Over the Top: the Emergence of Arctic Ocean Trade

The view of the world from the North Pole is not a common perspective. Most of us may only recognize it from the white-on-blue flag of the United Nations. However, this view of the world may become increasingly common as climate change opens new opportunities for Arctic trade routes. Scientists predict ice-free summers in the Arctic Ocean by the end of the decade and navigable winters by the mid-21st century. Regardless of how one may feel about environmental politics, the question of the polar caps melting is not one of “if” but “when.” The opening of these trade routes is of particular interest to certain actors and nations and has the potential to change the face of global trade.

Polar Routes

The Polar Paths for Shipping (via The Globe and Mail)

A dream of the 17th century explorer Henry Hudson, the fabled Northwest Passage over Canada was first navigated in 1906 by the Norwegian Roald Engelbregt Gravning Amundsen. The other Arctic Sea route, the Northeast Passage over Russia’s northern coast, more commonly called the Northern Sea Route (NSR), is a Russian-legislated shipping lane. The Russian Federation has already started developing infrastructure to service the NSR. Between 2009-2013 maritime traffic has improved from a handful of vessels to several hundred per year. While most are vessels conducting research, several trade voyages have been made. Thus far, Norway and Russia have been the primary navigators. However, in the past few years, Chinese shipping giant COSCO has turned its eyes northward. This past fall, COSCO’s Yong Sheng became the first container-transporting vessel to make a journey from Dailan to Rotterdam via the NSR. Huigen Yang, Director General of the Polar Research Institute of China, announced in 2013 that as much as fifteen percent of China’s maritime trade may travel via the NSR by 2020.

Most data estimates suggest that roughly 90% of mercantile trade is maritime. For China, the potential of Arctic routes could represent savings in the magnitude of hundreds of billions of dollars. According to Qi Shaobin, a professor at Dalian Maritime University: “Once the new passage is opened, it will change the market pattern of the global shipping industry because it will shorten the maritime distance significantly among the Chinese, European and North American markets.” Moreover, China’s traditional route to European ports passes through pirate-infested waters that the Arctic Route would bypass.

There is an undeniable economic advantage to Arctic Trade Routes that connect China to both Europe and the East Coast of the United States. Currently, the typical shipping time from Shanghai to Rotterdam is 25 days, Shanghai to Los Angeles is 13 days, and Los Angeles to New York is seven days by rail. Rotterdam to New York is another nine-day sail. However, a Northern Sea Route to Rotterdam from Shanghai would shorten the journey to 10 days, making a sail from Shanghai to New York via Rotterdam last only 19 days. Without any time lost with stopovers and putting cargo on rails, the current route to New York from Shanghai is twenty days, an Arctic route would be nineteen days at most.

Northern Sea Route vs Southern Sea Route

A visual comparison of the NSR (Blue) to the Suez Route (Red). The Northern Sea Route is 40%, or 12-15 days shorter than the traditional Suez route (Wikimedia Commons)

Commercial traffic over the Arctic would most profoundly affect the maritime route through the Suez Canal. Ports along the Suez route would see reduced cargo traffic from China to Europe. Singapore, one of the busiest ports along the route, has already signaled its awareness of this threat by applying for permanent observer status in the Arctic Council, a regional governance institution. Singapore isn’t the only observer nation that seems out of place in Arctic Council. China, France, Germany, India, South Korea, Italy, Japan, Netherlands, Poland, and the United Kingdom – many of the world’s largest economies – are also permanent observers.

As the Arctic’s pristine environment becomes accessible, commercial shipping is not the only encroaching human activity. Reduced sea ice is making an estimated 30% of the world’s natural gas and 15% of the world’s oil accessible. The combined potentials of Arctic shipping and resource extraction may tilt the scale in favor of developing economic infrastructure over environmental preservation in the Arctic. Professor Lassi Heininen, an expert in Arctic issues at the University of Lapland, describes this problem as a paradox by which less sea ice means better access and thus more human activities, which leads to less ice. Professor Heininen stressed the question: “Are we willing to lose the Arctic’s beauty, or do we try to keep it for our grandchildren?”

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“Are we willing to lose the Arctic’s beauty, or do we try to keep it for our grandchildren?” A baby Polar Bear at Ranua wildlife park in Finland. June 2012 (Photo by the author)

The Arctic region is governed by a combination of international agreements including the UN Convention on the Law of the Seas (UNCLOS) and multilateral governance institutions such as the International Maritime Organization (IMO), a UN agency, and The Arctic Council (AC). The AC is comprised of the eight nations that intersect the Arctic Circle: the United States, Canada, Russia, Norway, Finland, Iceland, Sweden, and the Kingdom of Denmark (by virtue of Greenland). In recent years, the AC has passed agreements on search and rescue protocols and the IMO is finalizing a shipping ‘Polar Code‘ that is expected to be codified by 2016.

Infrastructure is still the key obstacle to the expansion of trans-Arctic trade. There are few ports in the Arctic and they are critically underdeveloped. Missing too are extensive maritime charts as well as search and rescue capabilities. While the AC has passed a search and rescue agreement for cooperation between Arctic States, investment in these capabilities remains minimal. Icebreakers are expensive and the largest fleets number in the tens. Additionally, maritime laws and insurance standards in the draft of the IMO’s Polar Code need to be finalized before any substantial shipping would occur.

Thus far, Russia has been the only player to make significant commitments to development by reopening dormant research stations and Arctic ports. Canada has done little aside from accepting a legal framework for multilateral cooperation on paper. Notwithstanding, there has been an increase in maritime activity through Canada’s Arctic waters:

trans

Recorded Northwest Passage Transits 1903-2013 (via Globe and Mail)

Gustaf Lind, the Swedish ambassador to the AC, accepted the possibility of Arctic Ocean trade. But, he noted: “I don’t think we will see much shipping for quite some time.” Mike Keenan, an economist at the Port of Los Angeles, explained: “You need long stretches that are regularly free of sea-ice and right now you don’t have that.” With regard to how a port can respond to the dramatic effects of climate change, Keenan continued: “there’s a limit to what [the port] can do if you have a serious time advantage…the priority should be to focus on climate change and sea level rise.”

Perhaps it is too early to quantify the effect of Arctic Sea Routes on global shipping trade. Polar Codes and Arctic governance institutions can provide limited solutions to the challenges facing the Arctic, a region on the front line of climate change. What is clear is that climate change will affect more than global weather patterns. It will have an impact on all human activities. Understanding these changes and ensuring that governments address the fundamental problem of a changing environment is ultimately the best way forward.

The views expressed by the author do not necessarily reflect those of the Glimpse from the Globe staff and editorial board.

The Unknown Power of Shadow Monarchs

Belgian King Philippe and Queen Mathilde

Belgian King Philippe and Queen Mathilde wave to crowds in Brussels after Philippe’s swearing in as the new Belgian monarch. July 21, 2013. Michael Thaidigsmann (via Wikimedia Commons)

Do you know that Norway’s King can legally dismiss the Norwegian government with a simple stroke of his pen? In a world where international norms of democracy seem to reign supreme, it is easy to forget that 44 nations ultimately answer to sovereign monarchs as the supreme heads of state. While the degree of power associated with sovereign monarchs varies according to each type of monarchical system (absolute monarchy vs. constitutional monarchy), these royal sovereigns generally possess tremendous power relative to their countries’ elected officials. Sovereigns in constitutional monarchies generally do not exercise their powers, and their role in democratic countries has become largely ceremonial through legislation or convention. However, these monarchs still possess tremendous reserve powers and can legally invoke royal prerogatives at any time. I call these monarchs, “shadow monarchs,” as their roles and powers appear subservient to their countries’ elected leaders. In fact, this is often not the case as their powers are far-reaching. These often-underestimated sovereigns deserve our attention today – in 2014 – in a world where kingdoms and autocracy are often viewed as relics of the past.

There are generally two types of monarchies that exist today. The first type is as an absolute monarchy, in which the sovereign possesses supreme autocratic powers over his state and people. The second type is a constitutional monarchy, in which a system of government is established by a constitution or convention that mandates some form of an elected government overseen by a monarch. In almost all monarchies, succession is hereditary. Only a few monarchies, such as Cambodia and Kuwait, allow citizens to select a new sovereign from within the royal family. The majority of monarchies have an ironclad succession process. This continuous rotation of power and wealth among a select few royal families ensures the survival of an elite class that is inaccessible to the general population.

Absolute monarchies still exist today, but they are very few in number. These countries include Saudi Arabia, United Arab Emirates, Qatar, Oman, Brunei, Swaziland, and Vatican City. In these nations, the sovereign has absolute control over his state’s resources and population. Powers include setting the country’s general direction, such as Saudi Arabia’s King Faisal, who directed Saudi Arabia’s budget to match his personal priorities of technological and economic progress to modernize society in the 1970s. On the other hand, monarchs may utilize their state’s resources to satisfy their personal needs and desires, such as the acquisition of luxury items such as Oman’s “Super Yacht.” In these societies, there is virtually no opportunity for representative government and all power is concentrated in the hands of one person. No wonder absolute monarchies frequently draw heavy criticism from the international community

Even if an absolute monarch’s dramatic level of power seems foreign and excessive to the democratically oriented observer, this level of authoritarianism is to be expected from such a system of government. More surprising and interesting are the powers reserved for royals of constitutional monarchies with democratic systems of government, or shadow monarchies. There is a diverse set of countries that fall into this category, including Norway, Belgium, Sweden, Thailand, Jordan, and Denmark. Perhaps the most significant and popular shadow monarch of the contemporary period has been the Queen Elizabeth II of the United Kingdom (UK), who officially exercises authority over 15 Commonwealth realms in addition to the UK. Official descriptions regarding the duties of the monarch in England suggest a more “ceremonial” role as a symbol of “stability, continuity, and national focus” rather than an executive role. However, England does not have a written constitution, and many of the duties that have been undertaken by Parliament were delegated by the monarchy out of “convention.” In other words, the Queen has transferred some of her official duties as Head of State to the Parliament, although she can invoke her right to royal prerogative at anytime. The legislature in the UK can pass laws, but those possible affecting “the Crown’s interests” must receive the consent of the Monarch. The Crown has invoked the power of the royal consent and veto for at least 39 pieces of legislation in the contemporary period. The Queen also possesses other powers such as dismissing/appointing the Prime Minister and other ministers, declaring war as head of the Royal British Armed Forces (British soldiers swear allegiance to the Monarch), and making treaties. The royal prerogative in the case of the Queen of the UK and other Commonwealth realms is very robust, and her powers are clearly more than strictly ceremonial.

Not all shadow monarchies possess the same degree of power, however. Belgium and Sweden stand on opposite ends of the spectrum of constitutional monarchies. The Monarchy of Belgium is relatively powerful and similar to the Monarchy of the United Kingdom. The King is endowed with numerous powers according to the Belgian Constitution, such as signing and promulgating laws passed by the Federal Parliament, acting as Commander-in-Chief of the Armed Forces, and appointing/dismissing ministers of government. In addition, Article 88 of the Belgian Constitution states, “the King’s person is inviolable, his ministers are responsible.” This law basically means that the monarch possesses immunity from any type of prosecution. Clearly, the Monarch of Belgium is rather powerful and can dominate his elected counterparts if he so chooses. However, the Monarch of Sweden is much weaker in comparison. Sweden’s monarch was essentially stripped of his executive authority in 1975 by legislation, thus reducing the sovereign to a purely ceremonial role. Therefore, the King of Sweden is no longer considered a chief executive of the government and does not have nearly the same degree of reserved rights or privileges as the King of Belgium.

Besides conventional governmental authority and power, many monarchs also hold a position of religious or moral authority. The King of Thailand, for example, is designated as the “Upholder of the Buddhist religion and Upholder of all religions.” The British monarch, Queen Elizabeth II, is awarded the title, “Supreme Governor of the Church of England” and is frequently referred to as the “Defender of the Faith.” These roles, while sometimes not well defined, endow various monarchs from across the globe with a sense of moral authority and superiority. By being placed at the head of religious life in addition to political life, these monarchs are afforded even greater power, influence, and legitimacy.

Shadow monarchies that permeate the globe are vestiges of a different era. As the United States seeks to foster a democratic world order, it is rather perplexing that some of these monarchs still possess such tremendous power today. Elected governments of constitutional monarchies seem to be chipping away at the authority of their respective sovereign monarchs through legislation or convention, but much power still rests in the hands of this elite class. Debating the moral implications and efficacy of these monarchical systems is a different matter, but it cannot be denied that the power of these monarchs is certainly underestimated and, perhaps more importantly, unknown.