The Arctic region is not only located on the top of the world it is also top of mind in many policymakers these days. In the north we find many of the solutions to our globe’s major challenges . The region has a sustainable blue economy to feed a growing urban population. The Arctic has all kinds of energy sources from oil and gas to geothermal, hydro, wind and solar and now also hydrogen makes headway. Finally, the ancient old rocks in the region hold some of the raw materials we need in the green transition. The Arctic is rich in the ingredients to make batteries required in wind turbines, electric vehicles, and satellites
“The Arctic is the region of opportunities, and we know what it takes to unlock these. We need more investments, better infrastructure and most importantly we need to solve the demographic challenges. In the Arctic Economic Council, we believe that we need to showcase the investment opportunities, facilitate pan-Arctic infrastructure development and it is critical that we create local jobs that benefit the communities,” says Executive Director of the AEC Mads Qvist Frederiksen.
Recently the Chief Investment Officer of Guggenheim Partners’ Scott Minerd, stated that the Arctic needs one trillion US dollars in investments for infrastructure projects, including renewable energy. Various national Arctic strategies also support and encourage investments; yet little has still materialised.
“We have at the AEC decided to make an easy approachable document that showcases some of the many investment opportunities in the Arctic. We have the financial numbers, the sustainability footprints and short interviews with the project owners. In the end, we also have an investor square where we list some of the potential investors in the region, both public and private,” explains Mads Qvist Frederiksen.
The living document titled “Sustainable Investment Opportunities in the Arctic” has been put together by a group of experts from the Arctic region. The report includes business cases of large companies as well as SMEs from different economic sectors such as mining, energy, tourism, bioeconomy, technology, and infrastructure.
The recent pandemic showed that there is a digital divide in the Arctic that small remote communities depending on for example tourism or indigenous groups are hard hit when borders close. The remote villages were also partly spared some of the effects of strict lockdowns due to its lack of infrastructure connecting the smaller settlements of the north with the urban centres in the south.
“Investments in the Arctic are often like a kinder egg; you get three things in one. First of all, it benefits the local communities, for example, when a mine develops a new road or energy infrastructure. Secondly, it benefits academic researchers, for example, when we invest in SMART subsea cables that provide real-time data from the ocean. Thirdly, it benefits the private sector there. Even small-scale investments in the north can have a ripple effect on the local communities turning them into economic, scientific and educational, or cultural hotspots,” says Mads Qvist Frederiksen.
All of the investment opportunities have a common starting point and that is the Arctic Investment Protocol (AIP). This document developed by indigenous representatives, academics, policymakers, investors and the private sector with interest in the Arctic guides investors through a series of six principles to follow. The AIP aspires to promote sustainable and equitable economic growth in the region that furthers community well-being and builds resilient societies in a fair, inclusive, and environmentally sound manner.
“Making sure that local communities also benefit from investments is a key point in all of these cases. We, therefore, hope that this document can inspire outside investors to see how they can make a positive difference both to the small Arctic communities as well as to their finances. And this showcase is just the beginning, we expect projects to be pitched to us in the coming months”, says Mads Qvist Frederiksen
The investment report is financed with support from the Nordic Council of Ministers.