Alaska and Arctic Shipping: Boon or Boondoggle?

At the July 16-18 Symposium on the Impacts of an Ice-Diminishing Arctic held in Washington, D.C., Alaska Senator Lisa Murkowski asserted, “When it comes to circumpolar navigation in the Arctic, regardless of which route is taken – the Northern Sea Route, the Northwest Passage, or perhaps across the pole if we see an ice-free summer, they all converge on one end at the Bering Strait between Russia and Alaska.”

In her speech, as reported by Carly Restino in the Arctic Sounder, Murkowski noted the growing number of ships transiting the Northern Sea Route each year. 46 ships made the journey last year, up from a reported 4 in 2011. The Financial Times (subscription required) reports that 204 ships have received permits to sail the length of the NSR this year. Were all the permitted ships to ply the passage, this would represent an over four-fold increase in the space of one year. These voyages could be a boon for Alaska, but talk of developing a large transshipment hub in the Aleutian Islands could also be a boondoggle.

The very word “circumpolar” surmounts the traditional linear geography of routes and networks. So although Murkowski claims that all of the voyages converge in the Bering Strait, they could equally be claimed to converge in the North Atlantic. In fact, as I discussed in March, Eimskip, an Icelandic shipping company, moved their North America hub to Maine from Virginia. Iceland is already in a strong position to capitalize on Arctic shipping. It also has China interested, even though the country is actually closer to Alaska. Opportunities for transshipment and new markets for Asia to both buy goods from and sell goods to might actually be more prevalent in the North Atlantic. Ships sailing from west to east through the NSR to East Asia have little need to stop in the Aleutians before delivering their cargo or resources, which will likely consist heavilt of liquefied natural gas. To really thrive as a transshipment hub, Alaska will probably need the Northwest Passage to become more accessible. Alaska cannot just build infrastructure like a deep draft port and hope that ships will come calling. The geoeconomic conditions have to be right as well.

While the Northwest Passage slowly melts, Alaska can continue to bank on the importance of Ted Stevens Anchorage International Airport as a major cargo hub. Although there are at present no direct passenger services from the airport to East Asia, airlines like Korean Air and United fly many cargo planes between the two destinations. Inbound Logistics has a great, detailed article on Alaska’s status as a transportation crossroads.

In 2011, when the last direct flights to Asia ended. Scott McMurren of AlaskaTravelgram.com said to KTUU, “It’s not coming back, forget it, it was here only as an accident of geography – we’re basically a gas station. The last thing that China Airlines wanted to do was fiddle with passengers here anyway.”

Ironically, if the conditions prove right, another “accident of geography” could send Alaska to be a new crossroads, this time for ships rather than planes. It’s important to note, though, that whatever growing interconnections arise will link goods and markets rather than people. The Soviet Ice Curtain may have fallen, but that doesn’t necessarily make it all that much easier for residents from one side of the Bering Strait to foster ties with residents on the other side. Moreover, to go from Anchorage to Tokyo, a passenger now has to stop over in Seattle or Portland – highlighting the funny ways in which transportation connections change over time and in unforeseen manners due to politics, economics, the environment, and even marketing. How many extra tourism dollars, after all, has Iceland raked in thanks to IcelandAir’s free stopover campaign?