Beijing is approaching the polar riches
Material posted: Publication date: 14-06-2013

In recent years, more and more countries begin to allocate the forces and means for the analysis and assessment of the situation in "the great Arctic game". Near-polar region attract primarily the possibility of using sea routes for the transportation of cargo on the route Europe-Asia, and mineral resources.

China is the world's largest consumer and importer of energy, but to its great geographical distance does not allow him to directly apply for equal position in the region in comparison with the countries of the Arctic Council, which includes Denmark, Iceland, Canada, Norway, Russia, USA, Finland and Sweden. However, Beijing has found a way to achieve the desired, using detours. Every year a considerable riches of the Arctic are becoming more accessible due to global warming and retreat of the polar ice caps farther North.

According to estimates from the U.S. Geological survey, the oil reserves in the Arctic are 13 percent of the undeveloped world total, natural gas 30 percent, and liquefied petroleum gas — 20 percent. In quantitative terms it is 90 billion tons of oil, of 1.67 trillion cubic meters of gas and 44 billion barrels of liquefied natural gas. The commercial component of the transportation of goods across the Arctic compared with the route through the Suez canal also looks economically attractive. In August and September 2009 the first foreign ships passed along the Northern sea route — two bulk carriers and Foresight Fraternity of the German company Beluga Shipping Group transported the goods for the CHP in Surgut.

A year later the Arctic passage was used by four vessels. In 2012, 46 vessels transported along the Northern sea route more than a million tons, increasing the volume of cargo transportation by 53 percent compared to 2011. Researchers estimate that by 2020 Sevmorput will be transported for 50 million tons of cargo, which proves the attractiveness of the route for private carriers. And in the long term commercial potential is in the North-West passage in the Canadian Arctic archipelago.

Assessing the opportunities, China is the first Asian States began to get into full members of the Arctic Council. In Beijing hold the view that the Arctic ocean is the common area for shipping. In addition, it argued that climate warming will negatively affect food security of the country, in particular, will increase the threat of floods in the coastal regions, where the main acreage.

In this context, China began to devote considerable attention to studies of the Arctic and Antarctic. From 1985 to 2012, Beijing initiated five Arctic and 28 Antarctic expeditions, opened its own Arctic research station "yellow river". In addition, the Finnish shipbuilders will deliver by 2014 a new icebreaker in addition to the "Snow dragon", bought in 1993 from Ukraine. Chinese representatives participate in the work of the International Arctic science Committee, the project "international polar year" and other organizations and programmes involved in study of the Arctic in terms of climate change and environmental protection.

At the moment, Chinese actions in the Arctic clearly show that Beijing is trying to disguise its true interests in the region, issues of environmental monitoring, protection of Arctic animals and care about the indigenous population. The rhetoric of Beijing are aimed at positioning the Arctic as an international zone, changes in which affect all countries. In China point to the fact that climate change threatens global security.

Along with France and Germany, China is not without reason believes that the repetition in the Arctic of an oil spill, similar to the scenario with the 2010 disaster in the Gulf of Mexico, would entail catastrophic consequences for all countries of the world. This is why China spends annually on polar research 49 million euros, is building the Shanghai centre for the study of the North and increased the number of scientists involved in polar issues, five times, up to 1,000 people. Sometimes, however, Beijing allowed a number of researchers to suggest in the press that China does not intend to accept the current distribution of power in the region. The most significant event in the controversy, which speaks about the ambitions of Beijing in the Arctic race, is the naming of the PRC "colorchecker government". This term is already firmly established in the lexicon of Chinese researchers, who study the Arctic.

However, such a bold name provoked ironic reactions of the German newspaper Spiegel. The publication noted that if you follow the logic of the Chinese Ambassador in Norway, who said that China is alloactions government, since a large part of China reaches 50 degrees North latitude, and the German island of Sylt, located on the 54th latitude, must also be considered alloactions. The current position of the PRC looks rather cautious, given the close attention the US and Canada to Russia's actions in the region (publication of the new Arctic strategy, combat duty with the Russian air force and Navy in the border area, setting a flag at the North pole in 2007), which are regarded as a manifestation of aggression. In this regard, Beijing is likely to leave the image of the threat of the player Moscow, and he will maintain the image of a peaceful country and will focus on neutral topics: sponsoring expeditions to study climate change, support social and economic development of the local population, combating environmental pollution and tourism.

Having a strong position in the above areas, China will have the opportunity not only to accumulate knowledge of the international scientific community and to provide solid arguments in support of theories about the impact of melting Arctic ice in China, but also cooperate with organizations representing the local population and with the status of permanent members in the Arctic Council. It will allow China to lobby for their interests in the Council not directly, but using a special channel, which has already proven itself as an effective.

The scientific controversy needed by China to achieve the true objectives in the Arctic, and they lie in the economic sphere. First of all, is the diversification of the main transport routes. As is known, the main channel of supply to China — the Strait of Malacca is unreliable because of piracy and is a potential target for terrorists. In this regard, the Arctic sea route will allow China, first, to reduce the costs of transportation, secondly, to obtain additional trade route, thirdly, to reduce risks of closure of the Strait, the U.S. Navy in the event of a potential conflict.

Aware of the vulnerability of China's exports is already a former Chairman of the PRC Hu Jintao. According to Chinese analysts, by the year 2020 through the Northern sea route will take place from 5 to 15 percent of Chinese foreign trade. According to the Norwegian transport company Tschudi Shipping Company, transporting goods across the Arctic from Kirkenes or Murmansk to Shanghai will allow you to shorten the route for 16 days.

Increasing consumption is forcing Chinese companies to invest heavily in the extraction and transportation of oil, for example, from Africa and Brazil. In this regard, the predictions of the deposits of natural resources in the Arctic encourage China to be active in this matter, not to be on the periphery of big politics. So, the Chinese national petroleum Corporation (CNPC) became the third partner of "Rosneft" (along with Italy's Eni and Norwegian Statoil) in the development of fields West Prinovozemelsky (Barents sea), South-Russian and Medyn-Varandey (Pechora sea).

Obviously, in addition to access to new oil fields and oil supply, China will try to and modern drilling technology, which he had at the moment.

The second strategic resource in importance after oil and gas is iron ore. China has agreed with Greenland, starting in 2015, together with London Mining Sinosteel Corporation and China Communication will produce 15 million tons of iron ore from the mine isua and in the case of receipt of the contract for the field development Kvanefjeld (Kvanefjeld), China in the face of the state-owned Inner Mongolia Baotou Steel Rare Earth will only strengthen its position in the market as a leader.

The third element in the economic strategy of Beijing in the Arctic will be the desire to part of the marine resources of the region, in particular, fish. While the main operators of the offshore catch are Greenland, 90% of export of which falls on the fish, and Iceland (33 percent). At the same time, this trade brings Norway and Russia only six and one percent respectively. But these volumes are significant in absolute monetary terms. For example, in 2011 Norway has received $ 1.8 billion from the sale of cod and $ 4.8 billion — from the sale of salmon.

China is actively developing bilateral economic relations with small member countries of the Arctic Council, to ensure his support in the vote on permanent membership. This tactic worked effectively in the Asia-Pacific region, where China lobbied for a free trade zone with ASEAN in the framework of the organization and building a stable investment relations with individual States, which in 2010 led to the desired result. With regard to the Arctic, in may 2010 Denmark and China have signed agreements worth 740 million dollars in the areas of energy, green economy, agriculture and food security. In 2008, China provided Iceland currency swap on 406 million euros to support the banking system.

As a result, in 2011, the Danish Ambassador to China expressed support for granting China permanent observer status. A similar statement was made by the Prime Ministers of Greenland and Iceland. In January 2013 at the Arctic Council meeting in tromsø, the representatives of Sweden and even Norway (despite the scandal with the award of the Nobel peace prize to dissident Liu Xiaobo) has also expressed the desire to discuss China's role in the organization. These efforts were crowned with success. May 15, China has been granted observer status, however, along with potential competitors: India, Italy, Japan, South Korea and Singapore.

Additionally it should be noted that the policy of China in the framework of financial assistance to small countries in the region will enable Beijing to participate in the development of infrastructure, which is vital in the case of year-round operation of the sea route through the Arctic. We are talking about creating ports, ship repair workshops, transport hubs (for example, Ísafjörður in Iceland) and rescue centers. On the near - and medium-term Chinese foreign policy strategy in the Arctic will pursue exclusively pragmatic goals, because at stake is not only the economic welfare of the country, but the image of China as a potential world leader. While the debate will deal exclusively with the influence of warming on Chinese environment and food security, and openness of the Arctic world, Beijing systematically and purposefully continues to develop economic dependence on China small Arctic countries (for example the signing of the agreement on free trade area with Iceland) with the aim of sharing on full-fledged place in the Arctic Council.

In addition, costly projects to develop new oil fields in the Arctic mean the need to attract investors, which opens up the possibility of China's presence in the region and guarantee energy supplies. However, in addition to Beijing will have to negotiate with Moscow on favorable tariffs for the transit of ships and not to forget about competitors. Recently intensified efforts to study the investment attractiveness of the Arctic sea route, Japan and Singapore — the most powerful player in the field of construction of ports.

Arthur Guschin


Tags: assessment , strategy , Arctic , resources , China