do elsewhere For example northern lights and tourism related to it (the sector which serves the advantage) Arctic business links together CEE:s strategic innovation agenda

In the Arctic opening Roadmap to smart Arctic specialization (SMARCTIC) funded by The Finnish Funding Agency for Innovation (Tekes) was formed a vision and a roadmap for the development and utilization of the Finnish arctic expertise. Focus areas of the project were: environmental information and mobile technology, smart logistics, infra and living environment, natural resources management and economics and human in the north. After the project a need arose to clarify what should be done in practice in the area of North Ostrobothnia. This has acted as an impulse for the project of Arctic business, research, development and innovation activity in the North Ostrobothnia. Investing in the operations related to arctic know-how and expertise by following Finland’s Strategy for the Arctic Region has been highlighted as one of the most important objectives by the Council of Oulu region. The objective is to make optimal use of the possibilities by developing clusters between companies and research institutions. Project work packages: WP1 Arctic Business Needs: description and division by industry WP2 Arctic Business Supply from North Ostrobothnia to offer expertise and clarifying the need of an arctic business portal WP3 Arctic Research, Development and Innovation needs WP4 Arctic RDI-Supply – possibilities to offer solutions

• Comparative advantage: profitable to do here Research related to ice and snow – utilization of existing know-how and infrastructure

PROJECT • Funded by the Council of Oulu Region • Project carried out 3-8/2015. • Project team: Henna Hintsala (CEE), RD

Regional Development Ltd (Yrjö Myllylä), Janne Anttila and Tero Leppänen (CEE) and Erkki Alasaarela (Thule institute). Help from the staff of Thule institute and Sami Niemelä from Oulu University of Applied Sciences. Members of the steering group: Jukka Olli (BusinessOulu), Kari Laine (University of the Arctic) and Pekka Tervonen (Centre for Environment and Energy).

The current state of Arctic business (tenders in the Barents region)

Current business and export Possibilities for new business

FORESIGHT Strong predictive trends of the Arctic environment 2020-2025 Rise in the prices of raw materials Climate change (warming) Growth of resource efficient and eco-efficient systems Growth in the significance of bio-economy Development of suitable arctic technological solutions Growing environmental awareness Russia’s geopolitical interests’ transition towards north and Growth of general global interest towards north.

Energy cluster Mining activity Forestry Environmental technology (e.g. among others, oil spill response) Other use of natural resources (e.g. natural products) Tourism (e.g. nature and welfare tourism) ICT cluster (e.g. datacenters) Logistics, marine technology and construction of infrastructure

SUPPLY • There are plenty of companies in the area especially in the following fields: building, engineering industry, metal industry and ICT. • Export to for example Norway and Sweden mostly related to construction, consultation and planning and industrial companies. • The reality is that many companies don’t have a reserve ready to participate in arctic projects. • Services and products developed by the companies could be adapted to different branches to improve profitability. For example health technology know-how could be scaled wider to other industries. PROCEEDINGS • Need for different mediators and networks particularly in less known industries. • Need to examine the proportion of utilized arctic investments. • Northern investments are usually reached through the South, the decision-making of several state-owned companies takes place in the capitals. • Investing in arctic RDI activities appears important on the basis of the low (arctic-related) number of patents.

Photo: Petri Jauhiainen / Rodeo


Kuvaaja: Tero Sivula / Rodeo

Arctic research, development and innovation

Conclusions and proceedings

NEEDS

• Arctic investment projects need to be promoted from the point of view of the future of the area

• Arctic expertise is know-how of the arctic conditions or control of the arctic environment properties • Innovation activity is based on the identification of needs and environment - research or business based • Needs in which measures need to be taken are, among others, maintenance in the energy field, bioenergy and LNG interfaces, arctic transport and energy production technology and arctic know-how and testing (materials, machines, devices the welfare of the human being) which takes place in arctic conditions

FIELDS OF ACTIVITY • Environment, Energy and Natural resources • Processes, Production technologies and Materials • Construction, Infrastructure and Logistics • Information and Communication technology • Health and Wellbeing • Business and Economics • Culture and education (include Social science)

• Minor visibility of RDI operations – need for international exportation education, research and project cooperation need to be highlighted • Companies have a need for the development of the arctic know-how and testing in arctic conditions. SUPPLY

• Managing total costs - how to gain economic success and in turn how does it affect the state of the environment and the welfare of the population.

CHOICE need to be made - is it desired to emphasize the arctic through know-how and be involved in the arctic business Now is the TIME to make this decision, because the potential of the business is becoming more concrete RESOURCES need to be allocated to support the choice There needs to be active MEASURES to reach these objectives. Recommendations below: RECOMMENDATIONS Business life:

• Universities and sector institutions in the area are examined.

• Business-orientated clusters to the demand-needs in which RDI-actors have a supporting role • Bringing out the arctic know-how / A portal for arctic know-how is needed

• Strong linkage to arctic especially in: Environment, Energy and Natural resources, Information and Communication technology, Processes, Production technologies and Materials

RDI-activity: • Bringing out the arctic know-how • Resources for innovation activity • Strengthening the cooperation between universities and business life • Resources for the preparation of international consortium projects

Region has strong arctic know-how, actors of the area are connected with national and international actors and there is much business and RDI-potential in the Arctic. Creating CENTRE FOR ARCTIC EXPERTISE to Northern Ostrobothnia is recommended.

• Best know-how of arctic conditions related to temperature variation and natural resources.

PORTAL FOR THE ARCTIC KNOW-HOW

• Strong company co-operation especially in the fields of Processes, Production technologies and Materials

PROCEEDINGS

• Emphasis on utilizing resources (natural resources, conditions) and business and know-how connected to it.

Measures require tools to support the development of the ecosystem. The need for an arctic portal is obvious. These kinds of tools are also needed in the cooperation of the neighboring areas of Northern Finland. RDI actors of Northern Ostrobothnia, Finland and international networks

The question of how to direct RDI-activity has risen from the needs of investment projects and rising industries The way to display proceedings: Technology

Critical technological factors from the point of view of investments and developing them

Structures

New RDI- and realization structures meeting the demand

Networks

Market possibilities and contacts (international research projects and networking projects with small and medium-sized companies, databanks and websites)

Knowledge

Adding knowledge of new phenomena (market needs, standards and legislation, building and other regulations)

Training

Efficient sharing of existing information (directing education utilizing results mentioned above)

These measures have to be carried out during 2015–2020 to support the realization of arctic projects - getting competitive advantage and reaching the biggest advantage from the point of view of business life from 2020 onwards.

Maintenance and advantages • The biggest factor is active maintaining of sites, offering benefits/a customer point of view and financing - new models • Launching and resourcing; responsibilities and the model must be functional • International cooperation, offering the model into wider use Content To bring the matter forward there are the three modules involved: A portal for business, ecosystem • Meeting the current supply • When tenders come – gathering companies and meeting the supply • Possibilities of the new business Presentation of the know-how of research communities • Research results, know-how, contact persons, consortiums and complete packages (e.g. education) • References (reports and studies) Presentation of the infrastructures • Gathering and marketing research and testing environments

Photo: Petri Jauhiainen / Rodeo


CEE in social media: Photo: Petri Jauhiainen / Rodeo

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