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Home Archive April 2012 Issue Issue Content China's Quest for Arctic Access & Resources

China's Quest for Arctic Access & Resources

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China has become increasingly interested in the Arctic in recent years due to the melting of the polar ice-cap, and its own desperate need for energy resources and raw materials for its growing economy. Access to natural resources and shortened shipping routes has prompted China to look at what Arctic might provide. China is not an Arctic littoral state, has no Arctic coast, and as such neither sovereign rights over region’s continental shelves nor the resources that lay beneath them. Regardless as an emerging global power and permanent member of United Nations Security Council, it is expected to seek a role in determining this framework and legal foundations for the region’s future management. 
 
Figure1: Map of possible future shipping routes in Arctic
 
 
The changing situation in the Arctic has raised many questions and uncertainties about its future and could lead to new geopolitical challenges for both Arctic littoral states and non-Arctic countries. These issues are primarily related to free passage and resource extraction rights. To this end, countries across Asia, including China, Europe and North America are concerned with this transformation and its economic, territorial and geopolitical implications.

Due to the region’s spatial placement, the the trans-regional implications of competition, often spelled-out as another ‘Great game’,  these implications include increasing military activities especially from a Russian perspective. At present, border disputes do exist between Canada and Denmark regarding the rights over Hans Island in Nares Strait; Canada and the US, regarding a sea area in the Beaufort Sea; between Norway and Denmark, regarding the Exclusive Economic Zone (EEZ) of Spitsbergen; and between Norway and Russia which in the past concerned an EEZ in the Barents Sea which in fact has been resolved. 
 
There are three possible international routes through the Arctic:  1) the North East Sea Route or Northern Sea Route along the Russian coast (NSR), 2) Transpolar Route and 3) the North West Passage (NWP) through the Canadian Arctic archipelago. There is disagreement concerning the status of NWP which could considerably shorten the distance between Europe and Asia. The NWP is claimed as an internal waterway by Canada. In contrast, the European Union and the US identify the NWP as in international waters which they contend they have every right to sail across. In general, the potential NSR and NWP routes would substantially reduce the distance between Asia, Europe and North America.  
 
China’s commercial and strategic interests in the Arctic

China is extremely concerned and increasingly focused on the role of a changing Arctic. Primarily, China’s scope of research focuses on how the changing environment is effecting the country’s continental and oceanic environment and furthermore how such transformation will affect its domestic agriculture and economic development. However, at various levels government is being encouraged to actively get involved in the region and map the strategic opportunities the melting Arctic offers. China has not yet published any official strategy towards Arctic. However, their actions suggest a careful approach towards showing greater involvement in the region in order to avoid alarmism among polar states. In relation to the sovereignty debate.  China asserts that Arctic belongs to all people and the region is part of the ‘common heritage of mankind’. Vocalized or not, China’s strategic interest in the region is clear and the country is taking concrete diplomatic steps to ensure that it should be recognized as a key player in the region.

Changes in the Arctic will further increase territorial claims and border disputes between Arctic and non-Arctic states. China’s interest in the region is magnified by the fact that 46% of its GDP is shipping related and 85% of its energy imports come from abroad. China has no Arctic territories but does have appetite for its natural resources and is eager to utilize shortened routes. Different routes will be utilized depending on the origin of goods shipped and their destination. For example, LNG will be transported to Shanghai from the Barents Sea through Russia Northern Sea Route, German products will sail ‘over the top’, and Chinese exports to the Eastern US will make way through the NWP. The distance between Shanghai and Hamburg through NSR - along the north coast of Russia from Bering Strait in the and the Russian Arctic island Novaya Zemlya in the west - is 345 nautical miles shorter comparable to the route via the Strait of Malacca and the Suez Canal. 
 
In Chinese academic circles different voices are heard on how China should approach Arctic governance. Various Chinese researchers like Li Zhenfu, Xu Zhenwei, Guo and Xu Yuayuan, express an enormous sense of entitlement of the country towards the region and argue that China needs access over Arctic assets while insisting the country should not adapt a ‘neutral’ position as an outsider. In March 2010, a statement made by Chinese Rear Admiral Yin Zhuo revealed a sense of moral entitlement to access to the Arctic resources and sea routes and his concern that Arctic states might endeavor to restrict Chinese access “The Arctic belong to all the people around the world, as no nation has sovereignty over it [...] China must plan indispensable role in the Arctic exploration as we have one fifth of the world’s population” (Official China News Service, March 2010). China is asserting pressure to review and re-develop Arctic regulations due to changing circumstances.  They insist that Arctic issues are becoming inter-regional and that a balanced approach towards common interests should be adapted.
 
Figure 2: A Chinese view of Arctic Sea Routes

 
Note: ‘North East Sea route’ is red and the ‘North West Sea route’ is blue
Source: Chinese Arctic and Antarctic Administration
 
China is of course completely aware of the potential hydrocarbon resources and economically critical minerals in the Arctic region. According to US geological survey, the Arctic contains 30% of the world’s remaining natural gas and 13% of the world’s remaining oil reserves along with an abundance of other resources. Also, China recognizes the significance of new Arctic routes in ‘controlling new passages’ for its economic and international strategy, which refers to shortened sea routes, and the strategic military significance of the region.  Indeed, the increasing military importance of the region is reflected in several discussions made by littoral states in recent years to strengthen their military capabilities and overcome complex sovereign disputes in the region.

China and Arctic politics 
   

Due to the transformation of the Arctic region pressure from non-Arctic states like China and others is bound to increase and as suggested could escalate the friction between littoral and non-Arctic states. And, it is no wonder China is expected to expand its role as decisive power in the region’s management. China has had a permanent presence in the Arctic since 2004, when it established a research station - Huang He Zhan - in Svalbard, Norway, which is well inside the Arctic Ocean in the Barents Sea. Also, China already has the largest foreign embassy in Reykjavik, Iceland in expectation of Iceland becoming a major shipping hub. Further, China is reportedly planning three Arctic research expeditions over the next three to four years. The country has announced its intention to build a new 8000 ton ice breaker by 2013 which would be an addition to its current vessel, the Xuelong-Snow Dragon, in order to cruise the Arctic region to conduct various expeditions. Interestingly, no Arctic state possess a larger non-nuclear powered icebreaker than China.

China has also expressed its interest in obtaining permanent observer status in the Arctic Council. The Arctic Council has eight members states - Canada, US, Russia, Denmark (Faroe Islands and Greenland), Norway, Iceland, Sweden, and Finland. In addition, the Council includes six permanent observers, which are all European (France, Germany, Poland, Britain, and Spain) and ad hoc observer members, including Japan, South Korea, and China.

Before the Nobel Peace prize was awarded to Chinese dissident Lui Xiaobo in 2010, China and Norway had been actively improving their bilateral diplomatic and trade ties. In 2009, Norway together with Canada established formal bilateral dialogue with China and discussed various common interests including climate change, Arctic policies, polar research, energy issues, and shipping routes. In general, Norway’s position on China’s application for non-Arctic states to join Arctic Council was positive. However, since the Nobel Peace Prize was awarded in 2010 China-Norwegian diplomatic contacts have been largely been put on hold. China’s relationship with Canada is another important factor that will shape China’s future role in the Arctic as in 2013 Canada will hold the Chair of Arctic Council and will formulate its agenda over the next two years. So far, both nations’ relationship appears to be strong on both the diplomatic and trade fronts especially with respect to energy sector development and cooperation.

In summary, the Arctic region is constantly changing and polar coastal states should expect future geopolitical challenges as the new environment develops. It seems that conflict is now fermenting.  Arctic nations are alarmed regarding China’s position towards the Arctic; China’s economic growth and increasing military capacity building are further making Arctic nations suspicious about China’s interest in the region. A crucial question will be how to ensure a balanced approach and effective policies to confront the pressure from non-Arctic states that will arise as the Arctic is opened for oil, gas and mineral extraction, international shipping and other developments. There is no doubt that a melting Arctic provides a unique opportunity for China with its significant plans to benefit from possible sea routes and access to natural resources.  However challenges to these opportunities should not be underestimated. It would not be easy for China to sail through the NWP and NSP without clarification of the legal status of these passages (as one example).   There is a therefore a pronounced need to comprehensively understand all of the issues as interpreted by Arctic littoral states and non-Arctic nations alike.
 
Contributor Muhammad Makki is a PhD candidate at School of Journalism and Communication & Sustainable Mineral Institute, The University of Queensland, Australia.
 

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