Transition Strategies for Finland’s Eastern and South‑Eastern Border Regions

8. Framework for the transition strategies and action plans

Abstract

This chapter presents the strategic framework guiding the recommendations on transition strategy for Finland’s eastern and southeastern border regions. It emphasises the integration of security considerations into regional development, the need for targeted national and EU support, and the importance of investing in dual-use infrastructure and long-term regional renewal.

Introduction

Part II of the report presents recommendations for a transition strategy designed to address the challenges facing Finland’s eastern and southeastern border regions - Lapland, North Ostrobothnia, Kainuu, North Savo, North Karelia, South Karelia, South Savo, and Kymenlaakso. The recommendations are directed towards the Finnish Government, and the regions, both collectively and individually. The recommendations aim to support the development of a transition strategy that strengthens regional economic, social, and environmental resilience, responding to the changed geopolitical situation resulting from Russia’s war of aggression against Ukraine. To support the implementation of the recommendations, recommendations for Action Plans are also presented for the national and regional levels.

The next chapters present a comprehensive set of recommendations across multiple governance levels, focusing on targeted national and EU funding, promoting regional economic diversification, and strengthening the regions' role in national and EU security frameworks. A key recommendation is that, as a next step, the regions should explicitly integrate comprehensive security considerations into their regional development strategies and policies. In parallel, regions should proactively pursue opportunities to diversify their economies and enhance defence-related industries, including development and manufacturing, building upon their existing industrial base and regional strengths. These strategic investments and policy alignments would ensure long-term economic, social, and environmental resilience, consistent with post-2027 EU Cohesion Policy objectives.

While the national government and the regions should be responsible for implementing the recommended actions, their ability to fully fund them independently is limited. The recent budget proposal by the European Commission for the EU’s long‑term budget (2028–2034) (European Commission, 2025[1]), presented on 16 July 2025, is therefore a promising development. If adopted, it would be particularly significant for Finland, as the funding it currently receives through Cohesion Policy is both insufficient and poorly suited to address the spending needs arising from its geopolitical vulnerabilities and the resilience challenges linked to its unique proximity to Russia - challenges that also have broader implications for European security. Additional funding is needed to support critical dual‑use infrastructure investments in areas such as transport, energy, digital connectivity, water supply, emergency health and rescue services, and disaster preparedness.

The strategic framework

The strategic framework proposed to support Finland’s eastern and southeastern border regions in adapting to geopolitical shifts resulting from Russia’s aggression against Ukraine is built around two pillars. Recognising the new reality of the EU’s longest external land border transforming from an economic gateway into a critical security barrier, the framework emphasises integrating security considerations deeply into regional development policies. It also advocates balancing traditional regional development instruments with enhanced and targeted EU support mechanisms. Together, these two interrelated pillars aim to support long-term economic, social, and environmental resilience across the border regions.

Pillar 1: Integration of regional development and security

The transformation of Finland’s eastern and southeastern border regions from economic entry points into strategic security boundaries necessitates a significant shift in regional development policies. Given that Finland’s eastern border constitutes the EU’s longest external land boundary with Russia, securing and stabilising this region is a concern not only for Finland but for Europe as a whole. Consequently, measures to strengthen security and resilience should be systematically integrated into regional development planning across all eight border regions. This integrated approach ensures investments in border security, defence infrastructure, security of supply, and cybersecurity directly bolster sustained economic growth and social cohesion that benefit the entire EU.

Pillar 2: Balancing traditional regional development with enhanced support to tackle geopolitical challenges

Traditional EU Cohesion Policy instruments have played a key role in strengthening economic resilience in Finland’s eastern and southeastern border regions, with rural development funding under the Common Agricultural Policy (CAP) providing important complementary support. It remains crucial that Finland and these border regions ensure their unique characteristics - including harsh climate conditions, geographical remoteness, limited market access, and recently heightened security pressures - are reflected in both national and European regional policy frameworks.

However, the exceptional circumstances arising from proximity to Russia and related European security concerns necessitate advocating for new funding solutions. Recently, the European Commission announced that it is revising the EU’s cohesion policy to strengthen support for Eastern border regions, helping them address new challenges related to security, competitiveness, decarbonisation, and regional resilience. The updated policy also aims to foster the energy transition, affordable housing, and water security in these areas (European Commission, 2025[2]). This would be a positive development as it could enable Finnish eastern and southeastern border regions to address pressing challenges and support their efforts to enhance security, resilience, and sustainable development.

Additionally, Finland should make optimal use of available funding, including at the EU level, to offset extraordinary and urgent expenditures, particularly for dual-use infrastructure investments that the eastern and southeastern border regions cannot adequately finance through existing sources. Funding should be targeted to specifically support medium- and long-term security preparedness and resilience, ensuring robust, forward-looking regional stability and development. The recent budget proposal by the European Commission for the EU’s long‑term budget (2028-34), presented on 16 July 2025, could play an instrumental role in this regard.

References

[1] European Commission (2025), EU budget 2028-2034, https://commission.europa.eu/strategy-and-policy/eu-budget/long-term-eu-budget/eu-budget-2028-2034_en (accessed on 13 August 2025).

[2] European Commission (2025), Modernising the cohesion policy to meet today’s challenges, https://commission.europa.eu/news-and-media/news/modernising-cohesion-policy-meet-todays-challenges-2025-04-01_en (accessed on 16 June 2025).