Treasure Hunt in the Arctic

China has just signed a free trade agreement with Iceland and Chinese Premier Li Keqiang declares along with Icelandic president Johanna Sigurdadottir that this will: ”…further deepen their mutually beneficial co-operation in the fields of trade and investment…”
Mutually beneficial, really?
China has 1,354 billion inhabitants that can buy Icelandic fish. The size of the Icelandic population is 0.002 percent of that.
It´s a population so small it needs an app to make sure people don´t sleep with their cousin.
Now, of course Iceland has something else to offer besides free trade: Its´ all-of-a-sudden perfect location in the middle of the Arctic, these days coming to live with the warming up of the oceans.
Only last autumn the first ships managed to make it to China through the Arctic waters – no longer frozen most of the year and next summer there will be a regular Chinese shipping route here. This will cut the time and the cost for shipping Chinese goods to Europa by half.

In exchange for selling its fish on the enormous Chinese market, Iceland also signed several agreements on cooperation over different Arctic issues and promised to support the Chinese ambition to take place in the Arctic Council.
Like the agreement of the 15th of April says:
“Iceland reaffirmed its support for China’s application for observer status in the Arctic Council. The Chinese side expressed appreciation for this support.”

Lucky timing here, the Arctic Council is to vote on applications for observer status for a number of applicants next month.

Now, the Arctic Council is open strictly for countries in the Arctic region so observer status it will have to be but China feels it is a near-Arctic state so the Chinese are going for a ´permanent observer status´ so as not having to mix with the other 26 observers without any say in Arctic matters.

In case the permanent observer thing doesn´t work out, a Chinese company has bought land on Iceland, perfectly located for a shipping marina for passing ships but intended according to the buyer as a tourist resort for Chinese tourists.
China has also promised to help Iceland drill for oil in waters close by.
The Arctic region is believed to have the largest remaining oil and gas reserves in the world, only now surfacing because of the melting ice.
It also has large deposits of rare minerals.

Iceland is very grateful to China. Should this Arctic Council ambition not work out, Iceland – just the other day, lucky timing again – created a brand new assembly dubbed the Arctic Circle, to give non-Arctic countries like China, India and Singapore a forum for influence in the region.

And just in case that is not enough, China is investing heavily in Canada forged a “strategic partnership” with Arctic-Country Denmark only last year and sends its Prime Minister on a rare visit to current-Arctic-President Sweden a few weeks before the crucial vote.

It makes sense for China to try and secure the Arctic region for its commercial interests. But what about the European position in all this, you ask?

Well, do you remember the European position in the 1990s when the US courted European capitals and offered bilateral deals for their national airlines? The European Commission argued that it should negotiate for everyone so as to get the best agreement possible from a position of strength.
The EU countries in question were of the opposite view; they should negotiate their own deal, by themselves. Which they did.

With the Arctic it´s the same story over again.

The European Commission has been asking for a permanent observer status in the Arctic Council for five years but in spite there being three EU members in the Arctic Council (Denmark, Finland and Sweden), the request has been denied so far.
Canada seems to be against granting the EU an observers´ status in the Arctic Council on account of the EU banning seal hunting.
Russia is just against in general.

The US is also against and lobbying the EU countries within the Arctic Council, saying that having the EU onboard would undermine their national interests.

The EU does not have millions of euros to turn hesitant countries into allies like the Chinese can.
All it has is the hope of European solidarity prevailing.
Slim hope.




  1. #1 by jon livesey on April 16, 2013 - 9:45 pm

    “The EU does not have millions of euros to turn hesitant countries into allies like the Chinese can.”

    Don’t be so foolish. The EU is all about spending billions of euros to influence the policies of countries. 95% of the EU budget consists of “transfer payments”.

    • #2 by Bastian on April 16, 2013 - 11:06 pm

      Right, and without these payments many countries would not opt for membership. It is this which makes the EU so fragil.

  2. #3 by Artiom on April 19, 2013 - 12:43 pm

    jon livesey and bastian. can you give me some examples of spending money by EU to influence the policies of countries. thank in advance

  3. #4 by Marit Sandtrø on April 20, 2013 - 5:36 pm

    As Nilsson correctly points out, EU was denied observer status in the Arctic Council because EU has banned seal hunting. It was the AC members Canada and Greenland, which is not a EU-member, who refused to take on EU as observer. Seal hunting is an important part of the livelihood, tradition and culture of the Inuit peoples in the two countries. By banning seal hunting EU has also banned itself from becoming an observer as it is not fulfilling two of several demands observers must take into account:
    - Recognize Arctic States’ sovereignty, sovereign rights and jurisdiction in the Arctic.
    - Respect the values, interests, culture and traditions of Arctic indigenous peoples and other Arctic inhabitants.

    It should be quite obious that EU should not even be thinking of applying for observer status until it has lifted the ban on seal hunting. And by the way, EU is not synonymus with Europe, Europe is much much more and completely different than the EU, which is creating unbelievable havoc in Europe. Implying that an EU position is the same as an European position is simply Newspeak. There are presently six European countries with observer status in AC, and many more are applying. The Arctic Council would probably be much better off without the arrogant, unelected and increasingly dysfunctional EU-elites.

    Marit Sandtrø