The shockwaves from Russia’s invasion of Ukraine have reached across the world – all the way beyond the Urals to the globe’s northernmost point. The Arctic Council, established in 1996 as a forum for the eight countries that sit within the Arctic Circle – Canada, Denmark, Iceland, Finland, Norway, the US, Sweden and Russia – was in early March suspended for the first time since its foundation.
Citing Russia’s current holding of the two-year rotating presidency, the seven other members condemned Russia’s “violation of the principles of sovereignty and territorial integrity”, placing the council in “pause mode” and suspending its work. Russia’s own representative to the council has hit back, criticising Sweden and Finland’s applications to join NATO as endangering “high altitude cooperation” through the council.
Despite having grown from its original membership to include “near-Arctic” observer countries like Britain and China, the council had largely avoided becoming a proxy for conflicts in the 26 years of its existence. The Ottawa Declaration that established the council expressly banned the discussion of military matters and for a quarter of a century, the balance has held, with the council focused on civilian and scientific affairs. But as the climate crisis gathers pace, the political equilibrium within the council – itself a microcosm of the resource conflicts and territorial disputes that ecological decay is provoking globally – is disintegrating.
Arctic ice is fast retreating: summertime ice coverage is now down to 20% of its 1970s levels. This climate breakdown is creating three potential areas for interstate competition, threatening the uneasy cooperation that has governed relations in the Arctic Circle.
First, melting ice sheets are uncovering new sources for raw materials. Arctic oil and gas exploration and mining projects have grown rapidly in recent years, with 599 projects either already in operation or under construction and arctic oil and gas production forecast to grow 20% over the next five years. Western banks, estimated to have provided $314bn in financing for Arctic carbon projects, and western oil majors like France’s TotalEnergies and US-based ConocoPhillips are investing in projects alongside state-owned and state-backed companies like the China National Petroleum Company or China’s Silk Road Fund. TotalEnergies, for example, is investing in two giant Liquified Natural Gas (LNG) sites with Russia’s Novatek and Chinese state-backed investors in the Russian Arctic, Yamal LNG and Arctic LNG 2, expected to come on stream over the next few years.
Meanwhile, the Wall Street Journal has estimated that $1tr of rare earth minerals could lie inside the Arctic Circle. Ironically, accelerated efforts at decarbonisation are making this potential hoard increasingly valuable. Greenland is estimated to hold one-quarter of the world’s rare earth deposits that are essential to electric vehicles and wind turbines. A global push to switch to renewable energy is intensifying the battle to find new sources of rare earth minerals – not least, from the western point of view, because China presently controls 70% of known deposits. Inuit Ataqatigiit (IA) – the pro-independence leftist party elected to govern Greenland last year on an anti-mining ticket, banned uranium mining and has upheld an indefinite moratorium on oil and gas exploration in Greenlandic waters.
Second, as Arctic ice disappears, sea routes that were once impassable for much of the year are being opened up. On one side, the Northern Sea Route runs from the Bering Strait in the east to Kara Gate in the west, covering 2,500 miles along Russia’s northernmost coast. On the other, the Northwest Passage traverses the coasts of Canada and Alaska. As the Arctic ice retreats, these stretches of ocean transform into profitable transport routes.
Earlier forecasts suggested the Arctic routes would only become generally commercially viable by 2040, but a combination of faster ice melt and international competition is pushing for a faster rate of adoption. Cargo volumes along the Northern Sea Route have hit record highs, with traffic increasing 15-fold over the last decade – the majority being LNG, which is in increasingly high demand. Five years ago, virtually no shipping passed during the winter months; last winter an average of 20 vessels a day were making use of the route. Meanwhile, the first unassisted, icebreaker-free winter crossing of the Northeast Passage was made in 2020 by a Norwegian ship, shaving 3,000 nautical miles off the journey from South Korea to France.
Despite the climatic challenges, the appeal of shipping across the top of the world was put simply over a decade ago by Vladimir Putin: “The shortest route between Europe’s largest markets and the Asia-Pacific region lies across the Arctic.” The distance over the top of the globe from, say, east Asia to Europe is much shorter than the current route via the Suez Canal: around 3,000 nautical miles and 10-15 days shorter. The savings could be enormous: one estimate for China alone suggests $60bn to $120bn is at stake.
China’s interest in new trade routes is clear. 80% of its current oil imports come through the Malacca Straits between Malaysia and Indonesia, creating a potential pinch-point for a hostile power to close. Exports into Europe must travel through the Suez Canal, whilst those heading for North America face the Panama canal, controlled by the eponymous US ally. As the Ever Given’s blockage of the Suez graphically demonstrated, disruption to any of these chokepoints could threaten economic chaos.
Overcoming these hurdles is what is driving China’s vast investment into its so-called Belt and Road Initiative, a colossal system of new rail and road investments stretching across Asia and into Europe; the first cargo train from China arrived in the UK in 2017. The prospect of a new sea route, however, is too good to miss. The savings are enormous and China is already actively encouraging their use, offering detailed route guidance to shippers. Its 2018 Arctic Policy spoke of developing a new “Polar Silk Road” for the far North, and described China as a “near-Arctic state”.
China has been quietly building up its presence in the Arctic for years through a combination of direct investment and diplomacy. Iceland, hard-hit by the 2008 financial crisis, turned to China for economic support, becoming in 2013 the first European state to sign a free trade agreement with the country. China funds research at Reykjavik’s universities and Chinese investors have entered talks for two new deepwater ports on the island, intended for trans-shipment off the new Arctic sea lanes.
China won observer status at the Arctic Council in 2013. New icebreakers have been built and China has commissioned “ice-capable” patrol boats. China’s developing interests in Greenland have provoked Denmark to publicly express its concern, whilst Russia – although cooperating with China in the development of Arctic gas fields, notably in the Yamal liquified natural gas refinery on the Siberian coast – has strongly opposed the use of foreign icebreakers on the Northern Sea Route (although February’s joint declaration by both countries committed them to “intensifying practical cooperation for the sustainable development of the Arctic”). Lithuania has delayed investment by China in the port of Klaipeda, a gateway to the Northeast Passage, citing its NATO membership and the alleged danger to national security.
Like the Suez Canal of old, whoever controls the route will control an essential artery of the reshaped capitalist world economy. And, like the Suez, the Great Power scramble is turning into a growing military presence that threatens future conflict.
The third and final potential conflict area also arises from the Arctic’s prime geographical location. Positioned at the shortest possible distance between the globe’s two major landmasses, the Arctic has long been ripe for militarisation. Cold War listening posts at Skalgard in Norway and Keflavik in Iceland were long since established to monitor the movements of the Soviet Union, subsequently Russia’s, Barents Sea submarine fleet. In recent years, both Russia and the US have been steadily increasing their Arctic military presence.
Russia has reopened 50 shuttered Cold War military posts in its Arctic territory, including 13 airbases and 10 radar stations. It has tested Arctic-ready hypersonic cruise missiles and nuclear-powered undersea drones, with Pentagon officials publicly voicing concern about its northern “avenue of approach” to the United States. Russia’s Northern Fleet, made up of nuclear subs, battleships and amphibious landing class alongside icebreakers and troop support, has been reinforced in the last decade, forming the centrepiece of Russia’s 2017 Arctic Strategy.
On the other side, NATO completed its biannual exercises in Norway’s Arctic last month, with 30,000 troops involved – the largest since the end of the Cold War. The UK’s defence minister Ben Wallace has pledged further troops for the far north, meeting with the Norwegian defence minister in early April. Britain’s nuclear submarines have docked in a Norwegian port for the first time as part of their regular patrols. Norway’s military participated in the biennial Mjollner exercises in the high north for the first time in May, alongside the armed forces of Denmark, Belgium, Netherlands and Germany. Canada, meanwhile, is expanding its Arctic military presence, including the purchase of two new icebreakers and 88 fighter jets.
The push from Finland and Sweden to join NATO should be put into the context of an intensification of military activity in the Arctic, with their potential entry leaving Russia as the only non-NATO nation in the region. And the title of the new US Army strategy for the region, published early last year, makes the intention plain: ‘Regaining Arctic Dominance’ proposes a “rejuvenated” Arctic land force to operate alongside an expanded navy and airforce.
What most of us would think of as a monumental tragedy – mass extinction, the destruction of indigenous communities, the loss of an irreplaceable natural wilderness – is merely another step in capitalism’s shaping of the world. From the “unification of the world by disease” to the creation of a monoculture food system, the capitalist system has from its earliest days reordered and then adapted to the environment it exploits. The ongoing redivision of the Arctic is one more step in a centuries-long process of competition and exploitation. Capitalism won’t end the world, but it will reshape it. Resistance to that process, like that being mounted by Greenland’s indigenous ecosocialists in government, is the fundamental political requirement.
James Meadway is an economist and Novara Media columnist.