A Word of Warning: Greenland Is a Money Pit Island depends on Danish welfare

Anyone viewing Greenland as a strategic prize may want to examine its finances first. According to The Wall Street Journal, President Trump’s interest in acquiring the vast Arctic territory runs up against an economy that relies heavily on Danish support and a single dominant industry—seafood—with little growth to show for it.

Greenland’s government receives an annual grant from Denmark that covers roughly half of its budget and about 20% of its gross domestic product. Economists say that if U.S. funding replaced that support, Greenlanders would become the largest per-capita recipients of federal spending in the United States.

The island’s export economy is extremely narrow. Seafood accounts for about 98% of exports, and declining shrimp stocks along with lower prices have already slowed economic growth to near zero. Mining is often promoted as a long-term solution, but development faces major obstacles. Only one mine is currently operating, and new projects are costly due to Greenland’s harsh climate, difficult terrain, and lack of infrastructure.

As the Journal reports, building a mine often requires constructing roads, ports, housing, and basic services from scratch. Recruiting workers is difficult, and freezing conditions can make sites inaccessible for months at a time.

The takeaway, according to the report, is sobering: Greenlandic officials privately acknowledge that, at least in the near term, governing the island is more likely to involve managing mounting costs than uncovering economic windfalls.

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