Bioeconomy offers Europe and Russia opportunity
for long-term strategic cooperation

Esko Aho, Göran Persson, and Marc Palahí

September 2015. A window of opportunity has opened for Europe and Russia to develop strategic partnerships that break links between economic growth and social and environmental harm. That opportunity is called bioeconomy. A bioeconomy is one based on the conversion of renewable biological resources into food, feed, bioenergy and other value-added products. Russia is uniquely placed to excel in bioeconomy, while Europe has the know-how it needs. The time is right. Russia’s economy is at a crossroads. It depends heavily on oil exports and has been hit hard by falling oil prices. But this is not the only reason for Russia to follow the bioeconomy path.

Global population growth and the need to address climate change will drastically alter the dynamics of supply and demand for water, food, energy and land in the coming decades. There will be rising political, social and economic tensions over access to global natural resources - but also great business opportunities in transforming our fossil-based economy into a new bio-based, resource efficient and low carbon one.

This leaves Russia in an enviable position. It has 20% of the world’s forest resources and freshwater reserves, and is one of the world’s largest producers of grain. Despite the impressive scale of these renewable resources, however, Russia reaps relatively little of their economic potential. Russia’s bioeconomy sectors generate just 10% of those in the EU, which have an estimated turnover of 2 trillion euros. For Russia to realise its bioeconomy potential it urgently needs significant structural reforms, including long-term policies and investments in research, education, innovation and infrastructure. These should focus on forests, Russia’s most important renewable resource. This could transform Russia’s forest sector into a major producer of bioenergy and industrial products. Recent advances in science mean forest fibres can be transformed into high value-added products like speciality chemicals, food ingredients, bioplastics and composites, building materials, pharmaceuticals or textiles. A modernised forest-based bioeconomy could lead Russia’s transformation towards smart, sustainable and inclusive growth. It would create new jobs in rural and industrial areas, reduce fossil fuel dependence, and improve rural development and the environmental sustainability of primary production and processing industries.

It has become obvious that the most effective way to address new global challenges is to build global answers for the main regions of the world. The bioeconomy is unique in that it offers Europe and Russia a strategic area for long-term cooperation to address the grand challenge of our times: how to decouple economic growth from environmental and social degradation.

No European country could solve this challenge alone; no sector can be isolated from interrelated ones. The bioeconomy is therefore a window of opportunity that should not be missed. It can be an effective way for Russia and Europe to start mutually benefiting cooperation whilst supporting a fluent dialogue to address emerging global challenges related to climate change and scarce natural resources. Despite the current difficulties between Russia and Europe, we believe that cross-border bioeconomy partnerships at scientific, policy, economic and business levels should be brought to the European and Russian political agendas.

Europe and Russia need each other. Russia possesses vast natural resources in a time of increasing scarcity, and Europe has the science and technology Russia needs to modernise its bioeconomy. The benefits would be enormous. For Russia, the bioeconomy path could catalyse social, technological, and economic transformation. For Europe, it would build a long-term approach toward economic cooperation, tighter market integration and a better business environment for bio-based products and technologies.

Often, Europe lives more on memories of the past than on dreams for the future. But our world is changing faster than ever. We need new dreams, visions, and the courage to implement them. The bioeconomy will not solve all the challenges we will face in the coming decades. But unless we take the bioeconomy seriously, we will not find sustainable solutions to address those challenges.

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