The Russian government is planning to develop the Arctic region by further increasing bureaucracy
On June 18, a representative conference on the economic development of the Artic was held in the framework of the St. Petersburg International Economic Forum. The most pressing problems of actualization of Russia’s potential in the Arctic were discussed among numerous participants: heads of federal regions, members of the State Duma, diplomats, scientists and CEOs of largest companies from Russia, Finland and Switzerland.
Cooperation: tasks and challenges
The central event of the conference was the plenary meeting “International cooperation for actualization of the economic potential of the Arctic region”. The reports and following discussion demonstrated that such a comprehensive and convenient title implies a complex network of modern problems, and solutions to them are not easily found.
Over recent years, the Arctic littoral states had placed a priority on this frozen region both in domestic and foreign policy, as new navigation opportunities had been developed (Russia’s growing fleet of icebreakers) and pockets of fossils (most importantly, hydrocarbons) discovered. This is both a global challenge and a perfect opportunity for international cooperation. At the same time, it is crucial to the Arctic cause to preserve balance between economic interests and security issues. There will be competition and even rivalry, but confrontation is not an option. In the end, all governmental and business plans should serve national interests and strategic purposes rather than greed and predatory appetites of corporations.
The first Arctic conference at the SPIEF 2016 had demonstrated that Russian large-scale Arctic projects are open for mutual cooperation, but only on the terms offered by the Russian government.
In the opinion of Alexander Tsybulskiy, Deputy Minister of Economic Development of the Russian Federation, a breakthrough in the Arctic is only possible with new management strategies. One of these proposed strategies is to organize “basement zones”. This concept has been recently introduced by the government in of the program “Social-economic development of the Arctic zone of the Russian Federation”. “Basement zones” are to be unique cross sectoral centers designed for coordination of the development and supply of the territories of the High North. First “basement zones” are expected to be organized on the Kola Peninsula and in Northern Yakutia.
Unfortunately, many of similar ideas have remained only on paper even to this day. The new Arctic concepts must be implemented for real, which means that Russian regions and governmental agencies are to move to a new level of interdepartmental cooperation; communicate not only along hierarchical verticals but also along horizontals.
However, most of the ideas voiced at the conference were primarily management solutions. There were propositions to join all Arctic projects on the federal level, introduce the governmental position of “Arctic Vice Premier”, develop special “Arctic” laws or a whole “Polar Code”, and found the Arctic Bank of Reconstruction and Development. Those are nice ideas, of course, but they only can create governmental jobs, while what is really needed is jobs in new ports, industrial centers and educational facilities. Officials should never forget that infrastructure will not work by itself; it is people who will make it all run – and they are willing to. As a common saying goes, “there is no territory unless there are people”. More than half of Russia’s territories are stiff with permafrost, which makes these words sound almost dramatically urgent.
The Northeast Passage as the main nerve of the Russian Arctic
The press release of one of the “panel sessions” of the Arctic conference at the SPIEF 2016 read as follows: “The key factor of the development of the Arctic is the Northeast Passage and infrastructure objects for sea and air navigation located along this path from Arkhangelsk to the Chukotka Peninsula… As of today, the Northeast Passage is not economically efficient, but we have to look forward into the future and explore new opportunities from the geopolitical perspective.”
However, it is not geopolitics alone that matters. The prospects of the development of the Arctic region depend on the favorable condition of the Northeast Passage itself. The 1990s in Russia had showcased a simple pattern for the High North: if the seas are navigated, the shore will be populated and jobs created. Otherwise, there will be nothing but several meteorological stations divided by thousands of kilometers of unmanned territory.
Though slow it may be, there is progress in navigation in the Arctic Ocean. New icebreakers and ports are being built, so the future may actually hold for the Northeast Passage the destiny of one of the world’s major transportation corridors. Such international actors as Vietnam, China and even Singapore are already interested in the shortest sea route from Europe to Asia.
Sergey Frank, head of the Russian maritime shipping company Sovcomflot, made the following statement at the SPIEF 2016: “It is obvious that the transportation potential of the Northeast Passage is increasing. I am sure that by 2017, there will have been more transfers than ever before, and by 2020, there will have been thrice as many. Moreover, those numbers are based on the cargo base that we are aware of, that is guaranteed by the current contracts.”
This quiet certainty is worth more than all the bravado of the experts of the Higher School of Economy who somehow expect the 20-fold increase of turnover each several years. Real life is far from those predictions.
Reflections of theorists are valuable in their own right, but certainty of practitioners gives real hope for the future of the Russian Arctic, state and people. The Arctic conference that concluded the St. Petersburg International Economic Forum had proven it to be the only truth.
Translated by Daniil Yakovenko