China looks to the Arctic to cut shipping time and costs

In May the Arctic Council agreed  to expand to let in six new nations as ‘observer states’,  as the changing climate opens the Arctic to increasing economic and political competition. The council, formed in 1996, is made up of the eight Arctic nations: Canada, Denmark, Finland, Iceland, Norway, Russia, Sweden and the United States. The 6 nations granted observer status to the Arctic Council are China, India, Italy, Japan, Singapore and South Korea.. Although their role is mostly symbolic, their status as observers means they don’t get an official say in policy making. However, for China in particular, it was the culmination of years spent trying to gain a foothold in the region.

As the consequences of climate change in the Arctic continue to unfold the council has matured from a largely symbolic organization to one addressing the quickening pace of environmental change. With the Arctic ice melting, the region’s abundant supplies of oil, gas and minerals have become newly accessible, as have shortened shipping routes and open water for commercial fishing, setting off a global competition for influence and economic opportunities far beyond the nations that border the Arctic, prompting what has already been called a new “Great Game.”

China’s main interest is in ‘The Northern Sea Route’, which is rapidly becoming viable during longer stretches of the summer, allowing ships traveling from Asia to Europe to traverse the Arctic in far less time than they would on the traditional route through the Indian Ocean, the Suez Canal and the Mediterranean.

In 2010, only four ships carrying 111,000 tons of cargo made the northern passage; by last year, 46 did, carrying 1.26 million tons. Last year, China’s icebreaker Xue Long, or Snow Dragon, traversed the Northern Sea Route through Russia‘s territorial waters, accessible because of the receding sea ice.

Chinese shipping companies were left “greatly encouraged” about using the Northern Sea Route after the last year’s landmark trip of the Xuelong, or Snow Dragon, icebreaker. The icebreaker became the first Chinese vessel to complete a voyage cross the Arctic Ocean.

The three-month mission, led by Huigen Yang of the Polar Research Institute of China based in Shanghai, took the vessel from the Pacific Ocean to the Atlantic via the Arctic.The trip came as part of Beijing’s program to expand its presence in the Arctic region, opening new shipping routes as the icecap melts.

This summer, officials have said China plans to send a commercial vessel on a similar voyage, to test whether shipping shortcuts across the Arctic are financially feasible. By 2020 China hopes to transfer up to 15% of the country’s international trade through the Arctic.

The Arctic route will save China a lot of time and money. In comparison with the route through the Suez canal the Arctic route allows China to shorten the travel distance between Shanghai and Hamburg by 5200 kilometers saving time and money.

Oil will presumably be one of the commodities China’s ships will carry. Since 2003, it has invested billions of dollars in developing Canada’s tar sands south of the Arctic Circle, and in March it signed a deal with Russia that allows it to look for energy reserves in the Barents Sea. China’s half of the bargain is to double the amount of oil it buys from Russia. “It’s fair to say China will drive development of Arctic resources,” says Malte Humpert of the Arctic Institute in Washington DC. Russia exports three-quarters of its oil but since the American fracking boom, the US is no longer a customer – so without China, this oil may have stayed in the ground. “This deal is a sign of things to come,” Humpert says.

Ultimately, the Arctic is so fragile that any country could get it wrong, says Charlie Kronick of Greenpeace. While China’s need for oil may escalate drilling operations, he believes it’s a good thing that China and others are adding their voices to the Arctic Council’s decision-making process.

Sources include The New York Times, The New Scientist, rt.com

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With around 90% of the world’s trade being carried on the waves, shipping is essential to the world’s economy. Freight and shipping contracts (commercial, merchant and military) are huge international businesses. Whilst ships may be able to cross international waters with ease, communication sometimes has greater difficulty; the international nature of this industry means that language barriers can exist.  The range of international regulations and limitations is vast, and can be overwhelming, and the coordination of logistics can be difficult. At TJC Global, our expert linguists can offer shipping translation to accommodate all your language requirements.

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