Biannual address to the Storting on important EU and EEA matters

Mr President,

'Europe has never been so prosperous, so secure nor so free'. These are the opening words of the European Security Strategy that was adopted by the EU in 2003.

'A more connected, contested and complex world'. This is how the European External Action Service describes the world in its 2015 Strategic Review. The last decade has provided good reasons for this change of tone.

The 2003 security strategy clearly set out the threats facing the European idyll. Terrorism. Weapons of mass destruction. Regional conflicts. State failure. Organised crime.

But few thought that these threats would have such tangible consequences for Europe as they have had.

And few thought that Europe would have to spend more time and energy dealing with its own financial crisis than responding to crises outside Europe.

Europe's main foreign policy challenge was – and still is – to build security in its neighbourhood.

But at the time of the upheavals in the Arab world, many European countries were experiencing an economic crisis. When Russia's aggression changed the borders of one of the EU's neighbourhood countries, the major weaknesses of the European Neighbourhood Policy were revealed. And now that the refugee crisis is really hitting Europe, we are seeing signs of a political crisis within the EU.

Each of these crises is challenging in its own right. Moreover, they are connected in ways that make the situation even more complicated. The consequences of Russia's use of force both in Ukraine and Syria are being felt in a European political landscape where extremist parties are saying no to Ukraine's desire for closer integration with Europe and whose views are being fuelled by resistance to refugees. Turkey's key role in the Middle East, as well as in the migration crisis, is influencing sensitive discussions concerning the further process of European integration.

The EU's response to crises is often to develop more far-reaching common policy, but this can lead to greater disagreement between EU countries and greater polarisation within EU countries.

Mr President,

At no other time since the establishment of the EU has European cooperation been more difficult. But the need for European cooperation has never been greater.

And now, as it seeks to address this difficult situation, Europe is still experiencing low growth, high unemployment and an aging population. Several countries are having to deal with structural problems. Meanwhile, other parts of the world are enjoying strong economic progress.

Some positive trends

Nevertheless, we are seeing some positive trends. Growth is improving somewhat, and several countries are tackling their structural problems. The high level of education in Europe is also a strength. The challenges faced by several European countries due to an aging population could be reduced by immigration and migration, if immigrants are well integrated and able to participate in working life.

Compared with the rest of Europe, Norway is in a good position. But we face many of the same threats and challenges from Europe's neighbourhood. We also share an interest in promoting economic growth in the EU.

Globalisation and the digital revolution are making us more dependent on – and more vulnerable to – what is happening in the world around us.

The Norwegian economy and Norwegian jobs are dependent on developments in the world economy, and on developments in the EU – our most important trading partner.

The negotiations on the new funding period for the EEA and Norway Grants scheme and on market access for fish illustrate the fact that Norway and the EU have reciprocal interests. These negotiations were concluded in the summer, and agreements covering the period up until 30 April 2021 were countersigned.

It was important for the fisheries and aquaculture industry that we secured a good agreement on market access for fish. We are pleased that the agreement entails new tariff-free quotas for fileted and processed products such as frozen mackerel and fresh herring, and allows for more processing to be done in Norway. The quota for different types of spiced and/or vinegar cured herring has been increased by 50 %. The extension of the agreement period to seven years provides greater predictability for the fisheries sector.

Under the agreement on the EEA and Norway Grants, Norway will contribute a sum of EUR 388 million per year. This is an annual increase of about 11 % compared with the previous programme period, and the increase is more or less in line with inflation in the EU. I am expecting the agreement to be signed in early 2016 when the EU has completed its internal procedures. The Government will submit a proposition to the Storting once the agreement has been signed.

Our aim is to ensure strategic and targeted use of the EEA and Norway Grants in the next programme period. We have identified five key focus areas, three of which are to be given particular priority. These are:

• Innovation, research, education and competitiveness
• The environment, energy, climate change and transition to a low-carbon economy
• Justice and home affairs, including measures to address the refugee and migration crisis

Support will also be provided for projects in the areas of:

• Social inclusion, youth employment and poverty reduction
• Culture, civil society, good governance and protection of fundamental rights and freedoms

We will continue to provide support for projects aimed at strengthening minority rights and increasing opportunities for minorities to participate in politics and society, not least the Roma people. And we will continue our efforts to strengthen civil society in the beneficiary countries.

New negotiations on trade in agricultural products, known as the Article 19 negotiations, began on 3 February this year. A second meeting took place on 23 September. The EU and Norway have put forward their lists of demands, which will form the basis for the ongoing negotiations. As expected, the European Commission has put forward far-reaching demands.

Before the next round of negotiations, the Government will give thorough consideration to the EU's demands and will establish Norway's priorities for the ongoing negotiations. A date for the next meeting has not yet been agreed. The Government will keep the Storting informed of any developments in the negotiation process.

Mr President,

Participating in the EU authorities for the supervision of financial activities in the banking, insurance and securities sectors is important for Norway and the Norwegian business sector.

The overall aim of the EEA Agreement is to ensure the homogeneity of legislation throughout the internal market. The market for financial services is an important part of the single market. We are in the final stages of the work to reach an agreement with the Commission on the legal texts, based on the principles set out in the political agreement, which I discussed in a previous address to the Storting.

It has proved time-consuming to put in place the specific, technical adaptations to the EU's legislation that are necessary to enable the incorporation of this legislation into the EEA Agreement.

It now seems realistic that we will reach informal agreement with the Commission during the autumn on the EEA Joint Committee Decisions relating to the four main legal acts establishing the EU's financial supervisory authorities, as well as key related legislation.

A proposition will be presented to the Storting requesting its consent to this package of legislation before the decision is adopted by the EEA Joint Committee. Our aim is to submit the proposition in time for the matter to be considered during the spring session. The package will include legislation that requires the consent, by a three-fourths majority, of the Storting, under Article 115 of the Constitution.

Our aim is for the necessary legislative amendments to be adopted during the spring session and for them to enter into force on 1 July 2016. In parallel with this process, we will work to incorporate the rest of the legislation on financial services into the EEA Agreement during the course of 2016.

Incorporating new legislation into the EEA Agreement and implementing it in Norwegian law is important for ensuring that the same rules apply to Norwegian companies and workplaces as to companies and workplaces in EU countries.

The amount of EU legislation that has not yet been incorporated into the EEA Agreement has increased, partly because of the time it is taking to finalise the work on the financial supervision legislation. We are working hard to reduce the backlog, but ensuring the timely incorporation of new legislation into the EEA Agreement also depends on the EU and our Efta partners doing their part.

Good help: Free movement of labour

The part that Norway can deal with alone is implementing legislation that has already been incorporated into the EEA Agreement in Norwegian law. The Efta Surveillance Authority monitors performance in this area. Its most recent Internal Market Scoreboard shows that Norway's backlog is now at 0 %, i.e. there are no legal acts still outstanding. This is the first time since the EEA Agreement entered into force that this has been the case. This is good news for Norwegian companies and for Norwegian jobs.

Mr President,

The free movement of labour from other EEA countries to Norway has helped us meet our need for labour. Labour immigrants who work and pay taxes in Norway are also entitled to receive sickness and unemployment benefits. The rise in labour immigration to Norway has thus led to an increase in the export of Norwegian social security benefits.

This issue has been the subject of debate in several European countries, and as a result the Commission has initiated a dialogue on the export of welfare benefits and on how the vital principle of free movement can be translated into practice in a more sustainable way. Norway is participating in this dialogue. During the first quarter of 2016, the Government will also present a white paper examining this issue in-depth, with reference to the ongoing dialogue in Europe.

Mr President,

There are more than 23 million unemployed people in EU countries, and public debt is on average 88 % of GDP. High levels of private debt and unemployment are reducing growth opportunities. Inflation in the euro area is very low, despite a record low key interest rate and the extraordinary measures introduced by the European Central Bank.

The economic situation varies between countries in the eurozone, as it does between those EU member states that are inside the eurozone and those on the outside. It is a positive sign that countries that have previously received financial assistance are now experiencing increased growth, improved competitiveness and falling unemployment, as is the case in Spain, Ireland and Portugal. It is worth noting that these are countries that have implemented tough structural reforms. Now we are seeing the results.

In August, the eurozone countries approved a third package of loans for Greece. The Greek people renewed their confidence in Prime Minister Tsipras in the election in September, and he must now implement an extensive programme of reforms. The Government's ability to implement reforms will determine how quickly the package of loans will be disbursed and whether talks on easing the debt repayment terms can be held. Renewed growth is not expected until 2017. The situation places great demands on the Tsipras Government's ability to take the necessary action.

The UK's initiative to renegotiate its relationship with the EU and the planned UK referendum on EU membership are another major test for the EU cooperation, and this will be a key issue for the European cooperation in the time ahead. It is, of course, up to the British people themselves to decide where their best interests lie, but it is our view that Europe is a more secure and economically more dynamic place with the UK inside the EU. It is in Norway's interests that the UK – a close ally, partner and country with which we share many common views – remains a prominent and influential member of the EU.

Mr President,

To address external and internal challenges, Europe needs to pursue a balanced policy of reforms aimed at boosting productivity and strengthening public finances, and at increasing investment, employment and capacity for growth in the long term. The economic crisis has revealed structural weaknesses in many of the member states. The willingness and ability to implement reforms is therefore needed if Europe is to be able to compete successfully on the global stage.

The economic crisis also revealed shortcomings in the coordination of economic policy. For this reason, a number of reforms have been implemented over the past five years to strengthen the euro cooperation. Before the sovereign debt crisis, the EU could not provide bailout loans to countries in the euro area. Now the EU treaties have been amended to make this possible through the European Stability Mechanism, the EU's crisis resolution mechanism for the countries of the euro area. The banking union for the euro area is designed to break the vicious circle between failing banks and weak national finances.

In June, the presidents of the European Council, the European Commission, the Eurogroup, the European Central Bank and the European Parliament presented a report outlining proposals for strengthening the Europe's economic and monetary union. But the countries concerned have differing views on how far integration within the euro area should go.

It is in Norway's interests that the economies of the eurozone countries are strong, but Norway will not be directly affected by measures to further develop the euro area. Nevertheless, we must follow developments closely so as to assess the implications of any reforms in this area for the internal market.

Reforms are necessary, but on their own are not enough to stimulate renewed economic growth. In July, the Commission agreed on the last package of measures needed to get the European Fund for Strategic Investments (EFSI) – known as the Juncker fund – up and running.

The aim is for the Fund of EUR 21 billion to unlock investments worth a total of EUR 315 billion over a three-year period. It is unclear whether the Fund will make much of an impact in the short term, but in the longer term it may lead to increased productivity and economic growth. The Fund did not become operational until September and it is therefore too early to say anything about its priorities.

Two important instruments

As part of the effort to make more strategic use of the EEA and Norway Grants, we have identified innovation, research and education as one of the main priority areas for funding. In addition, a regional fund worth EUR 100 million is to be set up under the Grants scheme. A large part of this will go towards improving job opportunities and labour market mobility for young people. Norway will also benefit from the Grants scheme being used to promote growth in the EU.

The EU's research and innovation programme, Horizon 2020, and the EU programme for education, training, youth and sport, Erasmus+ are two other important instruments for fostering economic growth, competitiveness and innovation capacity in Europe. And they will be increasingly important for us as Norway undergoes a process of restructuring. In 2016, Norway is expected to provide over NOK 2.3 billion to Horizon 2020 and around NOK 0.5 billion to Erasmus+.

It is therefore important that Norwegian actors make use of the opportunities offered by these programmes: opportunities to obtain research funding, but even more important, opportunities to strengthen cooperation with world-leading research groups. The fact that the Norwegian University of Science and Technology (NTNU), Sintef and the University of Bergen have opened a joint office in Brussels illustrates how important the EU and European cooperation have become for the research sector.

The Commission's plan to establish a Capital Markets Union by 2019 is another initiative to improve the investment climate in Europe. One of the aims is to give companies better access to sources of finance other than banks.

The initiative has been described as the most ambitious financial project since the introduction of the euro. The establishment of the Capital Markets Union could bring substantial benefits to the European economy. We welcome the Commission's ambitions to improve the capital markets in Europe and thus promote growth and employment.

Perhaps the most important initiative for strengthening economic development in the EU is the work to create a digital single market, which entails innovative use of ICT and digital technologies. This is a priority both for Norway and the EU.

The development of digital technologies will open up significant opportunities for growth for both Norway and Europe, particularly if we can put in place a well-functioning digital single market.

New digital advances will bring major changes to our daily lives, our welfare services and the business sector, and will also create a need to clarify important legal questions and matters of principle. This applies to protection of privacy, and also to the interplay between new and old business models, as we are seeing, for example, with the emergence of companies such as Uber and Airbnb.

The Commission presented itsDigital Single Market Strategyin May. Norway is playing an active role in this area, for example by providing input on the 16 initiatives set out in the strategy. We have already submitted input to consultations on cross-border parcel delivery and on audiovisual media services, in which we have pointed to the challenges relating to the country of origin principle and commercial communications, in particular advertisements for alcohol and for betting and gaming. We also plan to submit an EEA Efta position to the EU on consumer protection in e-commerce.

We are also actively involved in the reform of the data protection rules, the copyright rules and the e-commerce directive, and the development of the new e-government action plan and the digital agenda.

We share the Commission's belief in the importance of a digital single market for boosting growth and competitiveness. At the same time, it is clear that we have both offensive and defensive interests to safeguard, and we are now in the process of identifying these. The Government will present a white paper outlining a new digital agenda for Norway. The European process is an important part of our own work in this area.

Mr President,

The negotiations on the proposed trade and investment agreement between the EU and the US, the Transatlantic Trade and Investment Partnership (TTIP) gained new momentum after the European Parliament gave its support to the ongoing negotiations, and after the recent agreement between the US and 11 other Pacific rim countries on the Trans-Pacific Partnership (TPP).

The signing of the TPP is a positive development for the countries involved, and could also have a positive economic impact on Europe. The fact that Japan will now be part of the free trade area around the Pacific Ocean will also affect the EU's negotiations on an economic partnership with Japan.

Challenges for Norway

The emergence of new mega-regional trade agreements must be seen against the backdrop of a lack of progress in the WTO. This development poses challenges for Norway. Norway is not party to the TTIP negotiations, but our participation in the internal market and our considerable trade with the EU and the US mean that a TTIP agreement will have direct implications for Norway.

We are making our views clear to the EU and the US. Norway has a strong interest in ensuring the best possible form of association with a transatlantic free trade deal.

In order to safeguard Norway's overall interests, we need a more thorough assessment of the various options available to us. For this reason, the Government decided before the summer to commission an external report on the possible consequences for Norway of the TTIP.

Mr President,

The growth both Norway and the rest of Europe need in the years and decades ahead must be created in a way that takes account of the greatest challenge facing our generation: climate change and the need to cut greenhouse gas emissions drastically.

The need for green growth and restructuring will influence policy in many areas. We must ensure that the action we take at national level is in line with developments in Europe and at the same time contribute to the debate at EU level. We are doing this in several ways.

The Government has asked two leading experts – Idar Kreutzer of Finance Norway and Connie Hedegaard, former European Commissioner for Climate Action – to prepare a draft strategy for green competitiveness. The Government-appointed green tax commission will present its recommendations before Christmas.

The commission's mandate is to put forward proposals for a green tax shift that moves taxation towards environmentally harmful activities, makes resource use more effective and promotes the achievement of the goals set out in the national cross-party agreement on climate policy.

The Government has also announced its intention to present a white paper on energy policy. A forward-looking energy policy will be vital both for future growth and welfare and for the transformation to a more climate-friendly society.

These processes are clearly linked to developments in Europe. For the EU, climate and energy policy is crucial to increasing competitiveness. Green tax reform is a key area of the work being carried out as part of the European Semester, the Commission's annual cycle for economic policy coordination and structural reform.

Norway recently submitted input to the consultation on the Commission's circular economy strategy, which is intended to improve efficiency by increasing the re-use and recycling of resources. The European Commission has announced that the strategy will be presented in December 2015.

Achieving an ambitious global climate agreement at the Climate Conference in Paris is a key aim for both Norway and the EU.

We have common interests in the area of climate policy, and many common instruments, and we are cooperating closely in the climate negotiations. Based on broad agreement in the Storting, we have entered into dialogue on collective delivery of our climate commitment together with the EU, with a target of reducing emissions by at least 40 %. This will form the basis for a more effective climate policy, and will strengthen cooperation on a global agreement. The meeting of the Environmental Council in September confirmed that the EU welcomes Norway's intention to participate in collective delivery of the climate commitment. Our aim is to conclude an agreement in two to three years' time, once the EU has put in place new legislation for achieving its emission reduction target.

We are contributing to the process of developing the EU's implementing legislation, for example the rules on tightening the cap in the EU emissions trading system (EU ETS), the rules for the non-ETS sector, and the rules for land use, land-use change and forestry (LULUCF). Norway is already part of the EU ETS through the EEA Agreement. We should also participate in the new cooperation on emissions from the non-ETS sector on the same lines as the EU member states.

As part of Norway's International Climate and Forest Initiative, we are cooperating with the EU and several EU member states through the UN Redd+ programme.

We are also helping the EU to reach its climate and energy targets through the export of gas and renewable energy to the EU.

Through the EEA and Norway Grants, we provide funding for projects on climate change, renewable energy, the environment and green industry development in beneficiary countries.

In July, the Commission presented its climate and energy summer package. In spring this year, we provided input to the consultation on the package and gave our support to a further tightening of the cap in the EU ETS. We are now looking more closely at the proposed legislation and will consider submitting further comments. One aim is to achieve a forward-looking system that cuts greenhouse gas emissions while also taking into account the risk of carbon leakage and safeguarding the competitiveness of industry sectors.

The EU's energy system is changing.In a communication launching the public consultation process on a new energy market design,the Commission is proposing a number of improvements to the energy market aimed at achieving an integrated EU-wide electricity market that provides clear price signals and facilitates investments, particularly in renewables.

Changes to the internal energy market will naturally affect Norway as well. In our input to the EU, we emphasised the importance of ensuring that energy markets function well and efficiently. Following a national-level consultation, Norway's main message is that we support a market design that provides effective price signals to all market actors, and we believe that this is the best way to further develop Europe's electricity markets. What is needed most is not new legislation, but to ensure that existing legislation is implemented fully and that we learn from experience.

The Energy Union

In our response to the consultation on an EU strategy for liquefied natural gas and gas storage, Norway emphasised the importance of ensuring a well-functioning and efficient European gas market with a wide variety of suppliers and buyers. This is essential for enhancing energy security.

Norway will continue to be a stable and predictable supplier of gas, the cleanest of the fossil energy sources, for a long time to come. Clear signals from the EU on the role of gas in the transition to a low-carbon society are important for ensuring the necessary investments in production in the future.

The design of the Energy Union has significant implications for Norway, and we consider it important to promote and defend our interests. We are currently in dialogue with the Commission on the role Norway can play as a stable and reliable gas supplier.

Later this month, European Commission Vice President Maroš Šefčovič will present his first annual report on the state of the Energy Union. It will be used as a basis for the assessment by the heads of state and government of progress in this area at the December summit. We are in close dialogue with the EU on the development of the Energy Union and will consider the need to provide input to the process on an ongoing basis.

Norway's energy situation, with nearly 100 % of electricity production from renewable sources and significant exports of oil and gas, is unique in Europe. This means that we sometimes have different considerations to take into account in our energy policy than many EU member states.

The development of a new governance system as part of the EU's climate and energy policies is a separate issue. Luxembourg has made this a priority during its presidency period. The system will be designed to provide sufficient coordination to meet the 2030 targets for renewable energy and energy efficiency, without it being necessary to impose national targets on member states. There are somewhat differing views of how this will be done, and it is unclear what the EU member states will eventually agree on.

The system could affect Norway, for example if it leads to changes in the reporting procedures set out in legal acts that have been incorporated into the EEA Agreement.

It is in Norway's overall interest for the EU to succeed in achieving its 2030 energy targets, and in this area too, we will consider on an ongoing basis whether to provide input to the discussion that has been initiated in the EU.

As part of the follow-up to the Energy Security Strategy adopted by the Commission last year, the EU is intensifying its energy diplomacy efforts. EU ministers have again indicated a desire to further develop partnerships with key countries such as Norway.

Here, I would like to mention Norway's budget proposal for 2016, which includes an allocation of NOK 5 million to research on European climate and energy policies. The EU is our most important export market generally, and also for energy and energy technologies. Through the EEA Agreement, we participate actively in European cooperation in this area. The economic, political and legal framework for our most important export sector is to a large extent set by the EU.

Climate change, the security situation and the need to strengthen competitiveness mean that EU climate and energy policy is constantly developing. This creates a need for better and faster analyses of developments and of what we can do to adapt and exploit the opportunities that are being created. The proposed allocation will go towards enabling us to carry out these analyses.

Mr President,

The migration and refugee crisis is dominating the agenda both in Norway and in the EU. The Prime Minister recently gave a detailed address to the Storting on this matter, so I intend to limit what I say now to the policy developments taking place at European level in response to the crisis.

As is well known, the security situation in and around Europe has deteriorated dramatically. There are deep divisions in the Sahel, in North Africa and in the Middle East, with outbreaks of violence in many areas. These are neither interstate wars nor traditional civil wars, but rather they are conflicts with regional dimensions, where the dividing lines between rebel groups, terrorists and criminal networks are unclear.

The civil war in Syria has forced a large proportion of the country's population to flee. The war is not only threatening the security of the region itself, but is also creating security challenges for Europe. The advance of ISIL has made the situation on the ground even more dramatic. ISIL has attracted foreign terrorist fighters from all over the world – 4 000 from Western Europe, according to current estimates.

There are currently well over two million Syrian refugees in Turkey. In addition to this, 350 000 Syrians registered as internally displaced are living on the Syrian side of the Turkish–Syrian border. The massive flow of refugees to the EU/Schengen area through Turkey has changed the dynamics of the relationship between Turkey and the EU. A joint action plan is now being discussed. The EU wants Turkey to do more to prevent irregular migration and human smuggling, and to improve conditions for Syrian refugees so that they have better grounds for staying in Turkey. In return, Turkey is to be given financial support and the prospect of visa liberalisation for Turks entering the Schengen area, as well as revitalised EU accession negotiations. The parties have not yet reached agreement, and there are divisions within the EU on a joint approach. Germany is currently negotiating a bilateral agreement with Turkey.

The high turnout in the general election last Sunday is testimony to Turkey's democratic aspirations. Regrettably, the run-up to the election was marred by serious security concerns and restrictions on the freedom of the media. The Justice and Development Party (AKP) succeeded in regaining a parliamentary majority.

It is hoped that the new Government, backed by a majority parliament, will be a good partner for the EU in dealing with the refugee crisis in Europe, and that the Turkish authorities will again be able to adopt a non-violent approach and work towards finding a peaceful solution to the Kurdish issue.

Mr President,

Two key EU processes are currently underway – towards a new EU global strategy for foreign and security policy and towards a new European Neighbourhood Policy. These will have to find better answers to Europe's main security issue: how to promote the development of stable and inclusive societies in Europe's neighbourhood. This is a long-term and highly complex task that is very challenging for Europe. The US, too, has made it clear that Europe must take greater responsibility for its own security. Ensuring the necessary diplomatic, economic, civilian and military capacity is essential. In European foreign policy, nothing is more important than addressing the problem of fragile states in our neighbouring areas, and preventing and dealing with conflict and chaos in these areas.

The most urgent task is to deal with the immediate consequences of the disintegration we are seeing in the Middle East. The current crisis is putting both Europe's fundamental values and its capacity to act to the test.

Now, when there are severe internal tensions within the EU, the EU is trying to chart a course for how to deal with the migration and refugee crisis. Key issues currently being discussed are cooperation with transit countries and countries of origin, improving the efficiency of the return process, division of responsibilities in the future and changes to the Dublin system, as well as the Schengen cooperation and the management of the external borders.

The enormous pressure on the Schengen area's external borders has given rise to a debate about the future management of the external borders. The Commission intends to present a package of measures aimed at improving the management of these borders. As part of this work, the EU has announced that it will strengthen Frontex and other agencies working in the field of migration and asylum, and will review cooperation between the various agencies, the tasks they have and how their responsibilities tie in with the responsibilities of the member states. It may be proposed to establish a common border and coast guard system in the EU.

The basic position of many of the EU countries is that any new measures should not significantly affect the division of competences between the EU and its member states. This is also Norway's position, although as a non-member we do not have the right to vote on such matters. However, we cannot rule out the possibility that the EU bodies may be given greater powers, for example relating to enforcement.

Today, the member states have full responsibility for their share of the external border, while Frontex has a supporting and coordinating role. In somewhat simplified terms, it could be said that the EU is seeking to establish a system whereby resources can be moved more efficiently from calm borders to borders that are under pressure.

The EU's discussions and decisions are now coloured by the need to deal with the current acute crisis. But they could have long-term consequences. As was the case with the financial crisis in 2008, the current crisis could spur the development of more powerful common EU instruments. Then, the aim was to strengthen the coordination of economic policy. Now, the aim is to strengthen coordination in the management of the migration and refugee crisis.

This development is likely to be gradual and piecemeal, depending on what it is possible to reach political agreement on. Many countries are wary of what could be perceived as a weakening of national sovereignty in the area of migration and asylum. At the same time, most countries realise that more Europe-wide measures are needed.

Norway has participated actively in the process so far, both because we are entitled to do so under the Schengen cooperation, and also because these are common challenges. The EU is seeking to address these by securing the support and involvement of countries beyond the 28 member states. Norway will continue to shoulder its share of the responsibility for dealing with the common challenges we are facing.

The Government has also taken steps to make it possible to use the EEA and Norway Grants to alleviate the migration and refugee situation in the next funding period. Today, funding is being provided under the EEA and Norway Grants for asylum and migration projects in Greece. We want to extend funding in this field to other beneficiary countries, and thus help to strengthen the capacity and expertise of their asylum and migration authorities.

We will make the most of the flexibility offered by the EEA and Norway Grants to ensure that they are used in a way that complements the funds being provided by the EU. We are willing to cooperate extensively with authorities in other countries on other measures that can strengthen control over the Schengen external border. We also intend to establish NGO programmes that can help to meet the refugees' need for healthcare, education and integration. This includes continuing the current effort to create an inclusive Europe by combating xenophobia and hate speech.

Mr President,

Over the past few years, the EU has taken on a stronger, more distinct role in the area of foreign and security policy. The EU and its member states played a key role in the process leading up to the agreement on Iran's nuclear programme this summer.

Serious security threats

The EU has several tools at its disposal that have been important in responding to the crisis in Ukraine. Despite certain internal tensions, political coordination within the EU has been strengthened. The alternative would have been greater insecurity. The serious security threats we are facing mean that Norway also has to work together with the EU and other European partners. We are therefore coordinating our policy with that of the EU and its member states. It is in our interests to participate in all aspects of the security policy debate in Europe – both within Nato and in dialogue with the EU.

For Norway, it is important to ensure that Europe remains united in its response to Russia's violations of international law and unacceptable actions in Ukraine. At the same time, we will strive to maintain cooperation with Russia in important areas such as fisheries management, the environment, nuclear safety, and search and rescue, as well as maintaining cross-border people-to-people contact in the north. Cooperation in the Arctic Council and in the Barents region also helps to keep tensions low in the north.

The association agreements and free trade agreements with Georgia, Moldova and Ukraine represent a new chapter in the European integration project. The agreements are crucial not only for these countries' integration into Europe but also for maintaining the credibility of the European cooperation and for reinforcing the principle that all countries are entitled to choose their international ties and alliances.

Norway has committed itself to assisting Georgia, Moldova and Ukraine in their processes towards European integration. These processes are fragile. The countries' own governments need to do more to move them forward. It is in our interests that they succeed in doing so, and we are providing support for reforms and modernisation efforts in these countries. Next week, a major Norwegian–Ukrainian ICT & Investment Conference is being held in Oslo.

We have proposed to the EU that we strengthen cooperation between Norway and the EU on the EU's Eastern Partnership. The EU is now in the process of reforming its neighbourhood policy, and it is in Norway's interests to ensure close cooperation in this area. A regional fund of about NOK 850 million is to be established for the next funding period of the EEA and Norway Grants. The aim is to support cross-border initiatives, possibly involving non-beneficiary countries. This will open up opportunities for cooperation with other countries such as Ukraine and Moldova.

As a member of the EEA, Norway has valuable experience of European integration to share. We have already informed representatives from Ukraine of how we organise and carry out work relating to EEA matters in the Norwegian public administration. We have also offered to share our experience with Moldova and Georgia.

The complex crises we are facing in our neighbouring areas require a response on many levels: civilian and military, national, intergovernmental and supranational. The relationship between Nato and the EU is particularly important and has been strengthened over the past year. The EU and Nato operate in different areas of crisis management, and we have seen that they have successfully complemented one another in the response to the Ukraine crisis. In order to ensure a more effective European response to current and future threats, it is important that we continue to develop both the political dialogue and the practical cooperation between the EU and Nato. This should be given priority both in the EU's work to develop a new security strategy and in Nato's preparations for next year's summit in Warsaw.

The EU directive on defence and security procurement (Directive 2009/81/EC) is of crucial importance to the further development of the Norwegian defence industry.

The directive, which was implemented in Norwegian law on 1 January 2014, could, in the long term, lead to new opportunities for competitive Norwegian defence companies, provided that the market is genuinely opened up to fair and open competition.

We intend to monitor the way the directive is implemented in practice in other countries, and will apply the legislation in a way that ensures that Norwegian defence companies are able to operate under the same framework conditions and rules as companies in EU countries. Developments in this area in Europe following the introduction of the directive are discussed in depth in the white paper on the relationship between the armed forces and the defence industry, which the Government presented on 30 October 2015.

Mr President,

Europe's role in the world is changing. The world is more connected, contested and complex. New crises are threatening the continent and its neighbouring areas. We in Europe must stand together to defend our values, our security and our global interests.

We must ensure that our values have real meaning in today's situation, when the world's troubles are reaching our shores.

And we must enhance our ability to put these values into practice.

Europe must become stronger economically.

Stronger, sustainable growth is needed if Europe is to maintain its high standard of welfare provision, create jobs, make the transition to a low-carbon economy, and be able to receive and integrate refugees.

Stronger, sustainable growth is needed if Europe is to be able to respond to developments in its unstable neighbourhood with a more forceful foreign and security policy.

It is in Norway's interests that Europe is successful. That is why we will continue to play an active role in efforts to ensure a prosperous, secure and free Europe in the future.