What do the Chinese say about the Russian economy

"Polar Silk Road" : Why China is investing billions in the Arctic

New trade routes, shorter routes between Asia and Europe - as well as oil and gas reserves. While the ice in the Arctic is melting, competition for supremacy in the new key region for the global economy is ongoing. "As a result of global warming, the Arctic shipping routes are likely to become important transport routes for international trade," says a "White Paper on the Arctic" from Beijing.

There is more to this than a statement. At the same time, China is formulating its own claims. According to forecasts, the Arctic should be ice-free by the middle of the 21st century. Long before that, the trade routes between Asia and Europe will change significantly with the help of icebreakers. And under the ice sheets, which will melt away in the coming years, there are also considerable reserves of raw materials, in which not only the Chinese are interested.

It is estimated that 13 percent of the world's oil and 30 percent of gas reserves lie dormant there. Diamonds, zinc, copper and platinum can also be found there - as well as rare earths, which are essential for the production of smartphones and car batteries. Sand and gravel, which the construction industry needs and which is also becoming scarce, could also be found there.

"The Arctic has become a key region in world politics," wrote the German government recently in response to a request from the Left Group. In turn, US Secretary of State Mike Pompeo made it clear at a meeting of the Arctic Council in May: "We are entering a new era of strategic engagement in the Arctic." This brings new threats to the region and its properties.

US President Donald Trump, who actually does not believe in global warming, wants to open a US consulate in Greenland to expand US influence on the ground. Before that, Trump even wanted to buy the island. But both Denmark and Greenland rejected the offer.

A new gas pipeline is also planned

In addition to the USA, the countries bordering the Arctic also include Denmark, Iceland, Norway, Sweden and Russia. China absolutely wants to get involved, but needs Russia for that. It was only at the beginning of December that Russian President Vladimir Putin and China's head of state and party leader Xi Jinping announced the commissioning of the XXL pipeline “Kraft Siberia”.

In the future, gas will be supplied from Siberia to the metropolis of Shanghai via a new 3,000-kilometer pipeline. Putin emphasized that this was working towards the goal of increasing the bilateral trade volume between the two countries to 182 billion euros by 2024. That would double: in 2018 it was the equivalent of 90 billion euros.

The Russian company Gazprom and the China National Petroleum Corporation agreed on the $ 400 billion project five years ago. Reuters news agency reported that Gazprom will initially deliver 4.6 billion cubic meters of gas in 2020 before ramping up the pipeline's capacity to its full capacity of 38 billion cubic meters by 2025.

The transport time is shortened via the northeast route

China has very different goals associated with the construction project. Because in return for the Chinese investments, Russia offers access to the resources in the Arctic. Beijing is pushing its agenda under the term “Polar Silk Road”. Chinese investors are encouraged to participate in projects and companies in the region.

The Chinese shipping company Cosco is already sending ships on the Arctic route. 2018 was the "busiest year so far," said company spokesman Feng Chen. Compared to the longer routes via the Suez and Panama Canal, the northeast route shortens transport times by up to 40 percent to 15 days. The dependency on icebreakers is still great.

So far, the Russians have been building the largest icebreakers with which they can control access to the Northeast Passage. China now wants to step up: The “Xue Long” fleet (“Snow Dragon”) is supposed to pave the way through the ice. A first icebreaker built by China itself set out on an arctic expedition from Shenzhen in southern China in the province of Guangdong in mid-October.

The USA meanwhile is against China building Arctic-compatible icebreakers at all and warns of the increasing influence of the People's Republic. US Secretary of State Mike Pompeo told the Arctic Council in May that China had already invested nearly $ 90 billion in the Arctic between 2012 and 2017.

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