The author suggests that seven countries with lands in the far north of the globe are in a position to capitalize on ecological and demographic shifts that will have the rest of the world looking north by 2050. He offers that these countries meet the requirements necessary for a new civilization to grow. The article is highly speculative. The key conditions upon which it is based (e.g., irreversible global warming, uncontrollable population growth) are disputable. Still, the article offers an intriguing case study to examine global strategies and the best ways to manage firms to take advantage of new opportunities.
IB1. Examine the map in the article and then the one on Page 71 of the text. Of the New North countries, all have positive current account balances except the United States. What advantages or disadvantages do you see to an alliance involving these countries?
IB2. Consider that Arctic countries, in contrast to equatorial countries, do not offer the most appealing climates for business relocation. How will countries in this region be able to satisfy Porter’s “diamond of national advantage?”
IB3. Compare the conditions required for new civilizations to grow with Porter’s Cluster Theory. While the former may be satisfied, how well are these New North countries poised to fulfill the conditions of Cluster Theory? What is your estimation of the likelihood of such a development?
M1. If you were the manager of a company (e.g., 3M) headquartered in the United States, would you be excited by this New North hypothesis? What type of global strategy(ies) would you consider?
M2. Develop an assessment of this new global business environment in terms of risk and trade.
M3. How does the author’s hypothesis fit with the notion of sustainable development?
SOURCE: L. C. Smith, “Unfreezing Arctic Assets,” Wall Street Journal (Retrievable online at http://online.wsj.com/article/SB10001424052748703440604575496261529207620.html)