China’s Influence in the Arctic:
The CCP’s first major play in the Arctic was in 2003, when their first research base was established in Svalbard, Norway. Since then, the CCP has utilized seemingly altruistic motives like research activities and infrastructure development to gain access and influence in the region.
The PRC has invested over $90 billion above the Arctic Circle in infrastructure, assets, or other projects. Investments are largely in the energy and minerals sectors.
The CCP published an Arctic Strategy in 2018, which outlined plans to develop a Polar Silk Road and created the title of “near-Arctic state”, a classification which does not exist and is not universally recognized. This strategy, the “near-Arctic state” title, and the increasing investment in Arctic infrastructure are aimed to give the CCP more standing in its claim as an Arctic stakeholder.
China’s Foreign Investment in the Arctic:
Several Arctic countries, particularly Greenland and Iceland, have very minimal review processes in place to evaluate sources of FDI
Greenland and Iceland have the highest percentages of PRC investment in the Arctic – in Greenland, these investments make up nearly 12% of GDP and in Iceland, they are roughly 6%
In 2018, the China Development Bank pledged nearly $10 billion to support the Belt and Road Initiative in Russia with a particular focus on developing the Arctic and Northern Sea Route
CCP SOEs have made several failed attempts to purchase critical infrastructure in Greenland, including three airports and a former U.S. military base – these were diverted or rejected by the Danish government
In 2011, a PRC-based businessman sought to purchase land in Iceland to develop a golf resort – this offer was ultimately rejected in part because of fears that an airfield or deep-sea port would be developed instead
China’s Foreign Investment in the Arctic Mining and Energy Sectors:
The Kvanefjeld uranium project in Greenland is valued at $1.4 billion – Shenghe Resources, a CCP SOE, owns 12.5% of the project
In Iceland, two CCP SOEs, CNOOC and CNPC, have expressed interest in onshore energy licenses when they become available for bidding in 2021
- CNOOC already owns a 60% share in two potential oil and gas shelf sites in Iceland – Dreki and Gammur
In 2016, Sunshine Kaidi New Energy Group invested $1.13 billion for a new biodiesel plant in Finland
- The Chinese Development Bank signed a financing agreement in 2017 for a biorefinery where CCP SOEs will be majority shareholders and operators
China’s Foreign Investment in Space and Data:
The first CCP overseas satellite-receiving ground station was established in Kiruna, Sweden in 2016
In 2018, the PRC and Finland agreed to establish a joint center for satellite observation and remote sensing
Before Greenland had even authorized it, a CCP delegation celebrated the future construction of a satellite ground station at the Kangerlussuaq airport in 2017
Huawei Marine is currently in negotiations with the government of Finland to develop a submarine communications cable along the Northern Sea Route
- The PRC is currently reliant on foreign cables for all data transfer between Asia and Europe – a Huawei cable would shield CCP data transfers from others
- This cable would also increase the CCP’s underwater surveillance capabilities and significantly enhance its eyes and ears in the strategic Arctic region
China’s “Soft Power” in the Arctic:
Russia and the CCP established the Sino-Russian Arctic Research Center in 2019, which was intended to be utilized in 2020 for a joint expedition to research routes through the Northern Sea Route and to research climate change
- The PRC was set to cover 75% of the cost of the expedition.
- The China-Iceland Arctic Science Observatory was also completed in 2018 on land leased to the Polar Research Institute of China
The CCP’s eye has also turned toward tourism development above the Arctic Circle as a means to snap up real estate
- CCP SOEs are developing a hotel at the Arctic Circle in Rovaniemi, Finland and another is planned for nearby Saariselka
Greenland also sent a permanent representative to Beijing for trade purposes in July 2018
*Last updated: 3/16/2021