The transformation of Finland’s Baltic Sea strategy

Finland has been shaped profoundly by its geographical location as a Baltic Sea littoral state. The Baltic has always been a vital waterway for trade, migration and cultural exchange, affecting the development of Finnish settlements and communities. Geopolitical shifts in the region have framed Finland’s national history. ‘Finland is an island’ is an often-repeated saying that usually refers to the fact that more than 80 per cent of its foreign trade is seaborne through the Baltic – and, after the outbreak of the Russo-Ukrainian war in 2022, which was followed by mutual trade sanctions and the closure of the border with Russia, the proportion has risen to 95 per cent. Although the border with Russia is 1,300 kilometres long, and Finland also shares over 500 kilometres of land borders with both Sweden and Norway in Lapland, the majority of the people live on the coast or near it. Moreover, ‘Finland is an island’ – at least indirectly – refers to the concept of an identity that emphasises the sea (and these days air) connections to the West more than the historical and cultural binds with Russia, while pointing at the same time to a certain sense of natural isolation.

The Baltic Sea region is so central for Finland that it is impossible to keep it separate from the country’s overall foreign and security policy. Finland even has its own official Baltic Sea Strategy. It focuses, however, mainly on the environment, sustainable development and other so-called soft security or low-politics issues. In any case, the Baltic Sea policy of Finland, dealing with trade, environment, culture and other transnational ties between the civil societies, is intertwined with geopolitics.

Three major phases can be distinguished in the development of Finland’s Baltic Sea policy from the Cold War to the current conflict in Ukraine, reflecting general geopolitical changes and Finland’s adaptation to them. During the Cold War, Finland navigated a balancing act between East and West, focusing on neutrality and stability. After the end of the East-West confrontation and the fall of the Soviet Union, new opportunities for regional cooperation opened up and were explored, especially within the framework of the European Union and other multilateral institutions of the Baltic Sea region, to a great extent together with Russia.

As the security situation in the region deteriorated following Russia launch of a full-scale war on Ukraine, Finland abandoned its earlier policy of military non-alignment and joined NATO in 2023, marking an overall shift in the country’s security policy. Following Finland and Sweden’s entry into NATO, the Baltic has effectively become a ‘NATO lake’, though with international waters that Russia can use, giving Finland a new and significant role in upholding regional deterrence and defence. Consequently, political and military tensions have arisen, and the Baltic Sea has become a site of new hybrid threats. A common thread, however, runs through all these eras, namely Finland’s desire to maintain stability. This enables its vital connections to western Europe and the rest of the world, a precondition that allows Finland to remain at peace.

Finland’s foreign and security policy after the Second World War was based on a combination of good, peaceful relations with the Soviet Union, which had won the war against Finland, and neutrality. Finland concluded a Friendship, Cooperation and Mutual Assistance (FCMA) Treaty with the Soviet Union in 1948, which was seen as the best means to take into account ‘the legitimate security interests’ of the USSR and prevent the Sovietisation of Finland through political reassurance. The treaty did not make Finland a member of the Eastern Bloc directly, but it impeded it from approaching the West militarily.

Until 1955 the USSR had a naval base near Helsinki, in Porkkala, but it retreated after Stalin’s death, for political as well as strategic reasons: as the Soviet Union already occupied the southern shores of the Gulf of Finland and new military technology enabled the control of the maritime area, the base was no longer required. Finland’s aspiration to remain ‘outside the conflicting interests of the Great Powers’ was mentioned in the treaty’s preamble, but Moscow did not fully recognise Finland as a neutral country before 1989. The so-called policy of ‘Finlandisation’ implied that Finland practised a policy of friendship towards the USSR – which allegedly led to negative by-products, such as political plotting, corruption and self-censorship – but in security policy it was considered a success even after the break-up of the Soviet Union. The real aim of the state leadership was not friendship as such – that was often just lip service – but to protect the core of state sovereignty and fundamental national interests in political, military, economic and cultural domains.

The policy of neutrality had certain roots in the interwar era, when Finland attempted to approach Sweden and distance itself from both the Soviet Union and Nazi Germany. Finland’s postwar policy had Sweden as a role model and neutrality made it possible for the country to join the Nordic community. For many in Finland, however, the policy of neutrality was more a means to strengthen Finland’s international position than an end in itself, and the Nordic reference group was also instrumental in severing Finland from the Baltic states among which it had been counted under the Molotov–Ribbentrop Pact, and which had subsequently been occupied by the Soviet Union. However, both neutrality and Nordicness gradually became genuine and widely shared identity factors for the Finns during the Cold War era.

The policy of neutrality was applied in particular to the power-politics between East and West, where Finland tried to treat both parties even-handedly – including, for example, the two German states. In practice, this often meant refraining from criticism and acting as a bridge-builder when possible. In trade relations, such a balanced pattern was impossible to achieve, since the key markets for Finnish exports, particularly for pulp and paper, were in the West. That is why it was important for Finland to take part in western economic integration.

The Soviet interpretation of Finland’s neutrality did, however, have an impact: it delayed Finland’s participation in the OECD, permitted the country to acquire only associate rather than full membership of the European Free Trade Association (EFTA) until the 1980s, prevented Finland’s participation in the plans for deepening Nordic integration under the auspices of NORDEK, and set limits on any efforts to approach the EEC until the end of the Cold War. Yet the direction of the slow change in Finland’s geopolitical positioning was plain. Civil society relations were also overwhelmingly geared towards the West despite Soviet attempts to create a cultural counterbalance.

Finland developed its armed forces equally to be able to defend the country against the Soviet Union but also to safeguard its neutrality. In the Baltic Sea, Finland kept a defensive posture, avoiding actions that could be interpreted as provocative by the Soviet Union. The Finnish navy, having been denied submarines in the peace treaty, focused on coastal defence by means of artillery and mine-laying, without major capabilities for power projection. Military activities in the Baltic region were nationally oriented, with no joint exercises or security integration with western navies besides occasional courtesy visits.

Over time, the policy of neutrality contributed to the assessment in the West that Finland had not been lost to the Eastern Bloc. However, it was crucial for Finland’s security policy that stability in the Baltic Sea region could be preserved. As the main frontline between the eastern and western military blocs ran between the two German states, the resolution of the German question was perceived as a key to easing tensions in Europe. Finland’s own role in trying to influence the general process of detente was limited but essential. The most important achievement was hosting the CSCE conference in Helsinki in 1975. Moreover, Finland also actively pushed for environmental cooperation between the then seven Baltic Sea states, and hosted the meeting in 1974 at which the Convention on the Protection of the Marine Environment of the Baltic Sea Area (also known as Helsinki Convention) was signed, establishing HELCOM (Helsinki Commission).

Although Finland later recognised NATO’s role as a stabilising factor in the Baltic Sea region during the Cold War, Finnish foreign policy leaders at the time hoped that NATO’s presence would remain limited and that the region remain an area of low tension. Finland launched initiatives such as the Nordic Nuclear-Free Zone for the purpose of enhancing dialogue, even though it understood that such a zone was not fully realistic as long as the Soviet Union was unwilling to declare its western areas nuclear-free.

Finland was wary of NATO’s presence in the area, and did not accuse the Soviet Union of frequently violating Swedish territorial waters, save for the ‘Whiskey on the Rocks’ incident in 1981. In hindsight, the idea of a Nordic balance during the Cold War has been deemed beneficial for Finland; it meant that Moscow had to reckon with Sweden’s possible NATO membership if it ever thought that it could tie Finland closer to its sphere of influence. Yet, for Finland, the problem was that the Soviet Union could have interpreted any increased NATO presence in the Baltic Sea region as a justification for suggesting that it needed to have a military footprint in Finland.

When the Cold War ended, the geopolitical outlook of the Baltic Sea changed dramatically. The disappearance of the Iron Curtain meant not only that the earlier barriers for cooperation vanished, but, with the dissolution of the Soviet Union, the three Baltic States also gained independence. Russia was still a central Baltic Sea state, but its littoral presence was reduced, with its access limited now to the Kaliningrad exclave and the Gulf of Finland around St Petersburg. A new spirit of collaboration led to region-building efforts in the Baltic Sea area.

In the first instance, the moment was captured by substate regions, cities as well as other forms of grassroots movements, with individuals and NGOs forging connections across borders to advocate for political change and a unified economic and cultural space with shared transnational identity. Civil society connections grew rapidly around the Baltic Sea, especially for Estonia: the connection between Helsinki and Tallinn soon became one of the busiest routes for passenger sea transport in the world. The city of Kotka hosted a major international conference to promote the idea of a ‘New Hansa’ as a network of economic, cultural and institutional links between the countries and regions situated by the Baltic Sea, launched by the prime minister of Schleswig-Holstein, Björn Engholm. Several Finnish cities actively took part in the Union of the Baltic Cities that was founded in Gdańsk in 1991; for example, Turku housed the union’s office for sustainable development. The Baltic Institute of Finland was established in 1994 in Tampere to promote cooperation and various projects around the region.

Second, cooperation was institutionalised as a more state-based endeavour with the establishment of the Council of the Baltic Sea States (CBSS). Initially, Germany and Denmark viewed the aim of the council as assisting Estonia, Latvia, Lithuania, Poland and Russia in their transformation into democratic free-market societies, but the scope was soon expanded to areas such as the environment, transportation and education. Finland, which hosted the second ministerial in 1993, emphasised that economic cooperation could be advanced by reducing obstacles to trade, forging new ties, attracting investments, building infrastructure and promoting military conversion. The environment and nuclear safety also remained key priorities.

Overall, the goal was to develop the Baltic Sea region into an area of security, well-being and mutual understanding. To complement the work of the intergovernmental council, Finland initiated the Baltic Sea Parliamentary Conference (BSPC) as a forum for wider political dialogue. Moreover, the Nordic Council of Ministers continued and expanded its projects and networks within the Baltic Sea region.

A third form of collaboration was EU-centric, which has been arguably the most salient idea to foster cooperation in the Baltic Sea region after the Cold War. At the beginning, regional cooperation in the Baltic was even seen as an alternative to Finland’s EU membership, but after Finland, Sweden and later Poland and the Baltic States joined the European Union, these two tracks began to converge. Finland’s brainchild was the idea of the Northern Dimension, which was first recognised and developed as a topic for EU policy in the late 1990s. A key idea for Finland was to regard the Northern Dimension as a bridge between the EU and Russia. It has had a wide range of issues on its agenda, including environmental protection and water quality in the Baltic Sea in particular, as well as public health, social well-being and transport.

The EU also launched a separate European Union Strategy for the Baltic Sea Region (EUSBSR) in 2009: at some point, Finnish foreign policy leaders and diplomats regarded this Swedish initiative to enhance cooperation among countries bordering the Baltic Sea, focusing on environment, connections and prosperity, as competing with the Northern Dimension, but they were reconciled and Finland subsequently fully supported the agenda.

Military cooperation was kept outside of almost all of these frameworks. Instead, there was NATO, and some bilateral and minilateral forms of cooperation – especially, from Finland’s perspective, with Sweden. Finland’s attitude towards NATO was positive but it did not consider membership. NATO’s enlargement was, however, a tricky question. On the one hand, Finland did not feel that it could affect the outcome or even have a say in matters in which it was not directly involved. On the other, changes resulting from a possible NATO enlargement were of crucial importance from Finland’s own vantage point. A policy concerning principles was easier to form than that based on concrete policy questions.

Finland rejected the creation of new spheres of interest in Europe and respected the right of all countries to choose their own security arrangements. The commitment of the US to European security, the renewal of NATO towards co-operative security, and the open-door policy were all considered good things. However, NATO’s enlargement against the will of Russia and increasing its presence around its borders were seen as a potential problem. Finland’s priority at the time was to help the Baltic countries join the EU.

For Finland, the membership of the Baltic countries was seen as a much bigger issue than the first round of NATO enlargement, which resulted in the admission of Poland, the Czech Republic and Hungary in the spring of 1999. Finland’s attitude was ambiguous. It supported NATO’s open-door policy and did not want to directly oppose the Baltic countries’ aspirations, and it asserted the importance of granting equal status to the Baltic countries compared to other aspirants. There was even a concern about the formation of a potential ‘security vacuum’ if the Baltic countries were left on their own. From Finland’s perspective, the security guarantees given by NATO to the Baltic countries were in any case a better solution than placing the burden on the shoulders of Finland and Sweden.

At the same time, Finland feared that the NATO membership of the Baltic countries would lead to confrontation between NATO and Russia, and that Russia’s countermeasures could also weaken Finland’s position. Finland therefore hoped that the enlargement of the alliance would be implemented in such a way that it would not lead to Russia’s growing sense of isolation. Yet Finland was also concerned that the membership process could last for years and be in itself a destabilising factor if the Baltic countries were given vain hopes of membership, since, from Helsinki’s perspective, NATO enlargement was not an easy process.

However, after NATO’s expansion to the Baltic countries, Finland saw it as having contributed to the security and regional stability of the entirety of northern Europe. The idea that Russia could be integrated into the EU-led framework in the Baltic proved to be too challenging, though a certain optimistic belief in the growth of regional cooperation was kept alive until the end of the 2010s.

Although the Baltic states were able to strengthen their international position, Russia did not fully normalise its relations with them and had growing grievances with the European Union as a whole, not to mention NATO. The prevailing paradigm nevertheless remained one based on cooperation and interdependence that would over time ease tensions and integrate Russia into the rest of Europe. The 2010 Baltic Sea Action Summit in Helsinki, which gathered more than 500 participants, including King Carl XVI Gustaf of Sweden and Prime Minister Vladimir Putin of Russia, was deemed a success, judged by the number of commitments made for the protection of the Baltic Sea and to improve its ecological condition.

The most salient project was, however, Nord Stream, the offshore natural gas pipeline through the Baltic Sea from Russia to Germany, the construction of which was agreed in 2005 and completed in 2011. Nord Stream II was agreed and constructed after Russia’s annexation of Crimea, but it did not enter service due to Russia’s full-scale invasion of Ukraine in 2022. Both projects were politically controversial, as the pipeline sidelined the countries between Russia and Germany and increased Germany’s energy dependence on Russia. Finland was, however, an active supporter of the project from the very beginning – energy cooperation was one of its main aspirations in its Northern Dimension initiative. The Finnish company Fortum was initially part of the consortium but later withdrew. Overall, Nord Stream II was treated not as a political but rather an environmental question in Finland’s internal and external policy-making.

The security situation in the Baltic Sea area started to deteriorate even before Russia’s annexation of Crimea and its proxy war in the east of Ukraine. On several occasions Russian aircraft violated the airspace of other Baltic Sea states, including Finland, and in the case of Sweden even simulated military attacks in spring 2013. As a consequence of Russia’s neglect of international norms and resort to power, Finland started to tighten its relationship with NATO. It deepened NORDEFCO, defence cooperation with the other Nordic countries, as well as within the UK-led Joint Expeditionary Force, but kept NATO membership only as a future option. From Finland’s point of view, the US and NATO presence in the Baltic Sea area were increasing stability, but it was not particularly concerned by Russia’s military exercises as a threat to its own security: Finland could pretend that both NATO and Russia were exercising for defensive purposes. The problem was the danger of accidental incidents. Therefore, President Niinistö proposed that airspace security should be enhanced by a joint agreement that all military aircraft use transponders.

Russia’s growing frustration with its place in the European security order and its full-scale invasion of Ukraine in February 2022 had epoch-changing effects in the Baltic. Its demand that NATO end its open-door policy of enlargement in December 2021 had already been a blow to Finland, as it would restrict the sovereignty of small states and make the NATO membership option as a strategic instrument null and void. After Russia’s invasion of Ukraine, Finland made a quick decision and applied for membership in NATO in May 2022. From Finland’s point of view, Sweden’s decision to apply for NATO membership at the same time was crucial because the entire Nordic region would be united in NATO. When Sweden’s membership was delayed due to slow ratification by Turkey and Hungary, Finland emphasised that its membership in NATO could not be complete without Sweden. From Finland’s point of view, it and Sweden’s membership strengthened NATO as a whole, particularly in the Baltic: they had not joined the organisation for a free ride, but were instead willing to be directly involved in the defence of the three Baltic states.

In domestic political debate, Finland’s NATO membership was marketed mainly as a move that could reinvigorate Nordic identity as a whole. One sign of this was that Finland wanted to be placed under the Norfolk command structure together with the other Nordic countries; paradoxically, this stressed Finland’s role more as an Arctic than a Baltic Sea country. Nonetheless, NATO membership was also bringing back Finland’s long-rejected identity as a rim state by fostering closer ties with the Baltic states and Poland. Finnish views on Russia, for example, were increasingly converging with those of the Baltic states, with the perception of Russian society as inherently inclined to use force and dominate its neighbours. On matters such as border security and defence spending, Finland often identified with this eastern reference group rather than its traditional Nordic partners. This evolving dynamic suggests that Finland may develop a hybrid Nordic-Baltic identity, blending elements of both regional affiliations.

Russia responded to Finland and Sweden’s NATO membership – and to their ‘unfriendly’ policy overall – by means of disinformation campaigns designed to discredit Finland and Sweden and by announcing that it will strengthen its defence in the Baltic Sea region with new military units directed at Finland and Sweden. Moreover, Russia allegedly launched various hybrid operations in the Baltic Sea to intimidate the West. Although direct attribution is difficult, the list of incidents and disturbances in the Baltic Sea area and at the Finnish border has increased dramatically since 2022. For example, the Balticconnector gas pipeline and undersea communication and power cables between Finland and Estonia, Finland and Germany, Sweden and Lithuania, and Sweden and Latvia were damaged by foreign vessels dragging their anchors on the seabed. These incidents led NATO to establish an enhanced vigilance activity called Baltic Sentry, ‘to protect critical undersea infrastructure and respond if required’. Finland also tried to strengthen the CBSS’s role, after the exclusion of Russia, in comprehensive security, crisis preparedness and resilience during its presidency in 2023.

Despite the emphasis on deterrence and defence now dominating Finland’s Baltic Sea policy, some aspects of reassurance and cooperation in promoting stability remain. Particularly important for Finland is international law, where the law of the sea has been a cornerstone in governing and regulating the freedom of the seas. Russian sensitivities are well understood and offering a casus belli is strictly avoided. In preventing hybrid threats, Finland has been very careful not to break international law, despite Russia challenging many established norms and abusing loopholes.

Another example concerns the precarious status of the Åland Islands. Although Russia’s invasion of Ukraine raised a debate about dismantling Åland’s demilitarisation and closing the Russian consulate that has the right to monitor the fulfilment of the treaty, the position of the Finnish government was that NATO membership would not affect the current treaty-based status concerning the Åland Islands. It refrained from expelling the Russian consulate, although Russian consulates elsewhere in Finland were closed after Russia invaded Ukraine. A government-commissioned study concluded that revoking old treaties would be difficult from a legal point of view.

Finland’s Baltic Sea policy is that of a holistic approach, in which security, trade and other societal ties to neighbours, as well as the environment, are interwoven. However, the security policy situation has been decisive for Finland’s strategy and priorities. Finland’s Baltic Sea policy has undergone a clear transformation: from cautious neutrality during the Cold War, to active regional cooperation after the fall of the Soviet Union, to full integration into the western security structures after Russia’s full-scale invasion of Ukraine.

At the same time, the Baltic Sea has gone from being a frontline between military blocs with a niche for neutrality and low tension, to an area of ​​cooperation and growing connections – and now to a western security zone that upholds stability in the Baltic Sea region by means of deterrence and defence, and developing resilience against various hybrid threats. During all these eras, Finland’s key interest has been to promote stability in the region: though the means have varied, reassurance and respect for international law are still regarded as central. Environmental and other forms of low-politics cooperation are often important in themselves, but Finland has also seen them as a means to enhance stability.

This essay was originally published in  The Baltic Sea: A Geopolitical History, edited by Peter Haldén and published by Bokförlaget Stolpe.