Countries, non-profit organizations, indigenous peoples, and natural resource companies are all interested in obtaining a part of the Arctic. Now, we can add a hedge fund to the list. Guggenheim Partners, the financial services company which manages over $125 billion in assets, has confirmed that it is looking into establishing an investment fund in the Arctic, perhaps with a focus on Alaska. Alice Rogoff, publisher of the online newspaper Alaska Dispatch and wife of the co-founder of the Carlyle Group, David Rubenstein, first announced the news at the World Affairs Council’s “Politics of Global Climate Change” conference at University of Alaska Southeast in Juneau earlier last week. Rogoff also suggested that one investment possibility for Guggenheim would be to privately fund the construction of an icebreaker, which it could then lease out to the U.S. Coast Guard. However, Lawson Brigham, a professor and retired Coast Guard captain, observed that this would likely not be practical, given that the Coast Guard would need full and unrestricted access to a federally-funded ship during war, should it ever break out in the Arctic.
Rogoff added, “The single biggest source of investment dollars in Guggenheim’s or probably anybody’s fund will be China.” This would be an indirect way for China to invest in and potentially profit from the Arctic even though it does not have any territory there. This would not be the first instance of private Chinese investment in the Arctic: Businessman Huang Nubo is planning to buy a swath of land equal to one percent of Iceland to turn into an ecoresort.
Guggenheim spokesman Jeffrey Kelley remarked, “We are in the very early planning stages for an Arctic investment fund. At this point in time it would be premature to comment further about potential structure or investment parameters.” Guggenheim reportedly posted a link to the article in Alaska Dispatch about the fund, but they seem to have removed it from their website, as I am unable to locate it.