Politics

China's Secret Weapon Against The US Is...Iceland?

By | Aug 12, 2014 06:31 PM EDT
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Iceland

Iceland's Prime Minister Johanna Sigurdardottir talks with Chinese Premier Li Keqiang during a ceremony in China last year.(Photo : Reuters)

Oil, natural gas, gold, tungsten, diamonds - the laundry-list of wealth lying in wait under the Arctic Ocean makes world leaders delirious with potential. The nations it touches, Russia, the United States, Norway, Canada, Iceland, and the Danish possession of Greenland, all have begun jockeying for staking a claim.

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Even better, it can now be reached, a side-effect of thinning pack ice courtesy of global warming. But for all its resources, the Arctic does have a spectacular lack: Infrastructure. 

The much-heralded Northwest Passage, a waterway stretching from the Bering Strait through Canada's Arctic Archipelago and into Baffin Bay and the Atlantic beyond, is predicted to be one of the most strategically vital trade lanes in the coming decades. With less ice, what was once an impassible sea route is suddenly an option for all the nations in the region. However, largely unpopulated due to the historic extreme cold, there is almost no settlement or port of call along the entire passage.

Enter Iceland.

With open ports year-round, Iceland is now being wooed by China and Russia alike for its growing strategic position. The traditional power-broker in the North Atlantic, the United States, withdrew its last troops in 2006 as part of America's post-Cold War wind-down. Eager to step into the vacuum, China is bundling up and heading north. Last year, the first Chinese tanker ran the Northwest Passage, the same year Beijing entered into a free-trade agreement with Reykjavik. 

The development makes good business sense; via the Northwest Passage, a Chinese cargo ship can skirt over Russia to Iceland, and from there to European ports in two weeks. The current route, through the South China Sea and Indian Ocean, is twice as long.

"Since World War II, Iceland has been considered in an American zone of influence but the withdrawal of the US military has resulted in a number of Icelanders looking more towards other parts of the world for security and support as well as trade," said Hjörtur Guðmundsson, an Icelandic historian and journalist writing for the Alaska Dispatch News. 

He continued by observing, "The US military was in Iceland for about six decades as the country continued to serve an important role during the cold War in keeping an eye on Soviet military activities in the North Atlantic. Today, Iceland's stragetic important is rather economic and geopolitcal." 

After Iceland's economic meltdown in 2008, Reykjavik found itself under extraordinary pressure from European leaders to join the European Union. Always of an independent mien, Iceland successfully resisted, but came away deeply resentful. It turning to other economies for trade did not come as a shock.

With no claim to Arctic territory, a closer relationship with Iceland will also provide China with a back channel to influence the region's politics, analysts believe.

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