An increased Russian military activity in the Baltic Sea is fueling a debate about Swedish NATO membership. However, if this occurred, potential Russo-Swedish cooperation and investment in the Arctic would be negatively impacted.
U.S.-Russia tensions are on the rise following the Russian interventions in Ukraine and Syria, and this has led to increased military tensions in the Baltic region. For example, a Russian fighter jet recently had a flyby of a U.S. warship in the Baltic Sea, and Russian aircraft have also frequently been coming into close proximity with U.S. and U.K. aircraft. As a response, the NATO forward presence in Europe has increased significantly.
From a historical perspective, the Russian Empire under Peter the Great decisively defeated Sweden at the Battle of Poltava in 1709, making Russia the dominant power in the Baltic. This explains why, in addition to being one of Russia’s portals to Europe, the Baltic Sea has always figured prominently in Russian security calculations.
Russia has already warned Sweden of the possible consequences of NATO membership, yet Sweden is apparently swayed less by either Russia or NATO and more by the wishes of its own citizens. The Swedes are split regarding the possibility of a NATO membership, and the division is multi-fold, as it encompasses disunity not only between citizens and their elected parties but also between Sweden itself and its fellow neutral neighbor, Finland.
Gateway to the Arctic
It’s important to remember the Baltic Sea’s proximity to the Arctic. Russia already faces NATO members Norway and Denmark, not only in its immediate periphery but on the Arctic Council as well. Russia, the Arctic state with the longest coastline, is currently taking steps to increase its military presence all along the Arctic. This further fits with Russia’s plans not only to develop the Northern Sea Route, but also the Arctic’s speculated vast reserves of oil, gas, and rare-earth metals.
Accordingly, the idea of being situated directly across from a hostile NATO state which could potentially impede its access to both the Arctic and Atlantic Oceans would not sit well with Russia. In essence, the Arctic is to Russia what the “One Belt, One Road” initiative is to China economically: a way to further develop one’s economy through resource extraction, coupled with decreased transportation costs and time between Europe and Asia.
Because of this vast economic opportunity, Sweden has already taken steps toward ensuring optimal cooperation between all Council members in different research and exploration areas. The original mission of the Arctic Council was to foster this kind of activity and to keep the Council removed from geopolitical considerations. If Sweden, along with Finland, were to join NATO, the Arctic Council would be then composed only of NATO members save for Russia. This would hardly be in keeping with the Council’s original purpose and would only further fuel Russian suspicions.
In the end, Sweden is in a similar situation to Japan. Like Japan, Swedish NATO membership would bring to the forefront potential trade-offs between military security and economic security. Unlike Japan, however, the pressure to align against Russia would not be as strong, as Sweden is not a formal treaty ally of the U.S. However, this is always subject to change depending on further Russian incursions into Swedish airspace, perceived Russian progress towards the Minsk II agreements, and the overall state of U.S-Russian relations.
Potential Swedish investors in the Arctic should also not fail to note the instances of irony in this situation. The Battle of Poltava was decided in present-day Ukraine, the very source of today’s U.S.-Russian tensions. In addition to winning this battle, Peter the Great specifically founded St. Petersburg across from Sweden and the rest of Europe as a “window to the West” in order to learn from its neighbors. Lastly, St. Petersburg was the original stronghold of Russia’s current president and further demonstrates that history can have a profound effect on many things, including investment decisions.