City Diplomacy, Seattle and the Arctic

Seattle can advance its strategic goals of increasing international trade and increasing its
leadership role on climate action and civil rights through city diplomacy and the Arctic. The
Arctic is changing rapidly due to climate change, presenting opportunities and concerns. The
permafrost is melting, there are unclear changes to marine ecosystems, and an increase in
greenhouse gas emissions.1,2At the same time, there are new opportunities, as the Arctic is
becoming more accessible to international shipping, business, and natural resource extraction,
including fisheries. 3,4
In order to capitalize on these financial opportunities and alleviate ecological concerns, the
Arctic needs sustainable development. The Guggenheim Financial Group in DC estimates that
infrastructural development in the greater Arctic are upwards of $1 trillion dollars. The
International Energy Agency estimates global Arctic investment as high as $20 trillion by 2038.
5,6
Seattle can lead this development to promote increased international trade, climate action and
civil rights. Building on Seattles multi-billion dollar relationship with Alaska, through the
maritime & shipbuilding industries and fisheries, as well as stationing the two Polar-class
Icebreaker ships that serve to clear Arctic pathways, Seattle is perfectly positioned to be the
policy hub for Arctic development by using existing networks. 7
These existing networks include the University of Washington, the private sector, and the public
sector. Specifically, Seattle can increase its trade and its leadership role through a cross-sectoral
(academic, private and public sector cooperation) Arctic Working Group (AWG).
Alaskan Relationship
As mentioned previously, Seattle already has a lucrative economic relationship with
Alaska. In 2013 alone, Seattle earned $6.2 billion dollars in revenue from Alaska. This
connection accounted for 113,000 jobs in 2013.8 These earnings and jobs included a wide
spectrum from shipping, seafood, petroleum, tourism, maritime support, education, and health
care. This relationship is growing. Seattles revenue increased from $4.3 billion to $6.2 billion
from 2011 to 2013, highlighting the rapid growth and change in the greater Arctic.9
1

Arctic Opening: Opportunity and Risk in the High North, Lloyds, Chatham House Charles Emmerson, Senior Research Fellow, Chatham House
2012
2

Opportunities and Challenges for Arctic Oil and Gas Development Eurasia Group report for The Wilson Center,Washington, D.C. 2014

Ibid.

Ibid.

Guggenheim Partners Endorses World Economic Forum's Arctic Investment Protocol

https://www.guggenheimpartners.com/firm/news/guggenheim-partners-endorses-world-economic-forums January 21, 2016
6

Polish Entrepreneurs Go Arctic: Rethinking Circumpolar Investment http://www.highnorthnews.com/polish-entrepreneurs-go-arctic-rethinkingcircumpolar-investment/ 11/12/2015

7

Ties that Bind Prepared for Seattle Metropolitan Chamber of Commerce Prepared by McDowell Group February 2015
http://www.seattlechamber.com/docs/default-source/Events-and-Programs-Documents/ties-that-bind-report-feb-2015.pdf
8
Ibid.
9
Ibid.

These earnings and jobs in Alaska can expand to the greater Arctic through city diplomacy and
cross-sectoral interaction. This interaction of Arctic cities, townships, NGOs, the private sector,
and indigenous groups can increase sustainable and progressive Arctic development. City
diplomacy agreements are a now-proven means to develop functional policies with great
efficacy, as the C40 Cities Climate Leadership Group and Compact of Mayors, which Vice
President Joe Biden has urged cities to join, has shown.10 Seattle, which is also a member of the
C40, could spearhead city diplomacy agreements for the Arctic, encompassing a range of issues,
like climate action and sustainable development.
Revenue through the Arctic Transport Infrastructure
Transport infrastructure is particularly vulnerable due to the effects of climate change. As
the temperatures increase, the permafrost melts and existing infrastructure is difficult to
maintain, and in many cases in coastal areas, breaking down altogether. Shorter winters limit the
use of ice roads, cutting off swaths of territory, necessitating new roads, highway and bridges,
airports, seaports and railways. 11,12 Some of the infrastructure that is needed includes refueling
stations, transshipment ports, ship-to-shore communication, trans-Arctic telecom cables, satellite
ground stations, and data centers and farm servers.13 Seattles private sector has numerous firms,
like Vigor Industrial, Delta Marine and Jensen Consulting, which are able to provide the
expertise for most, if not all, of these potential projects.14
The existing seaports the Alaskan Arctic have far less industrial capacity for repair, construction
maintenance compared to Puget Sound.15 Alaska lacks the technical capacity to build state of the
art ports. The difference in capacity between Alaska and Puget Sound is clear in just a few of the
local shipyards. Vigor Industrial operates 4 facilities in Puget Sound, 4 drydocks, 1 marine railway,
and 28 cranes. Foss Maritime operates 2 shipyards with dry-dock capacity up to 2,000 tons, a
marine railway along with machine and metal fabrication shops. For comparison, the entire state
of Alaska has 5 dry-docks.16 As the ice continues to melt, three new shipping routes will open for
container shipping, creating a new multi-billion dollar industry. By 2030, the Northern Sea Route
will have shipping volume equal to New York and New Jersey. 17
According to the McDowell group, by 2025, over 60% of Alaskan vessels will be 45 years old. In
the coming years, replacing these vessels, especially among the commercial fishing fleet, will
require spending of approximately $14 billion. Currently 450 businesses provide marine industrial
services in Puget Sound with 21,100 employees, earning $1.55 billion in wages in 2012. Given

10

C40 Blog Vice President Biden calls on more U.S. cities to commit to the Compact of Mayors November 05, 2015
http://www.c40.org/blog_posts/vice-president-biden-calls-on-more-u-s-cities-to-commit-to-the-compact-of-mayors
11

Guggenheim Partners Endorses World Economic Forum's Arctic Investment Protocol

https://www.guggenheimpartners.com/firm/news/guggenheim-partners-endorses-world-economic-forums January 21, 2016
12
Guggenheim Partners The Melting Arctic: Business Opportunities in Arctic Development Scott Minerd Global Chief Investment Officer
January 2014
13
Ibid.
14
Ties that Bind Prepared for Seattle Metropolitan Chamber of Commerce Prepared by McDowell Group February 2015
http://www.seattlechamber.com/docs/default-source/Events-and-Programs-Documents/ties-that-bind-report-feb-2015.pdf
15
Ibid.
16
Ibid.
17
Guggenheim Partners The Melting Arctic: Business Opportunities in Arctic Development Scott Minerd Global Chief Investment Officer
January 2014

Seattles existing marine infrastructure and services relationship with Alaska, it is highly likely
that Seattle shipbuilding firms will build the majority of Alaskan vessels.18
Revenue through the Icebreakers
Maritime infrastructure is not the only requirement. According to Admiral Papp, former
head of the Coast Guard and U.S. Special Representative for the Arctic, the United States needs
more Polar class icebreaker ships.19 These are vital for US strategic interests on a number of key
points including Freedom of Navigation transits, Thule Air Base resupply, Arctic science
support, assured access and assertion of US policy in the Arctic.20 The Coast Guard has asked for
10 more Polar-class Icebreakers, 6 heavy and 4 medium sized vessels.
Each Polar-class Icebreaker costs roughly $980 million dollars.21 The US has two, one of which
is non-functional, both built and currently stationed in Seattle. In comparison, Russia has 40
Polar-class Icebreakers, Shell Oil has 30, Sweden has 7 and Estonia has 2. 22
In addition to the Coast Guard, various Senators and think tanks have spoken about the
importance of the icebreakers including Sen. Maria Cantwell (D-WA), Sen. Dan Sullivan (RAK), Sen. Lisa Murkowski (R-AK), Rep. Don Young (R-AK), Alaskas former lieutenant
governor Mead Treadwell, the National Research Council, the Council on Foreign Relations, and
the Center for American Progress.23
President Obama requested $150 million dollars in the 2017 budget to prepare for the designing
and building of the new Polar-class Icebreakers set to start in 2020. Congress has not yet
approved the budget.24 Given that Seattles private sector built the Icebreakers currently in use,
and Seattles proximity to the Arctic, it is highly likely that new Icebreakers will be built in and
stationed in Seattle, should the funds be released.
Revenue through the Arctic Fisheries
Beyond infrastructural development, the Arctic fisheries produce 10% of the worlds fish
supply and Puget Sound is the central hub of Alaskan seafood.25 Specifically, Seattle houses the
largest seafood processors, support companies and fishing boats, as well as being Alaskas
transport hub for the remainder of the United States. In 2013, Puget Sound earned $3.3 billion

18

Ties that Bind Prepared for Seattle Metropolitan Chamber of Commerce Prepared by McDowell Group February 2015
http://www.seattlechamber.com/docs/default-source/Events-and-Programs-Documents/ties-that-bind-report-feb-2015.pdf
19 Coast Guard Polar Icebreaker Modernization: Background and Issues for Congress
Ronald O'Rourke Specialist in Naval Affairs April 15, 2016 Congressional Research Service 7-5700 www.crs.gov RL34391
20

Ibid.
Ibid.
22
Ibid
23
Breaking the Ice: Actually Doing Something About Americas Icebreaker Situation http://arcticenergycenter.com/breaking-the-ice-actuallydoing-something-about-americas-icebreaker-situation/
24
Ibid.
25
Guggenheim Partners The Melting Arctic: Business Opportunities in Arctic Development Scott Minerd Global Chief Investment Officer
January 2014
21

dollars from the Alaskan fishing industry. Of the total in 2013, $1.34 billion accounted for labor
income in Puget Sound through 23,900 jobs.26
Climate change affects Arctic fisheries. The effect on Arctic fisheries is not yet scientifically
clear. Fisheries are becoming more accessible, requiring study, and management due to the
increasing climate change.27 As the sea ice melts, moderate warming creates better access to food
for species such as cod and herring because higher temperatures would result in higher
productivity of their prey.28 However, since the Arctic is experiencing twice the global rate of
warming, there is concern from the scientific community that temperature increases would not be
tolerable for many fish species, like salmon and cod.
There are a great deal of unknown factors regarding the Arctic Oceans ecosystem. 29 This lack of
knowledge prompted the five Arctic coastal states (Russia, the US, Canada, Denmark and
Norway) to implement a fishing moratorium until a greater scientific understanding is acquired
and a regulatory policy put in place. Since 2015, Canadas Federal Environment Ministry is
pursuing research on Arctic fisheries with $7 million in funding.30
Given Seattles strong financial ties to the Alaskan fishing industry, and the growing effect of
climate change on marine ecosystems, it is vital that Seattle understand the situation and help
shape policy for Alaskas fisheries. Seattles ties to Alaska, along with its strong academic and
financial networks, naturally suggest that it play a leading role in studying the Arctic, by helping
to establish sustainable fishery regulations, norms and practices.
Asian Interest in the Arctic
Even non-Arctic nations are pursuing intensive study of the Arctic environment and
sustainable development. South Korea is building in-roads with the indigenous people through
small and medium business, through the University of Washington and the Aleut International
Association. In May 2014, the Henry M. Jackson School of International Studies at the
University of Washington and the Korea Maritime Institute signed an Agreement for Academic
Cooperation for Arctic policy, partly funded by the Korea Maritime Institute. This agreement
aims to include scholars from the United States, Canada and South Korea. The Korea Maritime
Institute is a Korean governmental policy research organization that aims to establish national
policies for marine and polar affairs, fisheries, and shipping and ports.31
Korea is not the only Asian country to have interest in the Arctic. China is quite enthusiastic.
China has attempted to purchase islands from Norway on a number of occasions, to be included
26

Ties that Bind Prepared for Seattle Metropolitan Chamber of Commerce Prepared by McDowell Group February 2015
http://www.seattlechamber.com/docs/default-source/Events-and-Programs-Documents/ties-that-bind-report-feb-2015.pdf
27
FACTSHEET: Effects of climate change on arctic fish WWF-Norway WWF International Arctic Programme Kristian Augusts Gate 7A P.O.
Box 6784, St. Olavs Plass 0130 Oslo, Norway
28
Ibid.
29
High North News: Climate change impacts on Arctic fisheries: benefit or harm? http://www.highnorthnews.com/climate-change-impacts-onarctic-fisheries-benefit-or-harm
30

High North News: Climate change impacts on Arctic fisheries: benefit or harm? http://www.highnorthnews.com/climate-change-impacts-onarctic-fisheries-benefit-or-harm/
Arctic and International Relations Series Spring 2016, Issue #2 The Arctic Council at Twenty J. Arteau, F. Griffiths, J.D. Kim, J. Kim, T.
Leschine, S. Montgomery, S. Myers, H. Nicol, B. Ray, O. Young.
31

on the Arctic Council.32 Chinese interest in the Arctic revolves around shipping routes, fisheries,
and oil. Regarding Chinese interest in the Arctic, Chinese Rear Admiral Yin Zhuo, in 2010, said:
The Arctic belongs to all the people around the world, as no nation has sovereignty over it...
China must plan an indispensable role in Arctic exploration as we have one-fifth of the worlds
population. 33
According to the Economist, given that upwards of 95% of Arctic resources fall within Exclusive
Economic Zones (EEZs) of five coastal Arctic Nations (Russia, the US, Canada, Denmark and
Norway) and the Chinese private sectors lack of Arctic expertise, it is likely that China will
pursue joint-ventures with Arctic nations for resource extraction.34 Given Seattles extensive and
growing ties with China and Asia in general, it seems highly possible to cultivate a joint AsianSeattle relationship for sustainable Arctic development.
Policy Options
The City of Seattle could capitalize on already existing networks to advance its strategic
goals by endorsing, participating and potentially chairing an Arctic Working Group. These
networks include academic networks like the International Policy Institute, and the Arctic
Studies Center, both located within the Henry M. Jackson School of the University of
Washington. They also include local business networks like the Seattle Chamber of Commerce
that already has Arctic-oriented stakeholders, like Vigor Seattle and Foss, both major
shipbuilding firms. City endorsement and participation would give the working group credibility
to extend the network and inform policymaking. The working group would responsible for
logistics and administrative affairs.
Overseeing an Icebreaker Initiative would be among the initial priorities of this working group,
to garner enough local stakeholders and voice to pass the Icebreaker budget. A strong and
coordinated voice composed of academics, businesses and public servants could conceivably
assist in bringing the Icebreaker funds to Seattle.
At the same time, Seattle utilizing the working group would be able to spearhead city to city
diplomacy for Arctic development, whether it is climate action, sustainable development or civil
rights. It would be the policymaking tool and mechanism for long-term leadership.
If South Korea, a nation relatively unconnected to the Arctic, sees fit to create a Korean Arctic
working group, Seattle, with its multi-billion dollar relationship with the Arctic, should do the
same.
Potential Stakeholders in progress

Norway stops Chinese tycoons bid on Svalbard http://barentsobserver.com/en/arctic/2014/05/norway-stops-chinese-tycoons-bid-svalbard-2305

33
CHINA AND THE ARCTIC: OBJECTIVES AND OBSTACLES U.S.-China Economic and Security Review Commission Staff Research
Report Caitlin Campbell http://www.uscc.gov/Research/china-and-arctic-objectives-and-obstacles
32

34

Snow dragons: As the Arctic melts, Asia shudders at the risks but slavers at the opportunities Sep 1st
2012 http://www.economist.com/node/21561891

The International Policy Institute & the Arctic Studies Center in the Henry M. Jackson
School of the University of Washington
Seattle Chamber of Commerce
Saltchuk (conglomerate with shipbuilding and shipyard building capabilities)
Foss (shipbuilding subsidiary of Saltchuk)
Vigor Industrial (shipbuilding firm)
Sustainable Fisheries Partnership
Port Of Seattle
Cities of Vancouver, BC, Whitehorse, Yellowknife, Barrow, Anchorage, Oslo, Svalbard,
Murmansk, Arkhangelsk, Pevek (non-exhaustive list)
Inuit Circumpolar Council
Korean Maritime Institute
Aleut International Association

Potential Members of AWG in progress

Recommendations and Actionable Steps

Meet with the International Policy Institute and the Arctic Studies Center to discuss the
possibility of an Arctic Working Group (AWG) and its goals, ideals and operations.

Endorse, participate and potentially chair the Arctic Working Group (AWG) with the
International Policy Institute, the Arctic Studies Center and the Henry M. Jackson School
of the University of Washington, the WA State Dept. of Commerce and Vigor Industrial.

Through the AWG:

1. Participate and endorse an Icebreaker Initiative capitalizing on Seattles private,
and public sectors to create a campaign to build the Icebreakers in Seattle.
2. Spearhead an Arctic City Diplomacy Initiative (ACDI) joining Seattle and Arctic
cities through cross-sectoral city diplomacy for
a) Economic development through transport & marine & telecom infrastructure
and shipbuilding
b) Climate action relating to sustainable fisheries, ocean acidification and
Greeenhouse Gas Emissions
c) Civil rights and the inclusion of indigenous groups in Arctic policymaking
3. Examine the possibility of Asian-Seattle private sector joint-ventures for the
Arctic to bring in more FDI to Seattle.