Hey, Greenland — Let’s Make A Deal!

President Trump is no longer a secret shopper. Word is out he would like the U.S. to buy Greenland. Yes, that’s right–the large northern land mass which is pretty much covered with ice, i.e., it isn’t green. The idea sounds crazy, but is it really?

Why would anyone want a frigid and icy land mass which mostly sits above the Arctic Circle? (Can you say Brrrr?) Three-fourths of Greenland is covered by a permanent ice sheet. In fact, 80% of Greenland is covered by ice one mile thick. Well, potential purchasers aren’t eyeing Greenland for its balmy weather and golf courses. Two things draw their attention–Greenland’s abundant natural resources and its strategic location.

Global warming leads to more than just higher temperatures; it causes Arctic ice to melt. As a result of global warming, Greenland’s mineral and energy resources are being uncovered and becoming more accessible. These resources include iron ore, zinc, diamonds (that’s my kind of ice!), gold, lead, oil, and uranium. Drilling and mining are more likely activities on Greenland than golfing.

Strategically, Greenland provides access to the Arctic. The United States’ northernmost military base, Thule Air Base, is located in northern Greenland. The base is 750 miles north of the Arctic Circle and 947 miles from the North Pole. In the past, the U.S.’s main interest in Greenland has been obtaining space for military bases there.

So, good reasons exist why a country would want to own Greenland. But Donald Trump is not the first or only leader to consider this, as he describes it, “large real estate deal.” In fact, the U.S. has tried to buy Greenland before. Way back in 1867, Secretary of State William H. Seward explored the possibility of our country buying Greenland. His idea was dropped due to congressional opposition. Later, in 1946 President Harry Truman attempted to buy Greenland from Denmark for $100 million in gold. Today, that offer would equate to $1.3 billion.

And the U.S. is not the only country to be sizing up Greenland for a purchase. China has been eyeing buying Greenland for years because of the minerals and sea lanes it offers.

So Greenland is an attractive purchase for a world power such as China or the U.S. But why would a deal have to be struck with Denmark, a country over in Europe? Well, it’s because Greenland is an autonomous Danish territory and a part of the Kingdom of Denmark. Based on the 2009 Self-Government Act, all governing power except for foreign affairs and defense was transferred to Greenland. Denmark’s constitution provides the future of Greenland’s sovereignty is in the hands of Greenland’s population to decide in a referendum. Sure, Denmark could negotiate to sell Greenland, but residents of Greenland would have to approve the purchase.

Why might Denmark want to unload Greenland? The icy land mass is poor with its economy tied to fishing, which accounts for 90% of Greenland’s exports. The country is not very developed. It consists of only about 17 towns, and virtually no roads connect them. Over one-third of the Greenland’s population lives in its largest city and capital, Nuuk. Danish subsidies are required to maintain the standard of living. Even if you aren’t an economic genius, you can see Greenland is an economic drain on Denmark.

And Danish subsidies go to support a fairly small number of people. Greenland’s population is merely about 57,000 people. To help you visualize this number of people, consider that the entire population of Greenland would not fill Sanford Stadium (seating capacity of just under 93,000), where my beloved Georgia Bulldogs play football. The world’s largest non-continental island, which is about three times the size of Texas, is not teeming with masses of people.

Denmark can’t bolster Greenland’s economy by promoting it as a great tourist destination. Since Greenland is located between the Arctic and the Atlantic Oceans, it is not a Caribbean island with sun and fun. Greenland does boast the world’s largest national park, the Northeast Greenland National Park, which, true to its name, is located in the northeast portion of Greenland. But outdoor activities are limited due to the ice covering the ground and the freezing temperatures.

So, is Denmark eager to make a deal? It does have a track record of entering into large real estate deals with the U.S. about islands. Back in 1917 Denmark sold what was then known as the Danish West Indies to the U.S. for $25 million. Today these islands are known as the U.S. Virgin Islands.

Despite this past transactional history, Denmark apparently isn’t interested in making a deal. Trump’s proposed purchase was quickly rebuffed by Greenland’s foreign ministry who responded, “We’re open for business, not for sale.” Similarly, Denmark’s prime minister, Mette Frederiksen, pooh-poohed the idea by characterizing it as “absurd.” Apparently responding, “No thanks, we’re not interested in selling,” was ruled out as being too diplomatic.

Thus, the deal is off. So what? Well, the drama continues. Donald Trump had been set to make his first formal visit to Greenland in early September. Not only is the purchase not happening, but neither is Trump’s visit which was cancelled in the wake of his real estate deal idea being torpedoed. President Trump did not take kindly to the Danish PM’s characterization of the idea as “absurd,” finding it a rather “nasty” response. Guess now is not a good time for the country’s leaders to meet face to face and have to play nice.

While the U.S. may not be buying Greenland, there is a bright side to the failed transaction. China isn’t going to be buying Greenland either since Greenland’s made it abundantly clear that it isn’t for sale. Period. Now China and the U.S. can go back to duking it out in their trade war instead of jostling to see who will buy coveted real estate.

Guess President Trump will have to revise his shopping list if Greenland is off the market. If he really wants an island, he may be able to get a good deal on a private one. I don’t think Jeffrey Epstein will be using his 70 acre private Caribbean island, Little St. James, now…

JUST WONDER-ing:

Is it “absurd” for a country to want to acquire specific real estate for strategic reasons? If Denmark was willing to sell Greenland and Greenland’a population would approve the transaction, should the U.S. spend the money to buy Greenland? Why or why not? Have you ever wanted to visit Greenland?

 

 

 

 

 

 

 

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