Earlier this month Canada began its two-year tenure as the chair of the Arctic Council (“AC”). There is little doubt that Canada has assumed the helm at the most dynamic and challenging time in the organization’s 17 year history.

Since its inception in 1996, the eight permanent members1 of the AC have focused their efforts primarily on facilitation cooperation and development in their common geographic spheres, and on issues that affected the populations in those areas. The AC’s two principal resolutions to date have focused on cooperation in Arctic search and rescue, and responding to environmental disasters.

The Canadian Chair at the AC will be held by Hon. Leona Aglukkaq, Minister of the Canadian Northern Economic Development Agency and Minister of Health. Canada’s stated goals for its chairmanship will be the promotion of business in the Arctic, as well as increasing opportunity for indigenous people to participate in the Arctic’s development. The desire to use the AC as a forum for the promotion of business represents a new direction for the AC, away from its traditional areas of concern.

Second, not only have the possibilities of the AC as forum changed, but its membership has also dramatically shifted. This month, the ranks of the organization swelled when Italy, Singapore, Japan, South Korea and most notably, India and China were granted permanent observer status. This alone represents a dramatic shift in the member states’ conception of the role and function of the AC, particularly when considering that over the past 12 months members including Norway, the United States, Russia and Canada were, at varying times, cool to the idea of extending observer status to China, in particular. The fear seemed to be that the permanent members’ influence could weaken against the interests of outside states.

However, the AC was arguably outmaneuvered and forced to open its ranks in the face of China’s recent bilateral free trade agreement with Iceland, as well as the establishment of the “Arctic Circle”, an open forum designed to make “Arctic issues” accessible to a range of actors, including non-state organizations that do not have access to the AC. By increasing the accessibility and the scope of its mission, the AC has helped solidify its legitimacy and place as the exclusive Arctic affairs body.

The inescapable conclusion of these recent events and the changes within the AC itself is that the Arctic has been brought into the international mainstream. Canada’s challenge will be balancing its stated objectives amid intense pressure to reduce carbon emissions, while also promoting safe and sustainable development for Arctic peoples. Moreover, the resolution of longstanding competing interests amongst the permanent members, including maritime boundary issues, will likely be complicated by interests in energy exploration and navigation amongst not only the permanent member themselves, but by the observers as well.

Of course, Canada’s assumption of the leadership of the AC at this time, with this agenda, presents a tremendous opportunity for Canadians and Canadian businesses. The surge in interest and activity in the Arctic will likely have an impact across a range of industries, including energy, mining, ship building, and air and marine transport, all of which will likely be encouraged to invest and expand their operations in the Arctic. While the challenges will be great, the leadership of the AC presents Canada with an opportunity to shape the dialogue around how the Arctic is understood and imagined, and to establish itself as a leader in this growing and dynamic economic and geopolitical space.