2016-01-12 By Kenneth Maxwell

It is summer time in Brazil and until “Carnival” is over in early February the on-going political crisis, at last in Brasilia, is temporarily on hold.

Although the New Year rises in transportation fees in the big cities is already causing opposition on the streets.

But what is unprecedented in Brazil is that so many politicians, bankers and businessmen, are being held accountable. 

And more significantly are being jailed, and in some cases, found guilty and sentenced.

The aggressive role of federal prosecutors and federal judges in Brazil is new.

But the investigation of crimes, particularly fiscal crimes, with the involvement of money laundering, or the hiding off-shore of illicit gains, is now almost always   international in scope, and the international banking sector has been forced to become much more transparent since the global financial crisis.

It is not only Brazil that is seeing the consequences of this shift. But it makes previously hidden Brazilian accounts in Switzerland, or the Cayman Islands, or even in the British cannel island of Jersey, much more likely to be opened up to judicial scrutiny, either by official judicial injunctions and criminal investigations (or by unauthorized leaks.)

There are globally fewer places to confidently hide stolen funds today than in the past. And this has been a major factor in the current Brazilian crisis.

Some have attributed the current Brazilian political and corruption crisis to the fact that Brazil has been an unequal country for so long, and that that this long pattern of historical social inequality, helps to explain why corruption in Brazil is so pervasive. But the truth is that Workers Party government (PT) did not invent corruption in Brazil.

Corruption in Brazil has always been bipartisan, often international in scope, and always the private and corrupt businessmen and politicians have obfuscated the public interest.

And this is not the result of Brazil’s social inequality. Many countries are unequal. Brazil is far from unique in this. Nor is Brazil the most corrupt country in the world. Russia, and China, and South Africa, to name only a few of the BRICS counties that Brazil likes (or liked until very recently) to compare itself with, are all certainly also highly competitive in the global corruption stakes. So to is Angola if one wants to look only at the Portuguese speaking (or Lusophone) world.

And all these countries have a much sorrier record in confronting these generic problems than does Brazil. In this aspect at least Brazil has much stronger institutional means, as well as much greater, and more democratic, and more transparent public pressure, to begin to deal more effectively with a what is after a deeply and universal human challenge.

But the current political crisis in Brazil does potentially put the major social advances of the last 20 years are at risk, as well as the future of the so called “new” middle class.

Unfortunately, because of the bitterness of the current political crisis, neither of the sides involved In the current very bitter contest for power in Brasilia, will recognize the collective achievement of these social gains.  And in fact those who have gained most, and have most to lose, have yet to speak.

The past year was not a good one economically for Brazil and 2016 looks even less promising. But it should be remembered that these are by and large not problems of Brazil’s making. Such problems include the following:

• The collapse of the international price of petroleum;
• The economic slow down in China;
• The action of the US Federal Reserve Bank in raising interest rates.

Brazil has no control over any of these events. But they all affect Brazil’s economic prospects.

The street protests in Brazil since 2013, even though they have certainly at times been vast and nation-wide in scope, have still been largely composed of by those with a degree of education, and income, and social comfort, at least in comparison with the vast number of Brazilians, certainly if one looks at the composition of the crowds on the Avenida Paulista in São Paulo on the Avenida Altantico in Rio de Janeiro for instance.

The real question is if, and when, the vast majority of Brazilians become involved. That is those millions of Brazilians who live on the margins, and particularly those who have gained from the social policies, and the economic stability, and the taming of inflation of the past twenty years, and who now risk returning to the poverty and deprivation from which they have only very recently escaped.

The problem in Latin America has been much less a contest between “left” and “right” than it is populist policies, certainly in Argentina and Venezuela. Brazil has to a degree escaped the worst excesses of both these neighbors. Brazil has developed much stronger and more resilient political institutions.

And it is very important to always remember that Brazil has always been a vast continental size nation, with a highly diverse and fragmented political system, with many important regional power holders, important powers vested in state and municipal governments, which has always required conciliation and compromise to function on a national level.

But the larger international problem has been the failure of Brazil to find an effective international role. 

Brazil rejected a deal with the U.S. on a free trade area for the Americas, but has found its regional alternative in Mersosul highly problematic. The USA is meanwhile perusing a free trade deal with Europe (which excludes Brazil.) The BRICS have proved be a chimera (and China has ceased to provide an insatiable market for Brazil’s exports of raw materials). And Brazil’s would-be partners on the east coast of South America, as well as Mexico, have been more attracted to the Pacific free trade area (which also excludes Brazil.)

Brazil has never received much serious attention in the USA and the attention now is dominated by corruption, and to a lesser degree in the sports pages of the newspapers, because of the on-going scandal at FIFA (with a dominant role played by Soccer federations in Latin America and in Brazil in the kickback scandals), as well as because of the upcoming Olympic Games in Rio de Janeiro in 2016.

But one can anticipate more of this year as the FBI and Justice Department’s investigation gathers pace. As the Petrobras case (brought by investors) progresses in the US federal courts. And the allegations of drug use in international athletics (especially the Russians but also many others) will surely impact potentially on athletes participating in the Olympic Games in Rio de Janeiro.

Brazil will certainly receive more attention in 2016.

Unfortunately, it may not be the type of attention that Brazil seeks or deserves.

2016-01-09 By Lt Gen P C Katoch (Retd)

With the increasing world population, diminishing resources, the rise of Asia and global power push by China, the Indo-Pacific will likely become the center of gravity of conflict with Sea Lines of Communication (SLOCs) of many countries crisscrossing these waters.

Maritime competition is essentially for control of trade routes, hence multitude of external powers that maintain naval presence in the Indo-Pacific.

Connecting the Indo-Pacific, the Straits of Hormuz and Malacca are major choke points, others being Sunda and Lombok; 17 million bbl./ day oil (30 per cent of global oil trade), 18.9 per cent of global production and 3.9 tcf of gas (1/3 of global LNG exports) pass through Strait of Hormuz, while 15.2 million bbl./day oil (26.9 per cent of global oil trade) and 4.2 tcf of gas pass through Malacca Strait.

Tensions in Asia-Pacific rose after China arbitrarily extended its Executive Economic Zone (EEZ) and drew her 9-dash claim across the SCS (South China Sea) based on a sketch drawn by the Kuomintang regime China refused to recognize and overthrew in 1948 stepping beyond her traditional continental land oriented security paradigms in 1993 having become a net importer of oil first time.

In 2005, the Deputy Political Commissar of PLAAF said, “When a nation grows strong enough, it practices hegemony. The sole purpose of power is to pursue power…Geography is destiny …….

When a country begins to rise, it shall first set itself in an invincible position.”

So China has gone about expanding her ADIZ, reclaiming land and reefs and building airstrips and military facilities on them, disregarding freedom of transit in open seas by other nations in complete disregard to the United Nations Convention on the Law of the Sea (UNCLOS), jostling Japanese and Vietnamese vessels, warning India not to assist Vietnam in oil exploration etc.

In March 2015, the U.S. document ‘A Cooperative Strategy for 21st Century Sea Power’ stated, “With strategic attention shifting to the Indo-Asia-Pacific, we will increase the number of ships, aircraft and Marine Corps forces postured there. By 2020, approximately 60 per cent of Navy ships and aircraft will be based in the region.”

Two recent developments in Asia-Pacific are noteworthy.

The first when USS Lassen entered Zhubi Reef which China claims part of China’s Nansha islands. Zhubi Reef is an undersea rock in the SCS that China has built into an artificial island in the contested Spratly Islands. Beijing’s claim is illegal since UNCLOS specifies that coastal states may construct artificial islands within “EEZ” extending 200 nm off their coasts. Beyond that limit, the law allows no such projects. Zhubi Reef is 500 nm from nearest Chinese shoreline.

The U.S. has termed the USS Lassen incident a “regular occurrence” but China says if such provocations continue, Chinese warships will have to engage in face-offs.

It remains to be seen how the situation develops; China denying freedom of navigation at sea to other nations and US wanting to ensure freedom of movement in global commons.

The second noteworthy development is the Hague-based Permanent Court of Arbitration ruling it has jurisdiction to hear territorial claims of Philippines filed in 2013 against China over disputed areas in SCS.

Manila seeking a ruling on its right to exploit waters in its 200nm EEZ, as allowed under UNCLOS. Beijing has been deflecting international arbitration in all its illegal claims.

Should Vietnam win her claim even partly, other countries facing similar Chinese obduracy may follow suit.

Chinese aggressive expansion to effectively control SCS is also linked to her nuclear strategy.

According to Vice Admiral Hideaki Kaneda, Director, Okazaki Institute of Japan:

“Submarines on a mission can quickly submerge in deep waters. Topographical conditions exist in the South China Sea that makes it a ‘sanctuary’ [from attacks].” Chinese nuclear submarines have been probing SCS, and China eventually aims to advance SSBNs from SCS to Pacific Ocean in future time frame.

Malabar 2015 recently saw Indian, US and Japanese ships exercising together in the Indian Ocean – annual naval exercise hosted by the Indian Navy, fourth time for Japan after 2006-7, 2009 and 2014.

As per a Sri Lankan media report citing China Daily, China plans to build 18 “Overseas Strategic Support Bases in the IOR under three categories: fueling and material supply bases for peacetime use (Djibouti, Aden, and Salalah); relatively fixed supply bases for warship berthing, fixed-wing reconnaissance aircraft and the naval staff ashore rest (Seychelles); and fully functional centers for replenishment, rest and large warship weapons maintenance (Gwadar in Pakistan) that gives immense strategic advantage due proximity to the Strait of Hormuz.

China has also invested heavily in Colombo and Hambantota besides port development projects in Myanmar and Bangladesh.

Chinese nuclear submarines have been frequenting the IOR and while the first CBG (Carrier Battle Group) would likely be based at Hainan Islands, the subsequent ones would get deployed in the IOR.

However, these would require land based air support. That is why behind the facade of overt economic rationale, China is discretely pushing her military agenda with all these land-based assets invaluable to Chinese submarines and CBGs in the IOR. Chinese missiles are already deployed in Gilgit-Baltistan and Pakistan will have no compunctions if Gwadar eventually becomes a naval base of PLAN.

In the backdrop of increasing Chinese hegemony, Indo-Japanese relations assume great significance.

Beijing terms military ties between India and Japan “dangerous for Asia” which is ridiculous due China’s military including nuclear assistance to Pakistan and more importantly China has joined hands with Pakistan in putting up a joint anti-India front at the asymmetric and sub-conventional level.

The ‘India-Japan Special Strategic and Global Partnership’ signed in 2014 during PM Modi’s visit to Japan was not to Beijing’s liking either as Japan’s importance in India’s foreign policy and economic development and her place at the heart of India’s Look East Policy was acknowledged by Mr. Modi.

Both PM’s acknowledged their critical maritime inter-connection, growing international responsibilities, abiding commitment to peace and stability, international rule of law and open global trade regime, shared interests in security of maritime and cyber domains, shared objectives to preserve the integrity and inviolability of global commons; shared commitment to maritime security, freedom of navigation and over-flights, and peaceful settlement of disputes in accordance with international law.

Signing the ‘Memorandum of Cooperation and Exchanges in the Field of Defence’ was an important step that also institutionalized bilateral maritime exercises, and existing dialogue, mechanism and joint exercises between Indian and Japanese Coast Guards.

Japan’s current policy of transfer of defense equipment and technology has enormous potential for transfer and collaborative projects in defense equipment and technology.

India is to buy 12 ShinMaywa US-2 amphibious aircraft from Japan.

Geopolitical developments and external factors have forced Japan to review its defense cooperation with other countries; realizing that the self-imposed restrictions post World War II will likely make her a sitting duck in face of increasing Chinese aggression. Japan is reportedly selling her latest submarines to Australia.

India and Japan are engaged in multi-sectoral ministerial and cabinet-level dialogues in the spheres of defense, finance, economy, trade and energy.

A large cross section believes the current Chinese mindset is well rooted in her historical “Tian Xia” (Under the Heaven) concept, which traditionally views “All Territories” as belonging to the Chinese and due to which, they attach no sense to territory.

The forthcoming visit of PM Shinzo Abe should see further progress in the India- Japan Special Strategic and Global Partnership including perhaps conclusion of the ‘Agreement for Cooperation in the Peaceful Uses of Nuclear Energy’ between the two countries.

The author is a veteran from Special Forces of Indian Army

Republished with permission from our partner India Strategic.

http://www.indiastrategic.in/topstories4436_Indo-Pacific_and_Indo-Japanese_Relations.htm

2016-01-09 By David Scott

In recent years three processes have caught the attention of the world.

Firstly, climate change has brought the Arctic Ocean into prominence, as melting unlocks its previously frozen waters.

Secondly, China’s economic rise presents a power-shift challenge for the international system.

Thirdly, the combination of these two processes has generated a further process in which China is increasingly entering into Arctic affairs.

The Arctic primarily consists of a hitherto largely ice-bound Arctic Ocean and an Arctic littoral made up of parts of the United States (Alaska), Canada, Denmark (Greenland), Iceland, Norway (Svalbard/Spitzbergen), Sweden (Lapland), Finland, and Russia, which lie above the Arctic Circle.

Although geographically China is far away from the Arctic and is not an Arctic state, its own power projection is making it an Arctic actor, and increasingly a player in Arctic geopolitics.

Indeed, on 20 May 2013, the government-controlled Beijing Review carried an article titled “How China became an ‘Arctic State,” which contained the assertion that “China has ultimately managed to re-shuffle the Arctic balance of power in record time”.

China now refers to itself as a “near Arctic state” (jin beiji guojia); an “Arctic stakeholder” (beiji lihaiguanxguo) with strategic interests to gain, maintain and, if need be, defend.

China’s Perspectives

The Arctic caught China’s attention in 1995, when a group of Chinese scientists and journalists travelled to the North Pole on foot and conducted research on the Arctic Ocean’s ice cover, climate and environment.

China’s first Arctic research expedition by sea took place in 1999, with further Arctic research expeditions in 2003, 2008 and 2010. The 5th Arctic research expedition in September 2012 was a particularly significant trip, which saw the icebreaker Xue Long (Snow Dragon), the world’s largest non-nuclear research icebreaker, became the first Chinese ship to sail through the Arctic into the Barents Sea.

The expedition’s scientific research included a systematic geophysical survey, installing of an automatic meteorological station, and investigating methane content in the Arctic area. The research team also held academic exchanges with their counterparts in Iceland. Upon return the vessel sailed a straight line from Iceland to the Bering Strait via the North Pole.

The 6th Arctic research expedition in July 2014, again by China’s icebreaker Xue Long, went across the Bering Sea, Chukchi Sea and Canada basin. A new ice- breaker is scheduled for delivery in 2016.

Beijing’s annual spend on polar expeditions has tripled in the last ten years and it is making a massive investment in polar-related infrastructure, although the Antarctic gets the lion’s share of China’s polar budget, 80% compared to the Arctic’s 20%.

The overall goal of China’s current five-year polar plan is to increase China’s status and influence in polar affairs. This was reflected in the 2013 National Annual Report on Polar Program of China, when Liu Cigui, director of the State Oceanic Administration (SOA), described China’s push as “extensive involvement in polar affairs.”

Speculation continues on the purpose and impact of China’s increased polar activities.

Such concerns are linked to a wider debate about China’s international behavior as it flexes its growing economic and military power.

This growing presence is why Chinese official Liu Cigui stressed in an editorial in China Ocean News in November 2014 that China’s polar policy was intrinsically tied to the national goal of becoming a “maritime power” (haishang qiangguo).

This goal, first unveiled by Chinese former president Hu Jintao in 2012, has remained a foreign policy priority under current president Xi Jinping. Liu also asserted that “today, we are already standing at the starting point of a brand-new historical era, of striding toward becoming a polar-region power.”

The context was that President Xi Jinping had just referred to China as a “polar great power” (jidi daguo) when he visited Australia in November 2014.

At the governmental level, the Arctic has become very much a matter for Chinese foreign policy in the last decade.

In July 2009, Assistant Minister of Foreign Affairs Hu Zhengyue arrived in Svalbard as part of his ‘High North Study Tour’, which included a formal public outline of China’s Arctic interests. This Arctic foreign policy was also demonstrated by the headline-making visit to Iceland in 2012 of Prime Minister Wen Jiabao, as well as by China’s successful bid for observer status at the Arctic Council in 2013.

Speaking at the Arctic Circle Assembly in Iceland on 1 November 2014, Jia Guide from the China’s Ministry of Foreign Affairs stressed China’s pragmatic approach and noted accurately enough that “China-Nordic Arctic co-operation is increasingly expanding from research areas to economic areas, like shipbuilding, shipping, and resource development”.

A quasi-official role is played by the Chinese Arctic and Antarctic Administration (CAA), set up in 1981 as a subordinate body within the State Oceanic Administration (SOA). Its remit is two-fold: to pursue “scientific research, and peaceful development.”

Such a polar push is further maintained at the research level in China by the Polar Research Institute (PRI) set up in 1989, which handles China’s research stations in the Antarctica and Arctic.

With this aim in mind, the PRI recently opened a new division devoted to the study of resources, law, geopolitics and governance in Antarctica and the Arctic. It was no surprise that the PRI noted on 17 December 2014 that besides conducting research into Arctic resources and waterways, the organization will also aim to participate in “relevant working group meetings of the Arctic Council and increase China’s influence” in Arctic affairs in coming years.

At the non-governmental level, China has steered away from too much involvement with the United States, and indeed Russia.

Instead the most notable discussions have been fostered since 2013 under the China-Nordic Arctic Cooperation Symposium (CNACS), as established by the PRI.

Who are CNACS’s members?

On the Nordic side are research institutes from Denmark, Finland, Iceland, Norway and Sweden.

On the Chinese side, some members are from similar academic research backgrounds, like the Centre for Polar and Oceanic Studies at Tongji University, the Research Institute of Polar Law and Politics at Ocean University of China, and the Centre for Polar and Deep Ocean Development at Shanghai Jiao Tong University.

All these represent straightforward academic inputs from China.

However, the Institute of International Studies (IIS) at Shanghai and the Strategic Studies Di- vision at the Polar Research Institute represent bridges into wider foreign policy-making discussions in China. At the first CNACS symposium, in June 2013, Yang Huigen, head of the PRI, announced that China’s outreach to Arctic nations was “part of the widening economic co-operation among countries under the context of globalization”.

Previously, China’s stated interest in the Arctic has been primarily for scientific research, signaled in 1996 when China joined the International Arctic Science Committee. China continues to justify its focus on Arctic issues by emphasizing the global impact of the shrinking ice cap affecting itself and others.

However, in reality, there are important strategic imperatives pulling China into these northern reaches.

China’s interest in the Arctic is primarily geo-economic. Partly, the geo-economics is a matter of trade.

On the one hand, China’s current trade with Europe goes through the Strait of Malacca across the Indian Ocean and through the Suez Canal. This is a lengthy route that, in the so-called ‘Malacca dilemma’, is easily choked by the United States and also India.

On the other hand, the Arctic sea routes are shorter.

Consequently, alternative sea routes going above Eurasia offer significant savings in time and costs for China: does an “ice Silk Road” (bing silu) beckon for China?

And partly, the geo-economics is a matter of mineral and energy resources found on the Arctic seabed and littoral land.

China’s Involvement with Arctic States

Even as China increasingly bumps up against the US in the Asia-Pacific, it has generally stayed clear of interaction with the U.S. on Arctic matters, though China’s growing presence in the Arctic has certainly raised US eye- brows.

Hence the article carried by The New York Times in 2012 by Didi Kirsten, titled “China and the Northern Great Game”. The deployment of the Chinese navy into the Bering Sea in September 2015, including into U.S. Alaskan Arctic waters, raised specific US concerns.

China has, though, taken no position on the dispute between the United States and Canada over whether the Northwest Passage going through the Canadian archipelago consists of international waterways with rights of free passage without encumbrance, which is the U.S. position, or whether these are internal Canadian waters over which Canada can exert control and restrictions, which is the Canadian position.

China’s concerns remain de facto access and transit for itself, rather than involvement in de jure sovereignty claims of others. The YONG SHENG was the first Chinese cargo vessel to traverse this passage in August 2013. It is perhaps noteworthy that China has expressed interest in building a Chinese research outpost in the Canadian Arctic, at Tuktoyaktuk or Cambridge Bay.

With regard to the so-called Northern Sea Route most of that is under Russian control.

The trip from Shanghai to Hamburg via this route, which runs along the north coast of Russia from the Bering Strait in the east to Novaya Zemlya in the west, is around 6,400 kilometers shorter than the existing route via the Strait of Malacca and the Suez Canal. The Hong Xing became the first Chinese cargo vessel to traverse this route in August 2013.

Its owners, the Chinese cargo-shipping giant China Ocean Shipping, announced plans in October 2015 to launch the first regular Asia-to-Europe sailings through the Arctic. Russia’s Arctic seas are also the focus for Chinese energy exploration, where deals have been made between China’s state-owned company China National Petroleum Corporation (CNPC) and Russia’s Rosneft and Gazprom corporations to drill in the Pechora and Barents Seas in the Arctic.

At the top of the Barents Sea, the Svalbard (or Spitzbergen) archipelago belongs to Norway. However, under the Spitzbergen Treaty signed in 1920, outside nations have rights of economic and scientific access. The treaty received China’s signature in 1925.

However, China’s involvement under the Republic of China and then the People’s Republic of China remained nominal, until 2004 when a permanent Chinese Arctic station, the Huanghe (Yellow River) Station, was erected near the main settlement Longyearbyen. Its official nature is scientific research centered on climate issues, the environment and atmospheric conditions, but suspicions continue to surround China’s intentions.

Indeed, in September 2014 Chinese efforts to build a new large radar antenna there were turned down because Norwegian authorities feared more spying, despite Chinese claims that it was aimed at studying the polar atmosphere and solar winds.

Greater economic penetration has been achieved by China in Greenland.

Although Denmark is still responsible for foreign policy and defense, the autonomous Greenland administration is moving, inexorably it would appear, towards independence in the near future. China has been able to project itself as a friendly face for the future.

Quite simply, China hopes to entice Greenland’s 57,000 inhabitants into further loosening Danish rule, in order to assist its own mercantilist drive towards Arctic resources. Mineral resources are the order of the day in Greenland.

Consequently, China’s state-owned mining firm Sichan Xinue Mining has agreed to finance a major international mining project at Greenland’s Isua iron-ore field. Other Chinese state-owned mining companies such as Jiangxi Zhongrun Mining and Jiangxi Union Mining are also looking at prospecting not only for iron ore but also for scarce earth resources like gold and copper.

The other significant Chinese entry point seems to be Iceland, a presence with geopolitical significance.

Nestling by the Arctic Circle, Iceland is in one direction the middle of the transatlantic routes between North America and Europe, and in another direction is a gateway into the Arctic Ocean and the ‘Arctic Bridge’ sea route.

The context for China’s growing presence in Iceland is Iceland’s search for alternative sources of investment to kick-start an economy that had been particularly hard hit by the global recession of 2008-2009. In effect China came to Iceland’s rescue, as signaled by Prime Minister Wen Jiabao’s visit in April 2012 and the signing of a document pack defining bilateral economic co-operation.

A Free Trade Agreement in 2013, the first such free-trade agreement between China and a European state, has put the EU on the backburner. Iceland’s decision to suspend accession talks with the EU in 2013 led to Beijing taking advantage of the tensions between Reykjavik and Brussels and offering a currency swap amounting to $406 million.

It also led to worries over China’s diplomatic influence generally. Of some significance is that of Iceland’s two potential oil and gas shelf sites, Dreki and Gammur, Dreki is operated by a joint venture of the state-owned China National Offshore Oil Corporation (CNOOC), Eykon Energy and Petoro Iceland, in which the Chinese side has a 60% majority control share.

One parallel storyline has been Chinese attempts to buy up plots of land for Arctic tourism in Iceland and Norway, which (like Chinese economic deals) has gene- rated scare stories that in reality seem overblown.

The activities of Huang Nubo, a former official in the Propaganda Department of the Chinese Communist Party, but now a property developer in Beijing leading the Beijing Zhongkun Investment Group, have provided a particularly curious twist.

Who does he really work for, himself or the ruling Chinese Communist Party?

In November 2011 Huang’s attempt to build a vast hotel complex on a 300-square kilometer plot at Grímstaðir in north-east Iceland, roughly a quarter of the size of Hong Kong, was blocked amid some security concerns.

Three years later in May 2014, one million square meters of prime real estate at Lyngen in Norway’s Arctic Far North was provisionally acquired by Huang’s company, amid speculation of further tourist-related ventures on Spitzbergen being blocked by Norway, and warnings in the Norwegian media that Huang was acting as a “straw man” for the Chinese Communist Party (Nordnorsk debatt, 16 May 2014).

This occurred alongside attempts by Hong Kong businesswoman Po Lin Lee to promote Svalbard as a tourist destination, which has included building a new hotel in the center of the main settlement Longyearbyen.

The Future

Some of the future dynamics for China in the Arctic lie in the pace at which climate change and rising temperatures will increase the melting of the Arctic cap, and thereby further extend ice-free passage both seasonally and throughout the year.

Eventually the sea routes hugging the coastlines of Eurasia and North America will be joined by still shorter trans-Polar passage opportunities straight through the Arctic Ocean and across the North Pole. This is the so-called Future Central Arctic Shipping Route that China can seek to use.

Other parts of China’s future Arctic dynamics lie internally in its own economics.

2015 brought signs of China’s economy slowing down, and of stock market falls. What is likely is that the iron grip of energy imperatives, which feeds into ‘regime survival’ considerations, will loom ever larger for China, bringing with it even more interest in the Arctic.

Finally, parts of China’s future dynamics lie externally in its position in the international system.

China is currently a close partner of Russia in terms of implicit unofficial balancing against the United States, and Russia and China have both moved towards increasing military exercises together in north-east East Asian waters.

However, Russia’s wide-ranging sectorial claims, all the way to the North Pole, have not been formally accepted by China, and it would seem that China has reservations for the future over unrestricted Russian control of these Arctic waters.

A pointer for Chinese avenues in the Arctic is the article titled “Arctic aspirations” by Chang Baozhi. This was published in the government-controlled Beijing Review on 25 August 2011, and was aimed at an international audience.

Chang flagged to the world that “China plans to make itself heard”, and that “to that end, it will strengthen co-operation and exchanges with North European countries such as Iceland.”

Reading between the lines, this indicates a sense that the bigger powers like the United States and even its erstwhile partner Russia do (in the case of the U.S.) and could (in the case of Russia) block Chinese aspirations.

In contrast, the smaller Arctic littoral states like Iceland and Greenland present an easier avenue for China, particularly in the wake of the global recession and subsequent euro-crisis that has hobbled Europe in recent years.

They are China’s Arctic avenues for the future…..

This article is reprinted with permission of our partner Risk Intelligence and appears in the latest issue of Strategic Insights.