REPORT 1/2024
Norway and its neighbors are going to take advantage of climate change and form a new axis of development in northern Europe. Scenarios for the inclusion of Ukraine.
Yermolaiev Dmytro
Head of the «Geoclimatic Department»

Northern Europe's location gives it an advantage in a changing geopolitical and economic landscape. The increasing accessibility of the Arctic region due to the melting of glaciers opens up new maritime and "energy" routes, making this region an important hub for trade and infrastructure projects. An open Arctic will allow Europe to move on to extracting from the seabed the minerals needed for the European Green Deal. Work on this requires close cooperation with Southeast Asia. And the geoclimatically stable countries of the Three Seas Initiative+ Ukraine have a chance to appear as an industrial and food core of commodity flows to Asia through the new Northern Route.

Human history, its realization in specific civilizations, trade routes and "orders" has always been determined by the forces of nature. The specificity of trade winds determined the ancient routes of trade in a specific way and interacted with the development of world trade. One of the key factors influencing trade routes was the use of trade winds and other sustained or intermittent winds.

For example, ancient traders used trade winds to cross the Indian Ocean and the Arabian Sea. Ships heading west could effectively use the trade winds to move quickly towards India and the western regions of Asia. On the other hand, when returning to the east, they used the trade winds to return to their original points.

If the direction, timing and other parameters of these winds had not contributed to the movement from the coast of the Middle East to the ancient Chinese ports, leaving the connection with the Celestial Empire only to the shuttle continental trade of those years, most likely the world would have been completely different. The transit of gunpowder technology alone cannot be overestimated for the future of Europe.

The specificity of trade winds (the status quo of the climate of its time) determined the direction of world history for centuries to come.

Along with the invention of self-propelled shipping, humanity launched a global process of industrial redevelopment of the Earth's landscape and atmosphere. Having conquered the logic of the winds, we paradoxically launched a very time-consuming process of changing the forces that these winds determine. And today, with great speed, it is changing the very conditions of our life on land. Every 10 years, agro-climatic zones began to shift 100 km to the North of the European continent; droughts and overexploitation of water resources in most world so-called "breadbaskets" lead to a critical state of global food stability; The parallel growth of the world's "hungry" population makes it necessary to consider food systems as a strategic resource in the planning of geo-economic rivalry. Climate change has finally reached the point where elements of the already familiar man-made trade infrastructure began to suffer from them and gradually turn off. "Wind" begins to retaliate for numerous greenhouse gas emissions and destroyed natural systems and again blows into the sails of the world economy, reformatting its usual schemes. Last year, drought created bottlenecks on the Mississippi River in the U.S. and the Rhine in Europe. In the UK, rising sea levels increase the risk of flooding along the Thames. Severe droughts in Central America have become a kind of "ice" for the Panama Canal.

Panama Climate Crisis.

The suffering of the Panama Canal (a drop in water level of 1.8 meters due to permanent drought) reflects how climate transformation is changing global trade flows. Under normal circumstances, the Panama Canal accounts for about 3% of the world's maritime trade and 46% of containers moved from Northeast Asia to the east coast of the United States. The canal is Panama's largest source of revenue, bringing in $4.3 billion in 2022.

Intense drought phenomena began to undermine the physical capacity of Panama's infrastructure. The crisis has set existing shipping routes back more than a century in terms of efficiency. When the canal began operating in 1914, it became an alternative Suez Canal, the Cape of Good Hope, and the Strait of Magellan to deliver goods between the Northern and Southern Hemispheres. Currently, shippers are returning to all three options to prevent bottlenecks in Panama, although vessels have only recently moved away from Suez to avoid attacks by Yemen's Houthi rebels (inadequate oil countries are playing in price appreciation factors and market divisions). While Suez is a sea-level canal, Panama is a freshwater canal that depends on artificial lakes, making it catastrophically vulnerable to drought.

At the same time, melting ice is creating new shipping lanes in the Arctic, and Europe's Nordic countries are seeing their global strategic advantage and making a long-term bet on it. Russia's war against Ukraine gave them a tool for potentially weakening its main competitor (Russia) on the Northeast Passage, which connects Europe with Asia through the Arctic region.

The Arctic region has warmed four times faster than the rest of the world over the past four decades. By 2035, parts of the Arctic will be ice-free during the summer months, opening up prospects for commercial shipping to navigate these waters and reducing transit times between the United States, Europe and Asia, bypassing destructive countries. The Arctic routes will be 30-50% shorter than the Suez Canal and Panama Canal routes, and transit times will be reduced by about 14-20 days!

Given these prospects and opportunities, major countries are pursuing a proactive Arctic policy.

China, on a par with others, strives to become a great polar power, getting rid of exclusive mediation from the russian federation in this region. Beijing has declared itself a "circum-Arctic state," claiming rights to freedom of navigation and flight, scientific research, fisheries and resource development. The Polar Silk Road (PSR) was added in 2017 to China's mega-massive Belt and Road (BRI) project. which was first announced in 2013. The BRI is characterized by infrastructure investment along a constellation of economic corridors, including the Northern Sea Route. Beijing's claim to be a "circum-Arctic" state challenges seven other Arctic states (Canada, Denmark, Finland, Iceland, Norway, Sweden and the United States). The interest of the Celestial Empire should not be reduced to the topic of hydrocarbons (which was played with in the russian federation): this country is aimed at green energy and transport and has enough of its own production.

China's interest in oil and gas Arctic projects is moderate: high cost and there is a sufficient alternative in the global oil and gas markets. The world is being harnessed to the energy transition (slowly, but demand will decline, and there will also be numerous Middle Eastern producers with low production costs). China has been reluctant to commit to russia's proposal to build the Power of Siberia-2 pipeline running from russia's Arctic to northeastern China. Given China's commitment to the energy transition, significant breakthrough demand from its side should not be expected. Their interest is leaning towards rare earths at the bottom of the sea and their delivery to rich energy transition markets. And this interest brings the Nordic countries and Beijing closer together than pipelines.

The U.S. is still slower to harness. They are only now planning to build their first deep-water Arctic port in Nome, Alaska, and Canada is planning a deep-water port at Kikiktarjuak, Nanuvut, which is located at the entrance to the Northwest Passage (a trade route on the opposite side of the russian coast).

Norway and Co. want to implement the option of the route without the russian federation. It will be a trans-Arctic route that will run directly through the North Pole, bypass the territorial waters of the Arctic states and run on the international high seas. Thousands of ships a year are expected to pass between North America and Asia, centered on Dutch Harbor in Alaska for the US market and through the city of Kirkenes (as an option) to enter EU space. Kirkenes could get a megaport with rail connections to Rovaniemi in Finland and further south to Helsinki and even through the Baltic Sea to Estonia (a direct underwater tunnel already has its own project: cargo tunnels under the Gulf of Finland, from Espoo in Finland to Tallinn in Estonia). The port will be the first and last stop in the European Economic Area and the only market along the Northeast Passage. The port of sea communication with the markets of Southeast Asia will be directly connected to the entire EU railway system.

In addition to direct rail connections, Kirkenes will also be able to send and receive smaller cargo ships capable of sailing south along the Norwegian coast to Rotterdam, Zeebrugge and Gothenburg, recreating in new forms the maritime activity of the former Hanseatic League. Only this time it will not be furs from Muscovy for the European nobility, but components of turbines and photovoltaics.

This route between Southeast Asia and Europe is 40% shorter than the journey through the Suez Canal. Every year it is getting closer: climate change means that the Arctic could become completely ice-free in the summer in 20 years.
The fastest trans-Arctic navigation routes are during September so far (2006-2015) and into mid-century (2040-2059) with RCP 4.5 (moderate warming scenario), for ships seeking to cross the Arctic Ocean between the North Atlantic and the Pacific Ocean. The red lines indicate the fastest available routes for the Polar class of icebreakers; The blue lines indicate the fastest available routes for open sailing ships. The RCP 8.5 scenario (which we are now more in line with) could shift the timeline back 10 years.
2.1 What the Arctic route should provide.

1) China + ASEAN Food Security

China's national food production fell from 93.6 percent in 2000 to 65.8 percent in 2020, and is expected to decline to 58.8 percent by 2030. China will face greater pressure on resources and more serious challenges in ensuring grain and food security. China has become a major buyer of soybeans, corn, wheat, rice, beef, pork, barley and sorghum. Short and climate-proof (vulnerable suppliers: Latin America, USA) access to food is China's top priority for the 2030s and 2090s.

China's crop production has not grown in the past decade, widening the gap between China and other advanced agricultural countries in terms of productivity. This is one of the main reasons why food security has become China's most fundamental interest for President Xi Jinping. About 30 percent of all agricultural land in China suffers from soil erosion, and another 40 percent is at risk of becoming desert.

Canada, Norway, Finland, Holland, etc. actively financed research on climate passportization of Eastern Europe. Ukrainian (and its neighbors') agro-industrial natural-economic resource of the territories is taken into account as a trade position for the comprehensive proposal of China + ASEAN on the Northern Sea Route project. The stakes are high and this is evidenced by 1.7% of its own GDP, which Norway alone has sent to help Ukraine in the last two years of big war(more than anyone else).

2) Ensuring the European Green New Deal.

Europe's northerners are betting heavily on their leading role in the European energy transition. The peculiarities of the windy weather on the coast allow them to build a powerful so-called offshore energy generation system - giant windmills in the very sea. The physical scale (Denmark's largest turbine has a diameter of 236 m) and the labor intensity of the equipment required for this shapes today's and determines the future system of division of labor in the field of global renewable energy, where China and its neighbors will always be given some significant role. The degree of this interdependence may vary in terms of the geo-economic degree of rivalry, but the dirty and energy-intensive recycling of rare earths and their transformation into the basic components of the green transition will definitely remain a job outside the heart of Europe. Therefore, Europe is also interested in the opportunity to be part of and control in a certain way those production moments on which their ambitions and claims to technological leadership in "green" technologies depend (including its advanced component - hydrogen, which is the only viable way to store renewable energy sources). For example, China and Norway have been cooperating in the field of offshore wind energy since 2010. Norway has advanced offshore wind energy technology and expertise. The Memorandum of Understanding on Sino-Norwegian cooperation in the wind energy sector was signed between Innovation Norway and the China Wind Energy Association in 2019. Climate change brings new opportunities to this: the melting of the Arctic opens up access to bottom deposits of beneficiated ore with a high content of rare earth and scarce metals in the north.

2.2 Seabed resources.

Context. The seabed is turning into the world's next theatre of global competition for resources, and China has a claim to add offshore mining to its temporary dominant position in precious metals. But the cost of such production so far makes it only an element of "muscle play", a light version of the ambitions of space programs to extract minerals on the moon or asteroids. With one clarification: According to existing estimates, further growth in demand for green energy and electric transport will make rare earth metals significantly more scarce. Therefore, it is worth considering deep-sea research and development in the field of production as a plan postponed to the 2030s.

What is this resource? Polymetallic nodules are minerals rich in manganese, cobalt, nickel, and copper — metals essential for everything from electric vehicles to advanced weapons systems. The main thing is that they lie freely at the bottom of the ocean. And it is only necessary to conditionally lift from a depth of +-4 km. The International Seabed Authority (ISA) has issued 30 licenses in four areas to explore the seabed of valuable metals. The start of deep-sea production is planned for 2025. China will receive exclusive rights to excavate 238 thousand km2 (that's 5 world licenses out of 30). Norway aims to cultivate almost the same area in its waters near the Svalbard archipelago. And these resources are needed to process a partner - China, connected by the Northern Sea Route. In any case, China will also deal with this topic, and its motivation is clear. The Clarion-Clipperton Zone, which is encroached upon by China in the Pacific: 4.5 million hectares. km2 and 15mln. tons of rare earth oxides.

The Norwegian parliamentary majority, which now advocates "cleaning" the seabed in search of minerals such as manganese, sulfide, copper, zinc and gold, zealously defends the national interests of northern Europeans. Taking into account national security considerations, the government's position opposes the involvement of Chinese entities in mining directly. Entities such as the China Ocean Mineral Resources Research and Development Association or China Minmetals Corporation, which dominate the global deep-sea mining race, will not scrape the bottom of the Norwegian Sea, but processing cooperation between them is inevitable.

Climate change used to be the reason for the cessation of mining in the Arctic. Now this is a reason to move forward at full steam.
(Fig. 1) ISA licenses issued fordeep sea mining.
(Fig.2) Map of underwater deposits (as we can see in comparison with the previous "licensed" landscape, the resources near Svalbard are not included in international regulation)
(Fig.3) Map of prospective production from the seabed in the Norwegian area of responsibility.
2.3 The rich bottom of Svalbard belongs to Norway, but the archipelago is very close to russian nuclear submarines: a security problem.

Spitsbergen, or Svalbard, is a purely sovereign territory of Norway under all accepted treaties after World War I. This territory is under Article 5 of NATO, but under old obligations, Norway and anyone else has no right to deploy anything military on its territory. Paradoxically, Svalbard's proximity to the Northern Fleet on the Kola Peninsula and its strategic position to protect the future Arctic project of the Varangians, demands to seek conditions for the revision of the ban on the projection of force from this archipelago into the space between Greenland, Iceland and Great Britain and Norway. Obviously, the militarization of the Arctic region by Europeans, its forms, schemes and possibilities is a matter of the near future. As proof of this: the Norwegian TNC Kongsberg Gruppen is an active participant (technical solutions) in seabed mining programs and at the same time a manufacturer of the famous NASAMS air defense systems, the production of which tripled due to the war in Ukraine.

Svalbard's geographic location will be central to controlling access to and from Russia's Northern Fleet (with nuclear warheads) on the Kola Peninsula. The only means by which the russian federation can only scare everyone is to try to slow down the deployment of the "Norwegian" version of the Northern Sea Route.

Briefly. The war in Ukraine has opened up a non-competitive way to consolidate roles in Europe's food system. The physical destruction of agricultural assets and related infrastructure, including transport, has put most Ukrainian farmers on the brink of survival. At the same time, the distorted land reform creates conditions for the transformation of the economic misfortune of the national food producer into an asset (land) open to foreign markets, which in the future they lost through the banks. The absence of a long-term national food policy will contribute to the final consolidation of Ukraine's status as a producer of agricultural raw materials "to order" (read more here). Our European neighbors are ready to ensure the deep processing of these raw materials into semi-finished and finished products and to play a leading role in food supplies to Asia along northern routes.

Arteries of the Three Seas project to connect Ukraine. Expansion into a union of countries with a common geoclimatic destiny.

Geographically, Ukraine is in an advantageous position in terms of climate transformation. Competent adaptation planning at the local and macro-regional levels can lay an advanced foundation for the creation of a socio-economic system with a "low economic cost of climate change" in the post-war restructuring, with a profitable supply of ultra-scarce natural economic resources in the world. Stable access to water and moderate temperature conditions will be the basic conditions that will form the investment passport of the territory.

To implement post-war development for inclusion in the new geo-economic project, Ukraine should focus on two types of situational allies:

1) Geoclimatic neighbors that share both natural systems with Ukraine and the spatial economic benefits of their future development, including the geo-economics of global "relocation to the North";

2) Global competitors for the status of a development center. Potential donors of equipment and technologies that have the resources to provide "industrialization for export" in the struggle for the inclusion of resource "third parties" in their zone of control.

In the first case, we are talking about the CEE countries, which already have the format of subregional project relations. This is the so-called. The Three Seas Initiative: Austria, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Slovenia + Ukraine + potentially Belarus.

In the second case, the EU and China.

BACKGROUND on the Three Seas Initiative - is a project initiated by Poland and Croatia and the European Union. It includes 12 countries that have declared their interest in Ukraine. The project at the current stage exists as an organizational mechanism aimed only at accelerating the construction of regional infrastructure, especially in the energy sector, and promoting the economic development of countries that find themselves in a position of creeping away (loss of economic ties) due to destruction trade relations with Russia. In Brussels, this format is also seen as a second attempt to bridge the economic gap between the European East and the West. The new vertical North-South infrastructure is designed primarily to loop the maritime system of trade in hydrocarbons (primarily liquefied gas) as a solution in the field of energy security of Europe "without the russian federation". Thus, the EU plans to control the issue of the initiative in creating an architecture of rebuilt trade routes, where China wanted to intercept the European palm with its "Belt and Road" project through European southern ports. The initiative put forward by Poland and Croatia is crucial for them, as it can form the independence of the entire region from russian energy, which will consolidate the rapprochement of Eastern European countries with the West. Of course, Poland's ambition is evident in the project: the task of raising its subjectivity as a subregional leader in relations with Western European giants. For the EU, the mechanisms of the Three Seas Initiative are considered as the best intermediate option for Ukraine's integration into the EU with the parallel implementation of all possible programs of the so-called. "Post-war reconstruction" is in the interests of these countries. By making the members of the Three Seas Initiative bordering Ukraine strategic recipients of the Ukrainian economic complex and implemented post-war raw material projects on its territory.

Of course, having knowledge of the upcoming geoclimatic damage to most of its territories, including in terms of food security and understanding the global value of control over export food, the EU is betting heavily on its victory in terms of Ukraine's absolute integration into its sphere of influence.

Intensive military-political support for Ukraine is a direct consequence of the EU's knowledge of the natural economic resource that Ukraine possesses in the perspective of global warming.

The issue of Ukraine's national security is the ability to realize the maximum potential for development. This requires increasing the subjectivity and proactive state participation in the processes of working out the economic content of integration processes in Central and Eastern Europe and the North – in order to create a complex and large national industrial economy of Ukraine, surpassing the simplified agro-raw materials projects proposed from the outside.

In order to realize its national interests, Ukraine should soon initiate a new ideological content of the Three Seas Initiative:

1) It is necessary to initiate joint work of the Initiative participants around the topic of geoclimatic change and the common natural economic resource shared among members in this sub-region, the benefits of regional cooperation and linkages (e.g. in the field of overall management of a stable annual water balance) in the short and long term. To develop, in the process of justifying this cooperation, a map of common eco-systems that require measures to increase sustainability, by implementation of a number of joint cross-border projects (more in report: D.Yermolaiev.The struggle for Europe's geoclimatic harbor: Ukraine/2023/);

2) Promote the creation of a bloc of countries of the so-called. A "common geoclimatic destiny" as a new regional union on a neo-geo-economic basis. This will create the need to connect the Nordic countries (Finland, Norway, Sweden) to the joint work. They represent a subarctic region, which receives as a whole (in the context of global warming) new development prospects and which the vertical North-South transport infrastructure should focus on. + The long-term interest of Southeast Asia in access through the infrastructure of the Three Seas to the development spaces of the European "New North" should be proposed as one of the contents of the Union's development.

3) To take the initiative to include future legitimate representatives of Belarus in the preliminary negotiations and to discuss its equal participation in the Three Seas Initiative. Spatially includes elements of water infrastructure that are important for Ukraine, as well as a natural economic resource of similar value for the agricultural sector and industry;

4) Include a detailed vision of Ukraine's economic sectoral participation in the regional project of the Three Seas Initiative and the EU as a whole. With a spatial plan of production and infrastructure clusters that can be included in the system of the European division of labor. These proposals should be based on a forecast of climate-related problems in the stability of the EU economic complex, its security problems in the medium and long term. So called "Master Plan for Post-War Development" should generally offer spatio-temporal economic planning for pan-European "relocation" to geoclimatically safe Ukrainian territories.

Within the framework of integration into the Northern Development Zone, the following export sectors should be developed in the first place:

1) Rare earth metals and materials. Industrialization of the extraction of Ukrainian rare earth resources and their inclusion in the cooperation of the EU-Southeast Asia supply chains for the energy needs of the European Green Deal. The old industrial complex of Ukraine concentrates a large amount of resources and wastes that have been excluded from processing, but contain particles of valuable minerals. The low prices of the past made such extraction impractical. But times have changed with the global green transition. A new interest in "abandoned" resources from the sight of "green metals" is happening everywhere and is activated by insane demand, which, according to forecasts, will multiply their prices. But the real deficit is yet to come, as is the corresponding "gold rush". For example, the development of the northeastern fjord of Greenland by the Australian company Ironbark Zinc for the purpose of zinc mining has intensified, due to a significant increase in price (x2). The Greenland Mineral Licensing and Safety Authority has already issued more than 110 valid mineral exploration licenses. The geo-economic globalized pattern here is as follows: at the top of Greenland, along with the military-administrative control of the United States and Denmark, there is Chinese infrastructure and money (and Swedish services) that help pull zinc out of the ground, a metal that is in demand due to the production of components of the global "green" transition at China's facilities. And the profit from the extraction of the ore itself goes to Western companies. As a country develops, its use of zinc tends to increase as it is used in things that support modern life, such as batteries, railway power lines, and automotive;

2) Food with a large depth of processing. Ensuring long-term supplies of food products with deep processing to the market of Southeast Asia - It is important for Ukraine to become a guaranteed element of food security in the developed markets of Southeast Asia, which in the medium term will experience devastating extreme events for agriculture. Within the countries of the Three Seas, a joint roadmap for non-conflict co-development (market sharing) is being developed national agro-industrial clusters through the integrated division of labor. The entire newly created sub-region gains the status of a reliable, all-weather global food supplier with maritime transport connectivity along all axes of world trade;

We are entering an active period of competition for the quality of adaptation to climate change. The critical importance of the stability of basic resources: water, energy, food is increasing. The key factor is time. National success will be determined by the ability to radically change socio-political "traditions" and stereotypes. In difficult circumstances, Ukraine has a unique national resource on a planetary scale - our land and sky. The options of our situational allies on the way to new construction are rigidly determined by objective circumstances. Who exactly will be able to dispose of the economic benefits from the space of Ukrainian land depends on who will be the first to engage in geoclimatic design: "WE" or "for us". There are state products and goals (collective goals) to which the market is not adapted. Adaptation to climate change through the comprehensive capitalization of the national natural and economic resource, which can lead to an increase in the wealth of the entire nation – precisely from such tasks – the tasks of state policy.
Did you like the article? Please give us a cup of coffee and we will speed up and improve for you even more.) SG SOFIA - media project - non-commercial. With your help, we will be able to develop it even faster, and the dynamics of the appearance of new Meta-Themes and authors will only accelerate even more. Help us and Donate!
Made on