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Arctic Human Development Report

In the Arctic, many local communities experiencepopulation declines as people leave to find jobselsewhere, while few if any others move in. Someplaces, however, are exceptions to this trend. Thischapter focuses on processes that allow commu-nities to survive and even to prosper, the factorsthat underpin community viability.

Four key themes are presented. In short theyare principal strategies for human developmentby people in the Arctic. The first is to form part-nerships with outside actors in developing nat-ural resources. A second is to combine subsis-tence activities with government employmentand welfare. Policies on regional developmentcan be used to create jobs, and our third strate-gy is to negotiate with governments for suchinitiatives. A fourth strategy, which has beensuccessful for many fishing villages, is to usebusiness and political networks to ensure accessto international markets. Common trends in allthese themes are the increasing connections toglobal economic processes and the key role thatlocal governments play in finding modern waysto cope.

Arctic communities incontextSmall communities still play a key role in theArctic: in terms of their numbers, in maintainingties to traditions, and in the economy of theregion. Arctic communities, however, face anumber of challenges connected to their rapidtransition from pre-industrial isolation to beingpart of a global market economy. This sectiondefines the concept of community viability andpresents a context for the rest of the chapter.

Defining community viabilityThe word “community,” or “local community,”is often used to describe smaller settlements,

villages, and towns. We use the word communi-ty in this way – a geographically delimited, smallor medium-sized settlement located outside theurban regions of the Arctic. Arctic communitiesvary in size from less than a hundred to somethousands inhabitants. There are also substan-tial differences with respect to their economicfoundations and public services.

There are many criteria that can be used toassess community viability and it is hard to finduniversal indices, except for the simple measureof population development. Although it is acrude measure, it is easy to understand andmakes sense to people discussing this theme,including people living in those communities. Aviable community can thus be understood asone in which people feel that they can stay asinhabitants for a period of their lives, wherethey find sources of income and meaningfullives. In some cases, community viability isbased on continuous activities of specific peo-ples, families, and groups, but most often viabil-ity will depend on the creativities and links gen-erated through emigration and immigration.More comprehensive definitions of viability dif-fer with the varying natural, societal, and cultur-al contexts for humans in the Arctic.

Local places with global connectionsMost people in the Arctic live in rather largeurban areas, like Murmansk in northwest Russia,Reykjavik in Iceland, or Anchorage in Alaska.These urban areas are centers of advanced pub-lic services, commerce, and scientific research.Most inhabited places in the Arctic, however, arerather small. These small communities are ofvital importance for the use and protection ofnatural resources, for market-based production,and for the informal subsistence economy. Andnot unimportantly, some of these places areattractive to a growing number of tourists. The

139Chapter 8

Community ViabilityLead authors: Nils Aarsæther, University of Tromsø, Norway, Larissa Riabova, Kola Science Centre, Russian Federation,and Jørgen Ole Bærenholdt, Roskilde University, Denmark.

smaller communities are also places in whichtraditional and indigenous life styles and cultur-al traits typical of the Arctic can have a space.Compared to the urban centers, they offer farbetter possibilities of accessing, and living inclose connection with the natural environment.As to social relations, communities vary fromsocially well-integrated to socially fragmented.

In any community in the modern world,social life will reflect ongoing interactionsbetween market-directed production and com-merce, welfare arrangements, and informal butstable person-to-person relations based on tiesof both kinship and friendship. In smaller com-munities, market-based production, the publicsector, and daily-life processes tend to be high-ly interrelated, and these relations are increas-ingly going on also at a distance via informationand communication technologies.

Arctic communities are no longer isolatedfrom the rest of the world. Community viabilityis closely linked to what power the local levelhas when it becomes involved in processes of apotentially global scope. Therefore any analysisof the situation has to include systems that arelarger than the communities themselves. This isnot only true for market and central authorityrelations. Even kinship and friendship relationsconnect over long distances, and such informalrelations can be important to local business,politics, or cultural life.

A journey in timeSince the 19th century, Arctic communities havemoved rapidly away from a pre-industrial stage,in which the emphasis was on harvesting bio-logical resources and people lived in scattered

household units, frontier settlements, andnomadic and semi-nomadic settlements. Theindigenous populations of the Arctic were in themajority and links to the central politicalauthorities were weak. Trading links with theoutside world were present in many of theArctic regions, however.

Industrialization, with organized manufactur-ing in forestry, mining, and fisheries, reached itsapex in the middle of the 20th century andchanged the living conditions in many places.“Company towns” were the typical communi-ties of that period. Beginning in the 1970s, oiland gas development has gradually come todominate the industrial sector in the Arctic. TheKola Peninsula in Russia has been an industrialstronghold of the Arctic.

Since the middle of the 20th century, much ofthe Arctic has been in the process of entering apost-industrial stage. Typical for this period hasbeen a growth of the information and servicesectors, including telecommunications, educa-tion, and tourism. State welfare institutionshave played a major role in many Arctic com-munities. For some of the regions, this transi-tion has also been marked with de-industrial-ization, when old manufacturing industriesclosed down or departed.

The post-industrial era differs from earliereras by its multitude of organizational forms.While the household was the dominant insti-tution of the pre-industrial era, and the factoryof the industrial era, the communities of thepost-industrial era lack any one dominantorganization.

Challenges facing Arctic communitiesCommunities of the circumpolar North are fac-ing several global trends that find their specificexpressions in the Arctic regions. They includeurbanization, competition over declining natu-ral resources, welfare state retrenchment, and atransfer of authority from central to local gov-ernments.

The dominance of city regions over the ruralsettlements has been profound in the Arctic. Inthe Murmansk oblast in northwest Russia, theurban population today makes up 92% of thetotal population. Urbanization has also beenvery strong in the northern regions of theNordic countries. Moreover, many inhabitantsof small communities commute to jobs innorthern cities. Younger people, women in par-ticular, tend to move south or to centers in theNorth that can offer advanced education and

140 Arctic Human Development Report

Andenes in NorthernNorway

PHOTO:MARKO KULM

ALA/SNOWCHANGE PROJECT,2004

employment. These processes leave smallerplaces with an aging population, often with amajority of male inhabitants. However, thedemographic situation is mixed within regionsas well as between regions of the Arctic.

Resource depletion in most of the fishingareas and in some of the reindeer herding dis-tricts in the Arctic has had a negative effect onlocal development. In addition, liberalization ofnational economies has led to the commercial-ization of herding and fishing rights, sometimesblocking access for local people. On the otherhand, regulations aimed at securing access toresources for indigenous peoples have led toconflicts with non-indigenous communityinhabitants. There are also conflicts betweenfull-time and leisure-time users of the sameresources. Local community institutions for reg-ulating access to and utilization of naturalresources have been suggested as a partialanswer to this problem (1).

Arctic communities have limited home mar-kets and have traditionally depended on incomefrom the export of natural resources, govern-mental transfers for service provisions, and tra-ditional subsistence activities. In addition toincreasing global competition for work andmarket shares, many Arctic communities areexpected to lower their level of welfare provi-sions. As an increasing part of local employmenthas been dependent on public sector jobs, par-ticularly for women, central level policies havethus been less supportive to smaller communi-ties. On the other hand, the central level’s com-mitment to indigenous peoples’ welfare hasbeen growing, which has led to improved serv-ices in some communities.

Within the countries of the Arctic, transfersof power to the local level have taken place, as discussed in Chapter 5. Political Systems.However, there are differences both in theaverage size of municipalities and in whatmandates are placed at the local level.

Local cultures, often based on the heritage ofindigenous peoples, have been challenged byboth national cultures and by a global entertain-ment culture. Within this context, a reassertionof indigenous culture has taken place, but also aredefinition of local identities in the wake of de-industrialization and with increasing awarenessof ecological and cultural values. The develop-ment of hybrid or complex identities (2), inwhich individuals see themselves as a mix oftraditional and modern elements, is a processthat may lead to innovations in the business and

public sectors, to individual mobility, and tonew forms of political self-assertion. On theother hand, local communities in which thecomplexities of identity are not acknowledgedmay experience social fragmentation as a resultof the tension between modern and ethnicidentities.

These challenges reflect influences cominginto the Arctic from outside. The four waysArctic communities have tried to respond tothem, with a focus on factors that promote com-munity viability, will be the topic of the remain-der of this chapter.

Partnerships with outsideactorsSeveral Arctic communities utilize oil and gasresources in partnership with large corpora-tions. The challenges of this path include how toconvert the economic compensation for use ofthese resources to productive and innovativelocal activities.

RussiaGenerally, the situation in the Russian Arctic isone of population decline and out-migrationdue to economic decline since the collapse ofthe Soviet Union (see box below). In the pastthree years, however, there has been a trend ofeconomic growth connected with the extrac-tion of mineral resources. Some towns profitfrom these developments. The brightest exam-

141Community ViabilityChapter 8

Russian ArcticRussia’s Arctic communities have all experi-enced a loss of population since the collapse ofthe Soviet Union in 1991. Reasons behind theloss include migration to southern regions dueto the closure of unprofitable enterprises and ageneral economic decline coupled with a dra-matic increase in mortality and a decrease inbirth rates. Unemployment rates are generallyhigher in the Arctic localities. In the settle-ments of the Murmansk region it was 13.4% in2002, compared to a Russian average of 7.1%(4). In smaller communities that depend onfisheries and forestry, the unemployment ratesare much higher. For example, the coastal vil-lages of the Murmansk region – places inwhich people for ages have relied on fisheries– have all experienced a severe loss of jobs dur-ing the crisis of the 1990s. The unemploymentrate has reached as high as 40% in some com-munities.

ple is Chanty-Mansiysk in western Siberia,which builds its wealth on oil and gas rev-enues. Oil and gas development in most Arcticregions is in its initial stage, but it is progress-ing fast and starting to influence northerncommunities in both positive and negativeways. On the one hand, it creates prospects foran increase in income and number of jobs. Onthe other hand, it brings the risk of negativeenvironmental impacts such as oil spills – thelosses from which corporations often fail tocompensate.

The extent to which local communities canbenefit from industrial development can behighly influenced by the level of local entrepre-neurship. A case study of Erv and Kharp illus-trates the differences between two communitiesthat share many other circumstances.

Case study: Erv and KharpErv and Kharp are reindeer herding coopera-tives located in Nenets Autonomous Okrug inthe Arkhangelsk region of the RussianFederation. This area is referred to as the ArcticKuwait because of its rich oil and gas resources.

Both cooperatives have their management andherders dwellings in the village of Krasnoe. Theyare both cooperatives but their structures arerather different. Erv is a cooperative of obschinas(family based communities of herders that relateto indigenous tradition) with private property.Kharp is a cooperative with collective owner-ship.

In the late 1990s, both cooperatives had tocope with continuous economic difficulties,such as lack of funds, and with oil and gasdevelopment in their area causing problemswith pastures. In 1996-97, herders in bothKharp and Erv were lacking cash; they couldafford only basic food, and had difficulties inbuying clothes and other things. Several yearslater in the village of Krasnoe, it was evidentthat the members of Erv were much better offthan their fellows in Kharp. This noticeableimprovement of Erv’s well-being was based oncontracts with the oil companies working in itsterritory. These agreements were initiated byErv’s management and had two parts: first,material help from the companies (financialhelp, use of company helicopters, food supplies,


Pipeline in Montsegorsk,Murmansk Region, Russia

PHOTO:MARKO KULM

ALA/SNOWCHANGE PROJECT,2004

etc.) and, second, the participation of herders inthe planning of land use.

Kharp’s contracts with the oil companies dif-fered from Erv’s: they were initiated by the oilcompanies, which provided some equipmentand occasional technical help. Workers inKharp questioned why herders of Erv lived somuch better than they did. On one hand theyclaimed that “everyone helps Erv, local admin-istration, foreigners, oil companies and every-one.” On the other hand, they blamed theirown management for not being able to makesuch contracts (3).

Obviously, ability to cope with economiccrises and oil development depended on thecooperatives’ ability to negotiate with oil com-panies. Erv’s success was based on actions by itsmanagement, and also on the use of outsidelinks such as assistance from the ex-president ofYasavei, the political organization of the Nenetspeople, and the help of a juridical bureau fromMoscow specializing in issues related to indige-nous people.

Erv is a case of development where localbusiness entrepreneurship managed to secure ashare of the resource rent from the oil compa-nies as well as the possibility of influencingindustrial decision-making in order to mini-mize the disadvantages of oil extraction forreindeer herding. Current Russian legislation isnot very comprehensive in regard to compensa-tion for land use to local populations or in toolsfor securing the needs of indigenous peoples.Combining local and non-local networkingwith local expressions of identity that includean indigenous component related to obschinasthus became a coping strategy. However, thesepractices are not institutionalized, and many ofthe herding enterprises in the area wait for helpfrom the regional and local administration,even though the reduction of governmentalsupport has been a major trend of the pastdecade.

North AmericaTaking part in developing oil and gas resourceshas been an important strategy for many com-munities in Alaska. The Alaska Native ClaimsSettlement Act (ANCSA) allowed for the cre-ation of 12 regional for-profit corporations,which control large funds as compensation forthe loss of land (5-6), as well as 200 village cor-porations that distribute and manage land forsubsistence activities. This is further described inChapter 7. Resource Governance. The develop-

ments in Alaska’s North Slope Borough repre-sent an interesting and in many ways uniquecase of coping with the challenges of thisapproach, and point specifically to the impor-tance of political entrepreneurship.

Oil development is also important in Canada,where funding from land claim agreements ledto the establishment of several for-profit cor-porations that are not under government con-trol. In contrast to the case of the North SlopeBorough, and also of the Greenland Home RuleGovernment, the Nunavut Government doesnot control funds from commercial activities.Instead, economic power rests to a large extentin the hands of Nunavut Tunngavik,Incorporated (7). Canadian Inuit Corporationsactively pursue the development of their ownindustries (8).

Theme summaryIn some cases, oil and gas development canprovide cash income and create new opportuni-ties for reviving communities, as illustrated bycases in North America and Russia. When suc-cessful, these ventures have often involved alarge degree of political entrepreneurship as thebasis for productive partnerships with outsideactors. For community viability, however, animportant factor is to what extent the local com-munity has ownership rights to, or other formsof control over, the resources.

Combining pre-industrialand welfare economiesIn some communities, there are almost no mar-ket activities. These include areas where oil andgas exploration provided only a brief experienceof an industrial economy. They often rely on acombination of government support and subsis-tence activities. Two case studies from theCanadian Arctic illustrate this theme.

Holman/Uluqsaqtuuq, Victoria IslandIn the late 1970s and the early 1980s, commu-nities in the Northwest Territories faced thechallenges of oil exploration in the BeaufortSea and the Mackenzie Delta. Some communi-ties suffered the experience that jobs andincomes lasted only as long as the explorationand construction period. In some cases, drillingholes were dry. Still, some communities gainincome from the land claim agreements, suchas that provided by the 1984 InuvialuitAgreement. One of these communities is


Holman/ Uluqsaqtuuq on the west coast ofVictoria Island, with 400 Inuit inhabitants(Innuinaq and Inuvialuit).

Holman became a mission and trading postas late as 1939, and it was not until the 1960sthat community development took place aspeople moved into town from the campswhere they used to live. In the wake of the landclaims agreement, it became a municipal gov-ernment unit and received hamlet status in1984. This led to many new amenities andfacilities, including television and a new school(9-10). The community also has plane connec-tions to other places in the NorthwestTerritories several days a week.

While subsistence activities still play a role inthis village, it is wage labor that provides mostpeople with income, and nearly all from publicservice jobs. Still, only half the working-agepopulation have regular full-time or part-timejobs. Some have seasonal paid employment andlive partly on welfare payments.

Holman has no industrial activity. Jobs arefound in the local authority, in the school, andthe health center, in shops, and in the HolmanCommunity Corporation, which is financed by the Inuvialuit Regional Corporation.Administrative positions are held by non-native people. In many other positions, peoplework side-by-side with their kin. Subsistencehunting has become a leisure activity for manyinhabitants. Supported by funds generated byindustrial resource extraction elsewhere, peo-ple in Holman have taken the step directlyfrom the pre-industrial to a post-industrialphase, depending heavily on public servicetransfers.

Kuujjuarapik, NunavikKuujjuarapik is the southernmost of 14 Inuit vil-lages along the coast of Nunavik (11-12). It canonly be reached by plane or by sea in summer.This village consists of two communities: anInuit population of around 700, and a Cree pop-ulation of more than 600. In Cree, the name ofthe village is Whapmagoostui. Although there isevidence of relations between populations atthe individual level (especially through mar-riage), relations at the institutional level are few.In fact, each community has been granted itsown institutions by the James Bay and NorthernQuebec Agreement.

This is a community where people have beenconfronted with several choices in connectionwith the land claims process. The Great Whale

hydroelectric project was planned for construc-tion near Kuujjuarapik. As a result of the JamesBay and Northern Quebec Agreement, the peo-ple of Kuujjurapik were offered relocation to anew village – Umiujaq (constructed in 1986),north of Kuujjurapik – and some moved.Meanwhile, the hydropower project was post-poned and some have moved back toKuujjuarapik.

Kuujjuarapik is a case of community develop-ment typical for the Canadian Arctic. As inHolman, there is almost no market economyand little private business development. This isdue to late modernization and societal integra-tion of Arctic communities in Canada, but alsobecause this integration is shaped by publiclygoverned and subsidized processes. The rolethat the Hunter Support Program plays inKuujjaurapik illustrates this well.

In contrast to Greenland, for example, there isno legal local market for country food in ArcticCanada. Hunters can only share with othercommunity members and maybe sell informal-ly. The Hunter Support Program, however,operated by a local committee with money fromthe Quebec Government, supports a municipalfreezer arrangement.

Hunters that need support to cover theirhunting expenses can receive a monetary sub-sidy from the program if they give the munici-pality some of their catch. Although it looks likea sale it is not, as the money received inexchange for the catch is not proportional to thevalue (defined by market prices) of the meat,nor to its weight, and even less to the prefer-ences of the community members. On the con-trary, money allocated by the program supportsa sustainable hunting practice by encouraginghunters to catch different species all year long.By this arrangement, hunting for popularspecies is not rewarded. The money that thehunters receive can thus be regarded as anincentive outside the market economy. This isunderlined by the fact that food stored in themunicipal freezer is made available to everycommunity member, who can thus pick upcountry food for free, an instance of modern sol-idarity (13).

This program and the municipal freezer pro-duce a certain social division of labor. Informalrelations between kin and community mem-bers are still possible and do exist, as manyhunters keep a portion of their catch to sharewith their family networks. But this practice isnow combined with the politically governed


and publicly funded distribution program ofcountry food, making market development forthis type of food not only illegal but also unre-alistic.

This is again a specific combination of pre-and post-industrial development, where publicfunds support the continuity of traditional hunt-ing practices. The redistribution of food via thefreezer differs from informal sharing andexchange, as it does not build on direct socialties between people. For those who can choosewhere they get their country food, more auton-omy has been gained, and traditional person-to-person ties are no longer the sole basis ofsocial integration. The basis of social life in acommunity like Kuujjuarapik has thus becomethe choice of autonomous individual house-holds.

Theme summaryThe two communities Kuujjuarapik andHolman illustrate how industrial social formscan transcend traditional social forms evenwhen there is no local industrial development.People become integrated on a new basis as cit-izens. People are heavily dependent on publictransfers, however, and there are few ways openfor community development through locallyembedded business entrepreneurship.

Negotiating for jobsHow can Arctic communities use opportunitiesto negotiate for public initiatives that create newjobs? When can such opportunities be the start ofa cultural revival and of creating local businessopportunities? Three cases from Scandinaviaillustrate the challenges in societies where publicservice sector jobs expanded until the 1970s. Theprovision of welfare services to all inhabitants,regardless of location, has thus played a role forcommunity viability, along with the generalpolitical goals of regional development.

Storfjord, NorwayStorfjord is a municipality along the majornorth Norwegian highway about 120 km fromthe city of Tromsø. The municipality comprisesseveral villages, is inhabited by three ethnicgroups (Norwegian, Saami, Kven), and borderson both Sweden and Finland, with easy roadconnections. Until the 1970s, there were veryfew business enterprises and a low level of pub-lic services in this community. A large hydro-electric development was then proposed. To

implement it, the regional energy authorityneeded approval of the project by the municipalcouncil.

Instead of just welcoming this project and thejobs that would come during the constructionperiod, the people of Storfjord, through theirelected representatives, went into hard negotia-tions with the developers and succeeded in get-ting compensation in the form of a laundrywhich would service public institutions in thewhole region, providing jobs for almost 30women. Moreover, a voluntary-sector-basedrehabilitation center for people with heart and


Northern NorwayIn northern Norway, there is a population ofabout 450,000. Approximately 10,000 peoplehave registered themselves in the Saami censusregister, but the number of Saami-speakingpeople is higher than this. The Saami Parliamentis located in Karasjok, and it is elected by regis-tered Saami voters from the whole country.

The total number of people in northernNorway has been relatively stable during thelast decades, but an increasing proportion ofthe population live in urban municipalities,Tromsø with a population of 62,000 the biggestone. Unemployment rates are low (about 4 %)and not significantly higher than in southernNorway. Very few of the many smaller localitiesin the region have been abandoned, but almostall of them have suffered population declinessince the 1980s. Among the exceptions fromthis overall trend are the two Saami municipal-ities Karasjok (pop. 2,900), and Kautokeino(pop. 3,000), the fishery-based municipality ofBåtsfjord (pop. 2,400) in Finnmark County, andthe municipality of Storfjord (pop. 1,900) inTroms County (14).

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Saami children in Norway,spring 1975

lung diseases was established, and a missionaryschool – a branch of the US-operated Youthwith a Mission – was opened. In addition, thedeveloper pays a special tax to provide capitalfor two funding schemes, one for small-scalebusiness development, and one for investmentsin local fishing and farming equipment.

Female occupational levels exceed male,which results in a vital population structure aswell as a favorable environment for growing up(15-16). A comparative youth study has shownthat young people really appreciate the easyaccess to nature and the “good social environ-ment” in the locality

Storfjord is a story of developing strategies fornegotiating with regional and central level pub-lic agencies. The community is admittedly weakon business innovations, but communitydynamics work on the basis of households com-bining incomes from public and private sectorsources. Many one-person or family-basedfirms, starting with support from the municipalfunding arrangements, take advantage of thelocal and the regional markets for constructionand services. And as in many other Arctic com-munities, there is a tendency to organize thestable public sector jobs on a part-time basis,particularly jobs for women.

Culturally, complex identity formation is tak-ing place in the context of common “projects,”such as a large annual market festival, andStorfjord is asserting itself as an arena of north-ern multi-culturalism. Storfjord’s municipalauthorities play a key role in providing theagenda for networking and funding of publicwelfare investments, but this would not workwithout the diverse income base at the house-hold level, ranging from agriculture to jobsrequiring a long-distance commute.

Karasjok and Kautokeino, NorwayKarasjok and Kautokeino are neighboringmunicipalities, located in the inner part of thecounty of Finnmark, and bordering on Finland.Both municipalities are connected by road to thenearest regional centers and airports (Alta andLakselv). In spite of setbacks in reindeer herd-ing, they experienced population growth in the1990s. This growth has been most evident in themunicipal centers, where several central-gov-ernment-funded Saami institutions, such as theSaami Parliament in Karasjok, and the SaamiCollege and the Saami Theatre in Kautokeino,are now located.

The successful outcome for these two munic-

ipalities is the result of processes involving theNorwegian state and the Saami organizations.Once the Norwegian Parliament had decided tocontribute to the construction of a broad rangeof Saami institutions, the two inner Finnmarkmunicipalities were the inevitable choices. As anumber of institutions were to be created, thisfacilitated the distribution between the twoSaami “capitals.” Being the core Saami commu-nities, both Karasjok and Kautokeino have alsobeen able to develop a viable tourist industrywith a focus on activities related to reindeerherding.

Jokkmokk, SwedenJokkmokk municipality has 6,000 inhabitants,with more than 3000 in the central town ofJokkmokk. The municipality stretches from thehighlands in the west with reindeer herding,recreation, and tourism, to the intensively uti-lized forestlands and wetlands in the east.Rivers have been used for hydropower develop-ment.

In 1960, Jokkmokk reached its maximumpopulation of 12,000 inhabitants. Since then,the local forest industry has been in steadydecline and the last sawmill in Jokkmokk hasbeen closed (17). The vast forest resources arenow transported to sawmills and processingplants outside the municipality and citizens of


Northern Sweden and FinlandThe northern peripheries of Finland andSweden have experienced a population declinedue to the restructuring of the forestry sector,agriculture, and the steel industry. When theeconomic crisis was over, only the urban cen-ters of the regions benefited, while unemploy-ment remained high in the rural peripheries.Today public sector services are by far the mostimportant provider of jobs.

Sweden and Finland joined the EuropeanUnion in 1995, and contemporary regionalpolicies are implemented in a variety of EUsupported programs, providing infrastructuresupport for tourism development, but alsofacilitating the formation of village develop-ment groups. Some of these programs create aproject economy, where much activity is asso-ciated with adult education and other types ofinfrastructure development. While substantialresults within the business sector are hard toachieve, project employees are required towork to raise funds for the next generation ofprojects.

Jokkmokk feel their resources are being extract-ed without proper compensation.

Jokkmokk is home to a Saami reindeer herd-ing community. In addition to reindeer herding,their economic activities include hunting, fish-ing, and tourism. Saami entrepreneurs havegained some influence through internationalnetworking in the formation of the UNESCOcultural heritage landscape Laponia (18). Theidea behind such cultural landscapes differ fromthose of conservation areas and national parksin that they recognize the economic and cultur-al activities in an area as an integral part of thearea. The process of realizing Laponia, however,has been full of conflicts between state, region-al, municipal, Saami, and international actors;few economic benefits can be documented.

Jokkmokk’s present economy is dependenton transfers from the Swedish state to financemuch of the public sector activities. Jokkmokkno doubt has some advantages from being thelocation of the language department of theSwedish Saami Parliament and of other Saamiinstitutions, but this has not had the sameeffects in added employment opportunities as inKarasjok and Kautokeino in Norway. Theattempts at economic diversification, for exam-ple in “cultural tourism,” are by no means suffi-cient to compensate for the vast job losses in theindustrial sector.

Theme summaryIn the inland of northern Scandinavia, manysmall communities depend on political initia-tives and funding to create local jobs. In somecases, negotiations between local representa-tives and governments have led to new institu-tions and small businesses, which have provid-ed a base for maintaining viable communities.However, the picture is mixed. Communitiesthat used to depend on forestry face problemswith the displacement of this industry. There arealso marked differences in the priority given inofficial welfare and regional policies for theperiphery areas in Norway, Sweden andFinland. Furthermore, Norway has the advan-tage of the revenues from oil, redistributednationally.

NetworksCombinations of market-driven processes, apolitically governed economy, and informalrelations can provide a way to ensure survivalfor small communities. This has been the case

for a number of fishing communities across theArctic. One key to success has been access tothe international fisheries market. Another hasbeen to diversify the economy. A major chal-lenge has been to transform the gains fromcommercial, political or civic networking to last-ing local development.

Båtsfjord, NorwayBåtsfjord is a modern fishing village inFinnmark County, situated on the coast of theBarents Sea. It has all-year road connections, inaddition to an airport with daily connectionsand transport by sea. As in all peripheralNorwegian municipalities, public sectoremployment is important, but in Båtsfjord thefishing sector is still the backbone of the com-munity. For decades, the owners of the land-based processing firms have co-operated inorder to make the community an attractive fish-ing harbor.

During the 1990s, the managers developed acommon strategy to take advantage of the moreliberalized fishery regime in Norway, and inRussia as well (19). Despite a deep crisis in codresources around 1990, they succeeded in secur-ing stable and even growing deliveries by mak-ing contracts with trawlers from the Russianfleet, diverting them from delivering their catchback in Russia by offering Norwegian prices.Meanwhile, reluctance on the part of the localpopulation to work in filleting plants had beencountered by bringing in refugees, coming toNorway mainly from Sri Lanka, to work forNorwegian fixed wages. More recently, thisrefugee labor is being partly replaced by Russianworkers, women and men, coming in on short-term contracts (20). To secure diversification atthe local level, the owners of the fish processingindustry have cooperated with the municipalauthorities and with central government agen-cies. Båtsfjord has, for example, set up sportsfacilities, relocated the airport in order to be ableto serve 40-seat airplanes, and offers secondaryand university level education on site andthrough distance learning.

In the highly volatile fisheries industry, set-backs come on short notice, however. It is alsoa problem to convert business success intodevelopment of culture and identity. Many ofthe refugee workers have by now left Båtsfjord,and a study of young people in Båtsfjordshowed that the younger generation expressesmixed feelings about their home place (21).Business innovation is the main thing in


Båtsfjord, but the networking involves only alimited group of actors connected to the inter-national fish trade (22).

Teriberka, RussiaTeriberka is a fishing village on the coast of KolaPeninsula, 120 km northeast of the city ofMurmansk with a population of 1,400. It is oneof the very few fishing villages left in this highlyurbanized region. It was, for ages, a wealthytown, and open to international contacts, espe-cially at the time of the Pomor trade before theRussian Revolution of 1917. During most of theSoviet period, Teriberka experienced intensivedevelopment, with a population maximum of12,000 inhabitants in the 1960s. In the lastdecades before perestroika, the population stabi-lized at a level of 2,400 inhabitants. The econo-my has been based on a fishing kolkhoz, whichowned the fishing fleet, several fish processingplants, and a shipyard (23).

In the beginning of the 1990s, the villagefaced a deep socio-economic crisis caused bythe transformation of Russia to a market econo-my together with the introduction of strong reg-ulation of fish resources. In 1993, the shipyardwas closed and about half of the jobs in the fishprocessing plants were lost. The former “prideof the coast” was about to collapse as the localeconomy crashed. Living standards declinedand a class of “new poor” appeared, made up ofwell-educated people. The welfare infrastruc-ture was cut back, with reduction of state trans-fers and a diminishing base for local financing.

Since 1994, the dominant strategy inTeriberka has been to attract external (primarilyforeign) capital to the traditional sector of itseconomy. These efforts resulted in establishing ajoint Russian-Portuguese-Lithuanian fish pro-cessing enterprise and a project of cooperationwith the Norwegian municipality of Båtsfjord.These business initiatives were mainly a resultof ties between outside entrepreneurs who hadeither formerly worked in Teriberka or whoknew about the place from business partners.The local and regional governments providedstrong political support for measures to attractexternal financial resources and to stimulatecross-border cooperation. Informal social tiesconnected to the fishery economy had been verystrong between family members and neighbors,but these ties played no role as a basis for thenew business initiatives.

New initiatives in the fisheries industry havebeen important for keeping the local economy

alive. Nowadays, people of the village can findwork in fish processing, both at the kolkhoz andat the new enterprise. In addition, 40-50 work-ers from Teriberka (9% of the workforce) havebeen employed in fish processing in Båtsfjord,which is seen as a fortunate way of coping withpoverty.

Oil and gas transportation development inthe region may bring another perspective intoTeriberka’s life, as there are some prospects ofconstructing transportation facilities in the vil-lage. Realizing these plans depends on corpora-tions from outside the region, but people in thevillage believe this new project will create newlocal jobs.

This case is about attracting externalresources to a traditional sector of the economyvia entrepreneurial and political networks at theregional and local levels. During the most diffi-cult period, the decline in living standards led tothe rise of a subsistence economy. The localinformal economy can thus be regarded as asafety net.

Iceland and the Faroe IslandsCommunity development in Iceland and theFaroe Islands is much about networking andentrepreneurship in the fishing industries,where the very small municipalities used to playan important role in organizing and facilitatingbusiness activities. It is much an “economy offlows,” where the decisive factors keep chang-ing all the time: the presence of fish in the seavaries, as do regulations concerning access tothese resources and international markets. Animportant response, especially in Iceland, hasbeen to diversify the economy, including newinformation technology and tourism develop-ments. The two municipalities, Ísafjörður andHornafjörður, illustrate this well.

Ísafjörður is the main town within a munici-pality that also includes villages and districtssouth of the town (24). While the population ofthe villages had declined to around 1,000 in2002, the town of Ísafjörður has had a stablepopulation of just over 3,000. The system ofindividually transferable quotas in the Icelandicfisheries has led to the municipal area losingboth some of its quotas and some of its vessels.Instead, Ísafjörður is becoming a town dominat-ed by public and private service sectors. Thestrategy of the municipal authorities has been tomake Ísafjörður a center for marine research inIceland, and a number of businesses in fishingtechnology have located there. Tourism is also


growing. The municipal authorities have playedan active role in supporting innovative projects.Ísafjörður is a town that its young people takemuch pride in, according to a survey of youngpeople’s perceptions of their communities (25).Many migrant workers from different countrieshave come to work in the fishing industries andare now enriching cultural life, for example bythe creation of an annual festival displaying thecultural multitude of the community.

The Hornafjörður municipality covers a 200km long but narrow strip of land on the southeast side of the glacier Vatnajökull. It includesthe fishing town of Höfn and five small ruralmunicipalities, and has 2,300 inhabitants. Thefishing industry in Höfn has coped more suc-cessfully with the quota system than Ísafjörður,but the municipality has nevertheless engagedin strategies of economic diversification. Amajor new source of income is tourism, whichwas facilitated by the completion of Iceland’scircle road that made Skaftafell National Parkbeneath Vatnajökull much easier to reach by car.Major events, such as the 1996 sub-glacial vol-canic eruption and the following flood, havecreated extra visitors. Other job opportunitieswere created when a biotechnology venture wasestablished in Höfn. Apart from the raw materi-als useful for producing enzymes and seafoodflavorings, there were few reasons to locate the

business in Höfn; but the choice of location wasfacilitated by personal networks of a non-busi-ness character. As in Ísafjörður, the municipalauthorities of Hornafjörður are actively promot-ing an innovation strategy, which includesbringing together secondary and continuingeducation facilities, the municipal library, anentrepreneurial center, and a branch of theUniversity of Iceland. On the other hand,inhabitants of Öræfi (a small formerly inde-pendent municipality, now part ofHornarfjöður) more than 100 km away fromHöfn feel that municipal authorities do not domuch for them.

These Icelandic cases indicate a shift on thepart of local people away from trying to stabilizeand “ground” the volatile fishing sector towardsdeveloping strategies that are more in line withpost-industrial attempts to become involved indynamic game plans of potentially global scope.This includes attracting new types of touristsand developing high-tech enterprises related tomarine resources and/or advanced services forthe fishing fleet. By capitalizing on informal net-works and allowing entrepreneurship and out-side contacts to flourish, at least some fishingcommunities are coping with the challengesposed by the process of restructuring traditionalindustries.

Greenland: Uummannaq and IlulissatThe introduction of Home Rule in Greenlandproduced many expectations of policies forcommunity development, especially in the vil-lages and rural districts. Today, regional policy isintegrated into all policy in Greenland, but withan increasing orientation towards economicindependence for Greenland as such. There isthus less emphasis on the leveling of regionaldisparities.

Municipal authorities in Greenland areexpected to behave as “midwives”, in facilitat-ing business development in their areas. Twomunicipalities in West Greenland have been rel-atively successful in connection with the successof specific fisheries: Uummannaq, with a stablepopulation in the 1990s, and Ilulissat, with agrowing population in the same period (26-28).

The municipality of Uummannaq (population2,700) comprises the town of Uummannaq(with a population of 1,400) and seven smallersettlements separated from the town by wateror ice. Travel in the vast municipal area is possi-ble by boat, snowmobile, dog sledge, or even bycar over the sea-ice, but isolation is part of life,


Whale watching is agrowing business inIcelandPH

OTO:

NÍEL

S EI

NARS

SON

especially when it comes to contact with the restof Greenland. Sea transport is only possible insummer. Since 1999, air connections go throughthe new airport for fixed-winged aircrafts nearthe small village of Qaarsut, 20 km across thesea from Uummannaq, thus involving a furthertransfer by helicopter to Uummannaq or theother small villages. As a result, tourism devel-opment is also limited. After the closure of theMaarmorilik lead and zinc mine in 1993, themain economic activity, except for the publicservice sector, has been the fishing ofGreenlandic halibut. There are fish plants in thetown and in several of the villages producinghalibut fillets. In addition to Royal Greenland,the home-ruled company, new private firmshave tried to enter into this business since thelate 1990s, supported by cooperative initiativesbetween the municipality, local fishermen andnon-local capital. This has caused conflicts, forexample concerning obligations to secure jobson-shore instead of relying on more profitablefactory ships. These events show that thoughmunicipal and central governments are stillmajor actors, the fishermen’s organization alsoplays an important role.

Entrepreneurship in Greenland is much a

question of political activities and personalnetworks. The intersections and networksbetween business, political and trade associa-tions, the public sector, and fishermen arewhat nourish innovation. This is also true forIlulissat, the third largest town in Greenlandwith 4,500 inhabitants, and growing since1990. Its municipal district also includes somesmaller settlements with a total of about 500inhabitants. Ilulissat’s economy is differentfrom Uummannaq’s. It hosts one of RoyalGreenland’s cornerstone plants for processingboth shrimp and Greenland halibut and thebiggest fleet of private fishing vessels in anytown in Greenland. Ilulissat is also a majortourist destination in Greenland, facilitated byits location vis-à-vis the most productive gla-cier fjord in the northern hemisphere and itsairport for fixed-winged aircrafts (opened in1984).

Entrepreneurship in fisheries has played amajor role in Ilulissat. Building on municipalinitiative and a combination of local and inter-national fisheries’ networks, a business corpora-tion began fishing snow crabs in 1995. Thedirector was recruited, local fishermen areshareholders, and the factory ships only employ


Supply ship in springtime,Ittoqqortoormiit(Scoresbysund), EastGreenland

PHOTO:JÓNAS G.ALLANSSON

people from the municipality. The 90 local citi-zens working on the factory ship operating indistant waters earn high incomes, which alsobenefits the municipal authority by income tax-ation.

Theme summaryIn the face of a volatile market and dynamicmarine resources, many fishing communities inthe Arctic have had to become more competi-tive. The economic success of one communitymay well be at the cost of others in a zero-sumcompetition over fixed resources. Success isoften built on a combination of business, public,organizational, and personal networks. Themultiplicity of local stakeholders is important inmaking business innovations issues of publicinterest, auditing their legitimacy and testingwhether they make sense to local people.

Another strategy has been to diversify theeconomy, often with tourism. Good communi-cations are important in order to attract tourists.

Finding patternsIt is hard to point to an overall pattern in Arcticcommunity development. Even though theforces of globalization may be based on a com-mon set of principles of economic liberalization,there are differences in how specific regions andcommunities are exposed to those forces.Moreover, buffering mechanisms and compen-satory measures vary within each national set-ting. This includes differences in welfare andregional policies, but also in policies towardsindigenous peoples. Other factors are distancesand the presence, and condition, of road con-nections that allow access to regional labor mar-kets on a commuting basis.

The economic structure of communities canaffect their viability. In many fishing communi-ties along the North Atlantic rim and in somecommunities dependent on oil or mineralsextraction, the economic basis may sustain a rel-ative high standard of living. The situation isquite different in communities that depend inlarge part on a combination of subsistence activ-ities, public sector jobs, and public transfers.

Local strategies can set specific localresources in motion, both by stimulating indi-vidual entrepreneurship and by more collective-ly oriented coping strategies and networking. Inboth forms, the strategies involve ties and rela-tionships with institutions and actors outside ofthe community.

Community-based strategies must be under-stood both with respect to how relations to theglobalized economy are being handled and howcentral and regional governments respond tospecific bottom-up initiatives. In a number ofsuccessful fishing communities, a combinationof market-driven processes, a politically-gov-erned economy, and informal relations werefound to intersect, along with local access tofisheries. This can be described as a way of com-bining industrial and post-industrial elements.Their direct involvement in the internationalfisheries economy has provided these commu-nities with income from these markets, in addi-tion to the income created by tourism and in thepublic and informal sectors.

Many communities without strong marketconnections combine subsistence activities andincomes from the public or corporateeconomies. Some communities have also beenable to capitalize on compensations for oil, gasand hydropower developments, in some casesthough not always with relatively high incomesas a result.

This diversity among Arctic communitiesbegs for moderation in the ambitions of formu-lating an overall policy for Arctic communitydevelopment. Two observations from the casepresentations seem to be salient, however: First,while subsistence activities are going on inmany villages, it is in fact wage labor that pro-vides most cash income, and a large proportionof that income stems from public serviceemployment. The second observation is thatclaiming compensation for utilization of localnatural resources is becoming increasingly com-mon, including compensation for loss of fishquotas, or industrial restructurings that have ledto fewer local jobs. It is not always easy for com-munities to make central and regional govern-ment authorities accept compensation schemes,however, and to convert such compensationsinto productive and innovative activities at thelevel of the community.

Key conclusionsCommunity development is a complex processwhere, unsurprisingly, small events make thedifference between who succeeds and who doesnot. The complexities are becoming increasinglyimportant as Arctic communities are integratedin northern modern societies and in globaleconomies. The potentials for development liein measures that balance global economic flows,


political organization, and often far-reachingcivic networks. In some instances, Arctic com-munities have succeeded in really influencingrather than just adapting to external agendasand flows.

Economic actors located closer to consumersare often profiting most from the industrialextraction of Arctic resources. Welfare state sub-sidies to the Arctic, understood as compensa-tions for this loss of natural resources, are there-fore justified.

A proper infrastructure is necessary in Arcticcommunities in order to enable peripherallylocated businesses to be competitive, both inmarketing products and in recruiting competentspecialists and staff. This includes both physicaland digital communication networks.

Self-government and home-rule governmentwere introduced with promises of local andregional development, but paradoxically thepolitical and economic priority given to nation-al and regional independence may result in lessfocus on local development issues. However,self-government and independence may alsolead to a stronger political culture of publicdebate and political accountability, thus secur-ing political agendas where issues, initiatives,and projects can be formulated and evaluated.

Municipal self-government plays a significantrole in community development. An effectiveand democratic local government structure isable to coordinate different public services, sup-porting both daily life and cultural life, andstimulating business development. Municipalauthorities are crucial actors when they combinethe roles of (1) partner, supporter or even entre-preneur in innovation, (2) gate-opener, estab-lishing contacts and legitimating actions by net-working, and (3) integrator, securing the direc-tion and commitment of actions to locate devel-opment. As the legitimate community represen-tative, local government should have the capac-ity to bridge local and non-local relations, andthe more isolated the locality the more impor-tant it is.

It is crucial to stimulate learning across theArctic by strengthening international coopera-tion, not least at the level of communities,municipalities and first nations.

We suggest that community viability in theArctic depends on people coping locally and ata distance, building on local citizenship, rightsof mobility, bridging between social fields, andpost-industrial economic development.

Gaps in knowledgeUnderstanding community development and itsconnections to global processes requires cross-sectorial analyses that focus on the spill-overand connections between economy, nature, pol-itics, and informal daily-life practices, not onlyat the local level, but also the links to higher lev-els. Such comprehensive community studiesshould investigate the relations (or lack thereof)between private businesses, associations, thepublic sector, and informal networks, includingthose working at a distance. Such studies can beimplemented most fruitfully in cooperation withlocal authorities and communities.

Researchers working on community develop-ment across borders need support from interna-tional bodies to cope with barriers to research,including those of infrastructure, language andpermissions. An international research projecton “Modern Societies in the Arctic” would bevaluable, and should help make Arctic commu-nities interesting to institutions of knowledge,research and development around the world.While such development carries risks of contin-ued colonialism, this would certainly also be thecase if research on Arctic communities and soci-eties were to be isolated and associated onlywith images of the pre-modern.

Chapter summaryA viable community is one in which people areable to dwell and prosper, for some period, find-ing sources of income and meaningful lives. Formany small communities across the Arctic, pop-ulations have declined because of a lack of jobopportunities. There are also examples of com-munities, however, where a combination oflocal entrepreneurship, engaged political lead-ers, and government initiatives have createdmore hopeful situations, where thriving busi-nesses as well as cultural revival give people ameaningful way of life and thus community via-bility. This chapter has described social transfor-mations in several such small Arctic communi-ties and it points to some key factors for suchpositive developments, issues ranging fromresource management and connections to glob-al markets, to the role of public services andinfrastructure.


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13 Martin 2003, chapter 4 (12).

14 Population figures in this section of the chapterare from Norwegian official statistics for 1992and 2003: Kommunehefter, Folke- og boligtelling1990, 2001 (Statistics Norway, Oslo).

15 M. Aure, “Innovative traditions? Coping process-es among households, villages and municipali-ties,” in The Reflexive North, N. Aarsæther, J. O.Bærenholdt, Eds. (MOST and Nordic Council ofMinisters, 2001), pp. 89-113.

16 On Storfjord, see also Bærenholdt and Haldrup2002 (29).

17 S. Lloyd, “Contours of the Swedish forest land-scape,” in Transforming the Local, N. Bærenholdt,J. O. Aarsæther, Eds. ((MOST and Nordic Councilof Ministers, Nord 2001:25, Copenhagen,2001),pp. 83-117.

18 K. Lindahl, “Coping strategies and regional poli-cies, social capital in Nordic peripheries –Sweden,” (Nordregio Working Paper no 6, 2002).

19 G. Hovgaard, Globalisation, Embeddedness andLocal Coping Strategies. Ph.D. dissertation,Department of Social Sciences, RoskildeUniversity (2001).

20 M. Aure, “The transnational North: construc-tions of labour migrants,” in preparation.

21 Young people in Båtsfjord and Storfjord havebeen included in the UNESCO-MOST studyYoung voices – Northern Futures (30).

22 By February 2004, all the processing factories hadlaid off workers, and the population figures showa loss of about 100 inhabitants during 2003.

23 Teriberka has been studied in a number of MOSTCCPP studies, including Riabova 2001: pp. 115-138 (31) and Skaptadóttir, Mørkøre and Riabova2001: 43-67 (32).

24 Ísafjörður and Höfn have been studied in a seriesof studies supported by Nordregio, building onthe CCPP platform (33-34).

25 This was very apparent when young people inÍsafjörður, during a visit of the president, wrotetheir school essays for the UNESCO-MOSTstudy Young voices – Northern Futures (32).

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29 J. O. Bærenholdt, M. Haldrup, “Economy-culture-relations and the geographies of regional develop-ment” in Voices from the North, New Trends inNordic Human Geography, J. Öhman, K. Simonsen,Eds. (Ashgate, Aldershot, 2002), pp. 56-58.


30 C. Bjørndal, N. Aarsæther, “Northern Futures –Young voices. A report from the UNESCO MOSTCircumpolar Coping Processes Project”(University of Tromsø, Tromsø, 2000).

31 L. Riabova, ”Coping with extinction: the lastfishing village on the Murman coast,” in TheReflexive North, N. Aarsæther, J. O. Bærenholdt,Eds. (MOST and Nordic Council of Ministers,Nord 2001:10, Copenhagen, 2001), pp. 115-138.

32 U.D. Skaptadóttir, J. Mørkøre, L. Riabova,“Overcoming crisis: coping strategies in fisherybased localities in Iceland, North-Western Russiaand the Faroe Islands,” in Transforming the Local,N. Aarsæther, J.O. Bærenholdt, Eds. (MOST andNordic Council of Ministers, Nord 2001:25,Copenhagen, 2001), pp. 43-67.

33 K. Benediktsson, U.D. Skaptadóttir, “Copingstrategies and regional policies, social capital inNordic peripheries – Iceland. Nordregio WorkingPaper no 5 (2002).

34 G. T. Jóhannesson, U. D. Skaptadóttir, K.Benediktsson, “Coping with social capital? Thecultural economy of tourism in the North,”Sociologia Ruralis 43, 3 (2003).

35 U.D. Skaptadóttir, G. T. Jóhannesson, “The Roleof Muncipalities in Innovations, Innovations inthe three sectors of society in two municipalitiesin Iceland” in Innovations in the Nordic Periphery,N. Aarsæther. Ed. (Nordregio Report, forthcom-ing).

Acknowledgements:The authors would like to acknowledge the effort byThibault Martin in commenting and contributing toour draft manuscript while writing this chapter.


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