Business despite sanctions and pandemic

Business in the Barents Region despite the pandemic
Russian and Norwegian entreprenurs still see opportunities for cross-border businesses

​​From November 9th to November 10th, 30 Russian and Norwegian entrepreneurs from the Barents Region got together to participate in digital workshops to develop skills on cross-border entrepreneurship. Most of them come from the border cities like Kirkenes and Nickel.

Cross border collaboration​​

The event was organized by the High North Center for Business and Governance at Nord University Business School, together with Orinor AS, the Northern Chamber of Commerce and Industry, Second School and RSHU in cooperation with the Norwegian-Russian Chamber of Commerce. It was all under the support of the Norwegian Barents Secretariat.  

The workshops covered Russian and Norwegian business culture, and Megatrends for Norway-Russia business collaboration topics. These events were a part of the “Barents.New” project aimed at contributing to cross-border collaboration in business between Norway and Russia. This is done by connecting and educating entrepreneurs from border cities. 

"By 2020, only 13 Norwegian companies were still registered in Murmansk"

For Norway, cross-border cooperation in business with Northern Russia has been a key priority in bilateral relations for the last two decades. During the period 2003-2013 alone, €24 million were spent through Norwegian public funding to support Norwegian companies in different sectors to develop projects in the Russian part of the Barents region. This according to a study done by Akvaplan-Niva​. Most of the investments were placed in Murmansk. 

Positivity despite negative trend​

However, in the past few years, we are seeing a negative trend. In 2012, there were 42 companies with Norwegian ownership in Murmansk and 7 in Arkhangelsk. By 2016, a quarter of these companies had disappeared. At that time there were in Murmansk and 7 in Arkhangelsk. By 2020, only 13 Norwegian companies were still registered in Murmansk, and four enterprises are represented by Russian one-person enterprises. There is good reason to assume that the situation has not improved since then. 

Goldfish jumping out of the water
Taking the leap: More Russian companies want to take the leap and have more cooperation and investment across the borders.

However, the interest from Norwegian companies towards North Russia and from Russian entrepreneurs to Norway is still high. This was evidenced during the digital workshops. There was clearly still a big need for joint communication among the participants, which were entrepreneurs and SMEs from Nikel, Murmansk and Kirkenes representing various industries and services. The original plan was to conduct in-person activities, but this became impossible due to the pandemic restrictions.  

Sanctions and pandemic​

The pandemic did indeed have a strong influence on Norwegian-Russian business cooperation. According to the survey, which we implemented among the project participants, entrepreneurs point to the pandemic and respective restrictions as the biggest challenge for cross-border businesses. 

Among other challenges, there were alsmo mentions of sanctions, lack of information about opportunities abroad, and lack of specially business-oriented programs for funding. 

Despite the effects of sanction and the pandemic, the entrepreneurs still see opportunities for cross-border business.  Workshop participants indicated that they need more Business to business (B2B) matchmaking events, courses and workshops on how to do business in Norway and Russia. This would be a great help to their organizations for developing business connections abroad. The project partners are going to look further into this initiative for a larger project for the Barents Region entreprenurs. 

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