Business adapts more quickly to changing times than politicians update their policies. Climate change is no different, as a burst of activity in the Arctic attests. Melting has cleared large ocean stretches of ice for much of the year. This is opening up new shipping lanes as well as prospects for resource exploitation in a part of the world that only years ago was deemed too inhospitable.
The Yong Sheng is the first Chinese cargo ship to try travelling from Dalian in northeast China to Rotterdam by the Northern Sea Route – the Arctic waterway that follows Russia’s northern shore. Commercial traffic along this path is only in its fifth season but its growth has been explosive. In 2009 and 2010, a handful of tankers took the route; in 2011 and 2012, three to four dozen. So far this year, Russia has granted permission for nearly 400 passages.
The route’s attraction is clear. It shortens the distance between the port cities of Rotterdam and Yokohama by 40 per cent compared with journeys via the Suez Canal. The Yong Sheng’s journey will take 35 days rather than 48 for the southern route. Such time-saving will benefit trade between Europe – still more than a quarter of the world’s economy – and the factories and rising middle classes of Asia. This will not produce only winners: it may delay the “reshoring” of production back to Europe, at least in bulky goods.
The access won from the receding ice allows more than just shipping goods through. It also opens a new frontier for prospecting and possibly exploiting subsea natural resources. For now, the scramble for resources remains polite. That may not last if discoveries run ahead of proper rules of the game.
These opportunities therefore also come with big challenges. Shipping and resource exploration pose safety and environmental risks. The Arctic remains one of the harshest places on earth. Given the damage the Deepwater Horizon blowout caused in the more benign climes of the Gulf of Mexico, the case for imposing the highest standards in the Arctic is self-evident. Efforts must similarly be made to defuse conflicts over competing claims to control of resources or shipping lanes.
Fortunately, some of this is happening. In 2010 Russia and Norway settled a four-decade dispute over their border in the Barents Sea. The Arctic coastal states have built institutions such as the Arctic Council to co-ordinate their policies. But much work remains to be done.
U.S. non-ratification of the UN Convention on the Law of the Sea is unhelpful. So is Canada’s disputed claim to the Northwest Passage as internal waters. Collaborating on common binding rules will do more for 21st-century economies than will the zero-sum game diplomacy from the 19th.Report Typo/Error