\n\u201cThere is no alternative for the Chinese\u201d \u2014 Rune Rafaelsen, Kirkenes Labor Party mayor<\/em>\n<\/p><\/blockquote>\n China published its first Arctic white paper<\/a> in January 2018, despite not actually owning any Arctic territory. In an icy twist to its Belt and Road<\/a> Initiative, the rising superpower outlined the economic importance of the region and called on Chinese businesses to participate in the development of Arctic shipping routes.<\/p>\n Kirkenes happens to sit at the western edge of one such shipping route. The Northern Sea Route<\/a> stretches from far-East Siberia along the Russian coastline to the Barents Sea, and has long been touted as a desirable alternative to current Asia-to-Europe passages. For one, it shaves about 40 percent off the distance. It also avoids the geopolitically tense Suez Canal. And in a special bonus for China, it dodges the heavy U.S. Navy presence in the Straits of Malacca<\/a>. The catch? Thick sea ice has made the route historically unnavigable, except by specially equipped vessels during certain intervals during the summer.<\/p>\n But as climate change ravages the Arctic, the Northern Sea Route is becoming slushier year-on-year. In 2018, the first container ship cruised the Northern Sea Route, and this year, transit volumes increased by 40 percent, reported the Barents Observer<\/a> (although most were related to the Yamal LNG plant, a China-Russia natural gas joint venture on the Russian coast, rather than regular cargo).<\/p>\n Some experts argue that the complexities of far-North transit \u2014 including increasingly unpredictable ice floes and severe winter storms \u2014 make even a warmer Arctic inhospitable to commercial interests. Maersk, the global shipping giant that tested the waters in 2018, insists it doesnt see the Northern Sea Route as a viable alternative to existing routes for its own vessels.<\/p>\n Maersk is not climbing aboard the Arctic shipping bandwagon | Olga Maltseva\/AFP via Getty Images<\/p>\n Still, a more crowded Northern Sea Route is likely a question of \u201cwhen,\u201d not \u201cif.\u201d And China, less constrained by budget and electoral cycles than its global rivals, has the luxury of the long view.<\/p>\n Chinese state-owned shipping company COSCO<\/a> has made no secret of its intention to ramp up its activity along the Northern Sea Route. At a conference in March this year, it flagged Kirkenes as a location of strategic interest, according to the Barents Observer. And in May, the town hosted a delegation from state-owned China Communications Construction Company Ltd. (CCCC), the worlds largest port infrastructure developer.<\/p>\n For Kirkenes, whose fluctuating fortunes have long been tied to an on-again, off-again iron-ore mine on the western edge of the peninsula, Chinese interest in the thawing Arctic looks like a lifeline.<\/p>\n \u201cThere is no alternative for the Chinese,\u201d Rafaelsen said, pointing to the geography of Norways northern archipelagos. \u201cIts not Troms\u00f8, its not Narvik, its not Bergen.\u201d Kirkenes unique position as the first ice-free port on the European side of the Northern Sea Route, he claims, makes it the ideal place for an Arctic shipping hub.<\/p>\n * * *<\/strong><\/p>\n To fulfill that vision, Kirkenes will need much more than a port.<\/strong> Goods landing in the European Arctic are still far from the hungry markets of the major cities further south, and currently, theres no way to get them there.<\/p>\n To solve this problem, the Norwegian, Finnish and Estonian governments have explored building various sections of a so-called Arctic Corridor<\/a>, including a railway linking Kirkenes to Rovaniemi, in Finnish Lapland, and an undersea tunnel connecting Helsinki to Tallinn, Estonia.<\/p>\n But these projects are expensive, and with the future of the Northern Sea Route still uncertain, governments have been reluctant to put money on the table. In February, the Norwegian-Finnish working group scoping the Arctic railway declared the project commercially unviable under current cargo estimates. The Finnish and Estonian governments have been sitting on a feasibility study of the Helsinki-Tallinn tunnel<\/a> since early 2018. Frustrated by government inaction, some northern entrepreneurs have taken matters into their own hands.<\/p>\n \n\u201cThis is the center of Norway \u2026 This is the closest Norway comes to something that is important regarding foreign policy. Nothing is happening in Oslo\u201d \u2014 Rune Rafaelsen<\/em>\n<\/p><\/blockquote>\n In March this year, Finnish entrepreneur Peter Vesterbacka<\/a>, best known as a creator of the hit game Angry Birds, signed a \u20ac15 billion deal with Beijing-backed investment firm Touchstone Capital Partners \u2014 as well as three Chinese construction firms \u2014 to build the Helsinki-Tallinn tunnel, which he says will be operational in 2024. If the agreement bears fruit, it will be the largest Chinese investment in Northern Europe.<\/p>\n Since then, Kirkenes-based public development company S\u00f8r-Varanger Utvikling<\/a> has inked a preliminary deal with Vesterbackas company, FinEstBayArea Development, to build the Arctic railway.<\/p>\n S\u00f8r-Varanger Utvikling Chief Executive Kenneth St\u00e5lsett insisted it was too early to talk about funding sources, but acknowledged that Chinas interest in the region certainly presented \u201can opportunity,\u201d as well as some uncertainty about whether the Norwegian government would approve large amounts of foreign funding for this kind of project.<\/p>\n But Rafaelsen says drawing attention to the question of foreign investment is part of his strategy. He is using the specter of Chinese development to show Oslo that \u201cwe should own our own infrastructure.\u201d<\/p>\n Mayor Rune Rafelsen is very optimistic about what Chinese investment can do for his rural community | Isabella Borshoff for POLITICO<\/p>\n \u201cThis is the center of Norway \u2026 This is the closest Norway comes to something that is important regarding foreign policy. Nothing is happening in Oslo,\u201d Rafaelsen said. \u201cThey dont understand whats going on up here. They dont have a clue.\u201d<\/p>\n At Norways foreign ministry, State Secretary Audun Halvorsen said the increase in shipping activity in the Arctic region was mainly related to \u201cpetroleum projects in Russia, fishing activity and cruise tourism,\u201d adding: \u201cThe commercial use of the Northern Sea Route as a transit route between Europe and Asia remains limited. A number of factors can explain this, such as demanding weather and ice conditions.\u201d<\/p>\n The Norwegian official said China had \u201cso far played a constructive role\u201d as an observer in the Arctic Council.<\/p>\n * * *<\/strong><\/p>\n For a week in February this year, Kirkenes pedestrian thoroughfare<\/strong> gleamed red under the glow of decorative Chinese lanterns. As part of an annual cultural festival, the town transformed itself into \u201cThe Worlds Northernmost Chinatown.\u201d A special Chinese-style gate popped up in the town center, and visitors from Chinas Harbin Theater Arts College performed a traditional dance for the residents of Kirkenes. The Chinese ambassador to Norway, Wang Min, opened the festivities alongside Rafaelsen.<\/p>\n Michael Miller, one of the festival organizers, said the idea behind this years theme was \u201cto see what Kirkenes possible future would be with \u2026 indications from China that they are really interested in this part of the world.\u201d<\/p>\n Chinese tourism in Kirkenes has exploded over the last five years, according to Miller. (Its not a phenomenon unique to Kirkenes \u2014 the Arctic has become a hotspot for Asian visitors.) This, combined with talk of Chinas commercial interest in Kirkenes, inspired Miller and his colleagues to involve locals in the conversation about what the future of their town should look like.<\/p>\n When POLITICO visited months later, opinions on the ground ran the gamut from unaware to cautiously optimistic to fearful.<\/p>\n P\u00e5l Riise, a Kirkenes resident who lives on a disability pension, called himself \u201ca little bit paranoid.\u201d<\/p>\n A special Chinese-style gate was erected in Kirkenes town center during the \u201cNorthernmost Chinatown\u201d festival | Lev Fedoseyev\/TASS via Getty Images<\/p>\n \u201cIf you let the Chinese buy one rock \u2026 they will be here forever,\u201d he said.<\/p>\n Others seemed less phased. K\u00e5re Tannvik, who runs the Kirkenes Snowhotel<\/a>, a major tourist attraction, thinks China could bring stability as well as opportunity.<\/p>\n \u201cI like it, because [right now] there are two boys quarreling. If there are three \u2014 Russia, America and if we have China here \u2014 it is a chance for peace, to take down the tension,\u201d he said. Hes a supporter of the Arctic railway, and believes China will be involved.<\/p>\n Jostein H. Maehla, a student in his final year at high school in Kirkenes, said the railway \u201cdefinitely should happen.\u201d The China question will be difficult, he said, but \u201cif the big boys come and they give you cash for something, you better accept it.\u201d<\/p>\n The town may never reach consensus on the question of Chinese investment. But its clear that many of its inhabitants are excited by the prospect of a more connected Arctic. St\u00e5lsett, who is spearheading the Kirkenes-Rovaniemi railway project, put it this way: \u201cPeople live here, we have our jobs here, our families \u2026 We want something to say in the development, we dont want to be looked at like a zoo.\u201d<\/p>\n \n\u201cEurope needs to define its own narrative. What our ambitions are economically and security wise, and what kind of role we want for China there in the Arctic\u201d \u2014 Jari Vil\u00e9n, Finnish diplomat<\/em>\n<\/p><\/blockquote>\n![](\"https:\/\/www.politico.eu\/wp-content\/uploads\/2019\/11\/GettyImages-1042361158-714x479.jpg\"\/)
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