Development of Business Environment in the Arkhangelsk Corridor
Funded by Euregio Karelia Neighbourhood Programme 2001-2006

Objective of the project

The aim of the project was to develop the Arkhangelsk corridor into a new functional traffic connection through Vartius to Karelia and to the Arkhangelsk and Murmansk regions. The sub-goals of the project included creating awareness of the Arkhangelsk Corridor, increasing cooperation between actors and altering the operational environment to assist business activity.

Main activities

• Development of cooperation networks, studying business alternatives together with companies from Kostomuksha, • Creation of Kuhmo-Kostomuksha optical cable work group for promoting the connection, • Establishment of a planning committee for the Vartius Border Traffic Centre, creation of a preliminary plan for the centre, • Implementation of marketing activities for border service company Via Vartius Oy, development of an operational model for producing services to the companies and communities in the region, and completing provisional subscription of company shares.

Achievements

Cooperation networks were developed during the project and business alternatives were studied together with companies from Kostamuksha. In fact, subcontracting activity was initiated in Kostamuksha already during the project. The project highlighted the significance of the increase in the standard of living and equality issues in the nearby area. Economic growth in Russia’s nearby areas was recognised as having great significance to trade and tourism in Kainuu. The Russian section of the Arkhangelsk Corridor had also become well-known as a low-cost production area within close geographic proximity. The positive publicity of the area had been increased and the interest in the area by companies had grown. In addition, the interest of Russian actors in cooperation with Finnish companies had increased. The companies and other actors in the region had excellent opportunities to take part in the growth in Russia, and they should take action in the issue. The limited resources of SME companies in the area were the greatest hindrance to doing so. In addition, Russian language skills should be improved in Kainuu. A Kuhmo-Kostamuksha optical cable team for promoting the connection was created as a result of the project. Permission to begin construction was finally received from the Russian Federation in March of 2007. The optical cable connection will strengthen the economic conditions of the region and increase opportunities for bringing about traffic- and development-related investments in the area. The growth in traffic in the region and the logistical status will be revitalised when the Lietmajärvi -Kotskoma connection, also promoted through this project, is available for commercial use. In addition, a planning committee for the Vartius Border Traffic Centre was established, based on the project’s initiative, and a preliminary plan was created for the centre. The City of Kuhmo later received separate funding for building the Border Traffic Centre, and it was completed during 2007 to serve the import and export activities occurring through the Vartius border-crossing location. Marketing activities for border service company Via Vartius Oy were started. In addition, an operational model for producing services to the companies and communities in the region, and the provisional subscription of company shares was implemented. Since the project, the company has become a well-known specialist authority in the region. At the same time as the interest toward the market in Russia continues to increase, the future of Via Vartius Oy appears bright as well. Via Vartius Oy’s reputation as a Russia specialist has increased in the international supplier networks as well, and new partners have began to use services of the company. Since the project, the company has participated in several different types of commercial projects directed toward Russia. In addition, the company was a member in the ‘Finland’s Economics Strategy for Russia’ taskforce by Sitra.