Chinese companies develop four mining projects on the island; Trump offered to buy it

The melting of the Arctic ice opens up new sea routes and gives special value to certain territories, such as Iceland and especially Greenland, whose enormous size also conceals great natural resources. Chinese mining companies have been present in the 'Green Earth' since 2008; the Danish government has sought to curb Beijing's increasing influence by directly taking over the construction of three airports instead of having them placed under management China. Copenhagen veiled fears that China will encourage Greenlandic independence, while the White House has offered to buy the island, as it has tried to do at other times in history.

▲ Population of Oqaatsut, on the east coast of Greenland [Pixabay].

March 20, 2020

article / Jesús Rizo Ortiz

Greenland is the largest island in the world, with more than 2 million square kilometers, while its inhabitants are less than 60,000, making it the least densely populated territory in the world. This reality, together with the natural wealth still to be exploited and the geographical location, give this Green Earth a great geostrategic importance. In addition, global warming and the struggle for the new world order between the USA, China and Russia place this territory dependent on Denmark at the center of geopolitical dynamics for the first time in its history.

Due to the melting of the Arctic Ocean, new communication routes are emerging between the American, European and Asian continents. These routes, although they will remain subject to limitations in the future, are becoming more and more accessible and for longer periods of time throughout the year. Greenland is a strategic control and supply point for both the Northern route (which follows the northern contour of Russia) and the Northwest route (which crosses the northern islands of Canada), not only in the case of goods and commercial ships, but also in terms of security, as the melting of the ocean ice significantly shortens the distances between the main international players.

Greenland's geographical position is core topic, but also what it contains under the ice that covers 77% of its surface. It is estimated that 13% of the world's oil reserves are found in Greenland, as well as 25% of the so-called rare earths (neodymium, dysprosium, yttrium...), which are essential in the production of new technologies.

Interest from China and the U.S.

The prospects opened up by the increased possibility of navigation through the Arctic have led the Arctic powers to develop their strategies. But also China, interested in a Polar Silk Road, has sought ways to be present in the Arctic circle, and has found in Greenland a gateway.

China's foreign policy is largely focused on the execution of projects in areas where its financial power is needed, and it is doing so in places where it is needed, such as Africa and Latin America, through development . This subject action is also being carried out in Greenland, where Chinese companies have been present since 2008. The main Danish political parties view this connection with Beijing with reticence, but the reality is that many of the Greenlandic population, more than 80% of whom are of Inuit origin, value positively the possibilities of local development opening up Chinese investments. That different perspective was especially evident when in 2018 the government of this self-governing territory promoted three international airports (expansion of the one in the capital, Nuuk, and construction in the tourist sites of Ilulimat and Qaqortog), which together represented the largest public works contracting in its history. Although an offer from the state-owned construction company CCCC was quickly received from China, Copenhagen finally decided to provide Danish public funds and to participate in the ownership of the airports, given the misgivings about the Chinese initiative.

China is present, in any case, in four previous projects, related to mining and managed by both state-owned and private companies, all following the geopolitical purposes of the Chinese government, whose Ministry of Information Technology and Industry has expressed its interest in the activity in Greenland. These four projects are the Kvanefjeld project for rare earth mining, mainly financed by Shenghe Resources; the Iusa project for iron ore mining, fully financed by General Nice; the Wegener Halvø project for copper mining, supported by Jiangxi Zhongrun after a agreement with Nordic Mining in 2008; and finally, the so-called Citronen Base Metal project, at position of China Nonferrus Metal Industry's Foreign Engineering and Construction (NFC).

The United States is no slouch in its interest in Greenland. As early as the 1860s, U.S. President Andrew Johnson highlighted Greenland's importance in terms of resources and strategic position. Almost a century later, in 1946, Harry Truman offered the Danish government to buy Greenland for $100 million in gold. Although the offer was rejected by Denmark, Denmark did accept the establishment in 1951 of a U.S. air base at Thule. This is the northernmost military base in the world, which was core topic during the Cold War and is still in operation today. This base gives the US an advantage not only in the face of the commercial opening of new sea crossings, but also in the face of a hypothetical Sino-Russian coalition seeking to dominate the Northern route. In other words, given the double aspect of Greenland's importance (natural resources and security), it is understandable that someone as unconventional as Donald Trump has once again suggested the possibility of buying the immense island, something that Copenhagen has declined.

Projected pathways through the Arctic; the top row corresponds to the melting that could occur with low emissions, the bottom row in the case of high emissions [Arctic Council].

At the center of a 'Great Game

Apart from the current unfeasibility of such an operation subject without taking into account, among other things, the will of the population, it is true that a Great Game is taking place between the main international players to count Greenland among their geostrategic cards.

1) The United States already has a military presence in Greenland, as well as good relations with Denmark and Iceland, both NATO members, so control of the Denmark Strait is guaranteed, as well as the space between Greenland, Iceland and the United Kingdom (known as the GIUK Gap), which connects the Arctic with the North Atlantic. However, Washington will have to change its strategy if it wants to take control of Greenland, starting by improving its relations with the Danish government and financing projects on the island.

2) Although it does not play a leading role in relation to Greenland, Russia enjoys preeminence in the entire Arctic region. It is by far the country with the largest military presence in the area, having reused some of the Soviet installations. It is the hegemonic power on the entire Northern route, considered by the Kremlin as the main national communication route. Given Russia's absolute empire over this route, the ice that still covers it for a large part of the year, and the control of the USA on its Atlantic side, this route will not be (at least in principle) a real and profitable alternative to the Strait of Malacca, much to China's discomfort.

3) China presented in 2018 its white paper on its Arctic policy, in which it defined itself as a "quasi-Arctic power". For the time being, it has set its sights on Greenland as a pivotal point on its Polar Silk Road. The northern route would shorten the transport time between Asian and European ports by about a week and would be a much-needed alternative to the Strait of Malacca. The big island has so far focused on resource extraction, following its particular and cautious modus operandi. In addition, the Chinese funds provide Greenlanders with an alternative to absolute dependence on Denmark, which additionally favors the island's nationalistic pretensions.