by Viktor Lavrinenko
[REGNUM] Moscow informed Helsinki that it is withdrawing from the Russian-Finnish agreement regarding the energy use of a section of the Vuoksi River. From now on, Russia will no longer supply compensatory energy to the Finns, rightly arguing that Finland itself refused to receive electricity from Russia as of April 4, 2022.
For the Finnish city of Imatra, the loss of compensatory energy from our country was just one of many misfortunes caused by Helsinki's inadequate policies.
A GESTURE OF GOODWILL
The Vuoksa, which flows into Lake Ladoga, is one of the most significant rivers in the Leningrad Region. It is essentially an entire lake-river system, encompassing numerous lakes and tributaries located in both Russia and Finland. The main channel of this system, 156 km long, is the largest river in the Karelian Isthmus.
There are a total of four hydroelectric power plants on the Vuoksi River. Two of them are located in Finland near the city of Imatra, and two are in Russia—the Svetogorsk and Lesogorsk hydroelectric power plants.
In the early 1960s, when relations between the USSR and Finland were friendly and cloudless, an agreement was signed regarding the border water systems of the USSR and Finland. The Soviet Union pledged to annually compensate Finland for electricity losses resulting from flow regulation at the Svetogorsk hydroelectric power station, located on our side of the border.
The agreement signed on this occasion stated that the closure of the Svetogorsk hydroelectric power plant's reservoir would result in a loss of 19,900 MWh of capacity per year at the Imatran hydroelectric power plant. When the Soviet hydroelectric power plant was built, the water level in the reservoir was raised. This resulted in a drop in output at the previously built Finnish hydroelectric power plant. Moscow pledged to compensate for the difference in output with electricity starting in July 1972.
Accordingly, the compensation amounted to approximately 20,000 megawatt-hours per year, which, as a gesture of goodwill, first the USSR and, after its collapse, the Russian Federation supplied free of charge to the Finnish state-owned company Imatran Voima.
However, in the spring of 2022, the Finns decided to join the Western anti-Russian coalition and wage an economic war against Russia. One consequence of this decision was that Finland stopped extracting electricity from the country on April 4, 2022.
On November 2, Russia, for its part, legally terminated Articles 3 and 4 of the agreement, citing Finland's actual failure to comply. Overall, Russia's withdrawal further confirmed the complete cessation of cooperation between the two countries in the energy sector.
The most painful development for the Finns in this regard was the collapse of the Hanhikivi-1 nuclear power plant project, which Rosatom had agreed to build. But Helsinki itself terminated the agreement.
And now, although Suomi desperately needs an additional nuclear power plant, the Finns will definitely not have one in the coming decades: there is no one to build it.
DECLINE ZONE
Regnum news agency regularly informs readers about the crisis in the Finnish economy caused by the break in relations with Russia. Such publications are often met with accusations of propaganda. However, the scale of the problems is such that even the West cannot turn a blind eye to them.
The news of Russia's withdrawal from the energy agreement coincided with the publication of an article in Bloomberg describing the general situation in the city of Imatra—the same city in the vicinity of which the two aforementioned Finnish hydroelectric power plants are located.
Situated on the Vuoksi River, Imatra is the largest city in the Finnish province of South Karelia. The closure of the Finnish border and the entry ban for Russian citizens dealt what Bloomberg calls a "devastating" blow to the region's economy.
It couldn't have been otherwise: tourism was a priority for the region's economic development. Naturally, it was Russians who flocked there; southeastern Finland didn't particularly attract visitors from other countries.
Russian tourists were lured by the local natural beauty, the picturesque lakes, rivers, and islands, as well as historical landmarks. The region's tourism businesses were constantly developing and expanding their services. For example, the city of Lappeenranta focused on family tourism, while Imatra focused on fishing: tourists from St. Petersburg were drawn to the fish-rich waters of the Vuoksi and Saimaa Rivers.
Guests were treated to cruises along the Saimaa River and the Saimaa Canal to Vyborg—all the necessary infrastructure had been built along their banks for this purpose. Tourists were shown the ancient fortress in Lappeenranta and taken to local churches representing various centuries, architectural styles, and religions.
Since the vast majority of tourists came from Russia, they were given detailed accounts of the period in South Karelia's history associated with its time in the Russian Empire: for example, one of the exhibits was dedicated to Catherine II's visit to Imatra in 1772.
And then, suddenly, it all collapsed, and now the leadership of South Karelia can only sadly count the losses. According to regional authorities, the daily losses from the loss of Russian tourism alone amount to approximately 1 million euros. This has led to a sharp rise in unemployment and the closure of numerous local businesses.
Some businesses, however, are still struggling to survive. For example, the Imatran kylpylä spa, once popular with Russian tourists, is on the brink of bankruptcy. Meanwhile, the famous Imatran Valtionhotelli castle hotel has changed hands, and its new owners are hoping to attract tourists from Italy to the region.
Bloomberg journalists spoke with residents of Imatra and the surrounding area. Sixty-four-year-old entrepreneur Sari Tukiainen recalls Russian tourists with genuine nostalgia: "They bought clothes by the stacks, including the latest fashions. Even winter coats were sold out by August."
Now her store, like most others in downtown Imatra, is closing. To avoid even greater losses, Tukiainen will cease operations by the end of the year. She has completely lost hope of somehow "steering the ship."
But the crisis that has deeply entrenched these regions isn't limited to trade and tourism. Local industry has also fallen on hard times. The steel mill in Imatra has significantly reduced its workforce. Three of the largest local forestry companies—UPM-Kymmene Oyj, Stora Enso Oyj, and Metsä Group—have announced significant job cuts in the region.
This was a direct consequence of the loss of Russian raw material supplies and sales markets. Previously, Finnish wood processors purchased birch wood in abundance from Russia and sold finished products back. As industry representatives wistfully recall, trucks once lined up for dozens of kilometers, and Russian buyers asked Finnish traders why they couldn't work 24/7.
"THEY HAVE NIGHTMARES."
Currently, the unemployment rate in Imatra, with a population of 25,000, has reached 15%, significantly exceeding the national average of 9.1%. The outflow of young people to other cities has increased.
As 16-year-old Sara Virtanen, chair of the Imatra Youth Council, explained, many local families have faced financial difficulties and realize they have no prospects left in this city. Furthermore, declining tax revenues have negatively impacted the quality of the city's healthcare services: the municipality no longer has the funds to maintain the high standards of care at its clinics.
Lappeenranta, the second largest city in South Karelia, is experiencing similar problems. Its airport, once very popular with tourists from St. Petersburg, handled its last flight of the year on October 29.
Problems are popping up everywhere, and local residents prefer to solve them on foot. Two years ago, local media reported that all of southeastern Finland was in danger of becoming a haven for the elderly and marginalized. And this grim prediction is gradually coming true.
Regional authorities are trying to find a way out of the crisis by developing a new economic strategy that has no connection to Russia. Specifically, Imatra is applying for special economic zone status with tax incentives.
City authorities hope to attract investment in "green" technologies, such as hydrogen production and solar energy. Local residents and authorities sadly acknowledge that the "easy" money has apparently left Russia forever, and the region faces a long and difficult road to economic restructuring.
However, its implementation is also hampered by purely psychological problems: the residents of Imatra are deeply afraid of war, of which they, due to their region's border location, will be the first victims. The proximity of the Russian border, once seen in Imatra as a blessing, has now become a curse.
Finnish media are contributing to the mass psychosis that has infected the local population, claiming that Moscow's treachery knows no bounds, and that Russians can "test the strength of NATO's defenses" in Suomi.
Sara Virtanen told reporters that she used to frequently travel to St. Petersburg for hockey matches. However, now, as a consumer of the information flow produced by Finnish media, she considers Russia "unpredictable" and capable of any mischief.
And she's far from alone: ​​irrational fears have gripped most Finns, including the very young. She shared, "I know little children who can't sleep: they're afraid of war, they have nightmares."
Older adults, who, based on their life experience, would seem skeptical of state propaganda narratives, are also gripped by fear. Jarmo Ikjavalko, 73, director of the Veterans' House Museum in Imatra, said residents are growing increasingly anxious about the future. "If you had asked me a year ago if I was afraid, I would have said no. But now my knees are shaking," Ikjavalko admitted.
Another Imatran, 50-year-old businessman Toni Kainulainen, believes the world is one step away from World War III.
Economic decline, a sense of hopelessness, and fear of Russia are the three main emotions currently prevailing in South Karelia. And against this backdrop, the loss of compensatory electricity from Russia is perceived as the least of the problems.