Canada's New Shipping Shortcut

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This is a Wendover Productions video made possible by Hover. Get 10% off your custom Domain from Hover with the code “Wendover” at checkout. The Arctic will be perhaps the single most influential region on earth in the coming century and yet almost no-one even lives there. Eight nations have territory above the Arctic Circle—Denmark though their constituent country: Greenland, Iceland, Norway, Sweden, Finland, Russia, the United States, and Canada—and they are all in close quarters. This circle represents the distance a plane can fly in three hours. Most of these countries can reach each other faster than they watch Titanic. Anchorage, Alaska is, in fact, closer to Tromsø, Norway than it is to New York because of the short-cut over the pole. Alert, Canada is so close to Tromsø, Norway that it could be flown by a turboprop plane (Pilatus PC-12 NG.) The only issue is, there’s about to be some serious money in the high north. The Arctic ice is melting, there’s no question about that. Some may debate the cause of the melt, but one cannot debate that there’s simply less ice up north than there was 50 years ago. This melt has profound consequences. Whole countries like Tuvalu and the Maldives could be largely underwater by the end of the century because of the rising sea levels from melting ice. But the melt has a different, more obvious effect—where there was once ice there’s now liquid, navigable water. One of the greatest quests for early explorers was to find a Northwest Passage—a navigable sea route connecting the Atlantic and Pacific Oceans through the Canadian Archipelago. It was long thought to be myth until in 1906 Roald Amundsen and his six crew members arrived at Herchel Island, Canada, having successfully completed a three-year voyage from Norway via the new Northwest Passage. The significance of the Northwest Passage is that, until 1914 when the Panama Canal opened, traffic from the Atlantic could only reach the Pacific by sailing around Cape Horn—the southern tip of South America. This meant that a sea route between London and San Francisco—5,000 miles apart as the crow flies—took 14,000 miles. This was not efficient. It was a significant hamper to development to the American west coast. The Northwest passage would’ve revolutionized maritime trade—if it wasn't covered in ice. Roald Amundsen’s ship, the Gjøa, was small enough that it could snake through and slide over ice. Some of the waterways Amundsen took were as few as three feet deep—far too shallow for the increasingly large commercial ships of the time. More than 100 years later, in September of 2013, however, for the very first time, a commercial bulk carrier, the MS Nordic Orion, transited an almost ice-free Northwest Passage on its journey from Vancouver, Canada to Pori, Finland, and this was far from a publicity stunt. This ship saved $80,000 in fuel costs and was able to take 25% more cargo than if it had gone through the Panama Canal. Even thousand passenger cruise ships are now making the journey. Ironically, global warming is actually opening a route that’s better for the environment. China is a country with a vested interest in the navigability of the northwest passage. As an economy largely based on manufacturing for the western world, their maritime accessibility has an enormous effect on their national wellbeing. A reduction in time and cost of shipping to the American east coast would renew their competitiveness in the manufacturing industry against emerging rivals such as Vietnam and Bangladesh. As China industrialized largely thanks to its manufacturing industry the standard of living in the country increased which correspondently increased labour costs. China’s Maritime Safety Administration, recognizing the imminent explosion in usage, recently published a 356 page guide to navigating the northwest passage and the country has announced plans to send more and more commercial shipping traffic through the passage in the coming summers. The introduction of maritime traffic to the northwest passage could present a significant opportunity for Canada. The northern territories of Canada, through which northwest passage runs, are historically underdeveloped. Less than 120,000 people live in the Yukon, the Northwest territories, and Nunavut. That’s less than the population of Saguenay—a town small enough that you probably haven’t even heard of it—living in an area larger than the entire country of India. It’s not all that surprising considering just how inhospitable the area is, but other places at similar latitudes such as Anchorage, Longyearbyen, and Murmansk have managed to overcome the conditions thanks to the money that can be made in the far north. If a large chunk of the worlds maritime traffic heads through the Canadian north, industry will develop to support these ships. Except, there’s a problem. Despite the general friendliness of most of the arctic countries, there are geopolitical issues in the high north. Even more surprisingly, one of them is between the US and Canada. When there’s a navigation choke-point restricting certain countries from accessing an ocean, it’s convention to declare that waterway an international waterway. For example, the Danish Straits—fully surrounded by Denmark—are an international waterway in order to give the Baltic and Scandinavian countries ocean access; the Turkish straits, fully surrounded by Turkey, are international waterways to give the black sea countries ocean access; and the Danube River is an international waterway to give landlocked Austria, Hungary, Moldova, Serbia, and Slovakia ocean access. When a waterway is declared an international waterway no country can restrict access or charge dues to passing boats except during a time of war. Canada considers the waterways comprising the northwest passage in their archipelago as their own waters. In the past nobody challenged this since there was no reason anyone would cross through these frozen waters. With its promise to cut shipping routes by thousands of miles, the northwest passage will almost certainly become an important shipping route so that’s why countries like the US firmly believe that the northwest passage should be and already is an international waterway. One of the tensest moments in history between the US and Canada was when, in 1985, a US Coast Guard Icebreaker travelled through the northwest passage without prior permission from Canada. In Canada’s mind, this was a military invasion of their sovereign territory—debatably an act of war. Canada argues that the northwest passage is not an international waterway because it has failed to meet an important criteria—usefulness. Of course the northwest passage is useful on paper—it shortens the route between the oceans—but Canada has pointed out that in previous cases determining whether a waterway is international, what proves a route’s usefulness is if a significant number of ships have already successfully transited it. In the northwest passage’s case, the number of successful commercial journeys is in the double digits. There’s also merit to Canada’s argument that the passage should be their sovereign waters. Currently, Canada has almost no search-and-rescue capabilities in their archipelago. Since there’s almost no traffic yet, there’s no real reason to spend the money to put ships and aircraft up there. Most previous journeys have been highly coordinated and often escorted by the Canadian Coast Guard. If a ship just went through with no prior coordination nowadays and sank, however, there would be almost no chance of rescue for the victims. If in a few summers hundreds of ships transit the passage, Canada would have an obligation to put resources in the northern provinces for the safety of both the country and sailors and that takes money. If treated as an internal waterway, Canada could charge passage fees just as there are for the Panama or Suez Canal—the other major shipping shortcuts of the world. These could fund the infrastructure needed to safety regulate and police the route. But on the other hand, should one country have the capability to chose who can get from the Pacific to Atlantic faster? Letting, for example, Vietnamese ships through the route but banning Chinese ships would make the Chinese goods uncompetitive for the Western European and Eastern American market. Canada would have the capability to choose which economies can succeed and which will fail. There’s a reason the issue’s so contentious. Scientists disagree on the exact date, but there’s a general consensus that by the year 2050 there will be a summer when there is no ice in the Arctic. This will have enormous and irreversible consequences on our globe, but it could further revolutionize how we get our goods. An ice-free arctic will open up the greatest shipping short-cut in the world—the Arctic Ocean. Ships traveling between Japan and western Europe, for example, instead of heading south, across the Indian Ocean, through the Suez Canal, and across the Mediterranean sea, will be able to head north through the bering strait, directly across the arctic ocean, and down between Greenland and Norway to Europe. That’s a 7,000 mile route compared to the 13,000 mile route of today. That has the potential to slash shipping prices in half. That means cheaper products across the entire world. But at what cost. Every degree of climate warming in the US alone is expected to cause $144 billion dollars per year of economic loss. If the US climate warms by 12 degrees, which the EPA says is possible by 2100, the US can expect to lose more than $1.7 trillion per year—that’s more than a full percent of its GDP. On top of that, by 2050, climate change is expected to cause more than 250,000 deaths per year. Surely that can’t be worth it for some cheaper goods. This video was made possible by Hover. I recently bought two new domains with Hover—the website for my new podcast, showmakers.fm, and an extra domain for my Wendover Productions site, wendover.productions. With showmakers.fm, I connected it to a hosting provider in seconds, and with wendover.productions I set it to redirect to my site in seconds. It was incredibly easy. I also love how the price they show you is the price you pay—there aren’t page after page of add on’s like with some other sites. Now, having a professional web presence is important and it all starts with the domain. What really can set you apart is a unique domain extension—that’s the bit at the end like .com, .fm, or even .pizza—and Hover has over 400 of them. Once you buy a domain through Hover you can set up an email account using that domain which will truly help you stand out. However you want to use Hover, you can get 10% off your first order and help out Wendover Productions by going to hover.com/wendover and using the code “wendover” at checkout. Get your unique domain and email to help you stand out with Hover. Please also be sure to check out my new podcast with Brian from Real Engineering called Showmakers. Episode one with Hank Green and two with Destin Sandlin from Smarter Every Day are already out. Links are in the description. You can also support Wendover Productions on Patreon here, follow me on Twitter @WendoverPro, watch my last video here, check out my fan-moderated subreddit here, and lastly subscribe to this channel by clicking here. Thanks again for watching and I’ll see you in two weeks for another Wendover Productions video.
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Channel: Wendover Productions
Views: 2,964,172
Rating: 4.7665391 out of 5
Keywords: the, northwest, passage, canada's, shipping, shortcut, artic, north, pole, ice, transport, ships, container, logistics, globe, world, geography, geopolitics, boat, boats, containers, Canada, united states, russia, china, manufacturing, norway, longyearbyen, sweden, finland, greenland, wendover, productions
Id: ZcDwtO4RWmo
Channel Id: undefined
Length: 11min 17sec (677 seconds)
Published: Tue Apr 25 2017
Reddit Comments
👍︎︎ 65 👤︎︎ u/JammieDodgers 📅︎︎ Apr 25 2017 🗫︎ replies

Canada deserves to get paid for use of their waters.

Back when that water was just a bunch of ice no one gave two shits about it. Now that it's useful, countries are deciding that the Northwest passage is international waters? Nah, Fuck that.

👍︎︎ 436 👤︎︎ u/CrazyAssFarts 📅︎︎ Apr 25 2017 🗫︎ replies

What a fun spin on global warming, This video bums me out.

👍︎︎ 31 👤︎︎ u/Dungeon_shrubbery 📅︎︎ Apr 25 2017 🗫︎ replies

A geopolitical view of the Arctic:

https://www.youtube.com/watch?v=dV67yJHoPvw

Shit is really interesting and will probably be the next major hot point in the world. Both literally and figuratively.

👍︎︎ 15 👤︎︎ u/jjBregsit 📅︎︎ Apr 25 2017 🗫︎ replies

I would like to point out it wasn't Roald Amundsen that discovered the Northwest passage but Robert McClure who traversed it in several boats and on foot during a search mission for the Franklin expedition.

Edit: removed a word

/u/wendoverproductions

👍︎︎ 9 👤︎︎ u/Ranolden 📅︎︎ Apr 25 2017 🗫︎ replies

The video had a couple of factual errors (see below) and overplayed the significance of the NW passage to global supply-chains. Shipping costs are actually not highly correlated with distance, which is why it is typically cheaper to ship from china to the US than to Japan. Distance is just one of many factors, and it is unlikely that the reductions in distance from NW passage would outweigh the obvious risks/costs.

Alaska recently scrapped their plan for a deep water port in the arctic because interest in the NW passage was weak and underwater oil reserves proved to be much smaller than expected. Moreover, the expanded Panama Canal seems to be doing a pretty good job at getting cargo from the pacific and vise-versa.

factual errors: - There have been way more than "double digits" of commercial transits - NW passage will not decrease by half the shipping costs from china to europe. - All of the numbers of the "costs of climate change out to 2100" are complete rubish.

👍︎︎ 22 👤︎︎ u/[deleted] 📅︎︎ Apr 25 2017 🗫︎ replies

Don't put it past Trudeau to roll over at the first sign of pressure.

👍︎︎ 55 👤︎︎ u/bigdongmagee 📅︎︎ Apr 25 2017 🗫︎ replies

Stay the fuck out of our water unless you want to pay your way through.

👍︎︎ 16 👤︎︎ u/DoxBox 📅︎︎ Apr 25 2017 🗫︎ replies

Man, global warming is awesome!!

👍︎︎ 7 👤︎︎ u/pony-baloney 📅︎︎ Apr 25 2017 🗫︎ replies
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