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International relations

Arctic emerges as collaboration hot spot for Japan and Russia

Joint projects bloom as China and other nations eye fast-changing region

TOKYO -- The Japanese government is accelerating efforts to collaborate with Russia on developing the Arctic region, with hopes that joint projects in shipping and natural gas exploration will push forward talks for a bilateral peace treaty.

In the latest development, Japanese and Russian officials met on Dec. 18 accompanied by members from the private sector to discuss economic cooperation. The two sides signed off on having Japanese trading company Sojitz and airport operator Japan Airport Terminal participate in the construction and operation of a passenger terminal at Khabarovsk International Airport in Russia's Far East.

This follows an October visit by Japanese Foreign Minister Taro Kono to Reykjavik, Iceland, where he became the first Japanese cabinet minister to take part in the Arctic Circle Assembly, a gathering bringing together an international assortment of government officials, business leaders and academics.

"Geographically, Hokkaido, our northernmost island, is a gateway from Asia to the Northern Sea Route," Kono said in a speech, referring to the Arctic sea lane which has recently opened up during warmer months due to the melting ice. Passing through the Arctic would shorten shipping times and cut fuel costs for shippers, compared with routes using the more traditional Suez or Panama canals.

"We see potential opportunities for this route and I will encourage more Japanese companies to pay attention to Arctic businesses," Kono said. Discussing Japan's determination to help in building an "Ideal Arctic," Kono said Japan will contribute to scientific research on climate change and sustainable economic use of the Arctic, as well as establishing free and open northern seas.

Japanese Foreign Minister Taro Kono speaks at the Arctic Circle Assembly in Reykjavik, Iceland, on Oct. 19.   © Kyodo

The possibilities inherent in developing the Arctic have captured imaginations across the globe. Five countries with coasts along the Arctic Sea, including Russia, the U.S. and Canada, have been actively developing the region in the name of national interest.

China calls itself a "near-Arctic state," citing the fact that conditions in the Arctic have an impact on the country's climate, agriculture, fishing and forestry. In January it issued its first ever white paper regarding plans for the Arctic and unveiled plans to construct a "Polar Silk Road" as part of its larger Belt and Road infrastructure initiative.

South Korea is urging marine shippers and other companies to head north.

"Japan, China and South Korea are all permanent observers to the Arctic Council," Damien Degeorges, a Reykjavík-based international consultant, specializing in Arctic affairs said. The council is a high-level intergovernmental forum that addresses issues faced by the Arctic governments.

"They are trying to get more and more involved in the Arctic, notably through high-level bilateral contacts with Arctic states. Russia is a central actor in the Arctic and major economic developments are ongoing in the Russian Arctic, so it makes sense for Japan to have a cooperation with Russia," Degeorges said.

When Russian President Vladimir Putin met with Japanese Prime Minister Shinzo Abe during a September summit in Vladivostok, Putin touched on development cooperation in the Yamal Penninsula in northern Russia. The Russian leader said he seeks to advance bilateral ties based on economic cooperation between the two nations. The two sides inked around 10 cooperation agreements, including liquefied natural gas development in the Arctic.

For Russia, the Arctic represents a key region in terms of economic vitality and national security. The northeastern shipping route in the Arctic Sea overlaps with Russia's maritime exclusive economic zone. The area surrounding Yamal is said to contain over 20% of global natural gas reserves.

Novatek, Russia's largest independent gas producer, is soliciting cross-border investments for its LNG platform project. This dovetails with the Russian government's appeals for foreign investment. For Japan, the opportunity to develop gas fields would help stabilize and diversify energy procurement.

In November, Japan's government-backed New Energy and Industrial Technology Development Organization, in partnership with Russia's Sakha Republic and other parties, began pilot operation of wind turbine generators that utilize Japan's cold-resistance technology. The demonstration project is part of the eight economic cooperation projects Abe proposed to Putin.

Many observers think that economic collaboration in the Arctic will serve to accelerate negotiations toward a final peace treaty between Japan and Russia, bringing closure to an issue dating back to World War II. Abe aims to reach a broad agreement concerning a group of contested islands, in addition to a peace treaty, when he meets Putin on the sidelines of the Group of 20 meeting in Osaka next June.

The polar region also represents a strategic location in terms of regional security. Russia is ratcheting up deployment of military hardware in the Arctic. China is developing ports around the world, which some believe could be converted to military use in the future. The Russo-Japanese cooperation hints at a desire to push back against Chinese expansion.

Nikkei Asian Review Chief Desk Editor Ken Moriyasu in New York contributed to this report.

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