Nordicness in SL Foreign Policy

By Dr Srimal Fernando | Published: 2:00 AM Mar 8 2021
Columns Nordicness in SL Foreign Policy

By Dr Srimal Fernando

The post-cold war paradigm shift in the global order, displays a growing importance in the Indo -Pacific region, in the Global South. As such, the geo-strategic position of Sri Lanka in the Indian Ocean region is key for advancing the strategic interests of NORDIC nations. This factor coupled with other elements has had a huge influence on Sri Lanka’s foreign policy priorities. 

Sri Lanka’s quest for North -South cohesion will be determined by the country’s increasing attention on 'Nordicness' in its external policies and the nature of its relations with the NORDIC nations in Northern Europe. The Nordic nations have regularly offered their expertise as mediators for Sri Lanka during the ethnic conflict while a number of Nordic countries have provided Sri Lanka with the highest levels of aid. 

Using trade and aid interdependence to balance Sri Lanka’s foreign policy orientation with ‘Nordicness’ has proved to be an influential mode  to reach a decent level of diplomatic ties with western nations . Arguably, with interdependence and the scope of foreign policy cooperation between Sri Lanka and NORDIC nations such as   Norway, Sweden, Demark, Finland and Iceland is predicted to strengthen with time. 

Norway’s Trade and Aid Diplomacy 

As a Scandinavian nation, Norway is bordered with Russia, Finland and Sweden. With its long coastline, it is home to extremely rich fishing grounds and hence has been a main European fisheries nation for centuries. 

Norway is the wealthiest among the Nordic nations. Regardless of having a small population of 5.3 million people, the purchasing power of Norway is similar to larger economies due to its high level in living standards and even distribution of wealth. The World Bank has rated Norway as 9th in its ease of doing business ranking.

In partnership with the private sector, Norway’s Conservative-led government is helping to resolve skill shortages in the core areas of the country’s rapidly growing economy.  In 1977, Sri Lanka became the main partner State that obtained Norwegian development aid. According to the Norwegian Agency for Development Cooperation (NORAD), Sri Lanka received more than 5,000 million NOK from Norway in development assistance from 1965 up to 2017. 

In 2002, Norway assisted in brokering a ceasefire agreement between the aggrieved parties opening the way for six rounds of peace talks while also leading the Nordic Sri Lanka Monitoring Mission (SLMM). In the recent years, Norway has been eager to play supportive role in Sri Lanka’s emerging situation. 

 Sri Lanka, Norway ties are based on shared democratic values and a rules-based regional and international order. Oslo, the capital of Norway, is home to over 7,000 Sri Lankan. Both nations have come up with novel long-lasting concepts to solidify the existing bonds to begin a new era in bilateral relations. 

Tapping in to Finland's Business 

Finland is strategically located between Russia, Scandinavia and Northern Europe’s expanding markets. Finland acts as a route to the Russian market with the most significant trade partners to be found in the Baltic Sea region. 

This Nordic country rapidly expanded from a traditional industrial society to a modern high tech service society.  Among the country’s strength are its highly educated workforce and a knowledge-based and innovative economy. Being a Nordic welfare state, its citizens have a high purchasing power while they value goods of high quality. 

Finland which also considered as the Nordic powerhouse is the global leader in ICT innovations. Its $ 195 billion economy was the birthplace of global brands such as Nokia, and Siemens. To improve self-sufficiency in energy, Finland has made substantial investments in renewable energy production, bioenergy and biofuels. 

Many Sri Lankans reside in Finland especially in Helsinki and its surrounding areas. Consolidating political and economic cooperation between Sri Lanka and Finland it recent years is reflected in the increasing number of active exchanges in delegations. On the business front, Sri Lanka is seen by Finland as its future destination for its exports of Finnish timber products. 

Finland has opened up business opportunities in electricity, gas, telecommunications, postal and rail markets in recent years to meet EU requirements. Finland has an ageing population which sets new requirements for health care products and services. 

Economic interdependence with Sweden 

Sweden is the largest economy in the 25 million strong “advanced” Nordic markets. The country is synonymous with the production of high-quality cars, steel and iron. Sri Lanka and Sweden have a long history of collaboration in the IT sector. Sweden’s leading IT company IFS with a significant share in the global market has provided employment opportunities for nearly 1,400 Sri Lankans. 

Economic powerhouse Sweden and Sri Lanka are en route to further strengthen bilateral cooperation in the IT sector while also enhancing ties in other main areas such  tourism and direct investments. 

Bilateral trade between the two countries has increased over the years. In 2018 alone, Sri Lanka exported US$ 90 million worth of goods to Sweden which is Sri Lanka’s 30th  largest export destination. Sweden has been in the forefront in providing aid for large infrastructure projects and for developing human capital. An iconic project and donation from the Sweden is the Kotmale Dam that was built in 1985. Around 6,700 Sri Lankan nationals live in Sweden as of 2010. 

Scope for Business with Denmark 

The most southerly of the Nordic countries, Denmark is an industrialised “value-added” nation having more than one-third of the world’s wind technology turbine sales. In the World Bank’s most recent survey, Denmark is placed as No. 1 in Europe and as No. 4 in the global ease of doing business rankings. 

According to the United Nations COMTRADE database on international trade, in 2017, Sri Lanka’s value of exports to Denmark was US$36.66 million. There are many opportunities available to further explore Sri Lanka’s export opportunities to Denmark; a country dependent on foreign supplies of most raw materials and semi-manufactured goods. Around 13,000 immigrants from Sri Lanka live in Denmark. 

Iceland Gateway to North Atlantic 

Located in the North Atlantic Ocean, Iceland is of fundamental importance with fisheries being one of the main pillars of its economy. In addition, another fast growing sector of its economy is Information Technology (IT). Iceland‘s unique offer of renewable energy from geothermal resources and hydropower provides a great opportunity for businesses seeking to meet their long term energy needs while reducing their carbon footprint. Iceland’s booming tourism industry has grown by double digits with an increase of more than 470 per cent in the number of tourists visiting Iceland from 2010 to 2017. 

Interdependence of geopolitical interests with NORDIC nations

Currently, the NORDIC Nations are the leaders in green technology and sustainable business practices. While NORDIC nations follow a liberal trade regime, their economies are characterised by untapped potentials where Sri Lanka can continued to work on tapping into these opportunities.  For instance, Sri Lanka can explore further opportunities to provide skilled workers to the NORDIC nations where shortages of such workforces exist. Sri Lanka should elevate its diplomacy to the next level and enhance its diplomatic foot print with the NORDIC nations for a green and digital future. 


About the Author

Dr. Srimal Fernando received his PhD in the area of International Affairs. He was the recipient of the prestigious O. P Jindal Doctoral Fellowship and SAU Scholarship under the SAARC umbrella. He is also an Advisor/Global Editor of Diplomatic Society for South Africa in partnership with Diplomatic World Institute (Brussels). He has received accolades such as 2018/2019 ‘Best Journalist of the Year’ in South Africa, (GCA) Media Award for 2016 and the Indian Council of World Affairs (ICWA) accolade. He is the author of ‘Politics, Economics and Connectivity: In Search of South Asian Union.


By Dr Srimal Fernando | Published: 2:00 AM Mar 8 2021

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