China’s Strategy and Activities in the Arctic

Although a non-Arctic state, China has become a significant player in the Arctic region, engaging in economic, scientific, cultural, diplomatic, and military activities in and around various Arctic countries. A RAND report assesses the potential implications of Chinese investments and activities in the Arctic for the regional rules-based order and for regional and transatlantic security.

In this research, which was conducted as a collaborative effort between the RAND Corporation and the Swedish Defence Research Agency (Totalförsvarets Forskningsinstitut, or FOI), the authors evaluate China’s strategy and diplomacy in the region and inventory existing activities in the North American Arctic (United States, Canada, and Greenland). Through such approaches as a scenario-based tabletop exercise, this study also takes a broader look beyond the Arctic region to better understand the types and characteristics of Chinese activities that have been problematic and potentially destabilizing in other parts of the world.

The authors assess how some of these activities could also arise in the Arctic—a region whose physical, political, economic, and social characteristics set it apart, in many ways, from the rest of the world. They advance five recommendations that the U.S. government—particularly the U.S. Department of Defense—in collaboration with international partners and indigenous populations could take to maintain and reinforce current factors of Arctic resilience and mitigate undesirable Chinese involvement in the region.

Key Findings

Chinese investments and presence in the North American sections of the Arctic remain fairly limited

  • This situation has not been the result of a lack of effort on the part of Chinese companies, investment firms, and scientific organizations. Rather, it has stemmed from U.S., Danish, and Canadian efforts to block or otherwise restrict Chinese investments in industries identified as being critical to national and NATO security interests, including rare earth elements, petroleum, and submarine telecommunications cables.
  • Additionally, Arctic subnational actors have been cautious in their welcoming of Chinese activities.
  • More broadly, the Arctic presents strong factors of resilience that make it unlikely that Chinese investments in infrastructure could present the negative security, political, economic, social, and environmental outcomes that other regions of the world have experienced.
  • These factors of resilience specific to the Arctic include China’s strained bilateral relations with several Arctic states; Arctic states’ historical effort to keep Arctic matters among themselves; fairly strict regulations that prevent potentially damaging Chinese activities; local population’s efforts to monitor and prevent potentially damaging activities; reduced attractiveness of investments due to high costs; solid level of technological development that limits China’s appeal; relative wealth protecting Arctic states from predatory lending practices.
  • Not all of these factors of resilience are within the control of the United States and its allies, however, and we the authors highlight potential red flags—warning signs that some of these factors of resilience are not as strong as they have been in the past—for which to watch.

Recommendations

  • The U.S. government should maintain, but also strengthen wherever possible, solidarity among U.S. allies and partners in the Arctic to include multilateral and bilateral diplomacy with these countries and in the Arctic Council and other international fora. The Department of Defense should continue to deepen bilateral security cooperation activities and those in the context of certain North American Aerospace Defense Command and NATO activities.
  • The U.S. government should explore the conditions and possible pathways for restoring some limited level of engagement with Russia on Arctic issues in the wake of its war on Ukraine. A potential adverse outcome of the current paralysis of the Arctic Council could be a push from Russia for a new (or drastically changed) Arctic governance institution and where other Arctic-interested states—including China—might have a louder voice.
  • The U.S. government should maintain active engagement with the Greenlandic government to promote mutual interests and sustainable economic development.
  • The U.S. government should continue to elevate its overall engagement in the Arctic and make it clear to both other Arctic and non-Arctic states that its commitment is grounded in a long history of diplomacy, stewardship, and scientific research and not solely based on the role that the Arctic plays in strategic competition with Russia and China.
  • The U.S. government should work more closely with indigenous populations in the Artic, for instance through working with the Arctic Council’s Permanent Participants (four of which represent populations living in Alaska), possibly in cooperation with Canada and Greenland.
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