The Baltic Region

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Russian Baltic Sea regions in the new geopolitical reality

The geopolitical effect of the maritime factor on the spatial development of post-Soviet Russia: the Baltic case

Abstract

The article explores the impact of geopolitical processes on the spatial organisation of society, a matter that has gained increasing importance in Russia. It focuses on the utilization of the World Ocean and its coastlines for resource extraction, logistics, military-strategic purposes, and settlement. Methodologically, this study combines modern socio-geographical approaches emphasising the role of the maritime factor in spatial development with classical geopolitical ideologemes drawing a line between the land and the sea. It stresses the fundamental possibility for territories, including states, not only to acquire synthetic continental-maritime attributes but also to transform the balance of these attributes under the influence of geopolitical determinants. The article analyses geopolitically induced changes in the maritime activities pursued by Russia in the post-Soviet period. The primary focus is on the situational territorial and economic shifts of 2014 and 2022, and their implications for Russian territories in the Baltic region. Pronounced inter-basin differences are described with respect to the coastalisation of the population. The study also evaluates the economic condition of key Russian maritime centres and their resilience to external influences, especially geopolitical challenges. The article offers a geopolitical justification for Russia’s ongoing maritime endeavours, emphasizing the need for inter-basin, intermunicipal, and interregional integration. This integration should be accompanied by the establishment of coastal-intracontinental facilities, such as hubs, across Russia. It is imperative for the nation and its prominent corporations to actively engage in shaping the framework of emerging expansive international maritime socio-geographical structures, facilitating the shift toward global maritime polycentrism. The solution to these problems is closely linked to the priority goal of strengthening Russia’s geostrategic standing in the Baltic region, particularly with a focus on its maritime components. These developments are anticipated within the context of the Russian Baltic Area, envisioned as a borderland with trans-basin geopolitical, economic-geographical, and geocultural bi-structural asymmetry.

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Three Russian Baltic regions in the context of confrontation between Russia and the West

Abstract

This study examines the features, limitations and development prospects of three Russian territories bordering the Baltic Sea — St. Petersburg, and the Leningrad, and Kaliningrad region — amid the sharply heightened confrontation between Russia and the West, which has affected the Baltic region. The time frame spanning from 2014 to 2023 was chosen for the study. This period encompasses the sanctions imposed by Western countries and their associations, primarily the EU, in response to the return of Crimea and Sevastopol to Russia, and extends up to the present day, when the relations between Russia and the West, as many experts and politicians have emphasised, have reached a critical point and may require substantial changes in the global order, including at macro-regional levels, for a return to what was once considered ‘bbusiness as usual’. The study examines the development level and dynamics in the three regions, alongside their economic security. Another focus is on foreign policy and a geopolitical typology of the Baltic region states. The article investigates the impact of a changed geopolitical landscape on cross-border cooperation, the restructuring of foreign trade relations in Russia’s three Baltic regions, and the geopolitical and military factors influencing the development and security of these territories. Based on the findings, several suggestions are provided to promote the ongoing growth of Russia’s Baltic regions and enhance their economic and military security.

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The Accession of Finland and Sweden to NATO: Geopolitical implications for Russia’s position in the Baltic Sea region

Abstract

The article examines Sweden’s and Finland’s motives for ending their long-time non-aligned policies and joining NATO after Russia had launched a special military operation in Ukraine in February 2022. The two countries’ decision is shown to be in the interest of the United States, which has always sought to fill the geopolitical vacuum reigning after the collapse of the opposing Soviet bloc and the Soviet Union itself. Finland and Sweden were the missing links for Washington and NATO in the Baltic region and Northern Europe as a whole. The study analyses the major consequences of these geopolitical changes for Russia in the Baltic region. These include the increasing disparity in armed forces with NATO, the substantial expansion of the border with the Alliance, the acquisition of new territorial and infrastructural capabilities by NATO to deploy reinforcements and military equipment from member countries to the region, the potential stationing of nuclear weapons on the territories of new member countries, the risk of blockading the Kaliningrad region, as well as the Gulf of Finland, and the Danish straits for Russian vessels. It is stressed that in the current circumstances, Russia needs to consider multiple scenarios in the Baltic region. On the one hand, it must safeguard its interests with minimal damage. On the other hand, it is crucial to steer clear of uncontrolled escalation of tensions with NATO, as it entails the risk of a military clash.

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The economy of the Russian Baltic Sea regions: adaptation and modernisation

The adaptation of Russian regions’ econ­omies to the rupture of relations with Europe: the case of Baltic Sea ports

Abstract

Despite the sweeping economic sanctions imposed by Western countries, Russia has managed to avoid a significant recession, experiencing recovery growth. The situation in the regions earlier involved in cooperation with Europe was more complicated. Yet, these territories have also succeeded in reviving their economies and returning to growth. A number of growth areas have emerged in the Russian regions, which continue to develop under sanctions. A prime example of this is Russian seaports. This article examines the factors that enabled Russian businesses, including those operating in Baltic Sea ports, to adapt to the sanctions and continue operations. To do so, a comprehensive analysis was conducted, with a focus on macroeconomic, sectoral, regional, and corporate statistics. In addition, scholarly articles and information from business media were examined, and a survey was conducted among Russian enterprises operating across various industries and regions of the country. This study traces the history of economic relations between Russia and Europe over the past twenty-five years, examining the impact of Western sanctions on Russia’s spatial development, the response of Russian maritime transport to these sanctions, and the adaptation measures taken. It also evaluates the performance of Russian Baltic ports between 2022 and 2023, assessing the long-term risks and threats to their development and exploring the potential for maritime transport growth in the Baltic region under the current circumstances.

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Knowledge and innovation dynamics of the Northwest Russia under geopolitical changes

Abstract

Over the past 25 years, Russia has faced several economic and geopolitical challenges, including the 2008 global financial crisis, sanctions imposed in 2014, and the COVID-19 pandemic. To remain resilient in the face of these challenges, Russia needs to adopt a flexible development strategy and transition to a new path of development. This transition requires the development of new knowledge-intensive industries, expansion into promising markets, strengthening trade and economic partnerships, and achieving technological sovereignty. This study examines the innovation system in Northwest Russia and identifies factors that are critical for its sustainability and innovation security in the face of geopolitical instability. The study uses an integrated approach to trace the knowledge production and innovation process from research findings to the commercialization of new technologies. The study finds that there are strong correlations between innovation activity and R&D investment, patent activity, and the number of innovative organisations. The study also identifies three types of regional innovation systems in Northwest Russia: core, semi-periphery, and periphery. The nature of the regions’ involvement in R&D determines the dynamics and specialization of their publications and patents. The study also finds that there is a positive correlation between the volume of innovative products and quantitative factors in the functioning of subsystems involved in knowledge generation and innovation. Finally, the study examines the geography and structure of the international research network that the regions of Northwest Russia had formed by 2022. It shows that the geopolitical transformation requires a significant part of cooperation ties with unfriendly countries to be restructured.

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Russian exclave on the Baltic Sea

The border as a barrier and an incentive for the structural economic transformation of the Kaliningrad exclave

Abstract

This paper aims to study how geopolitical shifts affect regional economies and their structures. Border functions and regimes act as tools for the economy and society to adapt to the redistribution of political influence, movements of people, goods, capital and information between integration associations, individual countries and their cores. A changed environment may slow down the development of some industries (and even cause them to decline) and give a boost to others, with these two processes constituting economic restructuring. In the exclave of Kaliningrad, heavily dependent on international trade and transit trade with mainland Russia, geopolitical changes have naturally had an exceptionally strong effect. The relationship between border functions and economic restructuring was investigated over four periods. The study utilised data from Rosstat and the Federal Customs Service, departmental statistics and findings from expert interviews conducted by the authors. The extent and direction of changes are assessed by examining the ratios between major economic sectors, the structure of foreign trade relations, and the volume and sectoral distribution of investments. Four main ways are identified in which the sharp increase in the barrier nature of the borders between the Kaliningrad region and neighbouring countries since 2014 and especially February 2022 has influenced the region’s economy. The significance and effectiveness of the agro-industrial complex have risen, with an increased focus on domestic tourism, and the adoption of advanced public administration practices in collaboration with businesses. This includes implementing mechanisms such as Free Economic Zones and industrial parks, along with a shift towards proactive measures to adapt to the changing environment.

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Priorities for the development of manufacturing industries in the Kaliningrad region

Abstract

The Kaliningrad region is a socio-economically developed area with a steadily increasing population. Its economy is predominantly influenced by manufacturing industries, whose growth is supported by the region’s strategic geographic position on the Baltic coast and the Special Economic Zone (SEZ) regime. However, the region’s exclave status, which makes it reliant on external factors, hinders its development. Any change in these external factors could necessitate a restructuring of manufacturing industries. The severing of former foreign economic and social ties, the discontinuation of cross-border cooperation due to the actions of unfriendly countries, and the imposition of eleven packages of unlawful anti-Russian sanctions have had a more pronounced impact on the regional economy compared to the country’s inland regions. Logistics between the region and the main part of the country have been significantly complicated. Manufacturing industries have faced disruptions in the supply of essential foreign-made semi-finished products. The exports of several regionally-produced goods have been restricted, and transit through the Baltic States has become more difficult. This article aims to assess the impact of these restrictions on the development of manufacturing industries in the region. Another goal is to provide a rationale for the restructuring of specialization and changes in the geography of external relations in these increasingly complex external circumstances. Recommendations based on the findings obtained will contribute to the region’s sustainable development, characterized by dynamic growth and proportional development.

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Municipalities of the Russian Baltic Sea region

The modern economy of Russia’s Baltic regions in the municipal context

Abstract

This article analyses the differentiation of municipalities at the municipal and urban district levels in the Kaliningrad and Leningrad regions based on their economic development and the response of their economies to the crises of 2020 and 2022. Emphasis is placed on the possibilities of conducting such assessments by merging Rosstat statistics with publicly available accounting and tax reporting data from the Federal Tax Service. The contribution also assesses the role of small businesses in municipal economies and their effect on employment, income levels of the population, and business activities. It is shown that over the ten years from 2012 to 2021, municipalities in the Kaliningrad region became more homogeneous in terms of the level of taxable income for individuals and individual entrepreneurs. In contrast, in the Leningrad Region, the level of differentiation remained unchanged, albeit with diverse income trends across municipalities.

The study highlights municipalities’ specialization as a factor influencing changes in local companies’ revenue, particularly in 2022. The research illustrates that small businesses have a significantly smaller impact on the official income of the population compared to their role in employment. Furthermore, there are no discernible patterns in how municipalities differentiate based on the contribution of small businesses, as this can vary depending on the local economic development level and the ratio of urban to rural population. In particular, the decline of small businesses is noticeable in regions with high incomes and abundant employment opportunities at large organizations. This trend is also observed in economically challenged peripheral areas characterized by low demand for the products and services provided by small businesses.

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