Renewed governance is the key for the future of the Arctic
Baltic Rim Economies

Climate change causes major shifts on the political agenda of the Arctic. The melting ice creates new commercial opportunities, such as access to energy resources and shipping lanes, thereby bringing the whole Arctic region into the wider global economy. Simultaneously, environmental crisis caused by the melting ice poses major threats regionally and globally. This new situation puts pressure on the governance of the Arctic, which is ostensibly the key for the sustainable Arctic future.

The Arctic region is warming faster than the rest of the world. Warming causes melting of sea ice in the Arctic Ocean as well as circumpolar glaciers and permafrost. Melting of the sea ice allows access to commercial potentials for the five Arctic coastal states (Canada, Russia, the US, Norway, Denmark/ Greenland): these being major energy reserves in the Arctic Ocean seabed and also new sea lanes. On top of this, the coastal states have acquired a set of new, complex issues to deal with. The issues include, for example, unresolved bilateral maritime borders; sovereignty questions related to sea lanes; the future status and use of the High Sea region and outer continental shelf beyond the coastal states’ Exclusive Economic Zones (EEZ); establishment of maritime Search and Rescue arrangements; and management of trans-boundary resources such as fish stocks, among others. In addition to this, the melting ice has caused an environmental crisis in the Arctic region with major global consequences projected for the future: sea level rise, shifts in ocean circulation patterns, and the acceleration of global temperature rise.

In 2007, Russia sent a submarine expedition to the oceanic floor of the North Pole and planted a titan flag in the subsoil of the sea. Russia’s manoeuvrings in terms of the symbolic flag planting attracted huge media attention and started heated debate referred to as “resource competition” for territorial claims of the outer continental shelf beyond the Arctic states EEZs. The escalating tensions between the states were demonstrated by increased military manoeuvres and provocative statements from some statesmen and military officials. Whether the provocations have been a manifestation of domestic, internal political developments within the coastal nations rather than international politics is an issue open to debate. Without doubt, however, the rhetoric of the coastal states has been assertive and sometimes even aggressive during the past two years.

These parallel developments of military posturing and environmental change pose great challenges for the governance of the Arctic. Since the Cold War period, the region can be characterized as a space of peaceful multilateral cooperation. In 1987, Mikhail Gorbachev launched the so-called “Murmansk Initiatives”, which led to creation Arctic Environmental Protection Strategy (AEPS) in 1991 and later, in 1996, to the establishment of a whole new system of governance for the Arctic, – the Arctic Council. The Arctic Council was designed to improve co-operation and dialogue in areas of mutual concern, such as environmental matters. However, the Council was not given legal form and has, in the light of the recent developments, been criticized for being too weak an institutional structure, given its soft law status and ad hoc funding system. The success of the Council, on the other hand, has been in that it amalgamates all the eight Arctic states as well as the Arctic indigenous peoples in the decision-making process. Additionally, the Council has integrated science into the cooperation framework by organizations such as AMAP (The Arctic Monitoring and Assessment Programme) and scientific reports such as the Arctic Climate Impact Assessment (ACIA).

As a response to sharpened voices in 2007, Denmark invited the five coastal states to a meeting to Ilulissat, Greenland, in May 2008. The result of the meeting was the Ilulissat Declaration made between the five coastal states. In the Declaration the states committed to “ensure the protection and preservation of the fragile marine environment of the Arctic Ocean” and to “the orderly settlement of any possible overlapping claims.” The meeting was criticized because it excluded the three non-coastal Arctic states of Finland, Sweden, and Iceland, along with the representatives of the indigenous peoples, NGOs and the Arctic Council. Furthermore, concerns about marginalization of the Arctic Council were expressed.

Yet it can be argued that the Danish initiative succeeded in several respects. For example the US, which as the only coastal state not to have ratified the main legal framework regulating the use of the sea areas beyond the coastal nations’ EEZs called United Nations Convention on the Law of the Sea (the UNCLOS), was a signatory party of the Declaration. The Declaration also opened constructive dialogue between all the Arctic coastal states and signalled the urgent need for a renewed and updated governance arrangement in response to the rapidly changing Arctic region dynamics.

After the heated debates of year 2007, discourse deliberating the circumstances of the Arctic has changed. On the one hand, the global financial crisis seems to have channelled Arctic states’ attention increasingly towards the predicaments of their own economies in the face of the global market situation rather than announcing the establishment of new Arctic military installations and increased military presence in the Arctic. On the other hand, there is a wide acknowledgement that the main issue in the Arctic is the environmental crisis of the Arctic ecosystem, including melting ice and its potentially catastrophic worldwide consequences.

In the current situation, the main challenge for the Arctic is that there exist major gaps in its present governance. The main challenge for the future development of the region is to find ways to combine environmental protection with potential commercial activities in a sustainable manner. These circumstances put pressure on extending the mandate of the Arctic Council. How this is to be done, is a critical issue that needs/demands a solution. The Arctic region in the future can – in the best case – provide the international community with a model of how to manage and govern dilemmas, disputes or even conflicts related to and emanating from climate change. This is, however, a process that requires engagement from all the Arctic states. It may also require acceptance of the involvement of international actors, such as the EU and the UN.