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The High North: An Economic Dimension

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Abstract

The economy of the High North can be characterized as mixed, with a very strong extractive sector which is to secure the subsistence of the local people. In this respect, our area of interest has abundant natural resources, from petroleum and minerals, to fish and forests. Management of the area and coordination of action are crucial due to climate changes. In spite of permafrost and ice, great distances and difficult accessibility, this is no longer the economy functioning in isolation and therefore protected against the consequences of outside influences and decisions. It is a place where the newest technologies meet and at the same time the land of traditional techniques that make survival in extremely harsh climatic conditions possible. The economies of the High North have a series of common features which differentiate them from the economies of the contemporary world. Equally important are significant differences between regions and diversity among the local communities of the region. Although the formal sector of the economy of the High North is perceived through the perspective of exploitation of natural resources, the local economy can be defined as mixed, where market and non-market activities all play an important role in supporting community livelihoods.

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Notes

  1. 1.

    As a result of the referendum of 2005, on January 1, 2007, the two autonomous okrugs of Evenkia and Taimyr (Dolgano-Nenets) were liquidated, and incorporated into Krasnoyarsk Krai.

  2. 2.

    The official name is the Yakut Republic.

  3. 3.

    As a result of the referendum of October 2005, on July 1, 2007, the Koryakia Autonomous Okrug was incorporated into the Kamchatka District thus creating Kamchatka Krai.

  4. 4.

    The highest per capita gross domestic product in the Canadian Northwest Territories is due to a low population density.

  5. 5.

    For data on overall GDP of the Arctic Region (2003) and per capita, go to Aslaksen (2008) pp. 242 and 243.

  6. 6.

    More on the subject in Sects. 5.2.1 and 5.2.2.

  7. 7.

    MISTRA ARCTIC FUTURES IN A GLOBAL CONTEXT, A Swedish research programme in social sciences and humanities funded by Mistra, the Foundation for Strategic Environmental Research, 2011, www.arcticfutures.se, p. 4; see also www.mistra.org, www.polar.se.

  8. 8.

    Estimated natural gas deposits under sea bed.

  9. 9.

    The Arctic Council estimates the energy potential of the Arctic at 5 % of the world’s oil deposits and 20 % of gas. See also Młynarski (2011); and also Bird et al. (2008).

  10. 10.

    The shelf holds rich deposits of oil, gas and minerals. How much of them the Arctic really holds, nobody knows, and the issue is a subject of heated debates.

  11. 11.

    For summary of results of the resources go to: USGS, Circum-Arctic Resource Appraisal: Estimates of Undiscovered Oil and Gas North of the Arctic Circle. http://pubs.usgs.gov/fs/2008/3049/fs2008-3049.pdf.

  12. 12.

    There are potential hydrocarbon resources of 50–60 billion cubic meters on those shelves. Compare World Energy Outlook 2012, Presentation to the press, London, 12 November 2012, International Energy Agency, OECD/IEA 2012.

  13. 13.

    This is comparable with the level of the best fields in Iraq. Compare: World Energy Outlook 2012, Presentation to the press, London, 12 November 2012, International Energy Agency, OECD/IEA 2012.

  14. 14.

    It takes usually 10 years from making a discovery to production of oil and gas.

  15. 15.

    Partners in the project are Statoil operator (50 %), ENI 30 %, Petoro 20 %.

  16. 16.

    It has 20 % shares in the concession for oil exploitation.

  17. 17.

    More on the subject at http://wyborcza.biz/biznes/1,100896,12381144,Norwegowie_znalezli_nowe_wielkie_zloza_na_Morzu_Polnocnym.html#ixzz2pFfSmhYf. Retrieved October 21, 2012.

  18. 18.

    Estimates as to the extent of these deposits vary considerably, as well as assessing the viability of mining and exploration. According to the United States Geological Survey, there are deposits of gas hydrates methane clathrate in the seabed and in some Arctic regions. See 90 Billion Barrels of Oil and 1670 Trillion Cubic Feet of Natural Gas Assessed in the Arctic at http://www.usgs.gov/newsroom/article.asp?ID=1980. Retrieved September 05, 2012; Compare: Kijewski (2009).

  19. 19.

    Severnaya Zemlya (Russian: Северная Земля—Northern Land)—archipelago in the Arctic Sea north of 80°N, with the surface of 37,000 km². Severnaya Zemlya belongs to the Russian Federation and is a part of Krasnoyarsk Krai. The Northern Land separates the Kara Sea from the Laptev Sea. Severnaya Zemlya is a continuation of Taymyr Peninsula. Severnaya Zemlya was the last archipelago discovered on Earth. The discovery was made in 1913, and initially it was thought to be a single island, originally named “Emperor Nicolas II Land.” The flight of Graf Zeppelin over the Arctic in 1931 established that there existed at least two islands. Today, it is known that the archipelago is comprised of four main islands: October Revolution (14,204 km²); Bolshevik (11,206 km²); Komsomolets (8812 km²); Pioneer (1527 km²) and several other smaller ones of which the largest are: Schmidt Island (467 km²) and Little Taymyr Island (232 km²).

  20. 20.

    Anabar is a short version for the name Anabarski District, one of the most northward points in the Arctic part of the Sakha Republic (Yakutia).

  21. 21.

    The Northwest Territories—Canadian territory located in the central part of the North. It borders with Yukon in the west and Nunavut in the east, and with the provinces of British Columbia, Alberta, and Saskatchewan. The northernmost border is delineated by the shoreline of the Arctic Sea. The territories also include several islands, including parts of Victoria Island, Banks Island and a few smaller ones.

  22. 22.

    These rare earth metals are indispensable in advanced technology industries. Without them it is impossible to manufacture smartphones, hybrid propulsion systems, superconductors, laser applications, optical fibers or medical magnetic resonance devices. Currently, China seems to enjoy a monopoly of sorts since it has some 35 % of the world deposits of rare earth metals on its territory, and as much as 90 % of supply comes from this region.

  23. 23.

    The European Commission pays great attention to the subject of rare earth metals used in the production of strategic and indispensable goods. For the EU, access to Greenland’s deposits may be a salvation from a diktat of China.

  24. 24.

    More on the subject in Krojna (2013).

  25. 25.

    Japan currently operates the icebreaker Shirase II, launched in 2008, which has so far only been used in Antarctic expeditions like its five forebears.

  26. 26.

    In 2011, the navigational season along the NSR lasted 141 days: from the beginning of July till mid-November. See http://earthobservatory.nasa.gov/IOTD/view.php?id=77270. Retrieved August 10, 2012.

  27. 27.

    The Northwest Passage sea route that connects the Atlantic and Pacific Oceans through the Canadian Arctic Archipelago is marked by 300 years of trying to negotiate it, but all attempts ended in tragedy. Roald Amundsen was the first to cross the Northeast Passage entirely by sea. Should the ice melt continue at a large pace, and large vessels will be able to navigate the Northwest Passage, Churchill, a town on the West shore of Hudson Bay may become one of the biggest oil terminals in the world; see the map in: Geology and Earth Science at http://geology.com/articles/northwest-passage.shtml.

  28. 28.

    The Northwest Passage through Canada’s Arctic islands shortens by ¼ the distance in comparison with the route through the Suez Canal, and by three times compared to the route through the Cape Horn, and is shorter by 4,000 km than the one through the Panama Canal.

  29. 29.

    The Dutchman Willem Barents made three attempts between 1594 and 1596, but made it only as far Kara Sea and died on the return journey. Danish-born Vitus Bering also made an attempt, but did not get farther from Kamchatka than to the strait which now bears his name. Only in 1878 was the Finnish-Swedish geologist, Adolf Erik Nordenskiöld, able to make the first complete crossing of the Northeast Passage from west to east on his Vega expedition, on a 46 meters long barge, tonnage 357, with additional steam engine.

  30. 30.

    The map illustrating the Northwest Passage and the Northern Sea Route can be found at UNEP/GRID-Arendal, http://www.grida.no/graphicslib/detail/arctic-sea-routes-northern-sea-route-and-northwest-passage_f951.

  31. 31.

    Vessels owned by the German Beluga Shipping company.

  32. 32.

    Foreign Policy deemed it the most important unrecognized event in 2009.

  33. 33.

    Rosatom, the owner of the nuclear-powered icebreakers informed that the first in history LNG tanker Ob River” (previously Clean Power”) sailed through the Northern Sea Route.

  34. 34.

    Vice President of the parliamentary club of the leading party United Russia, and the polar explorer who placed the Russian flag on the bottom of the ocean at the North Pole.

  35. 35.

    It should be emphasized that more and more vessels have been testing the new Arctic Route. In 2010, four ships navigated it transporting some 111,000 tons of goods. In 2011, following the outbreak of the Arab Spring, the route has been negotiated by 34 vessels carrying 820,000 tons. And in the year 2012, until November 23, the whole Northern Sea Route have been navigated by as many as 46 ships with 1.26 mln ton of goods. See http://barentsobserver.com/en.

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Correspondence to Ryszard M. Czarny .

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Czarny, R.M. (2015). The High North: An Economic Dimension. In: The High North. Springer, Cham. https://doi.org/10.1007/978-3-319-21662-1_5

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