Chinese Belt and Road in the Arctic

The Russian-Chinese cooperation enters the year 2018 against the background of new Chinese plans for the Arctic development. On January 26, Chinese Deputy Foreign Minister Kong Xuanyou presented a government “White Paper” on China’s Arctic policy.

The new term, “Ice Silk Road,” entered the Chinese political lexicon. Kong Xuanyou recalled that China and Russia decided to join the Belt and Road initiative together with the development of the EAEU. According to him, the joint construction of the “Ice Silk Road” in the Arctic can become part of the program of mutual confluence. How to make this confluence more effective, how to fill the “Ice Silk Road” with concrete content in accordance with the development interests of both countries – these issues, according to the Chinese diplomat, need to be discussed by China, Russia and other “relevant parties.”

Such a formulation indicates to the prospect of participation of the EAEU countries in shaping the image of the “Ice Road.” Some of them, like China, do not have access to the Arctic.

China’s Belt and Road initiative is continuously expanding. It started in the fall of 2013, when president Xi Jinping proposed a land-based “Silk Road economic belt,” connecting China with Europe through the territory of Eurasia. That project gave an impetus to the prospects of confluence with the development of the EAEC.

The originally planned transport routes should pass through the territories of the EAEU countries from east to west, connecting the shortest land routes of Chinese manufacturers with European consumers. New plans for the “Ice Silk Route” suggest the construction of infrastructure along the “South-North” lines to ensure the development of coastal Arctic space. The implementation of Chinese plans will generate a growing need for roads leading to Russian Arctic ports.

The White Paper outlines China's interest in the development of oil and gas resources in the Arctic, the development of renewable wind and geothermal energy in this region, and the establishment of transport infrastructure with the participation of Chinese companies. Partnership in these areas creates new chances for the development of Russia and its partners in the EAEU. Russia and China already have experience of joint participation in the production of liquefied gas in Yamal for supplies to the Chinese market.

China wants to deal with the economic development of the Northern Sea Route. This will require serious investments to the construction of transport infrastructure. The prospect of using the Arctic seas for direct delivery of goods between China and Europe is not a matter of today, even taking into account the climate warming and the retreat of the ice borders. The obvious reduction in distance may not lead to a comparable reduction of the transport time due to the continuing complexity of navigation in the area. In the foreseeable future, the main incentive for the development of the “Ice Road” in this part of the Arctic will be economic projects in the North of Russia.

China promised that in Arctic affairs it would not “go beyond its place,” following clear rules. However, in the Arctic “the Chinese place will no longer be empty.” The emergence of a new player in Eurasia with large economic needs and financial capabilities will have an impact on regional cooperation plans. China emphasizes that all this is serious and for a long time. It’s no coincidence that last year at the CPC Congress a special provision was added the CPC Constitution about the need to build the Belt and Road among other important program goals.

The parties are interested in one another. To implement the Arctic projects, China needs the support of the EAEU countries. In turn, the EAEC needs to find additional sources for economic growth. The situation of the “new normal” under the Western sanctions which slowed down the development of the Russian economy and did not allow it to play the role of an accelerator of the EAEU growth, acquired a long-term character. Attraction of China with its capitals and technology can help solve this problem.

China is interested in stability of its partners. It is not just about mutual trade, but about transport projects and the development of resources, with the assurance of their reliable export supplies. China is interested in the acceleration of institutional and legal integration within the EAEU, as the disparity in customs regulations, standards and tariffs hampers the implementation of the grandiose Belt and Road projects.

The emergence of new Chinese plans is changing the geopolitical landscape for the EAEU countries. The previous doubts of some countries whether the Eurasian integration will lead to a deterioration of rapprochement with the EU, now lose its practical relevance. The importance of ties with China is growing day by day. Increasingly noticeable is the desire of the Central and Eastern European countries to establish a direct dialogue with Beijing, bypassing Brussels in order not to miss the economic benefits of the Belt and Road initiative. In the “old Europe”, this gives rise to discontent and talks about China allegedly wanting to “split the European Union.”

For the EAEU countries, the European Union cannot serve as an assistant and advisor in resolving pragmatic issues to establish partnership with China – and it is unlikely that Brussels will want to play such a role. To what extent the EAEU should participate in the strategic projects proposed by China is a matter of negotiations within the EAEC. And this will require even closer mutual coordination at the levels of economic policy and diplomacy.

Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.