Greenland, a former Danish colony that moved closer to independence after a new law on self-government came into effect in 2009, has ambitions to open up its territory to mining, oil and gas development and tourism. Its aim is to boost its economy, reduce unemployment – and reduce its reliance on Denmark.
|Written byHannah Hoag||Published on Jan. 27, 2016||Read time Approx. 6 minutes|
Tromso, Norway – Some studies have suggested that Greenland, a nation of 56,000 people, may hold half of the world’s rare-earth elements, materials that are used in high-tech components, including cell phones and wind turbines. It also has gold, iron-ore, rubies and uranium, as well as offshore oil and gas reserves. Developing those resources could have a meaningful impact on the country’s economy.
Mining seized Greenland’s interest in 2013, after the government relaxed its mining regulations and lifted a ban on extracting uranium. It has one mine in operation, a ruby and pink sapphire mine, 150 kilometers (90 miles) south of the capital of Nuuk, that began production in December. A planned $2 billion iron ore mine has stalled with dropping commodity prices.
But the country also has its eye on tourism. Government figures show that since the 1990s, the number of tourists visiting Greenland has grown from 3,500 to 35,000 annually, coming for the unspoilt nature. The challenge facing Greenland today is to find a way to draw in more tourists while protecting the environment that draws them to the country in the first place.
We asked Vittus Qujaukitsoq, Greenland’s minister of finance, natural resources and foreign affairs, about how Greenland hopes to balance development and environmental protection.
Arctic Deeply: What industries have traditionally supported the Greenland economy?
Vittus Qujaukitsoq: Fisheries is our main income source, covering over 90 percent of the revenues from our exports. For that reason, the government is working to develop two other pillars of the economy: tourism and mining. We are working to diversify our economy to ease its vulnerability.
Arctic Deeply: As you build these two new pillars into the economy, will fishing continue to be a part of Greenland’s economy?
Vittus Qujaukitsoq: We anticipate that the fisheries will still be an important industry for us, but we need to diversify our income sources. It doesn’t mean that we are cutting down on the activities within the fisheries. The principles guiding us for our resource management are based on sustainability, regardless of whether it is a living resources or non-living resource. We anticipate our growth to come from tourism and mining, and for that we are enhancing our infrastructure to support airports and to improve the harbor facilities so that more tourists and cruise ships can enter Greenland easily. The mining sector has been under development for the past 5 to 10 years, but the legal framework in order to utilize mineral resources had not been in order, meaning that we were unable to mine uranium and other radioactive materials due to the restrictions we have in our legislation.
Arctic Deeply: What have you done to change that?
Vittus Quajaukitsoq: We have ratified various international conventions in order to uphold the international standards required and we are still working on this. There are still some legislations and acts within the Danish regime and the Greenland regime that need to be in place before we can submit any application to extract uranium as a byproduct. We have plenty of rare-earth elements with radioactive content that we haven’t been able to extract due to the lack of the legal framework.
Arctic Deeply: Why is Greenland interested in mining, oil and gas now? You mention diversifying the economy, but is it also about growing the economy?
Vittus Qujaukitsoq: We anticipate mining will be one of the major contributors to our economy, and will create growth and jobs. There is a considerable exploration in Greenland for minerals. The oil and gas industry is a bit marked by the international situation, meaning that we don’t expect any major activity for the next couple of years. It all depends on oil prices.
Arctic Deeply: Does the development of these new sectors help Greenland towards independence?
Vittus Qujaukitsoq: Well, it plays a role certainly, but it is not the only argument that we have for independence. I think it is a question of our aspiration for freedom that should be the key for the question for independence, not an economic or financial based idea. I think our quest for independence has nothing to do with economy.
Arctic Deeply: How do you see Greenland balancing environmental protection and resource development?
Vittus Qujaukitsoq: We have the mining act, which we think is a very strict act that ensures environmental protection, and the protection of health and safety. These are the three key elements in our act: to protect the environment and the people living in Greenland, but also to safeguard Greenland’s vulnerable ecosystems. We already have protected areas that we, of course, consider when we are looking at development projects. We have entered international commitments to protect the animals and the vulnerable ecosystems.
Arctic Deeply: Some are opposed to mining development in Greenland, often those in fisheries or farming. Can these communities continue their livelihoods?
Vittus Qujaukitsoq: We need to look at where and how the Greenland economy is doing today. We are hit by high unemployment in Greenland – it fluctuates between 7 to 9 percent –- and as long as there is unemployment, we need to address that there is a need for jobs in all sectors. It means that we need to get people into work and we can only do it with the fisheries sector, the mining sector and the tourism sector. There are no other alternatives for us. It is a question of making the necessary decisions in order to create development. I am waiting for the answers from the opposition on how they can create growth and jobs without including the mining sector.
Arctic Deeply: Do you have training programs in place to develop skilled workers in those areas?
Vittus Qujaukitsoq: We have a mining school in Sisimiut offering all the necessary basic training in order for people to work within mines and in the offshore industry. Our educational system supports what’s needed, not only in Greenland, but in the Arctic in general.
Arctic Deeply: What additional infrastructure do you need to get these sectors off the ground?
Vittus Qujaukitsoq: It takes a lot of money to get there. Right now, it is very difficult to enter Greenland because there is only one international airport, and to get from to the smaller communities, it is slow and very expensive. We aim to create two international airports and three regional airports to make Greenland more accessible and less expensive to come here. But it’s not enough to make longer runways and new airports: we need to have the necessary hotel capacity; we need the service facilities to accommodate more tourists; and we need to improve the harbour facilities. I think Greenland has plenty to offer when it comes to tourism because our history and heritage make Greenland an interesting destination.
Arctic Deeply: What do you see as being a major issue in the Arctic that is not getting enough attention right now, and what role will Greenland play?
Vittus Qujaukitsoq: I think the human rights and the lack of welfare among indigenous people is an issue that needs to be addressed. We need to look at the living conditions for living in the Arctic. We are a very small population in the Arctic, in the vast land areas spread across many countries. I think there is a need to harmonize our legal structures to make it easier to trade as well as a need to improve the transportation connections among neighboring countries.
We address some issues at the Arctic Council. Is it enough? No. but it starts the discussions and the dialogue that is needed.
Arctic Deeply: The Arctic Council is celebrating its 20th anniversary this year. It was formed to address issues of sustainable development and the environment. Do you think the role of the Arctic Council must change to address these issues or that another forum needs to be created?
Vittus Qujaukitsoq: We need to look at how we can make legally binding agreements to support a better harmonization in the Arctic. But the agreements made in the forum are not binding for any country. It makes it tricky. There are other things that the Arctic Council does not address, such as safety and military issues. In order to make Arctic Council more workable I think we need to look at the mandate and the restrictions that are preventing the Arctic Council from addressing the issues that are important for the nations involved.
Top image: Vittus Qujaukitsoq, Greenland’s minister of finance, mineral resources and foreign affairs, says the country plans to diversify its economy by building out its tourism and mining industries. (Arctic Frontiers 2016/Pernille Ingebrigtsen)