Executive Summary

The Arctic region is going through a serious transformation as it faces the disruptive challenges of climate change and shifting global political, social and economic patterns.

The harsh environmental conditions of the Arctic have long constrained economic activity in the region. The climate crisis, while having a negative impact on the region in some senses, opens up new prospects for development in others. The Arctic has become a geopolitical hot spot where global and regional players seek to increase their influence. Demographic shifts, transformative urbanisation and sustainable indigenous communities are at the core of regional social development.

Understanding the driving forces that will influence the business and political landscape of the Arctic in the coming decades is crucial for policymakers and businesses in order to come up with mutually beneficial approaches for exploiting opportunities without harming the unique Arctic natural and social ecosystem.

The Arctic is far from being an open book for everyone to read. There is a variety of critical uncertainties that might have unpredictable but significant impacts on regional development – the pace of climate change, the trajectory of economic and social development, the dynamics of geopolitics and others. Two specific dimensions of uncertainties are the most critical and could lead to a significant shift in the Arctic region.

  • Quality of institutional environment, including the effectiveness of environmental, social and demographic policies and regulations, the availability of financial incentives and the quality of governance,
  • Pace of technology and innovation development, including the level of digitalisation and connectivity, the commercialisation of technologies, and the cost of doing business.

Different combinations of those critical uncertainties provide very different scenarios of how the Arctic might look in 2050 and what might be the implications for the sustainable development of the region from the economic, social and environmental perspectives. Each scenario has been associated with one of four distinctive historical periods to make it more self-explanatory.

These periods applied metaphorically to the Arctic scenarios can be characterised as follows:

  • Dark Ages . A lack of coordinated national and supranational frameworks and governance and the low pace of innovations and deployment of new technologies literally freeze Arctic development, which remains static for a decade and then quickly deteriorates, leaving the Arctic a depopulated and devastated industrial site for the ruthless exploitation of exhausted fossil resources.
  • Age of Discovery . Fierce competition for the resources of the Arctic, fuelled by state-funded innovations, reaps the Arctic riches, making the economy grow and attracting opportunity-seekers to the region. Fragmented environmental regulation and weak disaster response fail to slow the degradation. Natural habitats and the livelihoods of the indigenous people deteriorate amidst an accelerating climate crisis.
  • Romanticism . The world of successful environmentalism has made the Arctic a showcase for all things good for the ecosystem. There is only sustainable energy and transport, no mining and extracting, going back to nature. Money stops flowing to the Arctic. What once was a global magnet for business has turned out to be just like a film location for the National Geographic.
  • Renaissance . In this scenario, nations agree to make exploration of the Arctic – just as much as space exploration – a symbol of international cooperation and humanity's eternal striving for progress and innovation. Governments agree on standards for doing business in the Arctic, incentivizing the use of best available technologies, and innovating to prove decoupling is possible. Ambitious dreams attract talent and the Arctic becomes a magnet for those willing to prove that "impossible" is just fake news.

All four scenarios have different social, environmental, and economic implications, and illustrate the urgent necessity for transformative, collective action in order to help shape better policies and design progressive strategies that will benefit local community, strengthen the region's strategic position in the global arena, and drive new opportunities to advance sustainable development goals.

This report is aimed at inspiring, guiding, and supporting policymakers and business and NGO leaders, especially those in the Arctic states, in their search of a new agenda for the Sustainable Future of the Arctic.


Dark Ages – a period of European history commonly related to the 5th-15th centuries. The name comes from the fact that few historical records have survived from this period, and therefore modern knowledge of it is limited. The other meaning is less literal: that after the decline of the Roman Empire, Europe was static with little progress made in any aspect of life. Instead, there were constant wars and unrest.

Age of Discovery – is a period of European history usually associated with the 15th-17th centuries. Starting with the Portuguese, and later followed by the Spanish, French, and English, explorers undertook ocean-going voyages in search of expensive commodities, mostly spices, which were found in the East, but incidentally involved discovering the New World in the West. Some countries were already adopting rules and what we would call 'business ethics', though they were of little use overseas, where everything that could make money would do – from bribing to genocide.

Romanticism – is a relatively short period in European history that emerged in the late eighteenth century and lasted less than a century. The core ideas emphasised individuals, their emotions and feelings, and especially their interaction with nature. Broadly seen as a reaction to the Industrial Revolution, romanticism was eventually superseded by realism.

The Renaissance – to date, it is the most beautiful period in European history. It started in Italy in the 14th century and lasted for more than three centuries, spreading across the whole continent. This period gave humanity the greatest names in the arts and sciences, such as Leonardo da Vinci, Petrarch, or Copernicus. Europe reconnected with its roots in the Classical world and built upon them, developing ideas of humanism, beauty, knowledge, and mercy.

Source: SKOLKOVO Institute for Emerging Market Studies


Exploring alternative and plausible futures for the region

To discuss different futures of the Arctic on a 2050 time horizon it is necessary to identify key developments, forces and processes which will affect the global landscape and the Arctic in particular.

In doing so it is important to separate what we know is about to happen, which might be called certainties, from developments that cannot be foretold but which might impact the development of the Arctic in the next 30 years. These we call uncertainties. These groups of factors will be key to outlining the context for the region's development and will map possible scenarios for the Arctic.

In this report we will explore different plausible futures for the Arctic region which offer a starting point, or common ground, for leadership discussions that will shape recommendations for businesses and policy-makers.

Research specifics

In this report we have applied a scenario planning approach, which includes scoping, framing and building steps (see the Methodology section for more details on the approach). We combined desktop research with a series of in-depth interviews and seminars with key stakeholders, including business, government, local administrators, and social and environmental non-governmental organizations.

As previously noted, thinking of a scenario as a certain development narrative between two conditions of a system, 2050 is probably the most difficult time horizon for mapping plausible scenarios. It lies exactly half-way between 'now' and 'then': shorter-term scenarios, like by 2035, can be built based mainly on what is available today in terms of technologies, infrastructures, policies and practices.

Although climate change is clearly accelerating, 10-15 years is a short period of time in which to expect radical change. On top of that, a combination of relatively long innovation and modernization cycles of the urban, industrial, and transport infrastructure, the state of international affairs, and general institutional inertia, protect the Arctic from short-term disruptions.

On the contrary, extremely long-term scenarios, to 2075-2100, are closer to futuristic exercises. Given the accelerating pace of technological development and innovation, the changing natural environment, and geopolitical dynamics, there will inevitably be a completely different Arctic in 2075+ from the one we have now. In other words, while scenarios to 2035 could be considered continuations of the present, those extending to 2075 and beyond are better thought of in reverse, as projecting from the future back to the present.

We believe this is the major difficulty with 2050 scenarios. At that point, the Arctic will be half-way through a transition from its today's structures to something completely different. It will most likely contain features of both of them at once, the old and the new Arctic together. That is what makes this exercise so compelling and creative.

In this report, no scenario modelling has been included. All numbers are presented for illustration only and reflect the magnitude and direction of change under different scenarios rather than specific, defined projections.

Finally, we present the plausible futures neutrally, and do not mean to suggest objectives of any kind. These scenarios are not predictions, they are instruments which will help to imagine the future, and to understand turning points, emerging opportunities and potential challenges. They are designed to present an exaggerated picture of possible developments. However, the actual future might contain elements of different scenarios, or a mix of them, or it might take a very different turn.