When you think innovation, you think California. Its tech industry thrives on a set of integrated production networks that link Silicon Valley to Shenzhen in southern China via specialized nodes in Taiwan, Japan and South Korea. The Pacific basin is really just one giant manufacturing hub. Call it “Calichina.”
The Calichina economy is so well integrated because the Pacific Ocean is so cheap and easy to cross. It takes less than two weeks to ship a container from Shanghai to Los Angeles, and since there are no canals or other choke-points to cross, the prices are rock-bottom. In economic terms, Europe is much farther away from China, even if it looks closer on a map. Shipping from Shanghai to Rotterdam takes more than seven weeks at several times the price.
China’s famous One Belt, One Road Eurasian infrastructure initiative doesn’t really change that comparison. Building ports in the Indian Ocean won’t shorten the sea miles to Europe, and railroads across the barren wastes of central Asia simply can’t carry enough freight fast enough or cheap enough to make any difference. China wants to diversify away from its reliance on the U.S. economy, but Eurasia’s inconvenient geography keeps getting in the way.
In its never-ending quest to bring Europe just a little closer, the Chinese government is now promoting the idea of a Polar Silk Road over the top of Eurasia, passing Russia and Norway to connect China to Europe via the Arctic Ocean and the North Sea. The Polar route is rapidly becoming viable (at least in the northern summer) as global warming shrinks the Arctic icecap.
But even this route, at an estimated 30 days, puts China no closer to Europe than to New York, which can be reached in 24 days from China via the Panama Canal. And the Polar Silk Road will only be open in the summer for decades to come. Sea ice and vicious weather conditions will continue to make the winter journey too dangerous even as global warming progresses. From an environmental perspective, it may be too dangerous at any time.
Nonetheless, in its January 26 Polar Silk Road white paper, China asserts its right to sail the Polar route under the United Nations Convention on the Law of the Sea (UNCLOS), which guarantees freedom of navigation in international waterways. This is ironic, considering that China has rejected the international Permanent Court of Arbitration ruling that China is itself violating UNCLOS in the South China Sea.
China is essentially running freedom of navigation exercises in the Arctic while denying international freedom of navigation in the South China Sea. Its aggressive push to open the Polar route also flies in the face of the eight-country Arctic Council’s recommendations for a go-slowly approach. The Arctic Council points to “the lack of communications, charts, adequate search & rescue response, [and] environmental response” in the region.
But in opening the Polar Silk Road, China says that its policies are based on the principles of “respect, cooperation, win-win result[s] and sustainability.” China specifically promises to protect the environment, protect the ecosystem, and address climate change. It also says that it “highly values” the Arctic Council’s “positive role in Arctic affairs.” China is not a member of the Arctic council but it has been an observer state since 2013.
Whatever happens with China’s development of the Polar Silk Road, two things are sure. First, it won’t make much difference to the structure of global trade. The United States will remain China’s main innovation partner for the foreseeable future. And second, it won’t carry much silk. Russian Arctic oil is the only cargo likely to make the route viable. And that’s bad news for the environment, for the ecosystem, and for global warming.