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Excellencies, ladies and gentlemen,

Welcome to the Ministry of Foreign Affairs’ European Conference 2005, which is the third of its kind. We hope that this conference will give us more insight and an opportunity to reflect on developments in Europe and Norway’s response to them.

Norway’s relations with Europe are characterised both by closeness and by distance. We Norwegians regard ourselves as Europeans. Norway is deeply integrated in the European economy, politics and culture, and we participate in most of the European co-operation. However, we have twice, by majority vote, chosen not to become members of the most important and most dynamic organisation for European co-operation, the EU. The Norwegian population is pretty much split down the middle when it comes to the question of Norwegian EU membership. It is therefore important for us now and then to take a step back to view Europe in an overall perspective. This conference offers a good opportunity to do so.

Although Norway has chosen to remain outside the EU, close European co-operation is very important for us. We are affected by decisions made in the EU every day. We have chosen to co-operate with the EU through treaties and agreements in a wide range of areas, and are therefore following developments in the EU closely. Despite the fact that Norway is not part of the EU, we attach importance to and support the significant role played by the EU in promoting peace, security and democracy in the whole of Europe. To some people it may seem like a paradox that Norway is such a strong supporter of EU enlargement given that we ourselves have chosen not to become a member. This shows that Norway and the EU countries share many of the same values and visions. We believe in the value of co-operating on common challenges.

Since the EU emerged from the ruins followingWorld War II, the vision of a united Europe has evolved from the Coal and Steel Community to a legally, economically and politically coherent European Union. So far 25 countries have joined forces to establish a common economy and governance system.

2004 was a historic year . On 1 May, 10 new countries were admitted to the EU. Bulgaria and Romania will become members in 2007, and the EEA will be enlarged correspondingly. Croatia, the Former Yugoslav Republic of Macedonia and Turkey have all applied for membership. And Ukraine’s new president has declared that membership is a long-term goal.

The EU, with its population of close to half a billion from Killarney in the west to Narva and Nicosia in the east, from Utsjoki in the north to Valetta in the south, has common legislative, executive and judicial authorities, an internal market, a central bank, a common currency and a rapid reaction force of 20 000 troops, and is likely to soon have a constitutional treaty, including a charter of fundamental rights.

One of eight UN countries is an EU member state. The EU generates about 20 per cent of the world’s total GNP. The internal market is the world’s largest multinational market. The euro has become the world’s strongest currency after gaining 50 per cent in relation to the dollar during the three first years of its existence. There is even a European space agency, which has 200 satellites orbiting the Earth and which is planning to make a European the first human being to reach Mars.

Yet at the same time, the EU consists of 25 sovereign states. The draft constitutional treaty underlines that all the authority of the EU derives from the member states and has been delegated in clearly specified areas where joint action is in the common interest and more effective than each country acting on its own. The fact that the EU’s common budget only represents about one per cent of the combined GNPs of the member states means that a great deal of power, authority and influence still lies with the nation states.

At the same time, most of the EU states, plus Norway and Iceland, have done away with border controls among themselves, making it possible to drive from the North Cape to Palermo without encountering a single border guard. Billions of euros have been invested in linking roads and railway lines into extensive Trans-European Networks. We, and other EEA citizens, have the right to live, work, start businesses, study and retire as pensioners anywhere in an area with a population of 460 million. And still retain our social security rights.

We are undoubtedly witnessing the most extensive and profound integration process in the history of Europe. At the practical level Norway is participating in many fields, but at the political level Norway has little influence on developments. The EEA Agreement, the Schengen co-operation and our various association agreements with EU programmes and agencies underscore the significance of our co-operation with neighbouring countries in the EU for the safeguarding of Norwegian interests. But as I said in my address to the Storting in February, the co-operation within the EU is affecting Norway to an increasing degree, while at the same time our possibility of influencing it is diminishing as the co-operation within the EU is being widened and deepened. This is quite a paradox, and something we have to take on board.

Outside the EU Norway is seeking to pursue a European policy that is as active as possible. Large resources are being dedicated to the efforts to promote Norwegian views and interests in EU capitals and in Brussels. The government has established a European Portal on the Internet ( www.europaportalen.no). Our work on EEA-related matters has been considerably intensified, in keeping with the European political platform of the coalition government. A well-functioning EEA Agreement is crucial to Norway.

The efforts to consolidate the common European Security and Defence Policy (ESDP) are continuing, in line with the EU’s political goals. The EU wishes to take on greater responsibility in international issues. Over time this will lead to a more equal burden-sharing between Europe and the USA. Such a development will benefit us on both sides of the Atlantic.

For this reason Norway actively supports the common European Security and Defence Policy, both politically and in the form of tangible contributions to international organisations. For example, Norway is participating in the military operation in Bosnia and Herzegovina, which the EU took over from NATO in December. This is by far the EU’s largest military operation to date. We will co-operate with the new European Defence Agency and contribute to the EU’s new Rapid Reaction Force in co-operation with other Nordic countries. At the same time, we want to underline that the European crisis management capacity must be co-ordinated with NATO’s efforts. For Norway, NATO is the cornerstone of the transatlantic community of shared values and security interests.

During his recent visit to Europe, President Bush made it clear that that the USA is interested in close transatlantic co-operation. The visit also showed that the USA wishes to intensify its co-operation with the EU in the time to come. But the transatlantic dialogue may to an increasing extent be conducted directly between the EU and the USA. It is important to us that NATO continues to be used and is strengthened as a framework for transatlantic deliberations on broader security policy issues.

Chancellor Schröder’s statement that NATO “no longer is the prime forum where the transatlantic partners discuss and co-ordinate their strategies” poses questions – and raises serious concern in Norway. Some have been reassured by the fact that the statement did not seem to have any particular impact on the NATO summit. But the issue raised by the German Chancellor is not a new one. We have already for some time seen a tendency for the USA and the EU to resolve important foreign and security policy matters directly between themselves. This could weaken NATO and marginalise us even further. A situation where important issues in the transatlantic dialogue are discussed directly between the USA and the EU would clearly pose major challenges to Norway.

The most important issue on the EU’s internal agenda this year and next is the draft constitutional treaty. Norway’s position on the treaty is straightforward: It concerns how the EU wants to organise its own affairs, and is thus none of Norway’s business. But at the same time, our basic view is that the EU is a positive force in Europe and the world at large. In my opinion the constitutional treaty will, if it enters into force, lead to democratisation and increased effectiveness, as well as to a number of other improvements in the EU. But it will also create specific challenges for Norway. It will not become easier to promote Norwegian interests and views as the EU becomes larger and develops more effective decision-making procedures.

Norway and the EU have strong ties in the economic field, primarily through the EEA Agreement, which secures equal access to the EU internal market for Norwegian companies. Norway is in fact the EU’s sixth largest trading partner. Only the USA, China, Switzerland, Russia and Japan have more trade with the EU. Norway’s trade in goods and services with the EU amounts to more than NOK 800 billion per year. This represents a value that corresponds to almost half of our GNP.

But we are important to the EU in other ways as well, not least when it comes to energy resources. Two thirds of Norway’s oil production goes to the EU market, accounting for 15 per cent of the EU countries’ consumption. In 2003 about 690 million barrels of oil were exported from Norway to the EU. Norwegian gas accounts for 15 per cent of the total gas consumption in the EU. We are the most reliable supplier of such energy to the EU.

On top of this come our fish exports. Yearly exports to the EU of salmon alone are worth NOK 7-8 billion. Unfortunately, we are currently compelled to fight EU import restrictions that we consider clearly unjustified. The Prime Minister, the Minister of Fisheries and Coastal Affairs and I have repeatedly taken up this serious matter with the EU member states and with the European Commission. Now that the safeguard measures have been imposed, we have no alternative but to submit the case to the WTO. The salmon issue shows that Norway is still facing considerable economic challenges in its relations with the EU, in spite of the EEA Agreement.

Norway has taken a significant share of responsibility for common European interests. Through the new EEA financial mechanisms, Norway provides nearly NOK 2 billion a year to support social and economic development, mainly to the new EU member states around the Baltic Sea (Poland and the Baltic states). Proportionally, this transfer of funds to new member states is larger than what most of the “old” EU states are contributing. We are seeking to make some of these funds available to Ukraine through cross-border regional co-operation in accordance with the EU’s European Neighbourhood Policy. The new Ukraine is turning towards Europe and deserves our support.

Substantial Norwegian funds are also being used to prepare the Western Balkan countries for EU membership in the future. This year we are granting NOK 750 million support political, economic, and social development in the Balkan states. In addition NOK 271 million has been earmarked for measures to promote peace, reconciliation and democracy in Moldova, the Caucasus and Central Asia. The goal is that these regions, too, should turn towards Europe.

In addition Norway is making considerable efforts for the benefit of Europe in northwestern Russia, where we are spending more than NOK 200 million a year to support democratic and sustainable development. Through the Barents and the Baltic Sea co-operation and bilateral co-operation with the EU and EU member states, we wish to promote the further integration of Russia into European co-operation. In our efforts to achieve a greater European focus on many of the challenges and opportunities in Europe’s high north, the European Commission is an important partner, and the EU’s Northern Dimension initiative, an important tool.

The EU is the only organisation for European co-operation of which Norway is not a member. But precisely the EU is the most dynamic and the fastest growing of these organisations and the one that to the greatest extent sets terms for Norwegian policy. This paradox must continue to be a topic of debate, regardless of the political constellation in government. I fully agree with the Prime Minister’s observation in his New Year’s speech, where he said that “Europe and the EU are quite different today from what they were when we took a position on Norwegian membership in 1994”. He pointed out that the EU is no longer a western, but a pan-European organisation. When we once again, at some point in the future, have to take a position on Norwegian EU membership, we must all take this new situation into account, regardless of our basic standpoint.

I hope this conference will help to stimulate an active and open-minded debate on Europe.

I wish you every success with the conference.