Changing tides in Scandinavia–Israel relations

Scandinavians no longer fear the implications of economic ties with Israel.

December 9, 2017 21:02
4 minute read.
The flag of Denmark

The flag of Denmark. (photo credit: REUTERS)

The delicate framework of political relations between Israel and Scandinavia is slowly witnessing a turnaround as the countries involved begin to recognize the potential that lies in the economic sector.

Derisive declarations are out and joint ventures are in.

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Scandinavians are in favor of increasing free trade with Israel, particularly in the field of technology. On the political level, there is mutual mistrust, but fast-growing trade ties between the countries have forced Scandinavians to unravel their criticism of Israel and recognize her unique contribution to the region.

In recent years Scandinavian countries, which continue to be among the largest contributors of foreign aid to the region, have not reaped the benefits of this monetary assistance.

More importantly, as boycotts between Arab states and Israel are replaced by increased economic cooperation, Scandinavians no longer fear the implications of economic ties with Israel.

Growing trade ties between Israel and some Arab countries, which have publicly expressed their cooperation with Israel, have changed the Scandinavian strategy. Simultaneously, relations between Scandinavia and Israel, once characterized by mutual suspiciousness, have transformed as Scandinavia has reached the unequivocal conclusion that every currency invested in Israel yields large returns.

In the eyes of many Israelis, Scandinavians typically view the region from a very narrow perspective. But in recent years that view has changed based on Israel’s position, which is characterized by extraordinary technological innovation.

Scandinavian countries value a gradual increase in investment in research and development, and they identify a pioneering spirit in Israeli entrepreneurs that no longer focuses solely on exporting agricultural grain.

Norwegians lead this sympathetic policy toward Israel. They recognize a common interface between the two countries, which were able to establish close ties thanks to the Norwegian government’s position.

Today, Norway’s state oil fund indirectly invests in more than 80 Israeli companies. Norway and Israel have also agreed to collaborate with research groups through the Norwegian Research Council, the Horizon 2020 Eurostars program and Israeli investment funds.

This is not coincidental, as Norwegian ambition and Israeli innovation have created an important interdependence in recent years. One result is the increased rate of trade between Norway and Israel, which has grown by nearly 30%. From the Israeli perspective, Norway is an attractive partner, mainly in the field of renewable energy, which also promotes technological cooperation.

The Norwegian foreign minister, who has visited Israel several times, has also shown growing interest in nanotechnology, nanomedicine and natural gas. Likewise, the University of Stavanger and the Israel Institute of Technology have been cooperating in research on gas technology and Norwegian lecturers are teaching Israeli students interested in integrating into the gas industry in Israel. Recently, the Norwegian University of Science and Technology has been considering similar cooperation with Israeli research institutions.

Scandinavian governments are well aware of the successful cooperation between Scandinavian and Israeli hi-tech companies that have taken place.

Some Danish companies, such as Novo Nordisk and Grundfos, are prominent examples of this cooperation. The Israeli development centers of leading global technology companies contribute to the Scandinavian societies that have decided to operate here.

Consequently, it is not by chance that Denmark decided to open an innovation center in Tel Aviv and to examine broad cooperation, including through investment funds.

The Danish trade minister, who recently visited Israel, was accompanied by a business delegation interested in increasing exports and cooperation with Israel in entrepreneurship, life sciences and digital health. Some Danish officials explained that Israel is one of the world leaders in the field of science and innovation.

The visit was a further step by Denmark, which promotes cooperation between Israeli research institutes and Danish universities in a variety of areas, among them smart solutions in the water industry. Denmark believes that Israel is adept at implementing and commercializing knowledge quickly and efficiently from academia to industry.

Furthermore, Sweden looks enviously at the warm relations that have developed between its Scandinavian sisters and Israel. Compared to Norway and Denmark, however, Sweden is conspicuously absent from the scene because of its controversial political considerations.

Nevertheless, cold relations between Israel and Sweden are making an interesting turnaround and new signals are being transmitted by both states.

The Swedish giant Volvo’s innovation center in Tel Aviv inevitably leads the Swedish government’s attention. The latest visit of the Swedish Minister for European Union Affairs and Trade Ann Linde shows that research centers and businesses are also interested in developing warm relations, mainly for commerce objectives. Israel can take a hardline position with Sweden, but must not close all possibilities for cooperation with her.

Even if it is difficult to expect a long-term rapprochement with Sweden, which conducts contradictory policy in the Middle East, it is likely that its interest in Israel will be increasingly aroused. Although Israel has ignored the appointment of the Swedish envoy to the Middle East and Prime Minister Netanyahu has refused to meet with the Swedish prime minister, the chances of a turnaround are increasing.

Israel may signal to the Swedes that they can strengthen economic ties by increasing political responsibility. Norway and Denmark, which show political restraint and refrain from belligerent behavior toward Israel, continue to improve agreements between their governments and the Jewish State.

If the Swedish government recognizes the economic need to break old habits and avoid unilateral decisions, it may receive a sympathetic ear in Jerusalem and promote regional cooperation that will contribute first and foremost to its foreign policy objectives.

The author is a Ph.D. candidate at Bar-Ilan University.

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