China needs to be more active in the Arctic

The United States, Russia and the Nordic countries are using their expertise and expediting efforts to derive maximum benefits from the developments in the Arctic. To match their pace, China has to deepen its participation in traditional regional activities such as transportation and resource extraction, and focus on new emerging markets in the Arctic.

Transit cargo and container deliveries to Europe through the Northern Sea Route fit perfectly with the concept of the Belt and Road Initiative, but China has to put in more efforts to make the interested parties actually take part in the initiative.

China and Russia, on the other hand, should analyze more precisely the practical transportation models (transition hubs, liner container shipping or just general cargo transit), solve the problem of navigating through icebergs and frozen seas, exchange weather and navigation charts and data, and conduct more test voyages to reduce uncertainties in the shipping sector in terms of navigation period, vessel types and the tariff system. Solving these problems will give Chinese shipping companies an edge in competition vis-à-vis their Japanese and Republic of Korea counterparts, which are strongly focused on a new transit corridor.

Additional investments in Russian and/or Nordic offshore oil and gas deposits would become lucrative assets in the long run for Beijing, as they will allow it to gain technological know-how, acquire resources and become a bigger player in regional development. Also, capital outlay will form a basis for joint infrastructure construction in the Arctic－whose financing can come from the Silk Road Fund－and add a northern dimension to the Belt and Road Initiative.

Moreover, the Arctic contains a wide variety of minerals and forest resources along with hydrocarbons that can serve China's industries and help it to shift the focus to "circular green economy", as practiced by Nordic countries.

The Arctic is becoming a region where pioneer sophisticated technologies will play a central role and create new markets in the mid term. These technologies include autonomous unmanned vessels, remote-piloted vehicles, marine robots, drones, small-scale liquefied natural gas projects, cruise yachts and research vessels, blockchain operations and offshore "green energy". Rather than being a dream, such technologies can be implemented in the not-so-distant future given the recent breakthroughs made by private companies in Norway, the US, the United Kingdom, Denmark and Finland, which include Rolls-Royce and IBM. Japan and the ROK are also eager to gain competitive advantage by increasing their financing for research into self-navigating cargo ships, which they aim to develop within 13 years.

The development of new technologies takes time, so Beijing should form work groups in these sectors to increase efficiency. The Gaofen satellite network that includes the first fully-China-owned foreign satellite ground station in Sweden is a good example of Beijing's understanding of and vision for the Arctic.

Besides, smarter collaboration between scientific research groups in top Chinese universities and industries could help fulfill the national goals in the Arctic. And an increase in research funds will help Chinese researchers keep one step ahead of their counterparts in other countries to foresee the challenges as well as opportunities.

The author is a visiting scholar at Fudan Development Institute and a researcher in Arctic at Akvaplan-Niva (Norway).