Geopolitics

Led By Russia, A Quiet Rush May Be On For Antarctica's Resources

Russia has explicitly stated it wants to begin exploration for minerals and hydrocarbons in and around the White Continent. But others, from China to Australia, have already given (and planted) signs that show they will not sit idly by.

A Russian icebreaker ship in the Antarctic
A Russian icebreaker ship in the Antarctic
Stéphane Foucart

Is the world getting ready for a rush on Antarctica's resources? During the last general meeting of nations involved in the international oversight of the Antarctic, Russia announced that it wants to begin exploration for minerals and hydrocarbons in and around the so-called White Continent. The document submitted by the Russian delegation lists the key points of "development of the Russian Federation's activities in the Antarctic in 2020, and also for the long term."

The list of demands may well have come as a shock for the rest of the international representatives involved in the June meeting, held in Buenos Aires, Argentina. But even four months later, it has yet to make headlines – in large part because the meetings are held without the presence of outside observers. Nor do the 48 countries involved in the Antarctic Treaty System tend to broadcast information about the summits. The Russian document has, however, been posted discreetly on the Internet site of the treaty secretariat (www.ats.aq).

Moscow's plan to carry out "complex research into the mineral resources, hydrocarbons and other natural resources of Antarctica" could weaken the continent's particular legal status by steering it toward a head-on collision with the Madrid Protocol. The Protocol made the largely virgin territory a sanctuary – "a natural reserve dedicated to peace and science" – where mining and other types of industrial exploration and exploitation are prohibited.

To protect Antarctica, a group of foreign dignitaries has launched an appeal to re-launch the ratification of the Madrid Protocol. In doing so, they hope that "stragglers' – 14 Antarctic Treaty member countries that never signed the accord – will finally do so. Among those calling for the ratification are former Spanish President Felipe Gonzalez, former Australian president Robert Hawke and former French Prime Minister Michel Rocard. They hope that by rallying the 14 holdouts, the key environmental document – which was originally signed in 1991 – will have its diplomatic weight reinforced.

Will this initiative be enough to avoid a rush to exploit the far-southern region's resources? An Australian think tank called the Lowy Institute for International Policy has recently published a report urging Australian authorities to protect their national interests and "open discussions with like-minded states' to address questions of sovereignty and resources to be revisited in 2048. What the Institute is urging, in other words, is that from here on, the Madrid Protocol can be reopened by the signatories.

Australia – like France, New Zealand, Norway, the United Kingdom, Chile and Argentina – is a so-called "holding" state, meaning it has territorial claims on the White Continent that have been frozen by the treaty. It is one of the oddities of this legal regime. The territorial claims of the seven "holding" states are effectively put on hold, but not questioned. Therefore each one of the seven maintains its rights but promises not to exercise them.

Taking liberties

Mr. Rocard, who created and designed the Madrid Protocol with Mr. Hawke, says he's confident the accord will hold up. "The protocol can be modified starting in 2048 if three quarters of the 12 consulting states agree," says Mr. Rocard. "Now, at that date, the world will be living the harsh reality of global warming, which is already underway. To go and look for hydrocarbons in Antarctica will not seem like a good idea to anybody... but today, the fact that we are heading towards a period of a shortage of resources terrifies everyone."

Like some other international treaties, the one regarding the Antarctic relies on the goodwill of the parties. As soon as one state takes liberties with the text, it could start to slide into a dangerous weakening of the treaty. It should be noted that the trial balloon launched by the Russians has, for the moment, produced no official protest from the governments of the other party states.

In addition, Russia's announcement came just as China was reinforcing its positions in the Antarctic. Its new base in Kunlun, situated at an altitude of around 4,000 meters, towers over all the other scientific stations on the continent. That the symbolism is even stronger than the scientific interest of this station hardly seems evident to the consulting parties who are responsible for granting – theoretically on the sole criteria of scientific interest – the authorization to create these stations.

The Lowy Institute's report notes the patriotic names given by China to these scientific stations as evidence of a "latent nationalism" in the Chinese policy toward Antarctica. There is a report that a "Welcome to China" sign has been installed near a Chinese station that is in fact right in the middle of territory considered by Canberra as Australian.

Read more from Le Monde in French

Photo – John E. Lester

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Society

Debt Trap: Why South Korean Economics Explains Squid Game

Crunching the numbers of South Korea's personal and household debt offers a glimpse into what drives the win-or-die plot of the Netflix hit produced in the Asian country.

In the Netflix series, losers of the game face death

Yip Wing Sum

-Analysis-

SEOUL — The South Korean series Squid Game has become the most viewed series on Netflix, watched by over 111 million viewers and counting. It has also generated a wave of debate online and off about its provocative message about contemporary life.

The plot follows the story of a desperate man in debt, who receives a mysterious invitation to play a game in which the contestants gamble their lives on six childhood games, with the winner awarded a prize of 45.6 billion won ($38 million)... while the losers face death.


It's a plot that many have noted is not quite as surreal as it sounds, a reflection of the reality of Korean society today mired in personal debt.

Seoul housing prices top London and New York

In the polished streets of downtown Seoul, one sees endless cards and coupons advertising loans scattered on the ground. Since the outbreak of the pandemic, as the demand for loans in South Korea has exploded, lax lending policies have led to a rapid increase in personal debt.

According to the South Korean Central Bank's "Monetary Credit Policy Report," household debt reached 105% of GDP in the first quarter of this year, equivalent to approximately $1.5 trillion at the end of March, with a major share tied up in home mortgages.

Average home loans are equivalent to 270% of annual income.

One reason behind the debts is the soaring housing prices. In Seoul, home to nearly half of the country's population, housing prices are now among the highest in the world. The price to income ratio (PIR), which weighs the average price of a home to the average annual household income, is 12.04 in Seoul, compared to 8.4 in San Francisco, 8.2 in London and 5.4 in New York.

According to the Korea Real Estate Commission, 42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s. For those in their 30s, the average amount borrowed is equivalent to 270% of their annual income.

Playing the stock market

At the same time, the South Korean stock market is booming. The increased demand to buy stocks has led to an increase in other loans such as credit. The ratio for Korean shareholders conducting credit financing, i.e. borrowing from securities companies to secure stock holdings, had reached 21.4 trillion won ($17.7 billion), further increasing the indebtedness of households.

A 30-year-old Seoul office worker who bought stocks through various forms of borrowing was interviewed by Reuters this year, and said he was "very foolish not to take advantage of the rebound."

In addition to his 100 million won ($84,000) overdraft account, he also took out a 100 million won loan against his house in Seoul, and a 50 million won stock pledge. All of these demands on the stock market have further exacerbated the problem of household debt.

42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s

Simon Shin/SOPA Images/ZUMA

Game of survival

In response to the accumulating financial risks, the Bank of Korea has restricted the release of loans and has announced its first interest rate hike in three years at the end of August.

But experts believe that even if banks cut loans or raise interest rates, those who need money will look for other ways to borrow, often turning to more costly institutions and mechanisms.

This all risks leading to what one can call a "debt trap," one loan piling on top of another. That brings us back to the plot of Squid Game, "Either you live or I do." South Korean society has turned into a game of survival.

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