The Baltic Institute of Finland contracted EFIS Centre to support the methodology development for a high-level interregional smart specialisation (S3) value chain (VC) mapping in the Baltic Sea Region (BSR) for the area of circular bioeconomy (CBE). Drawing on the questionnaire (circulated for completion to 16 BSR regions from 7 BSR countries) as well as on secondary sources, this report provides analytical insights on value chains in a selected focus area and fosters motivation for the mobilisation of BSR interregional effort in S3 collaboration. Value chain mapping is defined here as an analytical and visual tool that helps understanding how a particular innovation ecosystem is organised spatially, as well as size wise and direction wise. Overall, the lack of investment and collaboration mechanisms between key matching infrastructures (e.g. biorefineries) appears to be the most serious challenge in CBE development as identified by the BSR regions. Nevertheless, it seems that it is moderately difficult to mobilise financial support for investments/projects in the area of CBE, notably for smaller companies in earlier stage development. These answers may suggest the need for a more targeted funding line to support the emergence of stronger collaboration mechanisms among the key CBE infrastructures. The challenges related to slow establishment of a stimulatory framework for the new bio-based industries which allows introduction of products from new value chains based on biomass, waste and side stream conversion and issues related to new skills for CBE implementation are noteworthy aspects to take into account in the design of inter-regional support measures. Furthermore, the reality of the region is one of fragmented markets in which CBE faces issues related to the economies of scale. Hence, improving overall supporting conditions for CBE development in the BSR should be a priority. Moreover, the survey analysis suggests that the needs for new data and their better overviews are increasingly prioritised given the complexity of CBE value chains. The mapping of specialist expertise in relevant technologies, as well as identification of leading firms across CBE value chains in BSR are particularly highlighted. Gaining more fine-grained data and better intelligence on the complex cross-sectoral field like CBE should be supported by joint BSR collaboration mechanisms. Only a minority of the BSR regions seem to have placed an emphasis on digitalisation as an accelerator of CBE. New data and digital opportunities may aid the improvement of value chains by helping to identify the missing links or potentially beneficial new links e.g. new products emerging from biomass that was previously defined as waste or new industrial symbiosis connections among previously unrelated industries. Data generated from digitalisation is a promising avenue of how to foster the interlink of the highly complex CBE value chains across the diverse BSR regions.

Study funded by the INTERREG Baltic Sea Region Programme (2014-20) project BSR S3 Ecosystem. See https://projects.interreg-baltic.eu/projects/bsr-s3-ecosystem-214.html