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The promise of the geoeconomic Arctic: a critical analysis


Due to global climate change, the Arctic is losing its ice cover with two expected economic consequences: new accessible natural resource reserves and opening maritime routes are anticipated to become accessible. As a result, the Arctic is expected to transform into a globally important geoeconomic space. The article approaches the geoeconomic Arctic by asking whether this transformation is plausible and forthcoming. In particular, the article analyzes critically practical challenges for Arctic economic development as well as geopolitical challenges to the region as a favourable investment and operating environment. The article concludes that while the Arctic will develop economically, the pace and scope of developments are likely to remain moderate due to complex challenges, and that the geoeconomic importance of the region may be exaggerated. Furthermore, external geopolitical dynamics can hinder the realization of the geoeconomic potential of the Arctic. Due to various spill-over effects, illustrated by the crisis in Ukraine, the Arctic is not necessarily as stable an investment and operating environment as often assumed.

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  1. See e.g. AAPC (2015).

  2. This stems not only from its ‘hybrid warfare’ in Ukraine but also more broadly from Russia’s dismissal of various international norms and commitments, such as European security infrastructure based on principles agreed upon in the 1975 Conference on Security and Co-operation in Europe; the security assurances to Ukraine agreed upon in the 1994 Budapest Memorandum; conventional and nuclear arms limitation frameworks; and best practices of conducting military exercises.

  3. These include, for example, the re-opening of various military bases and the establishment of a new strategic military command in the region. The securing of the Arctic was also highlighted in Russia’s new 2014 military strategy. For a previous discussion, see Zysk (2011).

  4. See e.g. a comment by the former US Secretary of State Hillary Clinton in Peritz (2014).

  5. Russia has also introduced counter-sanctions on the import of food products from western markets.


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Correspondence to Juha Käpylä or Harri Mikkola.

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Käpylä, J., Mikkola, H. The promise of the geoeconomic Arctic: a critical analysis. Asia Eur J 14, 203–220 (2016).

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  • Arctic Ocean
  • Continental Shelf
  • Maritime Transport
  • Arctic State
  • Arctic Council