Possible Business Models Using the NSR: South Korea’s Perspective

The new era of Northern Sea Route (NSR) is changing the global logistics environment. In response to this phenomenon, this study explores possible ways for South Korea to use the NSR commercialization. The study highlights trade of wood pellets and promotion of cruise industry as promising two business models which enable to accelerate the NSR commercialization. The findings in this study for removing risks and barriers related to the models can be summarized as follows. First, a closer examination of ports and their related infrastructure along the coasts of the Arctic Ocean is required. Second, target and demand for the logistics infrastructure required should be identified. Third, enormous investments into the construction of ports and related logistics infrastructures are required. Fourth, transport?logistics network should be connected as a whole. Fifth, in order to maximize benefits and profits, business models relevant to NSR require considerable effort for further development. The South Korean government and the local governments should establish strategies by which business models can be utilized more effectively.