US announces new pact to boost shipbuilding, Arctic fleet

The U.S. on Thursday announced the creation of a new trilateral pact with Canada and Finland to boost shipbuilding and establish a stronger Arctic fleet as Washington aims to combat Russian and Chinese influence in the northern waters.

The Icebreaker Collaboration Effort, which the U.S. is referring to as the ICE Pact, will involve a multi-billion dollar and multi-year investment from all three allies into building polar-class icebreakers operated by the Coast Guard in the Arctic seas.

A senior U.S. official told reporters the pact would send a message to Russia and China that Washington will "doggedly pursue collaboration on industrial policy" and "to increase our competitive edge in strategic industries like shipbuilding."

The official said they also aim to "build a world class polar icebreaking fleet at scale" and to "project power into the polar regions."

"We're committed to revitalizing our capacity to build American ships and American shipyards with American sailors," the official said, adding the initiative was a "strategic imperative" to uphold.

"Without this arrangement, we'd risk our adversaries developing an advantage in a specialized technology with vast geostrategic importance, which could also allow them to become the preferred supplier for countries that also have an interest in purchasing polar icebreakers."

Melting ice in the Arctic has opened up new sea routes and channels that is leading to increased military competition in the region. Last year, Russia and China signed an agreement to strengthen cooperation in the Arctic and have conducted maritime patrols together in the waters.

Russia also owns a big Arctic fleet, with some 40 icebreakers, according to the U.S. official, while Washington only has two that are reaching the end of their life. Canada has around 20 icebreakers and Finland has nine, according to the official.

NATO, which is gathering in Washington this week for a high-stakes summit marking the 75th anniversary of the alliance, has announced the Arctic as a major defense priority.

The new ICE Pact aims to address the disparity between the U.S. and Russian and Chinese icebreakers.

"With this announcement, we're going to be able to scale up much faster with private investment," the official said, with potential demand coming in from countries other than Canada and Finland, and that's what's going to allow us to meet our targets."

The ICE Pact will involve enhanced cooperation between all three countries and a "consortium" of shipyards in the U.S., Canada and Finland, according to the U.S. official, who predicted the effort could cost around $10 billion.

The official added the goal is to have information and workers shared between all three countries to boost shipbuilding and lower costs, with the ultimate aim for all NATO allies to build some 70 to 90 ships over the next decade.