Prime Minister Vladimir Putin on Thursday predicted Arctic shipping routes along Russia’s northern coast would soon rival the Suez Canal as a quicker trade link from Europe to Asia.
Russian plans to revive the Soviet-era shipping lane as polar ice cover receded to near record lows this summer could speed energy deliveries to China and boost business for cargo suppliers such as state-owned Sovkomflot.
Officials at the Arctic Forum in the White Sea port city of Arkhangelsk said Russia must develop infrastructure to guard against oil spills, revamp ports and build more icebreakers to realise Putin’s vision of year-round shipments.
“The shortest route between Europe’s largest markets and the Asia-Pacific region lie across the Arctic. This route is almost a third shorter than the traditional southern one,” Putin told participants, who included Iceland President Olafur Grimsson.
High energy prices fueled by demand from China and other emerging economies are helping spur interest in the Northern Sea Route, which trims 4,000 nautical miles (7,400 km) off the southern alternative via the Suez Canal.
“I want to stress the importance of the Northern Sea Route as an international transport artery that will rival traditional trade lanes in service fees, security and quality,” Putin said.
“States and private companies who choose the Arctic trade routes will undoubtedly reap economic advantages.”
To meet demand, Putin said Russia will spend 38 billion roubles ($1.2 billion) through 2014 on adding to its atomic icebreaker fleet and plans to build three more by 2020.
“There is interest in transport on the Northern Sea Route and it is now shifting from the experimental to the commercial sectors,” Russian deputy transport minister Viktor Olersky said.