e eS xpert CommentarieSSummer SChoolSSCenarioS l eCr oundtabairrdIveenwnfpeaiouorlrlrtetkyn iSCnCeSgSe i pSrbaao poroeanrtkonSCSuedaniid oedf ttotauIrbnoylCeeCSangiatSaitoflinlonogr edianbtiegricnnaaat ilotpnlaool Ir lgev lipaCutiIoynetoS n tetworkyalprojeCtSlrCaeinntoantliffey eSpCorigSopreu eaonSSentColi dlgee CSfnenarioStour rrC epelpolitiCSoSmCotpaationSelStititSCi ionntpoolnygS etworkprojeCtS ernationalorganizationS SdSionSiCSiCeunSCSeduCationieoonSSneCurityS SrreefoeCruuenrCniet dbyo ogieSkSRIANaCyFUTFSEASRIIReNdASAN T dCiIOOauUNnlNAtCLCoe ILragntauitoeionnSSaCuhliomnormootgleeraSrrng nnaliaazatnitoiizonetyanaSlt iationonmaCySSCnCeSgloba tionalrel poliCytaletingnint CuS lrelati ptnCebookSaargSwCytbCndlelieioebarleSnbSoighCatSuieeelpaon ntholodiplomSaeCurityaldibrarypnaieCrSttonrxeChrmpShueomiepriSlenptgntSo ueroterigSoanotar SirldhneeCmiittpeSSuaSSrpS egSSInternatIolactIvItyC SoiviloCimbigrdaiplolConfere italentpoolnternaySiSf oreignoreCaSdmrgintiSiegeprrlnoaSotrhiitopbSSnbailateral dreferef oreignpoliroadmapSlibrarymigratiSCCenarioSonfdeiplomaCyrenwCebSiteeS annda lfyoSrieSCSaCSietninCge oreignpoliCynal ndf SmerCienolSCe ialogue i af nternational organizationS a o m S R1TFEwU,ea–w SlBxm.wS::. Ia A. Yr++iNula:7 7 sIkNw s(i(Tm4ei4Ea9l9Racn5N5oncA))mko T22auIeO22 ns@N55ctA r i6Lrl6e.u r22eAus8F8ts,F43 Ai1aIR1nS9c 1CoO8uU0nN,c CiMlI.Lro u(sRcIAoCw) , Russia Bb ilateralrelationSnternationalorganizationSS usInessummerSChoolSrwCebSiteeportSlmuigratione bpxpertCommentarieSa artnerShipm1TFnthologieSen etworkprojeCtSHOe7tidnternShipSRE imigdinfia/lno go igrationn tgrRlIS2ueieeNorCitSUg0nlnTbgrreaaCeS 1idpatEnxvoeieSauriplo5olalRlfexinliioy ICueSroplanSNypArbtgibl enStS o urNA eaCaraaeSdltlRnoeineT lr lodmtinC ACat dI ottmfoet OipnoiRpiia meCoroCpEoabonNenCSolmbSCtoilSolnaAaeC elTmolubmeetingSSrirnPtetILtkagraiStieCCienCenSCiaS ySgeruCyClrp:yfartnerShipewe OSiSOe rPCSteoompetitionSOe eaOnlnCRPerTitfCedCnternShipShef EEiotbgneioluuw toNRvCorkingpaperSoebrTrrogairrlnplCATeekilaeuiStSSInagS TiaoiboAeb SrbnnilateralI aatimt OLlirelationSrpno zdnrie eSwtoeNaeCmol ueaoladmrCtrtriimkeiauCSienotiennnryyhgCptS e gSipe aiCSyaxpertCommentarieg pShopto elobalSCienCeorilSonbSC nivilSSCSg SwnpoleCurityueStleCtureSoCietyreCotoCijworonferenCeSbemoadmapSoeCrortrnSkkSpa afdaeCurityiCanreoompetitionSnnkgrStyrit dapiiephtuiSCuSSionSolClaoSiySapoolSeSg onmirlobalSCienCetgSCSSiSChi aneonferenCeSagSCnSydCienCe i Cover Report 17 eng.indd 2 16.07.2015 22:30:22 RUSSIAN INTERNATIONAL AFFAIRS COUNCIL MOSCOW 2015 Russian International Affairs Council Council for the Study of Productive Forces Editorial Board Editor-in-Chief: I.S. Ivanov, RAS Corresponding Member, Dr. of History Authors: A.N. Pelyasov, Dr. of Geography (Head); A.V. Kotov, Ph.D. in Economics Copy editors: I.N. Timofeev, Ph.D. in Political Science; T.A. Makhmutov, Ph.D. in Political Science; L.V. Filippova; D.O. Kholopova The Russian Arctic: Potential for International Cooperation: Report No. 17 / 2015 / [A.N. Pelyasov (Head), A.V. Kotov]; [I.S. Ivanov (Editor-in-Chief)]; Russian International Affairs Council (RIAC). Moscow: Spetskniga, 2015. – 112 pp. – The names of authors and editors are listed on reverse of title page. ISBN 978-5-91891-370-3 The report continues work held in line with the “Roadmap for International Cooperation in the Arctic” project organized by the Russian International Affairs Council (RIAC). The report looks into the network of circumpolar territories including new industrial regions on the Arctic continental shelf, analyses key goals of educational cooperation and identifies opportunities for international collaboration among small and medium-sized businesses in the Arctic. Authors present their vision for strategic governance in the Russian Arctic and inter- municipal cooperation in the coastal zone of the Russian Federation. RIAC thanks Ksenia Kuzmina, Jacqueline Koo, and Douglas Herrick for their help with the editing process. The views and opinions of authors expressed herein do not necessarily state or reflect those of RIAC. Any linguistic inadequacies in the publication are the sole responsibility of the translation editors. Cover photo credits (top down, left to right): wikipedia.org, gazprom.ru, rosatomflot.ru. The full text is published on RIAC’s website. You can download the report or leave a comment via this direct link russiancouncil.ru/en/report17 © Pelyasov A.N., Kotov A.V., 2015 © Drafting, translation and design. NPMP RIAC, 2015 Table of Contents Introduction 4 1. Interregional International Cooperation in the Arctic 8 1.1. The Circumpolar Regions Network 8 1.2. New Industrial Regions on the Arctic Continental Shelf: Potential Spheres of International Cooperation in the Arctic 19 1.3. Arctic Cooperation of Small and Medium-Sized Businesses on the Sites of the Business Forum Established by the Arctic Council 28 1.4. Educational Cooperation in the Arctic and Competition for Talent 36 1.5. Inter-Municipal Cooperation in the Coastal Zone of the Russian Federation 46 1.6. Ecosystem-Based Management in the Arctic 52 2. Strategic Governance of the Russian Arctic 58 2.1. Prospects for the Creation of a Single Centre Responsible for the Implementation of the Russian Federation’s State Policy in the Arctic 58 2.2. The Arctic as a New (Virtual) Federal District 66 3. Conclusions and Recommendations 71 Tables and Figures 74 About the Authors 110 THE RUSSIAN ARCTIC: POTENTIAL FOR INTERNATIONAL COOPERATION Introduction International cooperation in the Arctic has been the subject of numerous works in recent years. Even though the extent of such cooperation is relatively small, scientists in and outside Russia have shown a keen interest in this phenomenon. The main reason for this is the unprecedented rate of its development: only 25 years ago there was no question of any cooperation between the Russian Arctic territories and those of other Arctic countries. Among the topics that engage scientists studying international cooperation in the Arctic are above all the general aspects of interstate cooperation, notably within the Arctic Council, the Standing Committee of Parliamentarians of the Arctic Region and the Northern Forum, which ensure Arctic navigation along the Northern Sea Route. These issues are addressed in presentations, articles and monographs by A.V. Vasilyev, Y.F. Lukin, G.D. Oleinik, V.I. Smorchkova, O.R. Young and other Russian and foreign experts1. During Soviet times, practically the only topic approached through international cooperation in the Arctic was how to protect its fragile natural environment. This topic still looms large today, with the addition of climate change issues, as Russian and foreign scientists study the impact of climate change in the Arctic on circumpolar cooperation. We are referring to the works of A.V. Zagorsky, M.L. Lagutina, A.V. Fedotovskikh, N.K. Kharlampiyeva, W. Ostreng, M. Tennberg and others.2 A separate block of studies is naturally devoted to cooperation among the polar states in the management of natural resources and in implementing on-shore and off-shore Arctic mega-projects. The most notable works in this area come from 1 Arctic Region: Problems of International Cooperation. Anthology: in three volumes / Russian International Affairs Council. Moscow, Aspekt Press, 2013. Vasilyev, A.V. “The Arctic: A New Development Vector // Arktika. Ekologia i Ekonomika, 2011. No 1, pp. 20–25 (in Russian). Zuyevskaya, A.P. International Relations in the Arctic Region: Marine Activities of the Coastal Regions of the Russian Federation // Development of the North and the Arctic: Problems and Prospects: Proceedings of the Interregional Scientific-Practical Conference, Apatity, November 14–16, 2012, Apatity, 2012 (in Russian). Lukin, Yu.F. Arctic Solidarity // Vestnik Severnogo (Arkticheskogo) Federalnogo Universiteta. Social Sciences and Humanities Series. 2010. No. 4, pp. 7–14 (in Russian). Oleinik, G.D. International Economic Cooperation in the North Must Be Actively Developed. URL: http://www.council.gov.ru/ media/files/41d44f2433e3c8cd295a.pdf#page=51 (in Russian). Smorchkova, V.I. The Arctic: Region of Peace and Global Cooperation: Institutional Prerequisites of Sustainable Development. Moscow, Russian Civil Service Academy Publishing House, 2003 (in Russian). Young O.R. The Structure of Arctic Cooperation: Solving Problems/Seizing Opportunities. 2000. URL: http://www.arcticparl.org/files/images/conf4_sac.pdf. Young O.R. Governing the Arctic: From Cold War Theater to Mosaic of Cooperation // Global Governance: A Review of Multilateralism and International Organizations. 2005, January/March. Vol. 11. No. 1, pp. 9–15. Young O.R. Whither the Arctic? Conflict or Cooperation in the Circumpolar North. Polar Record, Cambridge University Press, 2009. 2 Kharlampiyeva, N.K., Lagutina, M.L. International Cooperation in the Arctic: The Environmental-Political Aspect // So- ciety. Environment. Development (Terra Humana). 2010. No. 3, pp. 212–217 (in Russian). Fedotovskikh, A.V. Economic Modeling of the Consequences of Climate Change in the Russian Arctic Zone // The State of Arctic Seas and Territories in Conditions of Climate Change: Collection of Summaries of Presentations at the All-Russian Conference with International Participation / Compiled by S.V.Ryabchenko; Lomonosov Northern (Arctic) Federal University. Arkhangelsk, 2014 (in Russian). Østreng W. National Security and International Environmental Cooperation in the Arctic: The Case of the Northern Sea Route. Kluwer Academic Publications, 1999. Tennberg M. Arctic Environmental Cooperation: A Study in Governmentality. Aldershot, 2000. Vylegzhanin, A.N. et al. International Cooperation in the Field of Environmental Protection, Preservation and Rational Management of the Arctic Ocean Biological Resources: International Scientific Symposium Proceedings (Moscow, September 4, 2012, RIAC): Working Paper / Russian International Affairs Council. Moscow, Spetskniga, 2012 (in Russian). 4 Report 17 / 2015 INTRODUCTION scientists at the Kola Science Centre: V.V. Vasilyev, V.V. Denisov, G.G. Matishov, F.D. Larichkin, V.S. Selin and others (mainly from Moscow and St Petersburg).3 Geopolitical and geo-economic issues regarding international cooperation in the Arctic are regularly raised in the works of V.B. Mitko, A.A. Sergunin, N.A. Rubtsova and others, although they remain relatively rare.4 Some publications analyse examples of international cooperation between individual research organisations, civil society structures and associations of the small indigenous peoples of the North.5 One particularly experienced organisation is the Russian Association of Indigenous Peoples of the North (RAIPON), which operates in all the six Arctic Council working groups: the Arctic Contaminants Action Programme, the Arctic Monitoring and Assessment Programme, Conservation of Arctic Flora and Fauna, Emergency Prevention, Preparedness and Response, Protection of the Arctic Marine Environment and the Sustainable Development Working Group.6 Some authors (for example, E.P. Bashmakova, V.V. Didyk et al) look into aspects of interaction of the Russian Arctic regions with the Arctic territories of other countries. This report is devoted to the less well-studied (exploratory) aspects of international cooperation among entrepreneurs (firms) and corporate structures, universities, and municipalities (Arctic cities and regions). The focus on the economic aspect of international cooperation that characterises this report is fully in line with recent Arctic Council decisions, notably the establishment of the Arctic Economic Council on September 3, 2014. The Council is called upon to contribute to the economic and social development of the Arctic, present the position of the local business community to Arctic Council members, and work in close cooperation with entrepreneurs in the Arctic regions and countries.7 International economic cooperation in the Russian Arctic today is concentrated in three areas: 1) cooperation among Arctic entrepreneurs and their associations, chambers of commerce and industry (the topic of international cooperation among small and medium-sized businesses in the Arctic has not, unfortunately, been 3 Bogoyavlensky, V.I. The Current State and Prospect of the Development of Oil and Gas Resources in the Circumpolar Region // The Arctic Region: Problems of International Cooperation. Anthology: in 3 volumes. Vol. 2 / Russian Inter- na tional Affairs Council. Moscow: Aspekt Press, 2013, pp. 72–109 (in Russian). Yevstigneyeva, A. Russian–Nor- we gian Cooperation in Developing the Russian Arctic Resources. URL: http://www.observer.materik.ru/observer/ N11_2008/051_061.pdf (in Russian). Yeremin, N.A. Kondratyuk, A.T. Yeremin, A.N. Russian Arctic Offshore Oil and Gas Resource Base // Georesources. Geoenergy. Geopolitics (Electronic Scientific Journal). 2009. No. 3 (in Russian). Rudakov, M.N. Shegelman, I.R. The Arctic Natural Resources and Finland’s Economic Interests. URL: http://www.ivdon.ru/uploads/article/pdf/IVD_42_rudakov.pdf_2410.pdf (in Russian). Selin, V.S. Vasilyev, V.V. Interaction of Global, National and Regional Economic Interests in Developing the North and the Arctic. Apatity: G.P. Luzin Institute of Economic Problems of the Russian Academy of Sciences, 2010 (in Russian). Fadeyev, A.M. Larichkin, F.D. Effective International Cooperation in Industrial Support of Offshore Arctic Projects // Transfer Inovácií. 2012. No. 23. URL: http://www.sjf.tuke.sk/transferinovacii/pages/archiv/transfer/23-2012/pdf/013-018.pdf (in Russian). 4 Mitko, V.B. The Evolution of Geopolitical Factors That Determine the Russian Mission in the Arctic. URL: http://www.arcticas.ru/docs/Kongress_tisyacheletie2010_tom1.pdf#page=3 (in Russian). Rubtsova, N.A. The Barents Region in the Context of Globalization and Rationalization // Vestnik Severnogo (Arkticheskogo) Federalnogo Universiteta. Social Sciences and the Humanities Series. 2009. No. 5, pp. 60–64 (in Russian). Lukin, Yu.F. Arctic Cooling against the Background of Returning to the Cold War Instruments // Vestnik MGTU. 2014. Vol. 17. No. 3. pp. 515–522 (in Russian). 5 Ivanova, L.V. International Cooperation of the G.P. Luzin Institute of Economic Problems of the Russian Academy of Sciences, Kola Science Centre // Vestnik Kola Science Centre of the Russian Academy. 2011. No 4, pp. 42–45 (in Russian). Konyshev, V.N., Sergunin, A.A. International Organizations and Cooperation in the Arctic // Vestnik Mezhdunarodnykh Organizatsiy. 2011. No. 3 (34), pp. 27–36. URL: http://www.ecsocman.hse.ru/data/2011/09/08/1267443144/4.pdf (in Russian). 6 International Activities. Association of Indigenous Small-Numbered Peoples of the North, Siberia and the Far East of the Russian Federation. URL: http://raipon.info/activity/mezhdunarodnaja-dejatelnost.php (in Russian). 7 The Arctic Economic Council is Created. URL: http://www.vz.ru/news/2014/9/3/703676.html (in Russian). www.russiancouncil.ru 5 THE RUSSIAN ARCTIC: POTENTIAL FOR INTERNATIONAL COOPERATION covered widely enough in spite of the significant potential for further expansion and intensification); 2) cooperation among the resource corporations of various countries (the report uses the agreements made between Rosneft and foreign partners as examples); 3) international cooperation in creating new industrial regions on the Russian Arctic continental shelf. The potential new Arctic offshore oil and gas areas differ in terms of their readiness for international cooperation. This report breaks new ground in presenting an economic assessment of the work to support Russia’s claims to the areas of the Arctic continental shelf near the Mendeleev and Lomonosov ridges. The authors evaluate the costs and benefits to the country of obtaining millions of square kilometres of sea that is potentially rich in hydrocarbons, and which may in the future become an area of new international cooperation. Emphasizing the role of knowledge, talent and innovations, we have devoted a separate section to educational cooperation among the Arctic countries and regions. A comparison of two reports on the socioeconomic development of the Arctic (one from 2004 and the other from 2014) commissioned by the Arctic Council attests to the strengthening of the knowledge component in international cooperation in the Arctic. The report analyses cooperation of the Arctic universities as new actors in the economic development of the circumpolar zone and its cities and regions. It also describes the old and new Arctic research centres and looks into the phenomenon of international education migration in the Arctic. New research projects dedicated to the role of diasporas in shaping international research networks have broadened the focus of research on the flow of knowledge in the circumpolar region. Important centres of Russian expatriate Arctic researchers abroad and their work have been analysed using the materials of the International Congress of Arctic Social Sciences held in Prince George, Canada, in May 2014. Information-wise, an instructive example of the Norwegian oil and gas project Snow White on the Northern shelf has been described to highlight the vast differences in the ways that foreign experience and competences have been used at different stages in implementing the project. For the first time, the issue of restoring the federal structure responsible for developing state Arctic and northern policies has been considered in this report in terms of international cooperation. Russia needs such a structure, notably to adequately represent its Arctic interests in the negotiations with foreign partners. This structure is currently being designed based on Canada’s Northern Economic Development Agency and the latest experience of Russia’s Goskomsever in conjunction with the creation of the “virtual” Arctic Federal District, which is being modelled in various formats. The dramatic changes in the international situation that took place in the summer and autumn of 2014 made it imperative for the authors to cover yet another aspect of the topic, i.e. cooperation in the context of the economic sanctions introduced against Russia by the European Union member states, the United States and Canada. Sanctions inevitably cool the process of interstate cooperation and hinder many of the structures and elements already created within its framework. For example, university circumpolar networks, the networks of non-profit partner organisations and civil society institutions, in the new conditions, dampen the shock of otherwise complicated interstate interaction in the Arctic. 6 Report 17 / 2015 INTRODUCTION In dealing with each area of international circumpolar cooperation and each level thereof (national, regional, municipal, corporate and atomic, i.e. individual households and entrepreneurs), the authors have sought to describe and characterise the structures, institutions and projects that exist and are being created in order to make this phenomenon more visible and tangible. To this end, they have used materials collected from expeditions, interviews conducted in the cities and regions of the Russian Arctic, research papers, publications as well as articles and documents that have been kindly made available by foreign colleagues and internet resources. Interaction between the Russian Arctic and the countries of the Asia-Pacific Region, including China, and the description of existing and potential actors in such cooperation in Russia and Asia is not covered in the present study. We believe that this multifaceted theme calls for a separate study and possibly a separate RIAC publication. www.russiancouncil.ru 7 THE RUSSIAN ARCTIC: POTENTIAL FOR INTERNATIONAL COOPERATION 1. Interregional International Cooperation in the Arctic 1.1. The Circumpolar Regions Network 1.1.1. Arctic Test Range for International Cooperation In his book Arctic Politics: Conflict and Cooperation in the Circumpolar North, published more than 20 years ago, Oran Young predicted that in the 1990s the Arctic would become a test range for new forms of international cooperation.8 The past two decades have confirmed Young’s prediction. The process of international cooperation in the Arctic region has been gathering pace since the end of the Cold War and the military confrontation that took place between 1989 and 1991 between the Warsaw Pact countries on the one side and NATO on the other. Against the background of local conflicts and confrontation in the Middle East, Africa and Asia the unprecedented speed and vigour of cooperation in the Arctic during these years provides a positive example and a lesson for humankind. The Arctic regions today have emerged as a test laboratory for international cooperation. Even at times of temporarily heightened international tensions, cooperation continues on many levels between various structures, institutions and physical persons for the sake of diversifying the economies of the Northern territories, making them more innovative and more attractive for investments.9 The diversity of economic interactions in the Arctic Region can be reduced to three basic sectors: state, private and traditional. The state sector ensures budget employment and interbudgetary transfers. The traditional sector includes deer herding and the subsistence industries of the indigenous peoples. The private (corporate) sector is mainly represented by major extractive businesses as well as small and medium-sized Arctic enterprises. Each of these sectors has been involved in international Arctic cooperation. The state and municipal authorities of Russia’s Arctic territories have been members of international circumpolar organizations for the exchange of experience and good practices in developing the Arctic through the Conference of Arctic Parliamentarians, the Barents Region cooperative structures, the Northern Forum, the Northern Research Forum and similar bodies. The indigenous peoples of Russia, through the Association of Indigenous Peoples of the North, Siberia and Far East, have been involved in cooperation with indigenous Northern and Arctic organizations abroad. Russian corporations that develop Arctic resources have been engaged in ambitious partnership projects with Norwegian, Finnish and, until recently, US and Canadian companies. 8 Young O. Arctic Politics: Conflict and Cooperation in the Circumpolar North. Dartmouth College; University Press of New England, 1992. 9 Pelyasov, A.N. International Economic Cooperation of Arctic Countries and Regions // The Russian North: Modernization and Development. Moscow. Strategic Partnership Centre, 2012. pp. 66–76 (in Russian). 8 Report 17 / 2015 1. INTERREGIONAL INTERNATIONAL COOPERATION IN THE ARCTIC 1.1.2. Stages of International Cooperation of the Russian Arctic Regions The past 20 years of international cooperation of the Russian Arctic regions can be divided into three stages.10 Stage One (1992–1997) saw the establishment of external contacts in several areas: an increased number of partner regions abroad; a growing number of regional government structures involved in cooperation; early international contacts among the Russian Arctic townships and municipal districts beyond the Arctic Circle. This period saw the emergence of two types of leaders in Russia’s Arctic regions: those that were open to international economic cooperation in the Arctic (on land and within the 200-mile coastal zone) and prepared for broad cooperation with foreign colleagues, and those who eschewed such cooperation. The latter, purporting to defend Russia’s geopolitical interests, did all they could to diminish the format and content of international economic cooperation among the Northern territories. The contrast between the two models of leadership was brought into focus when two different teams of leaders adhering to opposite views on international economic ties succeeded each other over ten years in the same region, as happened, for example, in the Chukotka Autonomous Okrug. In spite of all the risks inherent in the first model (the possible penetration of foreign partners into territories and areas of military importance), it yielded new knowledge, experience, competences and technologies for the development of the Russian North. In the 1990s, during the massive decentralization of economic and political power in Russia, the Northern and Arctic regions were the main initiators of joint projects with foreign partners in the Arctic, originally as part of cross-border cooperation and then on a broader scale. Examples are offered by scientific cooperation between North-Eastern Russia and the state of Alaska in the early 1990s, the three-year Eurasia Foundation Project involving the transfer of the experience of the social and economic development of Alaska to Russia’s Northern and Arctic regions in the mid-1990s. Stage Two (1998–2002) was marked by a deepening of external ties among Russia’s Northern regions owing to the adoption of framework regional laws on this type of activity, active work to conclude and assess international contracts financed through regional budgets, and the emergence of early economic results from circumpolar interregional cooperation. This period saw the start of international educational programmes, such as the Russian–Canadian INRIPP Programme (Institutional Building for Northern Russian Indigenous Peoples) in the Yamalo-Nenets and Khanty-Mansi Autonomous Okrugs. In the programme, specialists from the regional and municipal authorities and representatives of non-governmental organizations from Yamal and Yugra studied in Canada. The outcome of the programme was the creation of a regional national corporation of the indigenous Northern communities in the Khanty-Mansi Autonomous Okrug – Yugra. 10 For the purposes of this report, the term “Russian Arctic” refers to the territory of the Arctic Zone of the Russian Federation determined by Russian Presidential Decree No. 296 “On Land Territories of the Arctic Zone of the Russian Federation” dated May 2, 2014. www.russiancouncil.ru 9