As global warming is accelerating the melting of the Arctic sea ice, the competition of the Arctic nations over the predominance of this highly strategic polar region intensifies. This historically low-tension territory is the theatre of significant economic interests, new maritime routes and ongoing military buildups.
The Arctic Council held on May 20 its 12th ministerial meeting in Reykjavik, Iceland. The meeting saw the passing of the two-year chairmanship from Iceland to Russia, hence bringing the spotlight to this high-stake region of the world.
The Ministerial meeting marked the Arctic Council’s 25th anniversary. On this occasion, Arctic Indigenous organizations met with the foreign affairs ministers of Canada, the United States, Denmark, Norway, Sweden, Russia, Finland and Iceland to agree on a strategic plan that emphasizes peace, stability and cooperation.
For the past two years, Iceland’s chairmanship mainly focused on the people and communities in the Arctic, strengthening the Arctic Council, the Arctic marine environment, and the climate and green energy solutions. While Russia’s chairmanship will continue Iceland’s initiatives, they will also introduce several new projects that will revolve around the environment and sustainable economic growth.
As the Arctic Council actively encourages collaboration and cooperation, national interests and geostrategy can’t be ignored.
The changing Arctic climate and its impact
Scientists are observing that the Arctic sea ice is retreating faster than expected. According to Greenpeace, in the span of the past 30 years, the areas of the Arctic sea ice that melted are the size equivalent of Denmark, Norway, and Sweden combined.
The Geophysical Research Letters published in the American Geophysical Union’s (AGU) journal revealed that the Arctic would be ice-free in the summer, as soon as the 2030s.
“The Arctic is warming at three times the average rate of the planet. It stands out as the most rapid change,” said University of British Columbia climatologist and tundra researcher Greg Henry.
“That is largely because of what’s called the ‘albedo effect’ and the albedo is a measure of the reflectivity of the surface,” Henry said. “The sunlight hits the snow and ice and most of that light energy is then reflected up into the atmosphere. That mirror is one of the reasons that the Arctic is changing so much reflected up into the atmosphere. That mirror is one of the reasons that the Arctic is changing so much.”
Arctic warming also leads to an increase in global climate, which results in rising sea levels around the world.
The undeniable consequence of the Arctic’s environmental changes is the opening of new trade routes and lucrative industrial and commercial opportunities.
A competition for high economic stakes
The WWF Arctic Programme has estimated that up to US$1 trillion could be invested in the Arctic in the coming decades.
Arctic countries are dedicating enormous amounts of money into the region to take advantage of its economic opportunities.
Mining activities in the Canadian Arctic provide copper, diamonds, gold and zinc. The mining operations in the Russian Arctic provide nickel, platinum, tin, diamonds, copper, apatite and gold.
According to the Resource Development Council, Alaska’s mining industry produces zinc, copper, lead, silver, coal, gold, and construction materials like gravel, sand and rock. In 2019, the Alaskan mining industry spent $225 million on development and $162 million on exploration.
The ice melt of the Arctic opens up exploration of gas and oil. The region holds 30 per cent of the world’s undiscovered natural gas and 13 per cent of undiscovered oil.
Large offshore gas and oil programs are taking place in Norway and Russian arctic territories. In January 2020, President Putin announced $300 billion of incentives for new gas and oil ventures north of the Arctic Circle.
In addition to natural resources and fossil fuel development, the Arctic is opening maritime shipping routes and waterways.
The Northern Sea Route, located along the Russian coast, could shorten several maritime routes. Experts estimate that this new maritime route could cut the current journey from Japan to Europe through the Suez Canal by 40 per cent.
In January 2021, a freighter used the Northern Sea Route and got through the ice for the first time.
Between fossil fuels, natural resources, and maritime routes, economic opportunities in the Arctic are substantial. However, some business activities such as commercial fishing exist but are tightly regulated until scientists conduct more research and the knowledge is made available.
In addition to the investments of the eight Arctic states, a global power that cannot be ignored is China.
China is a non-Arctic state, but the Arctic Council approved the Asian power as an observer to the council in 2013.
In order for China to become a more powerful nation globally, the country has secured natural resources, oil and gas around the world. China’s growing interests in Canadian and European oil, gas and mineral deposits have led to astronomical investments.
The Center for Naval Analyses has revealed that between 2005 and 2017, China had invested $1.4 trillion in the economies of Arctic countries. These investments are mainly in infrastructure and the minerals and energy sectors.
China’s strategy is to get involved in infrastructure and natural resource projects from start to finish. Its growing foothold in the Russian Arctic brings them slowly to the forefront of leading countries in the Arctic.
Russia vs NATO: The rise of military buildups
The Arctic region has a long tradition of cooperation and low tension. But various new factors affect the region’s geopolitical environment, hence causing each Arctic state to defend its interests.
The dynamics between the Arctic States created two poles. The first pole includes five Arctic countries that are members of NATO – Canada, the U.S., Norway, Denmark and Iceland. Russia embodies the second pole.
The Russian Arctic stretches over 53 per cent of the Arctic coastline. It represents 24,150 kilometers. Its inhabitants account for 50 per cent of the Arctic population worldwide: 2.5 million people.
According to the Center for Strategic and International Studies, the Arctic is a strategic priority for Russia. The Kremlin has taken actions to improve military technology and to strengthen military presence to defend territorial integrity.
“Russian Arctic is far more developed than the Canadian Arctic, and therefore it’s not surprising that they’re going to have a larger military presence,” explained Paul Robinson, a professor of public and international affairs at the University of Ottawa.
As Russia is enhancing its homeland defense, NATO is increasing its military presence in northern areas.
Striking the right balance between competition and cooperation
Although still filled with uncertainties, the melting Arctic is a region where nations can balance cooperation and competition. Environmental solutions require ongoing collaboration and communication, but other topics spark competition and confrontations.
As maritime routes open up and natural resources are more accessible, the Arctic nations and other world powers increase their presence in this geostrategic region.
The Russian chairmanship of the Arctic Council will create in the years to come, new dynamics between the nations that have economic and military interests in this polar region.