The heads of the Arkhangelsk Region and the Nenets Autonomous Area signed a memorandum on joint preparations for submitting an initiative on forming a new region in the Russian Federation. It would be one of the world's largest northern regions. To quote the memo, it would be "Russia's single powerful outpost in the Arctic, which would be able to resolve strategic goals on creating a center for economic development in the Arctic and northern territories, advancing science and consolidating the country's defense capability."

The main goal of the merger is to speed up the socioeconomic development of these territories and increase the living standards of the population. The document also confirms that all benefits and economic guarantees would be preserved.

The Nenets Autonomous Area is an independent area but is legally part of the Arkhangelsk Region. The regional head is elected by Nenets Autonomous Area's legislative assembly whereas the governor of the Arkhangelsk Region is elected directly.

"We must draft and adopt decisions for which our children will thank us. We need to leave them a territory that is prosperous and promising, a land with enormous economic potential. We have the opportunity to make this decision and it would be a historical event," Arkhangelsk Region Governor Alexander Tsybulsky said.

According to the constitutional law governing the creation of new constituent entities within the Russian Federation, the regions themselves must initiate the creation of a new region in Russia. Their parliaments and governors submit a proposal to the president who then informs the federal parliament and the government. Then the issue is submitted for a referendum in the affected regions. If the vote is positive, a law is adopted. It determines the name, status and borders of the new region, as well as transitional provisions.

Working groups will conduct hearings with the public and the regional expert community and accept proposals from local residents. A single commission would coordinate the drafting of the merger agreement. It would consist of equal numbers of representatives from the Nenets Autonomous Area and the Arkhangelsk Region. It would be co-chaired by their acting governors.

The final decision will be made by local residents in a referendum that will tentatively be held on the nearest election day, September 13, 2020. If the majority supports a merger, it could be come into force by mid-2021. The transition period would last for two years.

As Acting Governor Tsybulsky emphasized, both jurisdictions agreed to start full scale public discussions on merging the regions. "We hope that the majority of local residents will take part in this discussion. If they consider the proposal feasible and promising, we will plan for a merger. The decision must be made by the open expression of will in a referendum," he said.

In turn, Nenets Autonomous Area Acting Governor Yury Bezdudny also emphasized this idea: "It's up to the people, and we'll do this as openly as possible."

The current economic situation is one of the main reasons to merge. The area of the Arkhangelsk Region is 2.3 times bigger than that of the Nenets Autonomous Area, and its population is 25 times larger. According to Rosstat, in 2017 the domestic regional product of the Arkhangelsk Region (without the Nenets Autonomous Area) was 467 billion rubles and that of the Nenets Autonomous Area was 276 billion rubles (about 1.7 times less). Direct dependence of the Nenets Area budget on oil prices is also an important factor.

The same idea was expressed by Nenets Autonomous Area Acting Governor Bezdudny: "The economic situation that has taken shape in the Nenets Autonomous Area can only be described as catastrophic. Some 90 percent of its budget revenue is derived from the oil industry. The area directly depends on the price of oil. In today's conditions of the mounting international economic crises, there is almost no hope for a miracle… <…> Meanwhile, we have enormous commitments to the local residents. These are guarantees, benefits and subsidies that we must provide. But the truth is that by and large we won't be able to fulfill these commitments by July 1 <…> We are actually standing on the edge of the abyss. We will either fall into it along with our people or find a way out. Which is it? We will merge the economies of the Nenets Autonomous Area and the Arkhangelsk Region."

In turn, Mr. Tsybulsky suggested approaching the issue without emotion. He emphasized that historically the two regions have been close. "Today, we took part in the state commission meeting on developing the Arctic. I can tell you we haven't seen such interest in developing this region since Soviet times. The role that the state is assigning to the Arctic shows that there are very serious prospects for developing the Arctic. The two Arctic regions have a lot of potential. But separately, each of them will always lose a ‘global battle or a competition for the resources being allocated today. By pooling our resources and suggesting the creation of such a large and powerful region, we would create the most important Arctic territory in the country and attract public and private investment. This would allow us to improve the living standards of our people."

The creation of a bigger region in Russia's Arctic has its own logic in today's domestic and international realities. In perspective, it could legally fix the geo-economic reality — the coast of the White Sea and the eastern part of the Barents Sea would form a single coastal zone on the Northern Sea Route. The new strategy for the Russian Arctic through 2035 also requires integrated measures on developing the coastal territories and offshore areas, which is only possible if the resources of Arkhangelsk and Naryan-Mar are united. A uniform policy of comprehensive government could also help resolve certain problems caused by the differences in regulating issues of traditional management of mineral resources and production of marine bio-resources. In addition, participation in international projects on cooperation in the Arctic as a unified region may produce a multiplier effect. It would attract investment, upgrade the skills of the working force that would master new business practices and would allow the region to promote its interests at international venues.

There are several options for the name of the new region — the Arkhangelsk Region, the Arkhangelsk Territory or the Northern Territory, to name a few.