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A Seaway to Hell or an Economic Miracle of Melting Arctic?: The Northern Sea Trade Route

The journey took only 22 days, 30% quicker than Suez Canal Route. It was significant, indeed, as it drew attention once again to how far Global Warming issue has gone to, while at the same time introducing the world to a new sail route “too economically efficient to ignore”.

Discovery of new trade routes has always triggered a turnaround in world history. Take the Age of Discovery, Silk Road, Building of Suez Canal… All have shifted paradigms of their times after those new economically and practically feasible trade routes were discovered. Discovery of Northern Sea Trade route, however, comes by as a warning rather than new streams of wealth and geopolitical power.

While the average temperature of the Arctic has increased 2.3°C since the 1970s and is warming at a rate of almost twice the global average, both the extent and thickness of Arctic Sea ice has declined rapidly over the last several decades. Even if in winter the situation looks more stable at first glance, summer sea ice has almost disappeared, threatening the lives of various marine creatures and Arctic wildlife. As it warms up, both shipping traffic and oil drilling moves to the North, multiplying the effect of global warming by spilling waste, uplifting CO2 emissions and changing the life patterns of sea creatures with noise pollution.

It is not a coincidence that we often see the news recently, shouting out “New oil reserves are discovered in the Arctic.” or that we come across tour ads on Facebook offering “Northern lights tour for €400”. Or have you ever wondered why Iceland has become a very popular touristic destination recently? Changing climate creates its own economy not only in trade and drilling but also in tourism. Finland’s Lapland Region has seen double-digit tourism growth in recent years. Enhanced accessibility and more feasible conditions lowered the costs of doing any business within the Arctic. As companies deal with less ice and cold along the way, previously unprofitable businesses like oil drilling or budget tours in the Arctic becomes easier to offer at competitive prices.

It is, of course, inevitable that such a game-changer exploration will have political implications. Russian President Vladimir Putin plans to invest tens of billions of dollars by 2030 to develop shipbuilders, navigational aids, and ports along the Northern Sea. No wonder why the Russian Ministry of Transport expects a tenfold increase in cargo on the route by 2025. As Russian coast geographically forms the biggest share on the trade route, China is certainly not keen on giving up their economic share. Beijing government, a loyal customer of Russian gas already named the new trade route asThe Polar Silk Road”. They have promised a 12 billion dollars of investment in the Yamal Peninsula, known as the “gold mine” for Arctic Oil. Yamal is known as the epicenter of Russia-China Arctic strategy. Not only because lower cost of drilling and transport will provide cheaper gas to Northeastern China, but also because it has the potential to undercut the costs of major energy exporters like the United States, giving Russia a higher share in the liquified gas market. Even so, Washington seems to pose a wait-and-see attitude in this matter. Through many channels, US government stated that Arctic Trade Route should be “a corridor open to the entire world community” rather than “an exclusive economic zone for Russia”. Even so, as expressed by some high-ranking officials, US Armed Forces still do not intend to conduct operations in the Arctic regarding the freedom of navigation. Still, it is not easy to assume how much time the US government will stand being left out of the game in this “Polar Silk Road”. China is already running the Belt and Road Initiative and Suez Canal Economic Zone is a part of the Silk Road Economic Belt. Billions of dollars of Chinese investment on infrastructure, port building and creating new economic zones shape the area considerably already. China, now constructing also the other colder side of the world would render them as the sole dominant party in the world economy by 40 years.

A report from the Copenhagen Business School in 2016 found out that shipping through the Northern Sea Route would become economically feasible in about 2040 if the ice cover continued to diminish at its present rates. SO Russia and China will have to wait until then to get the real outcomes. Even if political and economic implications are on the way, environmental concerns are already a matter of discussion. As Whit Sheard of the Circumpolar Conservation Union (CCU) put it: “Common sense regulations, integrated ocean planning, and explicit protections are all needed before the resources of the region are targeted for exploitation or before it becomes a major shipping route.” Apprehension on environmental spillovers mainly includes ship waste being pumped to the sea, noise pollution coming stemming from the ship engines and the threat of populated urban-like local premises which grow year by year as idle locals around the Arctic begin to increase fishing and hunting practices to serve ships passing by. No doubt that this will hike the population of those villages and increase the demand for home, food, clean water etc, spoiling this peaceful area even more.

Taking a glance at our history, it has always been the case that as humanity exploited more of the world’s resources, they got more scarce and more expensive. Then humanity started looking for more in various other geographies and routes that never belonged to any country in the first place. Wars occurred to claim ownership, new orders were formed, meanwhile, deformation in the nature has always been turned a blind eye on. And now, countries wowing how sustainable they are by signing the Kyoto Protocole or Paris agreement do not show any reluctance on benefiting global warming instead of tackling it. Perhaps we should admit the fact that economic profits have always been more important to us than environmental spillovers, even after years of increasing consciousness and numerous protocols that were signed with countless words that were given. In the end, I cannot help to think; “when the time comes where we will start facing the dramatic effects of global warming in our daily lives, will we spend our resources  to tackle it, or will we look for new ways to still profit from it?”


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