Erik Larsen May 22, 2016, 9:24 p.m.

Crossborder trade and economic cooperation important for Kirkenes


          The value of economic cooperation with Russia in the Kirkenes area totals NOK 765 million, states a report by Akvaplan-niva’s Rune Rautio. The crossborder economic activity creates some 280 jobs in the trading sector, public administration, education and research. The report is not based on the total activity in Kirkenes, but on a sample of 73 important companies and public bodies.

          The crossborder cooperation is increasing in economic importance for Sør-Varanger municipality, despite the policy of sanctions and the low value of the rouble, concludes the report. The total turnover of the companies and institutions with Russian ties amounted to about NOK 1.8 billion in 2014. The maritime sector, including port administration, is the most significant segment representing two thirds of this value. Retail trade accounted for some NOK 500 million. The report states that continued growth may be expected in the transshipment of oil outside Kirkenes (in the Bøk ord). Maritime-related businesses in Kirkenes will be even more important and depend to a large extent on Russian activity and clients. The figure of NOK 765 million comprises Russian shopping, the sale of goods and services from businesses, port administration and other sales to Russian business partners. Many businesses would not survive in Kirkenes without the crossborder trade. Russian shoppers constitute the biggest group in the border crossing statistics, which showed a big increase from 2011 to 2013. In 2014, however, the traffic stagnated and fell drastically in 2015 (down 24% according to recent media reports).

          The report ends with a suggestion that a follow-up report be made to map the effect of value creation on the Russian side of Norwegian crossborder trade, business cooperation and investments.