The economics of climate change: misfortunes for one people and benefits for others

Arabia Weather - New shipping routes in the Arctic herald the opening of profit prospects for the prosperous cities that will arise along these new sea lanes. As interest in these new sea routes increases, interest in some other routes will decline.

Traffic through the Suez Canal and the Strait of Malacca in Indonesia is expected to shrink. Although these canals are still important, they will not be China's only major sea routes as new routes become operational to and from the country.

For Russia, one of the most impressive projects at the moment is the giant Megaport on the Taimyar Peninsula, which has a cost of $110 billion.

This huge project is considered the largest project in the modern global oil industry, as it will include the largest oil terminal in the country's Arctic. The project is distinguished by its enormous size and very remote location, as it will first be necessary to build the necessary infrastructure to reach the site via new highways.

Two new giant airports will be equipped, thousands of kilometers of highways and oil pipelines will be built, 15 villages, and many power plants will be established throughout the region, with the aim of starting construction work and providing housing for 400,000 workers to achieve all this.

So far, more than 18,000 tons of heavy machinery and communications equipment have been shipped to the site, and Moscow is working on building a 770-kilometre pipeline to transport the oil to the port, where it will be transported by 10 ice-type containers to the rest of the roads leading to the port. Europe and Asia.

Read also: Global warming plays an important role in Russia

From the city of Murmansk in the Russian Far West to Vladivostok, President Putin has ordered the installation of fiber optics at a cost of $889 million. This project, known as the “Polar Express,” extends along 12,600 kilometers. It aims to improve internet and telephone connections for nearly 2.5 million people living in Russia's far north, representing almost half of the entire Arctic population.

This huge port is only part of a broader development scheme in the region, as Russia has begun developing 4 airports along the northern coast, including Omderma Airport in the west and Pevek Airport, Chersky Airport and Keperviem Airport in the east. In addition, the railway sector is witnessing significant improvements in this region.

Money continues to flow into Arctic projects, as Russia's Rosatom, in cooperation with UAE-based DP World, is developing new ports in Murmansk and Vladivostok. The two companies are also designing a fleet of ice container ships that have been specially enhanced for sailing in polar waters.

Oil, natural gas, and mining projects become more profitable as a result of ocean melting, which reduces the costs of shipping supplies and products abroad. For example, the multi-billion-dollar joint venture involving Russia's Novatek, France's Total, China National Petroleum Corporation and other investors is a case in point. This project exports about 5% of the total liquefied natural gas traded globally through the melting Arctic Ocean.

Overall, analysts point out that at least 6 large Russian companies in the fields of energy, shipping and mining will benefit from global warming.

The idea is to significantly boost Russian economic development along the North Sea shipping corridor over the next 15 years, essentially opening up the region as an alternative to the Suez Canal for shipping goods between Europe and Asia, especially during the summer months when sea ice is completely gone.

Until 2035, Russia aims to increase the flow of goods through the region by at least 72 million tons, and is on track to achieve this. In 2018 alone, traffic rose by 80% compared to the previous year to reach 16 million tons, increasing to 23 million tons in 2019.

Read also: The frozen treasures of the Arctic... What is Russia’s position?

Source: aljazeera