Thursday May 25, 2017

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North by Northwest
Commentary with a Canadian accent
China and Norway

The ice breaks

ANALYSIS China and Norway have decided to let go of a long-standing diplomatic spat. That will make it easier for the two countries to pick up the pace of business activity in the North
What win-win looks like in practice (Photo: Utenriksdepartementet)

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The Norwegian Foreign Ministry made the sudden announcement today that diplomatic relations between China and Norway, downgraded since the 2010, when the Nobel Peace Prize was awarded to dissident Liu Xiaobo, have been fully restored.

The statement was made after talks were held in Beijing between Børge Brende, the Norwegian foreign minister, and his counterpart, Wang Yi (both pictured above, sitting across from each other).

In a joint statement, the long-standing ties between the two countries were acknowledged, and there was a promise to continue to build relations in a variety of different fields, including development and the environment. Oslo also further stated its support for the One China policy and the sanctity of Chinese sovereignty, and promised to avoid taking actions which would further harm bilateral relations.

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Mr Brende also noted that the conditions were now set for the potential restart of free-trade negotiations between the two countries, which had commenced in September 2008 but were suspended indefinitely in the wake of the diplomatic freeze.

When the Mr Brende met with Li Keqiang, the Chinese premier, it was confirmed that the diplomatic atmosphere had improved to the point where free trade talks could resume. If successful, the China-Norway FTA would be the second such agreement between Beijing and a Nordic country, after Iceland which concluded a free-trade pact in 2013.

In a statement (in Chinese) released by the Chinese Foreign Ministry, it was acknowledged that an “important consensus” had been reached. Erna Solberg, the Norwegian PM, added that the agreement opens the door for many Norwegian businesses, given the size of the Chinese economy. A government delegation from Oslo is now expected to travel to Beijing in spring of next year.

For the past six years, the diplomatic impasse between China and Norway had proven extremely difficult to resolve, as the dispute touched upon the core political interests of both states. There were no high-level meetings between the two governments, and the business climate had also become chilly, despite overall increases in trade. Especially hard-hit were salmon exports from Norway to China, which had become subject to periodic stoppages.

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However, during that time there were also instances and occasions when the two countries could collaborate, including on Arctic issues. Norway was accepting of Beijing’s application to join the Arctic Council as an observer in 2013, and specialists from both countries have had the opportunity to meet and share knowledge at various Arctic conferences, including the annual Arctic Frontiers event in Tromsø and the China-Nordic Arctic Research Centre/中国-北欧北极研究中心 conferences.

However, as Mr Brende acknowledged, the thaw in bilateral relations opens the door to further joint activities in the region, such as in the areas of fishing, energy and shipping, as well as joint scientific co-operation in areas like local climate change as the region continues to become more accessible.

Chinese shipping interests had frequently expressed their desire to make greater use of the Northern Sea Route to improve Sino-European trade, and Norway’s location places the country in an ideal position to act as a depot for increased northern trade between Asia and Europe.

As Beijing continues to deepen its Arctic engagement, the restoration of diplomatic relations with Norway after a long freeze has created new opportunities to build bilateral Arctic partnerships in the far north.

The author is a senior researcher at the Norwegian Institute of International Affairs (NUPI), in Oslo.