Arctic: New Political Economy

The world is not becoming safer and the planet more secure and livable. Quite the opposite, in fact. And there are special places in this world, the most vulnerable and at the same time the most important. Here, nature is particularly sensitive; here, human beings, if they are not responsible, can cause irreparable damage to the habitat of all mankind. And it is in these fragile places that the cost of international cooperation, of states and people interacting, is so high. Even if they are competing in other areas and even if they are, let's say, engaged in war, they still need to look for points of interaction in these particularly significant areas and cooperate. The most important of these places is the Arctic. The weather kitchen of the Northern Hemisphere, the climatic and environmental barometer of humanity's shared malaise. And a place where countries simply must work together and negotiate. That is what this book is about, the Arctic and the directions of Arctic cooperation. Despite all the difficulties and conflicts, we have to look for solutions and propose mechanisms. That is what we are going to talk about. Over the past third of a century, the Arctic Ocean has reduced its snow dome by a third. The natural treasures of its waters have become more accessible, and the international cooperation in the region has become a rivalry. Dozens of countries have declared strategic interests in the high latitudes. And since there is no single international treaty defining the legal status of the Arctic, contenders have emerged for exclusive possession of promising pieces of humanity's "common heritage". I would like to highlight Norway's successes. The descendants of the Vikings were the first to increase their exclusive economic zone by 235 000 km², stopping just 600 miles from the North Pole a decade ago. And they believe they have enough reasons to expand further. The Russians are nervous. In 2010, the countries shared about 175,000 km² of the oil- and gas-rich waters of the Barents Sea, but failed to resolve the whole set of contradictions. And in the summer of 2022, there was serious discussion in the Russian State Duma about denunciation of this Agreement. Here we have a new border dispute over hundreds of thousands of “km2”. Not to mention other things! Perhaps the highest bets today for Arctic players are on the Lomonosov Ridge. Its length is about 1,800 km: from the Novosibirsk islands across the middle of the ocean to the Canadian island of Ellesmere. Experts estimate that about 100 billion tonnes of oil equivalent hydrocarbons are concentrated there. The very resources that humanity is planning to abandon by switching to "green energy". Russia has applied to have part (1.2 million km²) of this luxury declared its own. Several expeditions have collected evidence that the ridge is an underwater part of the Siberian Platform. And, basically, the scientific world agreed with the continental origin (fifteen million years ago), but... Canada has put forward its own version. The mountains hidden by the ocean are indeed a sunken part of the continent… But in the Canadian version, it is not Eurasian, but North American. Accordingly, ownership should be in favour of North Americans. The Canadian hypothesis is also fully shared by US geopoliticians. However, the Kingdom of Denmark intervened in the dispute. Academics at Her Majesty Margrethe Alexandrine II are trying to justify that this hydrocarbon treasury is a giant spur of Greenland… Strangely enough, China has no claim to the Lomonosov Ridge, even though it is located on a wreckage of the ancient continent of Arctida . From all the countries concerned, it was the Celestial Empire that officially asked the Arctic states to take into account the priority of availability of international waters when establishing new continental shelf boundaries. And initiated informal negotiations on long-term lease (ownership) of large coastal areas of the Arctic Ocean with Icelanders, Norwegians, Canadians, Danes, and Russians. China has firmly taken over the world lead in terms of the pace of investment in the Arctic. Its state and private capital is the driving force behind many of the largest northern projects. From mining and logistics to scientific projects and tourism. In any case, sectoral control of the Arctic is fading, and global warming is making the region accessible and even comfortable for navigation, resource extraction, and even tourism. Hence the increased interest in the Arctic Circle, which is drawing more and more states and private corporations into the competition. And then there is the Russian-Ukrainian conflict, which entered a critical phase in 2022 and which, with the speed of a viral infection, entraps everyone, both near and far. In this book, together with my colleagues from the Planetary Development Institute (Dubai), I have tried to present in an accessible form one of the possible and feasible, provided the political will exists, ways of peacefully resolving the contradictions around the tightening "Arctic knot". The solutions I propose are the result of more than a decade of work in finding economic and political instruments to solve global, above all, environmental problems.