Is it more profitable to be friends with Russia instead of being antagonized?

By: Syrializm Analytics


While the Europeans, under the US mandate, are in conflict with Russia on the spheres of influence in the Arctic zone, China is quietly increasing its economic presence in the region.

The 5th International Arctic Forum held in St. Petersburg in Russia clearly demonstrated the absurdity of the situation in which European countries once again found themselves blindly obeying Washington’s command.

The St. Petersburg Forum has become a key platform for discussing the prospects for developing the Arctic zone and problems that are not getting smaller.

The main obstacle in this region is still the lack of precise borders of the Arctic and its sections belonging to the countries of the “Arctic Five”.

REFERENCE: According to experts, in the Arctic zone there are about 22% of all undiscovered hydrocarbon deposits of the planet: 30% gas, 20% gas condensates and 13% oil.

In accordance with international agreements, the Arctic is conditionally divided into five sectors of responsibility between the United States, Russia, Canada, Norway and Denmark.

However, for a number of objective reasons, the exact boundary of the Arctic has not yet been determined.

According to the 1982 Convention on the Law of the Sea, the water area of ​​the state covers only the Arctic shelf, while the outer zone is international.

The coastal waters for 12 miles are considered territorial, and the economic area is the 200-mile zone along the coast.

It is possible to expand its economic zone by proving that this territory is an extension of the continental shelf?

One of the most important events of the forum was the promulgation of a preliminary decision adopted on April 3 by the UN subcommittee recognizing the geological affiliation of a part of the Arctic (currently under the water of Mendeleev and Lomonosov ridges) to the continuation of the Russian continental shelf.

The final decision on this issue may be taken at the regular session of the UN Commission in the summer of this year, but already now it can be assumed with a high degree of confidence that the Arctic territories of the Russian Federation will increase by 1.2 million square kilometers of the shelf.

Russia has a rich experience in the development of the northern territories, which guaranteed to her the presence of the world’s largest icebreaker fleet, economic infrastructure and, importantly, a powerful polar group of troops, the promises of the Russian authorities to move the global center of oil and gas production to the Arctic by the middle of the century seem feasible.

What will Europe have from this?

At a meeting in St. Petersburg, the Russian President Vladimir Putin invited partners to take part in Russian and joint projects to develop the Arctic, develop and produce hydrocarbons, and preserve the unique Arctic ecosystem, and promised potential investors various preferences.

“To increase investment in the Arctic region will use all the tools to support investment, tax incentives, a simplified procedure for the provision of land and much more”, Putin said.

Alas, the promising invitation of business in the Arctic is still ready to take advantage of only far from the polar latitudes, China, which in recent years has demonstrated an increasing skill in making profit.

The interests of China in the Arctic zone are quite explicable, and they are by no means solely in the strategic reserves of hydrocarbons, for which Beijing, allegedly, doesn’t claim.

Much more economic and geopolitical benefits promise “Celestial” new transport arteries.

The Northern Sea Route, which runs along the Russian Arctic, turned out to be one and a half times shorter and much more profitable than the traditional routes connecting Asia with Europe.

Global warming made it possible to increase the season of navigation and, quite naturally, China, the world’s largest exporter of goods, declared its readiness to invest serious money in this area.

The countries of Europe are still quite wary of the quiet expansion of China in the Arctic, and Russia, apparently, is not thrilled by the emergence of such a powerful “partner” in the economic zone, much of which it considers sovereign.

But, in conditions when anti-Russian economic sanctions do not allow, first of all, the Europeans themselves, to participate in large Arctic projects, the Kremlin is simply forced to use the financial resources provided by China to create and develop the necessary northern infrastructure.

So, for example, a new large plant for the production of liquefied natural gas on the Yamal Peninsula in Siberia, put into operation at the end of last year, is one-third funded by Chinese investors.

It is China that is today also Russia’s largest partner in supplies through the Northern Sea Route.

That is, while America is building up its military contingent in Norway, let it talk about the “universal identity” of the Northern Sea Route, Russia is building new icebreakers and introducing increased transit fees to use the route.

While the European Union, led by the United States to fight, is expanding the list of anti-Russian sanctions, which are detrimental to the economy of Europe itself, China is investing in the Russian Arctic, declaring itself a “near-arctic power” and plans to build a “polar silk road” here.

While the countries of the North Atlantic Alliance are curtailing their social programs to provide funding for “containing the growing influence of Russia in the Arctic”, Russian scientists are conducting research that allows them to maintain control over the new strategic territories of the Arctic.

What results directly for the Europeans will lead such a policy – time will tell. According to some leaders, it is not too late to rethink their positions in the development of the Arctic and establish a constructive, mutually beneficial dialogue with Russia.

“We want all other countries to join us in order to stand together for a sustainable and peaceful future for the Arctic,” Guðni Jóhannesson, the President of Iceland said on the eve of a business meeting with his Russian counterpart.

As a reminder, in May of this year, Iceland will head the international Arctic Council and in two years it will handed over to the Russian presidency.