EXECUTIVE SUMMARY Canada’s North Pole is magnetic, and compasses point towards it. Its time for Corporate Canada and our governments to turn in the same direction. This Discussion Paper is based on the premise that: A. Climate change is quickly impacting Canada’s North and, at the same time, increasing the shipping viability of the Northwest Passage. Maritime shipping will foster other large opportunities. B. Canada must act as quickly to assert its sovereignty over the region and support the lives of local Indigenous peoples. Russia, the U.S., and even China have their own ambitions.

C. Asserting Canada’s sovereignty over the Northwest Passage and successful economic development are wholly interdependent. Neither can be achieved without the other. D. Without respect for and collaboration with local Indigenous peoples, neither objective is possible. CANADA’S NEXT GREAT OPPORTUNITY (AND RISK) E. It will take a coalition of like-minded business leaders to convince the Government of Canada, with some urgency, to develop policies and A DISCUSSION PAPER programs that support economic development of the North, including Fall 2020 the commercial operation of the Northwest Passage.

Throughout our history, Canada has never truly leveraged, collectively, three of its most important assets: our geographic position in the world as the largest land mass in the North; the shipping potential of the Northwest Passage; and our international reputation for political and economic stability. Canada’s North is very large in geographic and economic potential, but very small in population, infrastructure, and national focus. It is perhaps best to look at it in bites and compared to other such places in the world:

The length of CANADA’S ARCTIC COASTLINE 176,000 km The length of CANADA’S NORTHWEST PASSAGE 1,450 km (the largest of any nation) The length of the SUEZ CANAL 180 km The length of the CANADIAN-U.S. BORDER 8,900 km (including the Yukon and Alaska border) The length of the PANAMA CANAL 65 km 5,600 km The length of RUSSIA’S ARCTIC PASSAGE The length of the ST. LAWRENCE SEAWAY 3,769 km (Jointly managed by Canada and the US) Pivoting North – Canada’s Next Great Opportunity (or threat) INVITATION-ONLY ONLINE MEETING OF BUSINESS LEADERS & ARCTIC EXPERTS: Feb 11, 2021 Campbell Strategies Inc., Fall 2020

Over half of Canada’s land mass is north of 60 degrees latitude – including the territories of Yukon, Northwest Territories, and Nunavut as well as Northern Quebec. Yet only 70,000 people live along our northern coast, all of them Indigenous to the region (Inuit, First Nations, and Métis). Most live below the poverty line, and the near-term impacts of climate change are already threatening their traditional lifestyles. This is Canada’s next greatest opportunity – and threat. As the ice melts, the Northwest Passage will become the centre of the world’s new political chessboard. Canada must control it, alone or in partnership, or our sovereignty and long-term economic future will be in jeopardy. Canada must pivot north, away from its traditional focus on the American border. In our opinion, on large issues such as this, the federal government needs motivation from outside of its traditional decisioning processes to act with of sense real urgency and purpose. Canada’s North needs a business strategy behind it. A coalition of like-minded businesses that can embrace, improve, and enable Canada’s Arctic and Northern Policy Framework (see page 12) will not only be able to support the government’s own goals, but also bring real economic gains to the nation, Indigenous peoples, and Canadian business. If government could have done it alone, it would have done so already. “The key elements of Canadian survival and success in this great strategic game come together not at the As it concerns sovereignty and economic development, controlling the middle of that chessboard does not guarantee success. But it goes a long American border, which remains the unique way to exerting influence over the outcome. Same with the Northwest preoccupation of our decision-making class, but Passage. Canadians can – and should – be the main influencers of how, instead at our Arctic border.” where and when the Northwest Passage is developed. Dr. Irvin Studin, Editor in Chief and Publisher More broadly, Canada’s solution to the critical issues of sovereignty in the Global Brief Magazine North and economic sustainability across the country go hand-in-hand. The opportunity is so large that no government, no single business entity, nor individual group of Indigenous peoples can hope to address this alone. Economic Sovereignty WE CALL THIS STRATEGY “PIVOTING NORTH”. Goals Goals Capitalizing on that opportunity will require a robust federal government policy structure supported by investment and operations structures based on such options as public-private-partnerships (P3) and those with Indigenous peoples as partners. Hard work is needed, by Corporate PIVOTING Canada and Indigenous peoples, so that both groups learn the hard skills NORTH as well as the soft skills of how to do business together. We can’t just plant the flag and expect success in a highly competitive and rapidly shifting Business Environmental geo-political context. And the world isn’t waiting for Canada to develop its Opportunities Sustainability own northern region. We need to start now, together. Benefits for Indigenous 2 Peoples Pivoting North – Canada’s Next Great Opportunity (or threat) INVITATION-ONLY ONLINE MEETING OF BUSINESS LEADERS & ARCTIC EXPERTS: Feb 11, 2021 Campbell Strategies Inc., Fall 2020

Our goal at Campbell Strategies is to help facilitate the necessary conversations, relationships, and policies that will set the table for Pivoting North. This discussion paper is the first step in that process, followed by an online meeting of interested leaders from Corporate Canada and experts from the North. This event will be held on Wednesday November 25th, 2020 (11:00am EST). Following the online meeting, Campbell Strategies will invite interested corporate leaders to establish the CANADIAN ARCTIC ACTION COUNCIL. The Council will:

1. Ensure that Canadian business plays a prominent role in delivering Canada’s Arctic and Northern Framework and influences any future policy developments within it.

2. Provide an environment for collaboration among coalition members eager to discuss and pursue partnerships and shared investments in Canada’s Arctic.

3. Ensure that the message that sovereignty and economic development are interdependent is embedded in government policy. 4. Make Canadians at large aware of this interdependence and its importance to the future of the nation’s sovereignty, prosperity, and respect for Indigenous peoples.

5. Invite, encourage, and invest in initiatives that support a better mutual understanding between Indigenous peoples and Corporate Canada. 6. Ensure the integration of the needs of Indigenous peoples and environmental sustainability in the economic development of Canada’s Arctic.

7. Pursue Canadian leadership, ownership, management, and operations of the Northwest Passage along with any

partnerships – with other nations or international businesses – that may be required.

We invite your opinions on this critical matter, and we hope that you and your organization will consider joining with us at this critical intersection of government policy and business needs.

Barry Campbell and Ted Griffith Campbell Strategies Inc. Suite 3210, Commerce Court West Toronto, Ontario M5L 1E7 [email protected] or [email protected] 416.368.7353 www.campbellstrategies.ca 3

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This paper is divided into four sections:

Part 1.0 (pages 5 – 9) Part 2.0 (pages 10 – 27) Part 3.0 (pages 28 – 30) Part 4.0 (pages 31 – 37) THE OPPORTUNITY TO LEAD SITUATION ANALYIS CONCLUSIONS APPENDICES 1. There is much to gain 1. Canada’s North - What and 1. Why should we care? 1. Map of the Arctic Passages 2. A collaboration path forward to a where is it? 2. What does Canada do when? 2. The energy and mineral resources new paradigm 2. Canada’s claims on sovereignty What does Canada do if? of the Arctic 3. The Pivoting North Strategy in the North 3. Call to action 3. Arctic collaboration organizations 3. The evolving geo-political 4. Michael Mann, the EU landscape Ambassador at Large for the 4. Massive opportunities and needs Arctic. 5. North/South Collaboration

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PART 1.0 THE OPPORTUNITY TO LEAD The North needs critical infrastructure. It needs sustainable partnerships. And it needs Corporate Canada to pivot North. KEY QUESTIONS This discussion paper lays out some of the opportunities and challenges in front of us now, 1. What is the opportunity? and down the road, when it comes to delivering on the promise of the North. Starting off • To bring the economic opportunity of with a snapshot of Canada’s North, this paper then looks at the three pillars of sustainable the North together with the sovereignty development in that region: goals of the Northwest Passage and the  Asserting and maintaining Canada’s territorial sovereignty needs of Indigenous peoples. 2. Why is it important?  Defining specific economic opportunities • Canada’s economic future depends on  Proposing partnership models to seize these opportunities it, as well as our role in international Understanding and supporting the mutually reinforcing connections among these pillars affairs. is vital for any meaningful development in Canada’s North. The cornerstone of success 3. Why is it urgent? will be investing in initiatives that establish and maintain two-way relationship between • Other nations, China and Russia Corporate Canada and local Indigenous peoples. Both groups need a better especially, see this opportunity and are understanding and appreciation of each other. acting quickly. Climate change is negatively affecting the lives of Without asserting and maintaining clear political sovereignty over its own Arctic region, Indigenous peoples. Canada needs Canada risks having other countries influence and develop the North in ways that suit economic as well as military security. their national needs, and our own. 4. What happens if we ignore it? • If not Canada, other nations will, and it By extension, uncertainties stemming from these risks would exacerbate the general will be impossible to remove them after reluctance shown by Corporate Canada to develop the North, the financial and logistical the fact. challenges of such development notwithstanding. Likewise, any development with 5. What are the key steps to achieving it? people and capital from the South must be collaborative with and respectful of Indigenous • A collective effort by the private sector peoples, their traditions, their expertise, and their various forms of capital (human, and Indigenous peoples to motivate financial, territorial, and cultural). federal policy and collaboration. 6. What need to happen right now? This discussion paper is designed to stimulate engagement in an online conference we are • Establish a coalition, create an influence planning for later in 2020 featuring a range of speakers addressing facets of economic plan, and implement it. development in the North. We will move forward from there with organizations eager to explore and/or enhance their interests in the massive opportunities to be found in Canada’s North.

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Niilo Edwards, Executive Director of the First Nations Major Projects Coalition, told us: “Investing in the North means investing in the North. That means taking time and taking a genuine interest in the Indigenous communities with which you want to do business. Success in this will take a sustained presence with clear mandate from senior management to employ senior people on the ground who can make decisions.” 1

1. THERE IS MUCH TO GAIN The opportunity for Canada’s North is “associated mainly with increased viability of marine SOME KEY STATISTICS 2 transportation associated with reduced sea-ice cover.” US$2 billion Marine transportation and its related infrastructure (e.g., ports and shipyards) will be the o Projected annual revenues for the primary drivers. This will provide Canada’s extraction, fishery, tourism, and defense Panama Canal, 2021 sectors with the means to achieve Canada’s economic, sovereign, and environmental US$6 billion goals as well as establish a sustainable platform for the social and economic welfare of o Projected annual revenues for the Suez Indigenous communities. Underlying this opportunity is an international debate on Canal, 2022 sovereignty in the region, especially along the Northwest Passage, which starts, runs, and 13 percent of the world's undiscovered ends well within Canadian territory. conventional oil resources and about 30 percent of its undiscovered conventional natural gas Like the St. Lawrence Seaway, the Northwest Passage is a vital economic and social resources 5 artery. Both have significant international dimensions. In the case of the St. Lawrence, Canada partnered with the United States to develop the Seaway in the 1950s by way of a 37 times more fish for Northern fisheries by the series of cross-border collaborations and acts of legislation in both countries. end of the century (UBC study)

Since opening to deep-draft navigation in 1959, more than 2.5 billion tonnes of cargo There are also troves of metals and minerals, (estimated at $375 billion) have been shipped in the Seaway.3 In 2019 alone, more than 53 including gold, diamonds, copper, iron, zinc, and million tonnes were shipped fully or partially along the 3,700km Seaway route that runs uranium. 6 4 from the Atlantic to Duluth, Minnesota.

1 Phone interview on 30 July 2020. 2 Canada’s Marine Coasts in a Changing Climate, 2016 Donald S. Lemmen and Fiona J. Warren, Natural Resources Canada, 2016 3 “St. Lawrence Seaway Great Lakes Facts”, www.greatlakes-seaway.com. 4 “St. Lawrence Seaway 2019 Traffic Report, Table S1: Traffic Summary”, www.greatlakes-seaway.com. 5 United States Geological Survey 6 “The Energy and Mineral Riches of the Arctic”, TheVisualCapitalist.Com. 6

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Consider, then, the value of the St. Lawrence Seaway as a model (illustration at right) in the current context of three important factors:  Increased geo-political interest in the Arctic St. Lawrence Seaway  Climate changes reshaping the contours of navigable waters – a model for the Arctic?  Increased recognition within non-Indigenous populations in Canada of the traditions, needs and entrepreneurship of Indigenous peoples in the North. The question is this:

Is there a valid reason why governments and businesses within Canada cannot similarly find partnerships to develop the Northwest Passage in ways that put Canada literally and figuratively at the centre of decision

making over this crucially important waterway?

Could the St. Lawrence Seaway and its Canada/U.S. With strong partners inside our own country and beyond, Canadians can secure the partnership structure be a model for a future trade route of the future. The key word is indeed partnership – not loss of sovereignty, Canadian Arctic Seaway, perhaps in collaboration not capitulation to foreign interests. What is needed are business partnerships that with Denmark, the European Union, private include the private sector’s expertise to create, manage, and profit from these new sea enterprise, and Indigenous Peoples? lanes.

Indeed, Canada may already have part of the model with its cross-border partnership in the St. Lawrence Seaway – but developing the Northwest Passage will also require the leadership of the business community to push governments in this direction. As it concerns sovereignty and economic development, it’s a bit like chess. Controlling Success will require a shared vision between the federal the middle of the board does not guarantee success, but it goes a long way to exerting government, business and Indigenous peoples, all working influence over the outcome. Same with the Northwest Passage. Canadians can – and on a founding principle of environment sustainability and should – be the main influencers of how, where and when the North West Passage is respect for traditional uses of the land, sea, and shore. developed. Leadership, in our opinion, needs to come from the business community, specifically Corporate Canada. More broadly, Canada’s solution to the critical issues of sovereignty in the North and economic sustainability across the country go hand-in-hand. The opportunity is so large that no government, no single business entity, nor individual group of Indigenous peoples can hope to address this alone.

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2. A COLLABORATIVE PATH FORWARD TO A NEW PARADIGM

Sustained commitments to partnerships between Indigenous peoples of the North and economic interests from the South can open opportunities as vast as the landscape itself. In other words, we can connect Frobisher Bay to Bay Street in ways that match the traditions, expectations, and pace of the respective participants. And we can do so while maintaining and improving the policies and support programs of the federal government with the addition of business acumen.

Likewise, this approach must be founded upon environmental sustainability and the explicit imperative to share the benefits of development with local Indigenous peoples. Canada still has a lot to learn in this regard, but we can be a model for the world if we approach it the right way for the right reasons. In short, we don’t want a solution like the Brazilian Amazon – where the rights of Indigenous people exist only on paper, exploitation of the resource is rampant, and corruption seems ubiquitous. This is where Canada’s international reputation will play a critical role. However, developing the North will take time and patience. It will take human, intellectual, and financial capital working in a collaborative manner in the face of a clear reality:

We can’t just plant the flag and expect success in a highly The opportunities for Canadians to develop the North competitive and rapidly shifting geo-political context. together are as close and as sizeable as the risks are of Other countries are very keen to develop key aspects of the allowing other countries to capitalize on these Arctic. The world isn’t waiting for Canada to develop its opportunities themselves. own northern region. We need to start now, together.

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3. THE PIVOTING NORTH STRATEGY

This strategy will require a robust federal government policy structure. It must be supported by investment and operations structures based on options such as public-private-partnerships (P3) and those with Indigenous peoples as partners too. For example, Steel River Group has developed a P4 model that adds Indigenous Peoples to traditional P3 model.7

Hard work is needed, by Corporate Canada and Indigenous peoples, so that both groups

learn the hard skills as well as the soft skills needed to do business together.

Economic Sovereignty Goals Goals

PIVOTING

NORTH

Benefits for Business Environmental Indigenous Opportunities Sustainability Peoples

7 https://www.northernontariobusiness.com/regional-news/thunder-bay/jp-gladus-heading-to-alberta-after-all-2613666 9

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Part 2.0 SITUATION ANALYSIS 1. CANADA’S NORTH – WHAT AND WHERE IS IT? It depends on the map you’re used to seeing.

By looking at Canada’s North through the perspective of the Mercator map – While there’s no doubt that Canada’s North is indeed massive in terms our standard way of picturing the globe – most Canadians tend to think of the of total area, it’s not isolated from the rest of the world. Indeed, it is Arctic as being “way up there”, “massive”, and isolated from the rest of the literally surrounded by the northern regions of many other countries, as world. But as airline companies have demonstrated for decades, the fastest shown by this polar map. Our country now more accurately appears way from Calgary to London is via the polar route. much closer to China, Europe, and Africa.

Canada’s future may truly begin where the trees end. Taking a different perspective on the North places the economic opportunities within it – and geo-political risks facing it – into a new light. And it’s from this perspective that we feel Canadians should increasingly view the North, an area perhaps best described as beginning where the trees end. 10

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2. CANADA’S CLAIMS OF SOVEREIGNTY IN THE NORTH

Ottawa’s aspirations to develop the North date back decades. In a campaign speech in 1958, John Diefenbaker said “I see a new Canada – a Canada of the North .... We will open that northland for development by improving transportation and communication and by the development of power, by the building of access roads.” 8

In 1996, Canada played a key role in the Ottawa Declaration that created the Arctic Council, the pre-eminent forum for international cooperation in the Arctic on sustainable development and environmental protection.9

Prime Minister Stephen Harper elevated the North in his government’s agenda. In August 2010, for instance, he embarked on a five-day tour of the Arctic – an annual trip for him – to demonstrate Canada’s sovereignty there. As he told reporters at the time, "the first and highest priority of our northern strategy is the protection of our Arctic sovereignty. And as I have said many times before, the first principle of sovereignty is to use it or lose it.”10

Harper’s views of sovereignty in the North, which evolved over his time in power, largely focused on enhanced military capabilities in the Arctic as enablers to economic development 11 there. That view was articulated in “Canada’s Northern Strategy: Our North, Our heritage, Our Future”, which was released in 2009.

The Hon. Chuck Strahl, Minister of Indian Affairs and Northern Development, and Federal

Interlocutor for Métis and Non-Status Indians, said in this report, “Canada is a Northern Former Prime Minister Stephen Harper during nation. The North is a fundamental part of our heritage and our national identity, and it is 12 one of his annual visits to the Arctic vital to our future.”

8 Heather Exner-Pirot, “Canada’s Northern Economic Development Paradigm and its Failures”, Canada’s Arctic Agenda: Into the Vortex, Centre for International Governance Innovation, 2019, 15. 9 “Canada’s Arctic and Northern Policy Framework: Our Past”, www.rcaanc-cirnac.gc.ca 10 CBC News, “Arctic sovereignty a priority: Harper”, 23 August, 2010. 11 Joël Plouffe, “Stephen Harper’s Arctic Paradox”, Canadian Defence and Foreign Affairs Institute, December 2014, 4-8. 12 “Canada’s northern Strategy: Our North, Our heritage, Our Future”, 2009, 2. 11

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The Federal Arctic and Northern Policy Framework Following the election of Justin Trudeau in October 2015, Canadian Arctic expert Dr. P. Whitney Lackenbauer wrote: “the main substantive elements of Canada’s Arctic policy, which have remained remarkably consistent since the 1970s, have not fundamentally changed.”13 In September 2019, the government of Prime Minister Trudeau released its version of Ottawa’s northern strategy. The work of many years, Canada’s Arctic and Northern Policy Framework was created in collaboration with three territorial governments, more than 25 Indigenous organizations representing Inuit, First Nations and Métis, and three provincial governments (Manitoba, Quebec and Newfoundland and Labrador). The Framework – which articulates “a shared vision of the future where Arctic and northern people are thriving, strong and safe” – builds on eight overarching and interconnected goals: Current Prime Minister Trudeau’s focus in the • Strong, sustainable, diversified, and inclusive local and regional economies North is on climate change and Indigenous • Canadian Arctic and northern Indigenous peoples are resilient and healthy relations • The Canadian Arctic and North and its people are safe, secure, and well-defended • Strengthened infrastructure that closes gaps with other regions of Canada Job 1 is to have the role of commercial • The rules-based international order in the Arctic responds effectively to new enterprises included and the recognition challenges and opportunities that sovereignty and economic development go hand-in-hand. • Knowledge and understanding guides decision-making • Canadian Arctic and northern ecosystems are healthy and resilient • Reconciliation supports self-determination and nurtures mutually respectful relationships between Indigenous and non-Indigenous peoples.

The federal government’s desires for – and the imperatives of – partnerships in developing the North are expressed in what the Framework refers to as steps underway to move from “co-development to co-implementation”. Canadian business needs to have a clearer role in this policy.

13 Dr. P. Whitney Lackenbauer, “Global Arctic Leadership in an Era of Cooperation and Competition”, Canada’s Arctic Agenda: Into the Vortex, Centre for International Governance Innovation, 2019, 67. 12

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Specifically, the Framework says the Government of Canada and partners will develop: • “Governance mechanisms describing how partners will collaborate to share information and assess progress on the framework • An Implementation Plan outlining how new investments and other economic and regulatory levers will contribute to the implementation of the framework.”14 Canada’s broader claims of sovereignty over large parts of the North underpin this desired partnership approach, as outlined in the Framework. DISCUSSION QUESTIONS ABOUT “The Government of Canada is firmly asserting its presence in the North. Canada's Arctic SOVEREIGNTY sovereignty is longstanding and well established. Every day, through a wide range of activities, governments, Indigenous peoples, and local communities all express Canada's 1. In thinking about the Framework’s Phase II – enduring sovereignty over its Arctic lands and waters. Canada will continue to exercise the the “co-implementation” phase – how can full extent of its rights and sovereignty over its land territory and its Arctic waters, including the private and public sectors work together the Northwest Passage.”15 to commercialize opportunities in the North? Articulating and expressing the policy intentions of the Framework is considered a “whole of • How can the private sector lead? government” priority, meaning resources across departments are dedicated in various ways 2. Is it possible to foresee a future in which to achieving the Framework’s ambitions. This includes Global Affairs Canada, which is Canada is able to develop its North primarily responsible for coordinating and leading the international aspects of Canada’s Arctic with its own human and financial capital, or engagement. Ambassador David Sproule is Canada’s senior-most representative to the will such development always require the Arctic Council. help of other countries? The Canadian Forces are likewise keyed into the Arctic, as expressed in “Strong, Secure, • If the latter, what are the implications Engaged”, the country’s national defence policy released in 2017. to Canadian sovereignty, and by A decade ago, few states or firms had the ability to operate in the Arctic. Today, state and extension for Canadian businesses? commercial actors from around the world seek to share in the longer-term benefits of an accessible Arctic. Over time, this interest is expected to generate a corresponding rise in commercial interest, research and tourism in and around Canada’s northern territory. This rise in activity will also bring increased safety and security demands related to search and rescue and natural or man-made disasters to which Canada must be ready to response.16

14 “Canada’s Arctic and Northern Policy”, 2019, www.rcaanc-cirnac.gc.ca 15 “Arctic and Northern Policy Framework International chapter”, www.rcaanc-cirnac.gc.ca 16 “Strong, Secure, Engaged: Canada’s Defence Policy”, 2017, 51. Emphasis added. 13

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3. THE EVOLVING GLOBAL GEO-POLITICAL LANDSCAPE

While being a huge country physically, Canada is very small as a market. This mismatch underscores many reasons why governments and businesses look beyond our borders for new markets and new partners. That’s particularly important when it comes to the North. It’s simply too big to be developed by Canadians alone, regardless of one’s view of Canadian claims of sovereignty over vast areas north of 60°. Yet, in so doing, Canadians have to be aware of the rapidly changing geo-political context, dimensions of which put Canada’s claims to sovereignty at risk. As the Special Senate Committee on the Arctic wrote last year in their “Northern Lights” report: “While collaborative governance and circumpolar Arctic cooperation in a range of arenas have avoided conflict dynamics in the region for the past 25 years, the Arctic is increasingly subject to spill-over impacts from rising great power rivalry and conflicts taking place outside the region.”17 Policy expert Dr. Irvin Studin put it more succinctly: “The key elements of Canadian survival and success in this great strategic game come together not at the American border, which remains the unique preoccupation of our decision-making class, but instead at our Arctic border.”18 A scan of that geo-political landscape illustrates the growing interests in, and potential threats from, countries beyond Canada. U.S.A. In the summer of 2019, President Donald Trump floated a trial balloon about buying Greenland.19 This suggestion was largely derided by a baffled global audience. But the underpinning aspiration was clear – American dominance over (if not outright ownership of) Greenland would give the U.S. access to enormous resources on that big island, and would give them effective control over maritime access to large parts of the Arctic waters, including the Northwest Passage.

17 Special Senate Committee on the Arctic, “Northern Lights: A Wake up Call for the Future of Canada”, 2019, 99. 18 Dr. Irvin Studin, “When Whitehorse becomes the centre of the world”, Policy Options, 27 July 2020. 19 Vivian Salama, Rebecca Ballhaus, Andrew Restuccia and Michael C. Bender, “President Trump Eyes a New Real-Estate Purchase: Greenland”, The Wall Street Journal, 16 August 2019. 14

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Considering American influence over the Panama Canal, gaining control over the Northwest Passage would mean, in effect, that Washington controlled key maritime waterways at the north and south ends of North America. Canada would be boxed in by our southern neighbours. Greenland aside, American interests in the Arctic have been heating up considerably over the last few years. In an alarming speech to the Arctic Council in May 2019, Secretary of State Mike Pompeo said, “this is America’s moment to stand up as an Arctic nation. The region has become an arena of global power and competition.” In this same speech Pompeo spoke specifically about American perspectives on the Northwest Passage, and how they view Canadian claims in the North to be on thin ice.

“No one denies Russia has significant Arctic interests. We recognize that Russia is not the only nation making illegitimate claims. The U.S. has a long-contested feud with Canada over sovereign claims through the Northwest Passage.” 20 As The Economist wrote in discussing this story, Pompeo “raised Canadian hackles” with his suggestion that Canada’s claim to the Northwest Passage was “illegitimate”. The article then Mike Pompeo, the U.S. Secretary of State, has went on to ask the $64 million question: “if Canada does not own the Northwest Passage, rejected Canada’s claims to the Northwest Passage 21 who does?” as “illegitimate”, in a high-profile foreign policy

speech that prompted frustration and surprise The fact is Canada has always been more preoccupied with its Arctic than the U.S. has been with its “fourth coast”. Under President Trump, however, America “has rediscovered the among experts and government officials.

significance of the global Arctic and is refocusing on what homeland defence entails.”22 Pompeo also came in for criticism for enthusing This renewed interest was once again demonstrated in July 2020 with the appointment of about the “abundance” of resources available for James DeHart as the U.S. co-ordinator for the Arctic. DeHart is a career diplomat with extracting in the Arctic as climate change causing ice extensive experience in global defence and security issues, and his appointment came shortly to retreat. after the U.S. Air Force released its Arctic strategy for the first time. "I think it's all part and “Steady reductions in sea ice are opening new parcel of the Americans seeing the greater importance of the Arctic and the greater passageways and new opportunities for trade, that importance of the geopolitics of the Arctic," explained Dr. Rob Huebert, a Canadian defence can potentially slashing the time it takes for ships to expert who teaches at the University of Calgary. 23 travel between Asia and the West by as much as 20 days,” he said.

20 Secretary Mike Pompeo, “Looking North: Sharpening America’s Arctic Focus”, speech to the Arctic Council, Rovaniemi, Finland, 6 May 2019, www.state.gov. 21 “Who owns the Northwest Passage?”, The Economist, 22 May 2019. 22 Dr. Andrea Charron, “Canada, the United States and Arctic Security”, Canada’s Arctic Agenda: Into the Vortex, Centre for International Governance Innovation, 2019, 94. 23 Levon Sevunts, “Appointment of U.S. Arctic co-ordinator may signal more muscular American policy”, CBC.ca, 31 July 2020. 15

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With the results of the U.S. election pending, the following will be a key question for all Canadians with an interest in the Arctic: To what extent, if any, will the new American muscularity in the North be maintained should there be a change in government?

Canadian claims to its sovereignty in the North, as well as untold potential economic development of that vital area, could both depend on answers to this question. China

China’s leader, Xi Jinping, wants his country to become a “polar great power”. Excited by possibilities in the Arctic as the Earth warms, “fish, minerals, oil and gas that will become easier to extract; new shipping routes that will open up and shorten journeys between China and Europe. To facilitate this, China has been mulling the idea of building ports and other infrastructure in the Arctic.” 24

A recent special edition of “The World If”, published in

The Economist, paints a picture of what China’s role in

the Arctic might look like in 2049. “Six states that border the Arctic – Canada, Denmark, Finland, Iceland, Norway and Sweden – have all seen Chinese cargo and cruise ships bring lucrative business to once-sleepy northern ports, tempering domestic political opposition to China’s presence in the high North.25 Today, Canada can work with China when it comes to Arctic development. But as ongoing tensions over Huawei suggest, Canada needs to remain diligent in defining and defending its own needs in the Arctic when dealing with other countries that are taking a growing interest in the North.

24 “The voyage of two icebreakers have been creating headlines in China”, The Economist, 28 November 2019. 25 “What if water shortages destabilise China”, The Economist, July 2020. 16

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The current proposal by China’s Shandong Gold Mining Corporate to buy Canada’s TMAC resources mine on the shores of the Northwest Passage is a test of international relations between the two countries. In considering the dimensions of this proposed transaction, noted Canadian foreign affairs expert Colin Robertson said Canada should ask some crucial questions: • Is this a state-owned enterprise enjoying benefits not available to other companies? • Is this a strategic commodity? • What are the net benefits to Canada (i.e., local employment, trade, infrastructure, regional and local development)? • Would Canadian companies be able to buy a similar Chinese company (i.e., is there reciprocal treatment)? In responding to his own questions, Robertson said “I am not sure it would pass these tests, especially the last one”. 26 The EU, Denmark and Russia

The EU In April 2020, the EU appointed British national Michael Mann as its new Ambassador at Large for the Arctic.27 He and other EU leaders are consulting on the shape of the EU’s new Arctic policy that will, among other things, promote “sustainable development in the Arctic to the benefit of those who live there, including Indigenous peoples”.28

Denmark

While their Arctic Strategy is predicated on international cooperation29, longstanding territorial claims by Denmark over Hans Island – a 1.2-square-kilometre rock near the tip of Ellesmere Island, Nunavut – have led to some frictions with Canada over the years. 30

26 Marc Montgomery, “China’s effort to buy an Arctic gold mine raises many concerns”, Radio Canada International, 10 August 2020. 27 Trine Jonassen, “Meet the EU’s Man in the Arctic: ‘We Must Think Differently About Our Resources’”, High North News, 21 April 2020. 28 EU press release, “Arctic policy: EU launches consultation on the future approach”, 20 July 2020. 29 Denmark Profile, The Arctic Institute, updated 19 June 2020. 30 Sara Frizzell, “Truce? Canada, Greenland, Denmark inch closes to settling decades-long spat over Hans Island”, CBC.ca, 28 May 2018. 17

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Russia Russia, meanwhile, has far grander plans across a much bigger canvas. Its Arctic territory stretches more than 24,000 kilometers of coastline along the Arctic Ocean and waters above the Arctic Circle, from the Barents Sea in the west at the border to Norway to the Bering Sea and the Sea of Okhotsk in the Far East. Russia’s coastline accounts for 53 percent of the Arctic Ocean coastline and covers the Barents Sea, Kara Sea, Laptev Sea, and East Siberian Sea.31 Russia is rapidly bulking up their maritime, research and defence capacities in their part of the Arctic. And that shows no signs of stopping. “Efforts to harness the Arctic’s geostrategic potential have long been the Russia is investing heavily in military bases, equipment, and ambition of Soviet and Russian leaders. Drawing upon early Russian personnel to secure its Northern Passage, and has begun to exploration and Stalin’s “Red Arctic” propaganda, Russian President Vladimir charge transit fees. Putin personally identifies with Russia’s Arctic ambitions and seeks to exploit the Arctic narrative of man conquering nature as a distinctive feature of modern Russian nationalism. The Arctic is a pillar of Russia’s return to great power status.”32 Canada needs to pay close attention to Russia’s Arctic activities, as two international DISCUSSION QUESTIONS ON THE GLOBAL relations experts – Dr. Aurel Braun and Dr. Stephen J. Blank – wrote recently: GEO-POLITICAL CONTEXT

“With the advent of global warming, the Arctic is becoming increasingly 1. The geo-political context of the North is changing attractive due to [Russia’s] vast resources and navigational potential. Ideally, rapidly. What are the biggest opportunities and Arctic states would work together to ensure exploration of this region and risks for Canadian businesses within this context? sharing potential benefits, including the two countries with the longest Arctic

coastlines – Russia and Canada. However, this ideal of cooperation cannot 2. Looking out 10-20 years, what do you see in terms disregard geo-strategic, geo-economic, and ecological reality.”33 of cross-border partnerships in developing Canada’s North?

31 Russia Profile, The Arctic Institute, updated 19 June 2020. 32 Mathew Melino and Heather Conley, “The Ice Curtain: Russia’s Arctic Military Presence”, Centre for Strategic and International Studies, March 2020. 33 Aurel Braun and Stephen Blank, “The Cold Reality Behind Russia’s Charm Offensive: Why Canada needs a realistic Arctic Policy”, Macdonald-Laurier Institute, 9 April 2020, 4. 18

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4. MASSIVE OPPORTUNITIES AND NEEDS Climate change is re-shaping the Arctic There is no doubt that climate change is profoundly affecting the North in a variety of ways. Canada’s Minister of Northern Affairs, The Hon. Dan Vandal, illustrated just how fast the climate is changing. “I know that [climate change] is a tremendously important issue for the entire world,” he said during an online town hall with Tuktoyaktuk in July 2020. “But I know that in the North the climate is changing three times faster than it is in the south.”34 Speaking in the same conference, Randall Pokiak, an Elder and historian affiliated with the Inuvialuit land claim agreement, spoke of his personal experience with climate change in the North. “The breakwaters are relocating, some of them are gone. And it's every time you lose a breakwater in the ocean that protects the mainland, the permafrost and the tundra, well, more of that is exposed. As the waves hit or the ice during the storms in the fall and early fall and right to the middle fall, where the ice is like a bulldozer that comes in and breaks up the coastline, and then the water just does the rest of washing it away. So, it's our whole coastline is being changed.” 35 The changes experienced by Randall, his family and every person living in the North are part of a very stark warming trend. • The Arctic is warming by two to three times the global average (United Nations).36 • Oceans surrounding Canada are projected to continue to warm over the 21st century, with the sea level to rise along the Atlantic and Pacific coasts of Canada and the Beaufort coast in the Arctic. 37 • Impacts of warming on the physical environment in the Arctic include declining sea-ice concentration, earlier ice break-up and later freeze-up, a lengthening of the ice-free open-water season, permafrost warming and thaw, coastal erosion, sea-level rise and changing weather patterns, including wind and waves.38

34 The Hon. Dan Vandal, Minister of Northern Affairs, “Exchange on climate change in Tuktoyaktuk”, transcript of the call, July 2020. 35 Ibid. 36 United Nations Environment Programme, Global Linkages: A graphic look at the changing Arctic, 2019, 13. 37 “Canada’s Changing Climate Report – Executive Summary”, Environment and Climate Change Canada, Government of Canada, 2019, 14. 38 James D. Ford, Trevor Bell, Nicole J. Couture, “Perspectives on Canada’s North Coast Region”, Canada’s Marine Coasts in a Changing Climate, Government of Canada, 2016, 155. 19

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• Most scientific models suggest that the first ice-free Arctic summer could happen around the middle of this century. There are more pessimistic forecasts suggesting total melting of the ice cap in summer could happen before, and optimistic outliers pointing to some time after 2100. 39 • Research published in Nature Climate Change in the summer of 2020 suggests that Arctic sea ice could be completely gone by 2035.40 • Canada’s last fully intact ice shelf – the Milne Ice Shelf at the fringe of Ellesmere Island – collapsed in July 2020. 41 Climate-driven environmental changes have profound implications for Arctic community sustainability. For example, travel and hunting on ice may be hampered and safety compromised with later ice freeze-up and earlier breakup.42 With this Arctic warming comes rapid social and economic change. In fact, the Arctic is warming so fast that it has become an accelerator of climate change in the rest of the world. “The white surface of the ice cap helps reflect sunlight back into space, effectively cooling the planet. When the ice melts, it’s replaced by ocean, which is dark and absorbs the light, heating up the sea surface. The heat is speeding up the thawing of permafrost, the frozen ground that covers much of Russia’s Siberia, Alaska in the U.S. and the Yukon territories in Canada. When permafrost thaws, the organic matter that has been stored there since the ice age releases greenhouse gases such as carbon dioxide and methane into the atmosphere.”43 At the same time, as the Canadian Forces’ “Strong, Secure, Engaged” report says, “climate change, combined with advancements in technology, is leading to an increasingly accessible Arctic.”44

39 Laura Millan Lombrana, Anna Shiryaevskaya, Dina Khrennikova, Olga Tanas, and Mira Rojanasakul, “Front-Row Seats for the Arctic’s Final Summers With Ice”, Bloomberg, 27 July 2020. 40 Solarino Ho, “Arctic sea ice could be completely gone by 2035, new study predicts”, CTVnews.ca, 10 August 2020. 41 Hannah Paulson, “Collapsed Arctic ice shelf adds ‘exclamation point’ to dire climate trend, say scientists”, CBC.ca, 7 August 2020. 42 “Northern Lights: A Wake up Call for the Future of Canada”, 2019, 72. 43 Lombrana, Shiryaevskaya, Khrennikova, Tanas, and Rojanasakul, “Front-Row Seats for the Arctic’s Final Summers With Ice”. 44 “Strong, Secure, Engaged: Canada’s Defence Policy”, 2017, 50-51. 20

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The Trump administration, meanwhile, is much more blunt about the opportunities that this increased accessibility in the Arctic will reveal. In describing the rapidly warming region as a land of “opportunity and abundance,” U.S. Secretary of State Mike Pompeo, in that speech he gave to the Arctic Council, cited the Arctic’s untapped reserves of oil, gas, uranium, gold, fish, and rare earth minerals as areas for development. And melting sea ice, he said, is opening up new shipping routes.45 While keeping squarely in mind the profound and irrevocable changes wrought by climate change, increased accessibility lends itself to a variety of economic development opportunities. Indeed, the existential risks posed by climate change in the North compel concerted action in the near term and for the long haul. Massive economic opportunities in a massive area The economic opportunities of the North are close at hand and huge. They are also unrealized. In her briefing to the Standing Committee on Foreign Affairs and International Development” in November 2018, Dr. Jessica Shadian, President of Arctic360 suggested why that’s the case. “Canada has not created a specifically economic focused strategy for its North – a concerted strategic infrastructure investment analysis that is guided by the growing role of the strategic importance of the Arctic in the world and likewise that would guide the economic development of the Canadian North.”46 There are any number of economic development opportunities in the North, including fisheries and tourism as the Arctic warms up, and data-driven jobs that could stem from leading research out of the new Canadian High Arctic Research Station Campus (CHARS) operated by Polar Knowledge Canada.47 The increased length of the navigable season because of changing climate increases the viability of northern ports, and is expected to be beneficial for future mine development. Oil companies are interested in developing new offshore oil platforms, such as in the Beaufort Sea.

Potential opportunities for new commercial fisheries may arise because of a northward shift in the distribution of cod and other species, and because of improved and longer boat access. Across the North, several logistical, regulatory, and financial barriers may result in opportunities not being realized without changes in government policy.

45 Somini Sengupta, “United States Rattles Arctic Talks with a Sharp Warning to China and Russia”, The New York Times, 6 May 2019. 46 Dr. Jessica Shadian, President and CEO, Arctic360, “Brief to the Standing Committee on Foreign Affairs and International Development”, November 2018. 47 See Polar Knowledge Canada for more on CHARS, www.canada.ca/en/polar-knowledge.html. 21

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The following highlights a few of the biggest development opportunities.

Shipping DISCUSSION QUESTIONS ON ECONOMIC DEVELOPMENT Canada leads the way in Northwest Passage shipping, through which cargo ships can save days, if not weeks, using the Northwest Passage compared to other channels. 1. The infrastructure needs of the North are huge in Montreal-based Fednav has 75 years of experience in Arctic shipping. In 2014, the aggregate, while some of the specific, local infrastructure needs are quite small. How does the Fednav-owned ship Nunavik icebreaking bulk carrier took 26 days to carry nickel from private sector prioritize and finance those needs? Quebec to China, compared with a previous trip through the Panama Canal lasting 41 48 days. 2. What are the best vehicles (i.e., partnerships, But we are far from alone on those waters. As Arctic ice melts, a variety of sea routes will investment councils, etc.) to identify and finance stay navigable for longer periods, which could drastically change international trade and infrastructure projects in ways that take all perspectives and visions into account? shipping. For example, shipping from Rotterdam to Japan through the Suez Canal would

take about 30 days. 3. In its 2019 report, the Special Senate Committee However, if this same Europe-Asia trip used the Northern Sea Route along the northern on the Arctic said the Government of Canada coast of Russia, the trip would last 18 days and the distance would shrink from should “propose the establishment of a Pan-Arctic approximately 11,500 nautical miles to approximately 6,900 nautical miles. As Nicholas Infrastructure Bank at the Arctic Council and ensure an improved investment climate and trade LePan wrote earlier this year for the World Economic Forum in talking about shipping, flow in the circumpolar Arctic Region.”51 What “control of these routes could bring significant advantages to countries and corporations interest, if any, is there on Bay Street to be part of 49 looking for a competitive edge.” this proposed Infrastructure Bank? The Northern Sea Route, stretching more than 3,000 nautical miles between the Barents Sea and the Bering Strait, provides a shortcut to Pacific ports. Shippers could send oil, 4. Given the power of AI amid the ongoing gas and metals such as nickel and palladium to Asia more quickly, potentially reducing constraints of COVID-19, to what extent can economic development in the North be fostered costs. Russia’s largest liquefied-gas producer, Novatek PJSC, and the nation’s largest through digital technologies? private oil producer, Lukoil PJSC, send their eastbound cargoes via the route during summer.50

48 “Who owns the Northwest Passage?”, The Economist, 22 May 2019. 49 Nicholas LePan, “The final frontier: how Arctic ice melting is opening up trade opportunities”, World Economic Forum, 13 February 2020. 50 Lombrana, Shiryaevskaya, Khrennikova, Tanas, and Rojanasakul, “Front-Row Seats for the Arctic’s Final Summers With Ice”. 51 “Northern Lights: A Wake up Call for the Future of Canada”, 2019, 110. 22

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To support ongoing investment in Russia’s Arctic resources – such as the Novatek’s Arctic LNG 2 project – there are plans to build 15 new Arctic LNG carriers and two escort icebreakers.52 Looking down the line a few years, transport volumes in Canadian and Russian shipping routes through the Arctic are expected to rise to 100 million tons by 2025, and more than 25% of Asia-Europe container trade is expected to travel through the Northern Sea Route by 2030.53 Advances in satellite technology open additional opportunities to follow and track all vessel movements, resulting in more exact knowledge of transport volumes.54

Extraction Mining is the largest private sector employer in the Arctic, contributing 20% to 25% of the GDP of the northern territories and supporting about 9,000 jobs directly, or one in every six jobs. According to the Special Senate report on the Arctic, “the rich mineral deposits in the territories means territorial growth is projected to surpass the rest of Canada.”55

Mining activities have expanded significantly during the last decade in the eastern coastal Arctic, with new mines of various sizes and types being developed, including gold, nickel, lead, zinc, iron, uranium, copper, silver, platinum, palladium and cobalt. Nunavut has two operating mines, with more in the development stage and significant exploration in progress. In the western coastal Arctic, “potential offshore reserves of up 56 to 150 trillion cubic feet of natural gas and more than 15 billion barrels of oil exist.” Davik Diamond Mine Northwest Territories

52 Ibid., 3. 53 Guggenheim Partners, “Financing Sustainable Development in the Arctic”, 2019. 54 “The State of Maritime Transportation in the Arctic”, Arctic Economic Council, 2019, 2. 55 “Northern Lights: A Wakeup Call for the Future of Canada”, 30. 56 Ford, Bell, and Couture, “Perspectives on Canada’s North Coast Region”, 157-158. 23

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Infrastructure and Energy According to the U.S. investment firm Guggenheim Partners, the Arctic will require close to US$1-trillion of infrastructure investment over the next decade, including transportation, telecommunications and social services to support a new era of economic opportunity from energy, fishing and mining, to defence and tourism.57 In Canada, as the recent Senate report pointed out, building infrastructure in the Arctic is vital. “Canada lags far behind other circumpolar countries with respect to Arctic 58 infrastructure. However, unique challenges hinder social and economic development.”F A few of those challenges are manifest in different perspectives in the North and the South of the pace and purpose of development. In short, the pace of Bay Street is usually far ahead of the pace of the North when it comes to infrastructure projects. Niilo Edwards told us. “Some communities are further ahead than others, but even they 59 will have capacity constraints.”F The Mackenzie Valley Fibre Link The Mackenzie Valley Fibre Link (MVFL) is a fibre optic line that runs through the Mackenzie Valley from Inuvik to McGill Lake (near the border between the Northwest Territories and Alberta). The MVFL was developed as a public-private partnership between the Government, Ledcor Developments Ltd., Ledcor Technical Services and Northwestel Inc. This complex project crosses some of the most difficult terrain in Canada, and it brings telecommunications and high-speed internet access to a variety of communities in the Mackenzie Valley region. Torys LLP acted for the Government of the Northwest Territories in the procurement, design and construction of the MVFL. Among other things, the MVFL will also support the expansion of the Inuvik Satellite Station Facility, making it a leading facility to track and receive real-time data from polar-orbiting satellites.

57 Guggenheim Partners, “Financing Sustainable Development in the Arctic”, 2019. 58 “Northern Lights: A Wake up Call for the Future of Canada”, 2019, 39. 59 Phone interview, 30 July 2020. 24

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Massive needs for Indigenous peoples Canada’s northern coastal population mostly lives in small, remote communities. Most communities are accessible by air year-round and ship in the ice-free season, with only a few communities accessible year-round by road. The economies of communities in the North Coast region encompass a combination of waged employment and subsistence hunting, fishing and trapping, characteristic of what some have termed a ‘mixed’ economy. Both components are interdependent in contemporary life in northern coastal communities. Many northern coastal communities retain a strong connection with the environment, with traditional foods derived from hunting, fishing, and trapping having important social, economic, and dietary importance. The Survey of Living Conditions in the Arctic 60, for example, documented that the majority (74%) of respondents from northern Canada obtain half or more of their meat and fish from traditional sources. Traditional foods are widely shared within and between communities, and underpin Indigenous cultures across the North, with the ability to engage in these activities influenced by factors such as ice and weather conditions, and animal health and migration behaviour. Although median household income in some regions is greater than the Canadian average, costs of living are considerably higher. For example, food in Inuit communities typically costs at least double the Canadian average. The northern population is younger than in Canada as whole, with the median age of Inuit being 21 years in Nunavut and Nunavik, and 26 years in the Inuvialuit Settlement Region. Northern coastal communities are challenged by limited access to health services, crowded and poor-quality housing, concerns regarding drinking-water quality and sanitation, high levels of food insecurity and low educational achievement. Socio-Economic Conditions: those living in the North, particularly Indigenous people, are at higher risk of living in poverty, experiencing housing and food insecurity, and experiencing higher rates of acute gastrointestinal illness. Poverty has been documented to influence vulnerability to the health effects of climate change in several ways in northern coastal communities.

60 The Survey of Living Conditions in the Arctic, or SLiCA, was an international joint effort of researchers and indigenous peoples in Northern Alaska, Chukotka, and Greenland to measure and understand living conditions in the Arctic (2010). 25

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Health Impacts of Climate Change on Indigenous Peoples within the Arctic 61

IDENTIFIED CLIMATE-RELATED CHANGE EXAMPLES OF POTENTIAL HEALTH IMPACTS

Increased magnitude and frequency of temperature • Increased heat and cold-related morbidity and mortality extremes (Direct) • Respiratory stress in summer among high-risk populations (e.g., elderly, those with decreased respiratory health)

Increase in frequency and intensity of extreme weather • Increased frequency and severity of accidents while hunting and travelling, resulting in injuries, death, events (e.g., storms) (Direct) psychological stress

Increased magnitude and frequency of temperature • Increase in incidence and transmission of infectious disease, psycho-social disruption, changing animal extremes (Indirect) travel/migration routes

Decrease in ice distribution, stability, and duration of • Increased frequency and severity of accidents while hunting and travelling, resulting in injuries, death, coverage (Indirect) psycho-social stress • Decreased access to country foods, decreased food security, erosion of social and cultural values associated with preparation, sharing and consumption of country foods

Change in snow composition (Indirect) • Challenges to building shelters (igloo) for safety while on the land Increase in range and activity of existing and new infective • Increased exposure to existing and new vector-borne diseases agents (e.g., biting flies) (Indirect)

Change in local ecology of water-borne and foodborne • Increase in incidence of diarrhea and other infectious diseases infective agents (e.e., introduction of new parasites) • Emergence of new diseases (Indirect)

Increased permafrost melting, decreased structural • Decreased stability of public health, housing, and transportation infrastructure stability (Indirect)

Sea-level rise (Indirect) • Physical impacts and psycho-social disruption associated with infrastructure damage and community relocation (partial or complete)

61 Canada’s Marine Coasts in a Changing Climate, Donald S. Lemmen and Fiona J. Warren, Natural Resources Canada, 2016. 26

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5. COLLABORATIVE PARTNERSHIPS BETWEEN THE NORTH AND SOUTH

Bolstering the economy of the North is a key pillar of the federal government’s Arctic and Northern Policy Framework. “Canada will help bolster the economy in the North through enhanced trade and foreign investment opportunities, building on $2.2 billion in annual exports from Canada’s North. This work will include better market access to Northern businesses.”62 This is a laudable ambition. But no single group can do it alone: partnership is vital, as the Framework itself contemplates in its current co-implementation phase II. However, research for this discussion paper suggests that awareness of this Framework among many people in the capital markets is limited. The key, therefore, Members of the Arctic Security Forces Round Table gather on the HMCS Ville de Quebec is to connect capital in the South to opportunities in the North through awareness, engagement, and collaboration. To that end, we are considering ways to establish a group of like-minded business and Indigenous leaders focused on: THE CASE FOR COLLABORATION • Fostering a greater sense of urgency (political, commercial, Indigenous, and environmental) 1. If government had been able to do it alone, it would • Convincing the federal, territorial, and provincial governments to develop already be done. policies that reflect the partnership approach 2. If Indigenous peoples had been able to do it alone, it • Attracting capital to support infrastructure projects up to and including the would already be done. operations of the Northwest Passage, expanded fisheries, and extraction industries including oil, gas, and mining. There are many Indigenous 3. If Canadian business had been able to do it along it organizations structured for economic partnerships. would already be done.

62 Ambassador David Sproule, Senior Arctic Official, Canada, Global Affairs, “Canada’s Arctic and Northern Policy Framework”, online discussion with the Wilson Centre, 29 July 2020. 27

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Part 3.0 CONCLUSIONS As a nation, Canada must prepare. And as responsible, shareholder responsive corporations, Corporate Canada must too prepare. Soon, neither may be able look to our south border for economic and defensive security.

The decisions ahead will be challenging, and, in our opinion, it is better to be proactive

than reactive. It will also be better to be well prepared for any reaction that the nation and its businesses need to take. 4BAt time of writing, an opinion piece appeared in the Globe and Mail titled: It’s clear as ice: The Arctic is unravelling63. It is written by Glenn McGillivray, managing director of the Institute for Catastrophic Loss Reduction, a not-for-profit research organization. His Sled dogs wade through standing water on the sea perspective comes from the risk management industry. Here, he tells us: ice during an expedition in North Western Greenland Last week saw ominous reports that Canada has lost its last permanent ice on June 13, 2019. shelf. Using satellite photos, ice analysts noted that roughly more than 40 per cent of the 4,000-year-old Milne Ice Shelf, located on the northwestern edge of Ellesmere Island, broke off the main shelf into two very large and several smaller icebergs. The largest piece is nearly the size of Manhattan Island. The calving is thought to have occurred some time around July 30 or 31. Economic Sovereignty Glaciologists place the loss of the shelf squarely on the shoulders of climate Goals Goals change, with the Arctic facing summer temperatures this year that were about five degrees warmer than the 1980 to 2010 average. This, in a region already warming about three times faster than the global average. PIVOTING 1. WHY SHOULD WE CARE? NORTH McGillivray then asks: “It’s clear as ice – the Arctic is more than just fraying at the edges. It is unravelling altogether. But why should we care? After all, what possible effect can melting sea ice and exhausted, hungry polar bears have on the lives of those in the urban south?” Business Benefits for Environmental Opportunities Indigenous Sustainability The answer to that question is on the following page … Peoples

63 https://www.theglobeandmail.com/opinion/article-its-clear-as-ice-the-arctic-is-unravelling/?symbol=print-msg 28

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What does Canada do when? What does Canada do if?

• The loss of sea ice becomes so vast that shipping • Nations such as the United States, Russia and through the Northwest Passage becomes China stake out physical positions in “Canada’s financially attractive to most international North”, as the Russians have done in the shippers. Ukraine and China has done on various Pacific islands. • Sovereignty issues become more than intellectual concerns to a few civil servants and • Post the 2020 election, if the United States academics but threatens to place other nations remains a divided country with a focus on its as the custodians of our northern waters. own national interests rather than its previous support for international stability. • When tens of thousands of Indigenous people lose their traditional way of life and require • Military actions in the Middle East threaten the either re-location or massive infrastructure stability of Suez Canal. investments to maintain them. • Outside commercial interests, perhaps • Environmentalists force delays or cancellations financed by former entities, begin to scale up of commercial projects and are supported by investments in Canada’s North. international pressure (real or manufactured). • International companies invest in the Canada’s • The United States begins to press its North without the concern and oversight for sovereignty claims through the international environmental sustainability and benefits to courts, as well as increased commercial military Indigenous peoples. presence.

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3. Call to Action In either sense – when or if – the answer Campbell Strategies proposes is a sustained, well-planned and executed collaboration between the Canadian government, Indigenous peoples, and Corporate Canada – a collaboration that Corporate Canada must lead. We’d like to help get that started. Once formed, the Canadian Arctic Action Council will seek to:

1. Ensure that Canadian business plays a prominent role in delivering Canada’s Arctic Framework and influences any future policy developments within it 2. Provide an environment for collaboration among coalition members eager to discuss and pursue partnerships and shared investments in Canada’s Arctic 3. Ensure that the message that sovereignty and economic development are interdependent is embedded in government policy 4. Make Canadians at large aware of this interdependence and its importance to the future of the nation’s sovereignty, prosperity, and respect for Indigenous peoples. 5. Invite, encourage, and invest in initiatives that support a better mutual understanding between Indigenous peoples and Corporate Canada. 6. Ensure the integration of the needs of Indigenous peoples and environmental sustainability in the economic development of Canada’s Arctic. 7. Pursue Canadian leadership, ownership, management, and operations of the Northwest Passage along with any partnerships – with other nations or international businesses – that may be required.

We invite your opinions on this critical matter, and we hope that you and your organization will consider joining with us at this critical intersection of government policy and business needs. Barry Campbell and Ted Griffith Campbell Strategies Inc. Suite 3210, Commerce Court West Toronto, Ontario M5L 1E7 [email protected] or [email protected] 416.368.7353 www.campbellstrategies.ca

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Part 4 Appendices

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Some statistical information on energy and minerals in the region. 64

2. The Energy and Mineral Riches of the Arctic The Arctic has been the fascination of many people for centuries. Hundreds of years ago, the Europeans saw the Arctic’s frigid waters as a potential gateway to the Pacific. The region has also been home to many unique native cultures such as the Inuits and Chukchi. Lastly, it goes without saying that the Arctic is unsurpassed in many aspects of its natural beauty, and lovers of the environment are struck by the region’s millions of acres of untouched land and natural habitats. However, the Arctic is also one of the last frontiers of natural resource discovery, and underneath the tundra and ice are vast amounts of undiscovered oil, natural gas, and minerals. That’s why there is a high-stakes race for Arctic domination between countries such as the United States, Norway, Russia, Denmark, and Canada. The infographic to the right highlights the size of some of these resources in relation to global reserves to help create context around the potential significance of this untapped wealth. In terms of oil, it’s estimated that the Arctic has 90 billion barrels of oil that is yet to be discovered. That’s equal to 5.9% of the world’s known oil reserves – about 110% of Russia’s current oil reserves, or 339% of U.S. reserves. For natural gas, the potential is even higher: the Arctic has an estimated 1,669 trillion cubic feet of gas, equal to 24.3% of the world’s current known reserves. That’s equal to 500% of U.S. reserves, 99% of Russia’s reserves, or 2,736% of Canada’s natural gas reserves.

64 Jeff Desjardins, “The Energy and Mineral Riches of the Arctic”, TheVisualCapitalist.Com, 6 April 2016. 32

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3. Arctic collaboration organizations The First Nations Major Project Coalition works collaboratively, cooperatively, and cohesively towards the enhancement of the economic well-being of its members, understanding that a strong economy is reliant upon a healthy environment supported by vibrant cultures, languages and expressions of traditional laws, and in particular to: a) Safeguard our air, land, water and medicine sources from the impacts of resource development by asserting its members’ influence and traditional laws on environmental, regulatory and negotiation processes. b) Receive a fair share of benefits from projects undertaken in the traditional territories of its members; and c) Explore ownership opportunities of projects proposed in the traditional territories of its members. Steel River Group’s Governing Principles are deeply rooted in Indigenous values, beliefs, and culture. Their foundation is grounded by a strong sense of community, centered around people and relationships. They aspire to be thought and action leaders for positive change in the space where Steel River Owned Entities, Indigenous Communities, their Alliance Partners, and Industry collaborate. Their underlying mandate is to drive employment for local Indigenous and partnering communities, as we strongly believe that employment and education are essential for positive social, cultural, and economic fusion. The Canadian Council for Aboriginal Business builds bridges between Aboriginal and non- Aboriginal peoples, businesses, and communities through diverse programming, providing tools, training, network building, major business awards, and national events. Indigenomics invites dialogue and thought-provoking insight into possibility of the Indigenous relationship both in Canada and beyond. It explores the pathway of the threshold of the Indigenous relationship and modern economics. Indigenomics is about honoring the powerful thinking of Indigenous wisdom of local economy, increasing the quality of this relationship and the application of human values in the modern context.

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Arctic 360 works with Indigenous development corporations, Northern governments, the private sector, the federal government, Arctic leaders, and other stakeholders to help educate and attract Canadian and global investment to the North American Arctic. Arctic360 works with Indigenous development corporations, Northern governments, the private sector, the federal government, Arctic leaders, and other stakeholders to help educate and attract Canadian and global investment to the North American Arctic. In its two-day conference in 201865, Arctic 360 summarized its recommendations on moving forward in Canada’s North: 1. Governments and Indigenous corporations in the North American Arctic must recognise that they are competing in global markets (e.g. energy, resources, and transportation). It is necessary to find ways to reduce costs and improve reliability for investors. 2. Investment into the region requires forming partnerships with those in the North. 3. We need to create East to West investment (rather than North to South). Cooperation through the Arctic will promote cost-sharing for infrastructure (e.g. From Arctic 360’s Mission Statement: air, ship, rail, road links between Arctic hubs, and broadband connections). We “We believe that a prosperous and sustainable North also need to learn from one another American Arctic relies on incorporating and expanding 4. It is in the interest of Alaska, Canada, and Greenland to convince global financial the intellectual and financial equity of those that live leaders that the North American Arctic is an emerging market. there. “Further, we believe that only through earnest 5. New models of public-private partnerships that are distinct for the region are partnerships is it possible to generate a greater global necessary. understanding of the region as it attracts greater 6. Bringing together 40-60 prominent leaders in this field to specifically address international attention and investment.” Arctic investment was critical and needs to be ongoing. It was the first time this particular sector of people came together and there is a lot more work to be done and which will be accomplished through making this an annual, at least, event. 7. We need to take the conference to the North as well. It is essential to bring the southern investment community North to learn and see first-hand the opportunities and challenges that are there.

65 Harnessing Investment in the North American Arctic: Challenges and Opportunities”, Arctic 360 conference, 13-15 February 2018. 34

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The European Union has assigned an Ambassador at Large for the Arctic – perhaps something Canada should do.

Michael Mann of Great Britain is EU’s Ambassador at Large for the Arctic. He is passionate about an Arctic in balance both when it comes to economy, climate and environment, as explained in this article by Trine Jonassen in High North News.66 The Anglo-German Brit took over the job as EU Special Envoy for Arctic Matters in the European External Action Service - or EU’s Ambassador at Large for the Arctic - from Marie-Anne Coninsx. Swedish Lars Gunnar Wigemark briefly held the position but left it after three months for another engagement. Thus, Michael Mann received the still rather new position in Brussels, following two and a half years as the eyes and ears of the EU in Iceland. The father of five from Kent has a diverse background and has already served the Arctic for much of his professional career. Before bringing his then pregnant German wife and the family to Iceland in 2017, he was Head of Division for Strategic Communications, EEAS. Before that, he earned his way as spokesman to High Representative Catherine Ashton, also in the EU. However, he started his career as a journalist and has worked as an EU correspondent for the Financial Times. We are talking EU all the way. "I was told, as I moved from journalism to communication, that I had stepped over to ‘the dark side’. But to me, it is key to tell the truth no matter what you do. If you do that, you can´t go wrong. Integrity is something you have or don’t have". Loves Iceland He was bitten by the Arctic bug during a tour up north with his former boss, Ashton. First Rovaniemi, Finland, then Kiruna, Sweden, then Svalbard. That was it – Mann was now a man of the Arctic. Michael Mann has lived much of his professional life in the EU and serving the Arctic. "It was an amazing journey that did something to me. Fortunately, it was the perfect time for my family and I to move to Iceland when the opportunity came along", the Ambassador says. "We absolutely loved our time in Iceland. It is such a great place to raise children, as it is safe and you can just let them out to play and run about. In fact, Iceland is a very special place and they do a lot of things right, both in their close cooperation with the EU as well as during the Corona crisis".

66 “Meet the EU’s Man in the Arctic”, High North News. 35

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Such as? "They are very clear about what they mean and imposed strict measures on the population as soon as the crisis hit. I was for instance supposed to take my car by ferry and drive to Brussels via Denmark, but I was advised to leave my things behind and travel out by plane while there were still a chance. Luckily it didn’t come to that. But I left my best suits in the house where we lived, along with some boxes. I will try to pick up my stuff when I go back for the Arctic Circle Assembly in Reykjavik in October. If it will happen". There is a fine balance between protecting and exploiting. We must not forget that. “Sustainability is the future” The way from working for the EU from the Arctic to working for the EU towards the Arctic was a bumpier ride than presumed. And so far he does not need his best suits in his new family home in Brussels, which is acting as kindergarten, school, and office – for now. There are plenty of time to figure out the way ahead for the EU’s Arctic strategy. Like “The European Green Deal”. "That is the future. A roadmap to a sustainable economy in the EU", says Mann. That is something he is passionate about; a world in which climate and environment go hand-in-hand with sustainable production and economy, in which the world cooperates around an Arctic that is well-managed. The EU holds ambitious goals:

• Carbon neutrality by 2050. • Economic growth disconnected from use of resources • No persons or places left behind [emphasis added] "The Arctic is proof that we need this roadmap and the sustainability goals more than ever". Will Corona lead to permanent changes in the way we live and work in the High North? And lead to changes in how the EU works with and towards the High North? “I think it is too soon to say. Though I will say that I think it is impressive how well the EU works in this situation. Cooperation between member states is working thanks to impressive coordination. However, we have to expect that knowledge we do not yet possess will change society as we know it. I don’t think we will stop meeting in person, even if we take onboard our new, digital everyday life. Screens cannot replace face-to-face meetings. But perhaps we will fly less after this? We see even now that the EU member states are stronger together, and we will keep that in mind going forward. I believe we will think differently about our resources. In particular in the Arctic, which is so rich in them". Right now, much work is going on regarding the EU’s new Arctic strategy. The most recent one dates back to 2016 and is considered obsolete in many areas. Development in the Arctic has been rapid, both in climate and in economic terms. This is best illustrated by the symbolic memorial wake Iceland held over its first lost glacier, the Okjökull, which thawed at an age of only 700 young years.

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New Arctic strategy "We are approaching some issues with new eyes and knowledge. Like connectivity, tourism, thawing and trade routes. What happens when tourism shuts down, like now? There is also a lot happening in security policy. We are seeing great interest in this area, and the EU is doing a lot of research and working on strategies for better preparedness in the Arctic. More than we are able to communicate at the moment. Actually, the EU is world champion at planet protection", Mann states with enthusiasm. "Sustainable development, good climate strategies and international cooperation. This is what we need to move forward right now. EU has a big role to play here. We also have to make sure to have a close cooperation with indigenous peoples of the Arctic, and we have already established a dialogue where we can learn from their knowledge and experience", says Mann. "There is a fine balance between protecting and exploiting. We must not forget that". About that. Is an oil-free Arctic a Utopia? "The EU goal is to be climate neutral by 2050. I would say that carbon neutrality is an opportunity rather than a limitation. Carbon neutrality creates jobs and many other opportunities. Again, just look to Iceland. They are proof that we can do this", Mann says. "However, in order to make it we have to get out there and repeat the message over and over. We have to join debates and make our research available and provide genuine and truthful information", says the Ambassador, eager to get going.

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Pivoting North – Canada’s Next Great Opportunity (or threat) INVITATION-ONLY ONLINE MEETING OF BUSINESS LEADERS & ARCTIC EXPERTS: Feb 11, 2021 Campbell Strategies Inc., Fall 2020

Barry Campbell and Ted Griffith Campbell Strategies Inc. Suite 3210, Commerce Court West Toronto, Ontario M5L 1E7

[email protected] or [email protected] 416.368.7353

www.campbellstrategies.ca 38