Arctic Yearbook 2015 - Page 332

332 Arctic Yearbook 2015 states (Gautier et al. 2008). Minerals or other valuable resources may be found on the bottom of the sea, but they are still very difficult to exploit, as the sea floor is covered by 500 to 4,200 meters of water and an ice-sheet that is unlikely to disappear for decades. Of course, the very possibility of finding exploitable resources at some point in the future gives the states an incentive to maximize their piece of the Arctic territory. The value of potential future gains is, of course, not the same as the value of a certain gain in the present. The uncertainty of their very existence is the first major problem. Even if they do exist, their value is also time-discounted, meaning that resources that may lie centuries down the road have a lower value for two reasons: first, the timevalue concept of money tells us that the present value of an asset decreases as the time to potential exploitation increases. Second, events in the meantime may prevent states from actually exploiting those resources, feeding into the uncertainty argument. Thus, states must consider how pursuing uncertain and highly discounted resources stacks up again the certain and undiscounted political costs of pursuing a large stake at this point in time. Claiming Arctic territory entails an effort to substantiate the validity of the claim and the risk of creating animosity in other states. States will be unwilling to incur political costs, if they gain from political cooperation. The political costs are determined by the grand strategic goals of the states in question, which will be analyzed in the following section. Arctic policymakers have previously shown that they are willing to compromise in order to avoid incurring political costs. For instance, concerns for the stability of Arctic cooperation and an unwillingness to incur political costs played a key role when the Arctic states decided to give six non-Arctic states, including China, India, and Japan, Observer status in the Arctic Council. Russia was skeptical at th