Conference Report: “The Arctic: Region of Cooperation and Development”
By Elizaveta Kozlova, December 19, 2013
On 2-3rd December 2013, “The Arctic: Region of Cooperation and Development” international conference took place in Moscow, Russia. The conference was organized by the Russian International Affairs Council (RIAC) and its partners – the Russian Academy of Sciences Institute of World Economy and International Relations (RAS IMEMO), International Maritime Law Association, The Pew Charitable Trusts, and The Center for Strategic and International Studies (CSIS).
The conference enjoyed a high-level opening ceremony which featured the Russian President’s Special Representative for International Cooperation in The Arctic and Antarctic Arthur Chilingarov, Senior Arctic Official for Russia Anton Vasilyev, RIAC Director Andrey Kortunov, RAS IMEMO Director Alexander Dynkin, followed by Director of the CSIS Russia and Eurasia Program Andrew Kuchins, Director of The Pew Charitable Trusts International Arctic Programme Scott Highleyman, President of International Maritime Law Association Vladimir Mednikov, and Leonid Kalashnikov of the State Duma Committee on Foreign Affairs.
The proceedings were organized in six consecutive panels on shipping, fisheries, environmental legislation, regional development in the Russian Arctic, resource exploitation, and potential for further Russian-U.S. cooperation in the Arctic. The conference delivered informative and detailed perspectives from the Russian Arctic stakeholders, thus addressing what Mr. Kuchins referred to as “deficit of understanding how Russia perceives the Arctic”.
The “Regulation of International Navigation in the Arctic” section discussed the increase in shipping along the Northern Sear Route (NSR) and the prospects for its further development from a practical, infrastructural point of view.
Timur Mukhametyanov of the Department of International Cooperation in the Russian Ministry of Transport gave an overview of the relevant recent legislative developments: the clear definition of the NSR water area, the adoption of the new ‘Rules of Navigation in the Northern Sea Route water area’ in January 2013, and the establishment of the Northern Sea Route Administration in March 2013.
Sovcomflot Deputy Director General Mikhail Suslin highlighted the potential for further shipping development in polar waters against the backdrop of offshore oil and gas projects in the Russian Arctic. In 2010-2013, hydrocarbons made up 70% of NSR cargo flows, while bulk cargo amounted to 24%. The recent increase in the number of ships transiting the NSR may lead to its transit cargo reaching as much as 70 million tons, Mr. Suslin said. Sovcomflot has also explored the deepwater section of the route, which is an alternative to the passage via the Sannikova Strait.
Deputy Director General of Rosatomflot Stanislav Golovinskiy described the main functions of Rosatomflot icebreakers, which are not limited to icebreaker support to cargo vessels but provide service to military vessels in the Northern Navy Fleet and assist in disembarkation and evacuation of scientific research stations as well. He pointed out how unpredictable the changing climate and sea ice conditions can be, referring to the vast area that was covered by one-year sea ice floes in the East Siberian Sea in September 2013 as opposed to the record sea ice minimum one year before. Appealing to the voyage by Tor Viking II in December 2010,Mr. Golovinskiy said that navigation along the Northern Sea Route is also possible in December, therefore the navigation period may be prolonged. Finally, he presented the Russian nuclear icebreaker capacity, which is currently comprised of five vessels: three “Arktika” and two “Taimyr” type icebreakers, with three IB-60 type universal nuclear icebreakers planned to start operations in 2017-2021.
In concordance with the conference title, cooperation was indeed the main theme of the conference, which concerned governmental, civil, scientific, and business interactions both within and across borders.
During the opening ceremony, RAS IMEMO Director Alexander Dynkin stated that there is no conflict potential in the Arctic, while Ambassador Vasilyev referred to the region as “stable and predictable”. The dissonance between mass media speculation and real Arctic diplomacy was accurately reflected in a comment by Ambassador David Balton who said,“I wish I had a ruble for each story that I read about conflict in the Arctic”.In his turn, Andrey Zagorsky of RAS IMEMO complimented the U.S. Department of Defense’s Arctic Strategy because it aims at ensuring security in the region by means of cooperation rather than military deployment.
Business can play a significant role in regional development through participation in various forms of business or public-private partnerships with federal and regional authorities, research centers, or companies from the same or another industrial sector. As announced by Lukoil representative Alexander Abashin, Lukoil and Gazpromneft were on the brink of signing a partnership agreement between their flagship Arctic projects in the Pechora Sea, namely the Varandey Oil Export Terminal and Prirazlomnaya Oil Platform, respectively. The agreement would entail joint training sessions and exchange of experience and information. After a brief review of the company’s main operations, Vladimir Zhukov of Norilsk Nickel made a rather impressive presentation of the corporate citizenship strategy, which takes up as much as 4% of Norilsk Nickel profits spent on investment in regional infrastructure in Taimyr and the High North generally. This includes two relocation programs for inhabitants of areas suffering from industrial pollution in Norilsk and Dudinka, a partnership with the regional Taimyr Airline to modernize its fleet, and contribution to the development of the Northern Sea Route by virtue of investment into Dudinka port infrastructure. The presentation of Vladimir Bagreev of the Norwegian-Russian Chamber of Commerce (NRCC) provided a good example of how comprehensive cross-border business interactions can be. With a membership of some 140 companies, NRCC promotes networking among both government agencies and large and medium size enterprises in the form of, among others, high-level business forums, market information seminars, and business-to-business (B2B) and Young Entrepreneurship matchmaking programs.
Andrey Krivorotov of the Shtokman Development AG claimed that the government-business-science triangle would be the most effective model for the sustainable exploitation of the Arctic resource base. However, he noted, social and economic development in the Arctic cannot be compatible with a liberal economy. The Arctic is competing for investment flows with other regions, such as Africa, Brazil, Australia; the government is therefore responsible for establishing favorable “rules of the game” to attract investment, as well as for providing the necessary infrastructure.
The human dimension of international cooperation in the Arctic was represented by the “Human in the Arctic” project which was announced by Permanent Representative of the Republic of Sakha (Yakutia) to the President of the Russian Federation Alexey Struchkov. The project, aimed to deliver a comprehensive evaluation of life quality and human development in northern regions, has been recently launched by the Northern Forum, founded in 1991, an international organization which brings together nine regional governments across Russia, Canada, Iceland, South Korea, and Japan.
Saint Petersburg State University (SPBU) Professor Georgiy Cherkashyov introduced several case studies of international scientific and educational cooperation in the Arctic: University of the Arctic coalition of higher education institutions, and bilateral university cooperation programs: POMOR polar and marine sciences cooperation between Russian and German universities, SPBU cooperation with a number of Norwegian universities; and scientific workshops and expeditions under the auspices of the joint Russian-American Long-Term Census of the Arctic (RUSALCA) project.
A separate panel was devoted to U.S.-Russian cooperation in the Arctic. The panel participants seemed to have a shared vision of the two states’ relations in the polar dimension as that of a committed and effective working relationship.
The two states cooperate within the framework of the Arctic Council, where the United States and Russia co-chaired the negotiations of the Search-and-Rescue agreement, which was the first legally binding document negotiated under the auspices of the Arctic Council in 2011; together with Norway, Russia and the United States also co-chaired the Arctic Council negotiations of the second legally binding agreement – Oil Spill Preparedness and Response – which was finalized in 2013. Head of the U.S. Arctic Research Commission David Benton suggested that together the United States and Russia could lead the way to improve the Arctic Council.
The main areas of bilateral cooperation include numerous joint scientific projects, coast guard cooperation and joint trainings, and fisheries management in the Bering Sea. Mr. Zagorsky called for more cooperation in regulating shipping in the Bering Strait, which may soon turn into a “bottleneck” due to increased shipping activities in polar waters.
Mr. Benton argued in favor of extending fisheries cooperation to the Chukchi Sea, part of which lies beyond the 200-mile zones of Russia and the United States and may therefore fall prey to unregulated fishing, for these high seas areas are becoming very attractive to third-party fishing nations due to the retreat of polar sea ice. The need for future fisheries regulation in the Chukchi Sea and the central parts of the Arctic Ocean was prominently featured across several panels and was supported by many conference speakers, among them Ambassador Balton, Commissioner Benton, Mr. Highleyman, former Canadian Minister of Fisheries and Aquaculture Trevor Taylor, and Chairman of “Sevryba” Coordinating Council Vyacheslav Zilanov.
The conference made a valuable contribution in terms of demythologization of some popular themes frequently discussed in Arctic forums.
Oleg Kozlov of the Russian Ministry of Transport provided a detailed explanation of the main issues, which are behind the slow progress of the Polar Code negotiations. There are differing opinions among negotiating parties in a number of issues, which include ice strengthening categorization for vessels, determination of the minimum acceptable temperatures, the applicability of the Polar Code to different kind of vessels, and environmental regulations for shipping in polar waters. He acknowledged that the Polar Code negotiations are proceeding more slowly than expected and still have a long way to go before the agreement can be finalized.
Saint Petersburg State University Professor Valery Konyshev explained the internal political struggle and some national legislation issues, which constitute the major impediments to ratification of the United Nations Convention on the Law of the Sea in the U.S. Senate. He made it clear that the problem stems from a domestic issue rather than geopolitical motivation.
The issue of charging fees for using the Northern Sea Route came up in discussions several times. A key objective of the Russian government’s transport policy in the Arctic region is to attract shipping traffic to the NSR in order to ensure its commercial development. For this purpose, the federal law "On Amendments to Certain Russian Federation Legislative Acts for Commercial Shipping in the Arctic Ocean", adopted in July 2012,lifted the polar shipping charge for vessels taking the route, leaving only icebreaker escort and pilotage charges. In other words, the Russian government does not charge foreign vessels for traveling along the routeper se. Icebreaker escort is no longer mandatory,  but it is widely agreed among members of the Russian shipping community that provision of icebreaker and pilotage services to vessels traveling along the route is crucial to its navigation safety. Mr. Golovinskiy remarked that the current tariffs are marginal, which means that service providers such as Rosatomflot may negotiate lower transit fees with shipowners, which would bridge the tariff gap between the Northern Sea Route and the Suez Canal and enhance the NSR’s commercial viability. At the same time, during the plenary session a representative of “Transport of Russia” newspaper voiced the concern that the elimination of the polar shipping charges might be regarded as an infringement on the Russian transport industry’s interest, as these charges could otherwise be a source of transport revenue. Mr. Zagorsky and Deputy Secretary of Security Council of the Russian Federation Vladimir Nazarov, however, explained that the NSR is already subsidized by the Russian government, and in case of its full self-sufficiency the costs for shipowners would be so high that none of them would consider using the route.
 For a more detailed discussion of recent developments in the Northern Sea Route navigation regulations, and economic factors which are relevant to the prospective development of shipping in the Russian polar waters, see this article by The Arctic Institute’s Kathrin Keil and Andreas Raspotnik, available here - http://www.thearcticinstitute.org/2013/09/the-myth-of-arctic-shipping-why_8.html