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International relations

China's Arctic plan spreads a chill

'Polar Silk Road' challenges existing northern power balance

With a lot of fanfare, China has expanded its flagship Belt and Road Initiative to a vast swath of new territory far removed from the Middle Kingdom -- the Arctic.

A detailed white paper last month outlined plans for a "Polar Silk Road" that would link Asia to Europe across the frozen far north. As has been widely noted by governments and commercial companies alike, climate change has led to melting ice caps that will open shipping routes and make the extraction of natural resources easier.

Since 2013, China has been one of 13 countries with observer status to the Arctic Council, an intergovernmental group with eight permanent members with Arctic territories, including Russia and the U.S.

But Beijing will not be satisfied with a watching brief. In the white paper, China referred to itself as a "near-Arctic state." It spoke about "a shared future" in the Arctic and its interest in "peace, stability and sustainable development," echoing the rhetoric of the wider Belt and Road Initiative.

Existing Arctic powers, led by the U.S., should take care. Given China's militarization of the South China Sea, its Arctic intentions are raising a broad disquiet, particularly within the international defense community. "China's increasing activity in the Arctic has been met with concern that it may lead to a significant redrawing of the region's geopolitical map," Niklas Granholm of Sweden's Defense Research Agency recently noted.

The 21 million sq. km. Arctic is the Earth's most unknown and underdeveloped region. Its future will be determined by climate change, trade routes and resources and geopolitical rivalry among key powers China, Russia and the U.S. Within this, China has three specific areas of interest.

The first is the opening of northern shipping lanes that climatologists estimated will be free of enough ice by 2050 to enable shipping companies to set reliable cargo delivery deadlines. Chinese shipping companies have already taken a lead conducting ice-breaking tests in the Arctic and estimating voyage schedules.

The second area involves resource exploration. The U.S. Geological Survey estimates that the Arctic holds 30% of the world's natural gas reserves and 13% of its oil. Scientists from various regions agree that the more the ice melts, the more accessible these resources will become, and China wants its share.

Third, to achieve all this, China needs long-term reliable partnerships because it lacks direct land and sea access to the Arctic. At present, its preferred partner is Russia which has lodged a massive territorial claim with the United Nations for 1.2 million sq. km of sea shelf that extends 650km from its shoreline.

Russia needs technology and investment to exploit these resources. Its reliance on China has increased since the 2014 Russian takeover of Crimea from Ukraine triggered Western sanctions.

The massive natural gas project on the Yamal peninsula in the far north of Russia stands as a striking example of the challenges. Well inside the Arctic Circle on the wild, frozen and remote estuary of the Ob River in western Siberia is one of the world's biggest and most complex resource extraction projects.

Temperatures fall to below -50C and intricate engineering is needed to stabilize the shifting permafrost. The area is so inaccessible that Russia is developing a fleet of tankers capable of sailing year-round to break up ice packs up to 2.5 meters thick.

Western sanctions against Russia stalled investment in the region from U.S. companies, prompting Russia to reach out to China for engineering help and loans; in return, Chinese concerns have received a 39% share of the Yamal project and access to natural gas supplies with 50.1% held by Russia's Novatek and 20% by France's energy conglomerate, Total.

Throughout history, national ambitions revolving around trade and resources have invariably molded strategic and military planning. China's expansion in Asia has been no exception.

China quietly began implementing its claims to the South China Sea 30 years ago by putting up makeshift shelters on the Spratly Islands. Back then, Sinologists pointed out that Beijing's was pursuing a long-term plan to protect its southern coastline by controlling these shipping lanes and creating a "Great Wall of the Sea." But the issue received low diplomatic priority until recently and Asia is now confronted with the reality of new military island bases.

A similar pattern in its very early stages may be emerging in the Arctic. China is stating plainly that it will "pursue its own interests" there while paying "due regard" to the interests of other countries.

One indication of Beijing's intentions concerns the economically weak but territorially vast Arctic land mass of Greenland. The defense and foreign policy of this strategic North Atlantic island is controlled by Denmark. In recent years, the Danish government has stopped some Chinese investments in Greenland out of fear that they could be used to manipulate and bolster a growing independence movement. There are worries that should Greenland win independence, China could gain a dominant influence as it has done with Asian countries such as Cambodia and Laos.

Meanwhile Russia has been building or modernizing military bases throughout the Arctic since 2012, around the time China began its South China Sea island building. Russia has now created a similar area of control on the western edges of its Arctic territories, known as its "bastion of defense," that stretches out along the northern Scandinavian coastline into the north Atlantic.

In strategic terms, this raises the possibility of Russia and China controlling the eastern and western gateways to the Arctic which could impact trade routes within both the Atlantic and Pacific regions.

Much depends on the degree to which Russia and China wish to secure a future long-term partnership that inevitably will be regarded as an anti-Western alliance. Beijing's Arctic white paper suggests that China plans to hedge its bets.

There are substantive differences between Beijing's relationship with Moscow now and the ill-fated anti-Western Sino-Soviet alliance of 50 years ago that collapsed due to mutual acrimony. This time the Sino-Russian alliance is not ideologically driven nor primarily anti-Western. Rather, it is based on pragmatic material transactional needs, with China having the upper hand.

Having roundly rejected international judicial rulings and objections from the U.S. and its Asian neighbors for its South China Sea policy, it is noteworthy that China is now relying on the global rules-based system to stake a claim to the Arctic.

Global rules

The Polar Silk Road white paper contains no fewer than 10 direct references to the point that Arctic development must be governed by the United Nations Convention on the Law of the Sea. Many other references emphasize the importance of international law.

As it expands further from home, Beijing may be treading more carefully. It suggests that China would prefer to take a middle path and forge a practical alliance with Russia while not alienating Europe and the U.S.

China appears to be approaching the Arctic issue in a clever manner. As with the South China Sea, it has put down markers and made clear what it wants.

The U.S. and its allies can learn much from Asia. Thirty years ago, the West had a clear advantage in the region, but the military alliances with Japan, South Korea, the Philippines and others have not been robust enough to deter China's maritime expansion. Nor has the Association of South East Asian Nations been cohesive enough.

The West has a similar advantage in the Arctic of which the critical institution is the Arctic Council. Seven of its eight permanent members are developed democracies. Four are members of NATO, and the Nordic states, in particular, have long experience in international mediation and conflict resolution.

NATO is already focused on Russia. Now, the strictly civilian Arctic Council needs to be molded into an institution robust and flexible enough to ensure that international law is upheld. A strong Arctic Council and NATO firepower should be enough to ensure that the hegemony creeping into Asia, does not reoccur in the Arctic.

Humphrey Hawksley is an Asia specialist. His next book "Asian Waters: The Struggle for the South China Sea and Strategy for Chinese Expansion" (The Overlook Press) will be published in June.

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