PC/STC
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Original: English
NATO Parliamentary Assembly
SUB-COMMITTEE ON
NATO PARTNERSHIPS (PCNP)
SUB-COMMITTEE ON
ENERGY AND ENVIRONMENTAL SECURITY (STCEES)
MISSION REPORT
HELSINKI, FINLAND
STOCKHOLM, SWEDEN
TALLINN, ESTONIA
21-25 SEPTEMBER 2015
www.nato-pa.int
November 2015
This Mission Report is presented for information only and does not represent the official view of the
Assembly. This report was prepared by Henrik Bliddal, Director of the Science and Technology Committee,
and Steffen Sachs, Director of the Political Committee.
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I.
VISITS TO FINLAND AND SWEDEN
1.
Baltic security issues, the role of Russia for regional security as well as Finland’s and
Sweden’s relations with NATO were on top of the agenda of a joint visit of the NATO Parliamentary
Assembly’s Sub-Committees on NATO Partnerships (PCNP) and on Energy and Environmental
Security (STCEES) during the week of 21 September 2015. The delegation, comprising some
20 parliamentarians from NATO member states, was chaired by Karl A. Lamers (Gernany) and
Jan Arild Ellingsen (Norway) and visited Finland jointly before the PCNP continued to Sweden and
the STCEES to Estonia. In Sweden, the PCNP was joined by Associate members to the NATO
PA.
2.
The visit was particularly timely as Baltic security, has become more volatile after the recent
developments in Ukraine. Despite a number of differences, Finland’s and Sweden’s views on
security are very much aligned. International co-operation is an important cornerstone of their
national defence for both Finland and Sweden, and both countries co-operate on regional security,
both bi-laterally and in multi-lateral fora, including the Nordic Defence Co-operation (NORDEFCO),
the European Union, and NATO.
3.
Both countries can look back to a long-standing contribution to peace keeping operations.
Helena Partanen, Director for Defence Policy in the Finnish Ministry of Defence informed
participants that Finland’s international co-operation plays an increasingly important role for
national defence. Moreover, Finland seeks to be an active contributor to international security,
giving support where it can provide the most added value. Similar views were expressed by
Swedish officials. Representatives of the Finnish and Swedish governments as well as
parliamentarians in both Finland and Sweden noted that Russia’s new assertiveness, and its
actions in Ukraine in particular, have impacted the security environment negatively in the
Baltic Sea region and in Europe overall. This, together with new threats like cyber warfare and the
security challenges in the Middle East and North Africa (MENA) region, make today’s security
environment more complex and unpredictable.
A. RUSSIA
4.
Russia is a littoral country of the Baltic Sea and a direct neighbour of Finland and Sweden,
its role for regional security featured prominently in the discussions in all three capitals.
Senior Finnish officials acknowledged that the Baltic Sea is strategically important for Russia,
among others because it serves as central channel for Russian energy exports as well as shipping
and communication links. However, the more assertive stance of the Kremlin, particularly the
Russian aggression towards Ukraine, is seen in the three capitals as a major factor in increased
strategic volatility in the region. Activities of Russian aircraft in the Gulf of Finland and the rest of
the Baltic Sea have significantly increased and Swedish and Finnish airspace repeatedly violated.
Moreover, large-scale snap exercises, which have begun in 2014, have caused wide concern in
the region. Official speakers and independent experts generally considered Russia’s actions in
Ukraine as a violation of the OSCE principles and the Budapest Memorandum. The more critical
perception of Russia’s foreign policy has also led to increased public support for NATO
membership both in Finland and, to an even greater degree, in Sweden. Both Finland and
Sweden are supporting the sanctions that have been imposed on Russia as a result of its actions
in Ukraine, the delegation learned. Like NATO member states, both countries have also reduced
their bi-lateral co-operation with Russia considerably. In addition, as Ms Partanen pointed out,
multilateral co-operation, for example in the Arctic, now often takes place without Russia.
However, official as well as independent speakers in both Finland and Sweden underlined that
Russia remains a key actor and that there is a need to continue dialogue with Russia even if
relations with Russia are a “never-ending balancing act”, as Maria Lohela, Speaker of the Finnish
Parliament, noted. Also, neither Swedish nor Finnish speakers considered Russian actions to
specifically target their countries. The increasing Russian military presence and activities in the
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Arctic were considered to be ambiguous. For example, Major General Timo Kivinen, Deputy
Chief of Staff of the Finnish Armed Forces, suggested that the Russian military stance in the region
remains generally defensive, but that this does not exclude offensive actions.
5.
Even though low energy prices and the effects of Western sanctions affect Russia’s
economy negatively, official and unofficial interlocutors in Helsinki and in Stockholm did not
anticipate that the Kremlin would change its foreign policy and its course towards Ukraine in
particular. This is due to several reasons, the delegation heard, among others because Russians
tend to consider Ukraine as part of their country. Although Russia is a state and society in decline,
the system is not collapsing, according to Arkady Moshes, Programme Director of the EU's
Eastern Neighbourhood and Russia Research Programme at the Finnish Institute of International
Affairs (FIIA), who reminded the delegation that even though Russia’s economy is struggling
severely it is better off today than it was 15 years ago and that Russia’s budget deficit for the next
year is fairly small. A slightly different view on the impact of low energy prices and the implications
of sanctions on Russia’s economy was held by Susanne Oxenstierna of the Swedish Defence
Research Agency (FOI). She suggested that the costs to the Russian economy were huge and
that Russia’s growth had already been declining since 2010, when energy prices were still high.
This was primarily due to the lack of structural reforms in the country, she explained adding that it
is unlikely that the Russian political leadership will be able to guarantee the standard of living of the
Russian population for much longer.
6.
Timo Soini, Finnish Minister of Foreign Affairs, reminded the delegation that there seems to
be a general sentiment of victimisation among the Russian political elite and in the Russia society
in general. This, together with the economic difficulties facing Russia, creates a dangerous
situation. However, reengagement with Russia is currently wishful thinking, according to
Mr Moshes. No matter what happened in Ukraine, the fundamental disagreement between Russia
and the West would remain. At the moment, Russia wants to re-impose itself on the West as an
indispensable actor through stoking conflicts. Russia’s recent engagement in Syria follows a
familiar pattern of the regime’s approach: It creates a problem and then offers negotiations to
address the issue and obtain concessions from the West.
7.
In Stockholm, FOI Deputy Directors of Research Dr Carolina Vendil Pallin and
Dr Susanne Oxenstierna argued that President Putin views the conflict in Ukraine as a
geopolitical and ideological confrontation between Russia and the West. In addition to exercising a
degree of control over Ukraine by keeping it weak, the Kremlin also aspires to weaken the
transatlantic order, according to Ms Vendil Pallin. Moreover, the confrontation with the West
serves as a way of shifting attention from Russia’s internal problems. This strategy has worked
with Russians showing unprecedented levels of hostility towards West and Ukraine. Mr Moshes
also pointed out that the regime is considered legitimate and the majority of Russians support
President Putin, also because the Russian people support a leader “at war”. The level of public
support also would make it more difficult for President Putin to back down from Crimea. While a
majority of Russians support the Russian government under President Putin there are also signs
for an increased polarization of the Russian society, Ms Vendil Pallin pointed out. Moreover, the
Russian population is showing signs of apathy and fatalism, which is partly due to the fact that the
organised opposition which could present political alternatives is eliminated, Mr Moshes argued.
One symptom was that demonstrations gathered only 4,000 to 5,000 people today, where
30,000 people would have participated in late 2014. The regime has become authoritarian and
controls the mass media, particularly TV.
8.
As far as the Russian government’s goals in Ukraine are concerned, several interlocutors in
Helsinki and Stockholm argued that Russia prefers a security zone around its territory.
Pertti Salolainen, Vice Chair of the Foreign Affairs Committee in the Finnish Parliament,
suggested that Russia wants to keep Ukraine unstable. Several speakers, including
Jussi Niinistö, Minister of Defence of Finland, anticipated the standoff in eastern Ukraine to
continue, thus creating a “frozen conflict”. Mr Moshes argued that the semi-frozen conflict in
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Ukraine does not work in Russia’s favour as it has no control over Ukraine. Moreover, the
Ukrainian military is much better now than a year ago. A more negative view of the Ukrainian
armed forces was held by Ian Anthony, Stockholm Peace Research Institute (SIPRI) Director
(ad interim) and Director of the European Security Programme, who noted that – despite the
support from NATO for many years – the Ukrainian military are “not fit for their purpose”. In that
sense, NATO’s partnership with Ukraine has been a “failure”, he said. Mr Moshes added that,
even if the Kremlin has not achieved its goals in eastern Ukraine, time does not work for the
government in Kyiv either. In this context he pointed out that Ukraine’s GDP shrank considerably
in 2014 and is likely to do so again in 2015, which could lead to the collapse of its economy.
Profound reforms are sorely needed, as inefficiencies and corruption plague the economy and the
political system. There are limits to what the population can endure, he warned and explained that
the destabilising effect of people’s discontent is tangible. He continued by arguing that the
Minsk II Agreement was imposed on the Ukrainian government and added that it would be
counterproductive if the West would urge Ukraine to accept additional concessions.
Michael Haltzel, Visiting Senior Fellow for Global Security at FIIA, suggested that NATO Allies can
support Ukraine to improve societal resilience and fight corruption. Moreover, NATO Allies could
step up co-operation on intelligence and in the diplomatic realm. Officials in Helsinki and in
Stockholm, including, for example, Anna-Karin Eneström Director General for Political Affairs in
the Swedish Ministry of Foreign Affairs, noted the need for reform in Ukraine and stressed at the
same time that the Finnish and Swedish governments will continue the support for the country.
9.
The situation in the MENA region, and particularly the increasing number of refugees arriving
from Syria, Iraq, and Afghanistan was also briefly addressed in some of the exchanges. Sweden
in particular has accepted a high number of refugees. There was agreement that the situation in
the MENA region poses new challenges and that the flow of refugees to Europe may have
implications for security by affecting relations between European nations. Official speakers in
Helsinki and in Stockholm also agreed that more needs to be done to solve the issue in Syria.
Maria Lohela, Speaker of Parliament, said that Finland supports the neighbouring countries of
Syria and Iraq by providing assistance with the refugees crisis. Speakers in Finland and in
Sweden stressed the need to focus more on Syria.
B. BILATERAL CO-OPERATION BETWEEN FINLAND AND SWEDEN
10. Finland and Sweden have developed close co-operation in the security field over the years,
both bilaterally and in the context of NORDEFCO. In a joint presentation,
Brigadier General Michael Claesson, Swedish Armed Forces, and Brigadier General Eero
Pyötsiä, Finnish Armed Forces informed the PCNP Sub-Committee about the deepening defence
co-operation between both countries. The bi-lateral defence co-operation aims at improving
effectiveness and efficiency through the combined use of resources as well as through increased
interoperability and through a closer dialogue on common challenges. More specifically,
co-operation possibilities have been identified in air and naval surveillance, joint training and
exercises between Finnish and Swedish naval and land forces, in the field of maintenance, in
developing secure communications and in combined participation in international exercises and
operations. Challenges that both sides need to tackle derive from limited available personnel and
financial resources, differences in legislation and regulations but also from cultural and practical
differences. Mats Bergqvist, former Swedish Ambassador to Finland, went further by suggesting
that the defence co-operation between Sweden and Finland is deepening to a point where it may
become an ‘implied commitment’ to assist each other when attacked. This view was not shared by
other independent speakers in Sweden who considered the co-operation successful, both on the
bi-lateral level and through NORDEFCO, but also argued that it will never have binding
commitments to collective defence unless Sweden and Finland join NATO.
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C. RELATIONS WITH NATO
11. Finland and Sweden are also long-standing NATO Partners and senior officials in Helsinki
and in Stockholm underlined that their co-operation with NATO is crucial for the development of
their countries’ defence capabilities, as well as interoperability, and standards. Both countries are
also willing to develop the partnership further. Host country officials also considered NATO’s
presence in the region as a stabilising factor. In this context Mr Timo Soini, Finnish Minister of
Foreign Affairs, commented that NATO reassurance measures have increased security and
stability in the Baltic Sea.
12. According to Helena Partanen of the Finnish Defence Ministry at the upcoming NATO
Summit in Warsaw in 2016 progress could be made in developing strategies in countering
so-called “hybrid warfare”. Other areas where the existing co-operation could be deepened are
defence capability building. Moreover, it would be desirable to strengthen co-operation between
NATO and the EU. Finland welcomes participation as an Enhanced Opportunities Programme
(EOP) partner as decided at the 2014 NATO Summit in Wales. Being an EOP participant provides
new opportunities for pragmatic cooperation with NATO and partners, the delegation heard.
Official Finnish interlocutors also considered it important to fill the Enhanced Opportunities
Programme with life.
13. Possible future membership of Finland and Sweden in the Alliance was also raised during
some of the exchanges. According to the Finnish Defence Minister Niinistö public support for
NATO membership in Finland is approximately 25%. Finnish and Swedish officials repeatedly
underlined that any move to apply for membership in the Alliance would be up to either of the two
countries to decide and not for any other party. However, host country parliamentarians in both
Helsinki and Stockholm agreed that the debate in their own country is likely to have a strong
influence on the other. The Finnish government is preparing an evaluation of its relations with
NATO the delegation learned in Helsinki.
14. In addition to continuing and deepening the partnership with NATO, Finland and Sweden are
also interested in a good working relationship with the United States. Likewise, the Baltic area is
important to the United States, delegates heard from Michael Haltzel. He argued that reaction of
the Obama Administration in the aftermath of the crisis in Ukraine was appropriate. The
reassurance package for the Baltic countries is adequate he said, especially because it includes a
rotation of US troops into the region. Mr Haltzel wanted the United States and NATO to go further,
however, and argued that NATO should create a credible, permanently stationed ‘trip-wire force’ in
the Baltic republics. This would show that NATO was fully committed to defend all its members and
reduce miscalculation on either side.
D. FINLAND
15. In Finland, the programme for the joint delegation included meetings with President of the
Republic of Finland Sauli Niinistö, the Parliament, senior officials at the Ministries of Foreign
Affairs and Defence, the Finnish Institute of International Affairs (FIIA) and Arctia Shipping. Similar
to Sweden, Finland has opted for a policy of Non-alignment and territorial defence. However, in
contrast to its western neighbour, which abolished peacetime conscription in 2010 and replaced it
with volunteer armed forces, Finland still has general conscription in place. According to
Helena Partanen “practically all Finnish citizens feel that they have a role to play in the defence of
Finland”.
16. At present the Finnish armed forces number 12,300 professional soldiers plus approximately
25,000 conscripts and 18,000 Reservists in peace time. This figure can be expanded to
approximately 230,000 in wartime, Major General Timo Kivinen, Deputy Chief of Staff of the
Finnish Armed Forces, informed the delegation. In 2015, Finland contributes some 500 military
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personnel to international operations; slightly more than 300 of the Finnish soldiers are currently
deployed with UNIFIL in Lebanon, to which Finland is contributing since 2012. Finland’s defence
budget amounts to EUR 2.65 billion in 2015, or about 1.29% of Finland’s GDP, which is about the
same amount as in 2014, but slightly less than in 2013 (EUR 2.85 billion). These figures do not
include border guards and pensions.
17. Finland plans to develop its military capabilities further. The biggest – and by far most
expensive – item is the replacement of its fleet of F/A-18 Hornet will be obsolete by 2030,
according to Major General (Ret.) Lauri Puranen. A study is currently underway and Finland is
evaluating several options, including joint acquisition of a new fighter aircraft with Sweden, the
delegation learned.
E. SWEDEN
18. In Sweden, the PCNP also received a comprehensive overview of the country’s foreign and
defence priorities. Anna-Karin Eneström underlined that the European Union remains at the core of
Sweden’s foreign and security policy. Main security challenges from Sweden’s perspective are the
Euro crisis, the assertive Russian behaviour and the high number of refugees fleeing the wars in
Syria, Iraq, and Afghanistan. Sweden attaches high importance to developing the co-operation
with the Eastern Partners of the European Union and supports internal reforms taking place in
Ukraine.
19. State Secretary for Defence Jan Salestrand noted that Russia’s actions towards Georgia
and Ukraine forced Sweden to re-evaluate its assessment of the international environment.
Consequently, renewed focus was given to national defence, which has resulted in higher defence
spending, the first increase in many years, the delegation learned. However, while Sweden is now
focusing more on national defence, its involvement in international peace support operations has
slightly decreased. In a separate panel discussion with independent experts Mikael Holmström
(Dagens
Nyheter),
Lena
Bartholdson
(Folk
och
Försvar),
Stefan
Ring
(Allmänna Forsvarsföreningen), Jacob Westberg (Försvarshogskolan), Sven Hirdman (former
Ambassador to Russia) it was suggested that successive defence cuts have hampered Sweden’s
defence capabilities significantly.
20. Although support for joining the Alliance has grown in Sweden, and is currently higher than in
Finland, membership in NATO is not on Sweden’s agenda, the delegation learned. Neutrality is
still a strong concept in Swedish society, although polls show a significant shift of opinions in
recent years. Main arguments against a NATO membership being discussed in Sweden are
related to the risk of retaliation from Russia and consequently a general deterioration of the
security environment. Moreover, as Mats Bergqvist, former Swedish Ambassador to Finland,
pointed out that a decision on Alliance membership is so fundamental that it would require a huge
majority in the population. This uncertainty is another factor that makes a referendum on Alliance
membership unlikely at least in the near term. Swedish officials pointed out, however, that there
are no limits for co-operation with different NATO partners on bilateral and multilateral basis.
21. The programme in Sweden also included an exchange with representatives of Swedish
political parties’ youth movements on current and future security challenges. The meeting was
jointly organised by Folk och Försvar and the Embassy of Poland which served as the NATO
contact embassy.
22. Briefings on The future of NATO Partnerships by Ian Anthony, SIPRI (ad interim) Director,
and on Patterns of military expenditure in Europe by Aude Fleurant, Director of the Arms and
Military Expenditure Programme at SIPRI, concluded the programme in Stockholm. These
briefings pointed to relative decrease of Europe’s defence spending when compared to all regions
of the world in the last 15 years. This tendency may yet change due to renewed concerns over
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international security. While Western Europe has seen steady declines in spending in 2013-2015,
the two biggest increases in defence budgets in Europe came from Lithuania and Poland.
23. Cyber security featured prominently on the programme in Tallinn as well as in Helsinki.
Jarno Limnell, Professor of Cyber Security at Aalto University noted that digital and physical
security is becoming increasingly integrated. As a result, more than 100 armed forces worldwide
have established cyber units and 40 countries have developed a cyber strategy. Developing and
increasing resilience against cyber-attacks is a major challenge, among others because of the
rapid development of technology and the fact that cyber offence is developing faster than cyber
defence. Moreover, information technology has become crucial in all areas of today’s life including
the military and economic areas. Finland's Ministry for Foreign Affairs (MFA) has been subjected
to a sophisticated and successful cyber-attack aimed at extracting political intelligence over several
years. In this context Mika Aaltola, Programme Director at Global Security, noted that a study by
the internet security company MacAfee and the Washington-based Center for Strategic and
International Studies suggests that as many as 500,000 US jobs are lost each year from costs
associated with cyber espionage. In the view of Jarno Limnell the biggest challenge is to develop
a strategic understanding of the existing and evolving cyber threats and to develop possible ways
to cope with them, he argued.
24. The visit provided a comprehensive overview of the security situation in the Baltic Sea
region. Participants found the meetings particularly valuable as the presentations offered
comprehensive and profound insights in regional and Euro-Atlantic security issues from senior
officials of two long-standing partner countries of the Alliance.
II.
VISIT TO ESTONIA
25. Cyber Security: Karoliina Ainge, Head of Estonian Cyber Security Policy at the Ministry of
Economic Affairs and Communication, explained and discussed cyber security policy in Estonia,
focusing on the country’s Cyber Security Strategy 2014-2017. The strategy aims to ensure
country’s cyber security and support the functioning of an open, inclusive and secure information
society. Cyber security is recognised as an indivisible part of national security. To do so, the
government tries to increase cyber security capabilities and people’s awareness of cyber threats.
Key efforts include:
-
guaranteeing vital services;
combating cybercrime more effectively;
advancing national defence capabilities; and;
creating a cyber security industry in Estonia.
26. Estonia ranks as number five in the world for cyber security capacity, Ms Ainge told the
delegation. Currently, the global cyber security situation is worsening. In 2014, 1,151 incidents with
real consequences were reported in Estonia. Highly critical incidents involving state bodies
increased four times compared to the year before. Worryingly, Estonia registered an increase in
state-backed cyber-attacks.
27. Mihkel Tikk, Head of the Cyber Policy Department, Estonia’s Ministry of Defence, told the
delegates that the IT budget had increased by the factor 36 after the cyber-attacks on Estonia in
2007. Before the attacks, Estonia had no IT or cyber strategy, and there were only about
200 specialists in the whole country. The aftermath of the attacks revealed that better regulations
were direly needed. The Estonian Defence League’s Cyber Defence Unit was created after the
events in 2007. It is a unique voluntary part-time national defence organisation and part of
Estonian Defence Forces. It created a collective brain force, provides a testing ground, and serves
as a knowledge reserve and resource pool for the government. For example, the unit is helping the
government build a cyber reserve force. Estonia is providing its cyber expertise to both NATO and
the EU, especially in the training and testing, Mr Tikk told the delegates. Cyber hygiene was
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another important part of Estonia’s efforts, as most attacks succeed because people forget the
basics, even the specialists. In the Estonian Defence League, there was a mandatory cyber
security test each year for example. Mr Tikk’s takeaways for the parliamentarians were that
public-private partnership, awareness and clarity, information sharing, preparation for the unknown,
and the absence of legacy systems were key.
28. Rain Ottis, Associate Professor of Cyber Security and Head of the Centre for Digital
Forensics and Cyber Security at the Tallinn University of Technology, gave members an insight
into Estonian universities’ approach to educating Estonia’s next cyber elite. Estonia has a fairly
long history in computer science and cryptology, dating back to the Soviet Union. However, a
distinct lack in technology, policy, and law specialists led Estonian universities to concentrate on
these aspects after 2007. Tallinn University works, inter alia, very hard on serious games training
and exercises of their specialists. They are also starting to work on “attacker profiling”, which could
complement the technical tracking of attacks.
29. The NATO Co-operative Cyber Defence Centre of Excellence (CCD COE) is also located in
Tallinn. The CCD COE is a NATO-accredited research and training facility dealing with education,
consultation, lessons learned, research and development in the field of cyber security. The
Centre’s current sponsoring nations are the Czech Republic, Estonia, France, Germany, Hungary,
Italy, Latvia, Lithuania, the Netherlands, Poland, Slovakia, Spain, the United Kingdom and the
United States. In addition, Austria is a Contributing Participant.
30. The organisation is funded, directed and tasked by the multinational Steering Committee
consisting of the representatives of the sponsoring nations. NATO does however task the Centre
via Allied Command Transformation (ACT) and all products of the Centre are available to NATO
nations unless restricted by the organisation requesting that product.
31. Chief of Staff Lieutenant Colonel Jens van Laak presented an overview of the CCD COE
and its current programme of work. The centre focuses on law and policy, strategy, and technology
in the realm of cyber defence. With its budget of around EUR 1 million, the COE delivers on around
80 requests by NATO and the sponsoring nations per year. Key activities are cyber defence
exercises at the tactical/technical, operational, and strategic level as well as training courses. In
2013, the COE published the so-called Tallinn Manual on International Law Applicable to Cyber
Warfare, a landmark publication on cyber defence and security. Currently, the CCD COE is
working on a version 2.0, which looks at cyber security during peacetime.
32. The delegation also visited Cybernetica, which is one of Estonia’s most prominent
companies working in the cyber security field. As an information and communications technology
company investing heavily into research and development, cybernetic researches, develops and
manufactures software solutions, light signalling and telematics products, maritime surveillance
and radio communications systems, as well as investigates and applies the theoretical and
practical security solutions. Aivar Usk, Head of Navigation Systems Department and a member of
the Management Board, gave the delegates an overview of the company. Mr Usk focused in
particular on Estonia’s e-government systems, including X-Road (the backbone of Estonia’s
e-government systems) and the internet voting system in use in the country. Delegates were
particularly interested in the safety and security of the company’s e-government solutions and
citizen’s privacy concerns.
A.
ENERGY SECURITY
33. Emmet Tuohy, Research Fellow at the International Centre for Defence and Security,
presented the delegation with an overview of energy security in the three Baltic republics, as they
transition from dependence on Russia towards interdependence with the EU. Mr Tuohy argued
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that Lithuania was the “head of the class”, Latvia was lagging behind, and Estonia made pragmatic
but slower progress.
34. Lithuania experienced a difficult recovery after the 2009 closure of the Ignalina nuclear power
plant, when they went from significant electricity exporter to electricity importer virtually overnight.
However, early restructuring and indeed the contentious decision to build a Liquid Natural Gas
(LNG) terminal unilaterally helped the country increase its energy security. The success of the LNG
terminal far exceeded expectations, Mr Tuohy argued, even though it was constructed without EU
assistance and against the wishes of neighbours. Indeed, the mere existence of the terminal
caused Gazprom to offer a discount of 23%, far in excess of the 5-7% expected.
35. Latvia had bigger hydropower reserves and less incentive to invest in electricity co-operation.
Mr Tuohy told the delegation that the current natural gas monopolist in Latvia was said to have
deliberately drafted poor regulations for implementing the EU’s Third Energy Package in order to
delay the process. However, after Latvia’s EU presidency, things are improving. Nevertheless,
Latvia’s consumer experience prices that are significantly higher than in any other country in the
region (and that are among the highest in the EU).
36. In contrast to the other two, Estonia enjoyed energy independence, but not energy security.
Sixty percent of its energy came from a type of oil shale that Mr Tuohy called “the world’s dirtiest
fossil fuel”. It is responsible for 70% of Estonia’s CO2 emissions and 70% of its solid waste.
Estonia is struggling to wean itself off this resource, which is key to industry as it generated 4% of
GDP with only 1% of Estonia’s workforce.
37. In the longer term, Mr Tuohy was optimistic about the relationship between the EU and
Russia on natural gas. First, Gazprom was moving towards being a commercial player in the
long-term. Second, the EU would continue to need (more) gas in the medium-term future including
Russian gas, even if its relative importance will decline. He argued that the EU should extend the
“North West European Gas Model” to the rest of the EU; enact the necessary regulatory
infrastructure; construct physical interconnector projects among countries; and obtain new sources
of supply to be traded on open markets with transparent prices.
B. RUSSIAN MILITARY MODERNISATION
38. Kalev Stoicescu, an Estonian Research Fellow at the International Centre for Defence and
Security, argued that Russian actions over the last two years constituted “not just a change of
weather, but a change of climate”. Russia had moved from an adversarial to a hostile stance
towards NATO. He argued that Russia would not constitute a military threat to the Alliance in the
medium term, but pointed out that the military balance was more precarious in the Baltic region.
39. Mr Stoicescu discussed Russia’s military modernisation efforts. President Putin had already
seen the sinking of the Kursk submarine in 2000 as a wakeup call, starting to initiate first reform
efforts in 2003. However, it took until the Georgia-Russia war of 2008 for the military to ease up on
resisting any modernization. Russia’s modernisation efforts rested on five pillars, according to
Mr Stoicescu. First, a reorganisation of the military districts; second, a move away from the model
of mass mobilisation towards a Western model of organisation; third, a focus on large-scale
exercises and training, including massive snap exercises; fourth, the introduction of a hybrid
warfare doctrine; and fifth, the modernisation of defence equipment.
40. He argued that Russia was in big trouble on military modernisation, as financial resources
dwindled rapidly. For example, mass exercises were very expensive, he said. Defence
expenditures were at a Cold War level, he argued, but it was very difficult to say how high they
were, as Russia was not transparent on defence budgets and rarely indicated the measures it
used. He also argued that sanctions were having an effect on the Russian military industry. They
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depended on sophisticated components, especially dual-use components. The European Union
and the United States should be very vigilant on this, he said.
C. ÄMARI AIRBASE
41. The reassurance measures that NATO agreed upon at the 2014 Wales Summit were also in
focus during the STCEES visit to Estonia. The lawmakers thus took a first-hand look at Allied
commitment to collective defence, when visiting Ämari Airbase. The airbase – together with Siauliai
Airbase in Lithuania – serves the NATO Baltic Air Policing Mission which ensures that the air
space of Estonia, Latvia, and Lithuania is defended. NATO member states provide combat aircraft
on rotation to the Baltics, as their air forces do not possess a combat aircraft fleet. The Baltic Air
Policing Mission was set up in 2004 when the Baltic countries joined the Alliance. Even though the
countries studied if the build-up of full range air defences could be achieved in conjunction, the
Alliance in 2012 decided it was most economical to extend the mission indefinitely in 2012. The
Estonian Air Force – numbering 400 personnel and growing – does, however, provide crucial parts
of the air defence system and offers extensive host nation support. Estonia, for example, provides
five sensors, including three mobile systems. Last year, NATO and the United States earmarked
substantial financial resources to build up Ämari Airbase for the coming years. The members of the
delegation discussed the NATO mission at length with the Estonian commanding officers, including
Lieutenant Colonel Riivo Valge, Chief of Staff of the Estonian Air Force, as well as the German
pilots currently providing the combat aircraft at the airbase. They also provided an overview of
Russian activities in the Baltic Sea region.
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