The North American Arctic: Building a Vision for Regional Collaboration Panel discussion on What are the needs and the future of the five NAA sub-national governments and their most pressing challenges today? What are the needs and the future of Greenland and what are Greenland s most pressing challenges today? By Minister for Industry, Labour, Trade, Energy and Foreign Affairs, Mr. Vittus Qujaukitsoq. Thank you Premier Taptuna, Dear Friends, First of all, I want to thank the Wilson Center for putting together this event today, and in particular I want to thank Mike Sfraga for pushing through with his idea and for making this format for discussion a reality. This morning I had the chance to talk at length in a roundtable format with fellow-decisionmakers from across our region of Arctic North America. I would like here to highlight to you elements from this discussion, as they relate specifically to Greenland. Last year, Greenland hosted an Arctic Circle Forum in May 2016. Some of you were there. At the Greenland Forum we brought together Arctic indigenous and business leaders to talk about the type of developments we want to see in the Arctic for our regions and peoples. We had a particular focus in Nuuk on bringing indigenous leaders from across Alaska, Arctic Canada and Scandinavia together with Greenlandic and Icelandic business leaders to try and see how the increasing attention the Arctic is attracting internationally, can be transformed into real economic development for our peoples. I think the event today is a very natural next step in focusing on achieving and supporting sustainable development across our Northern regions now with an exclusive focus on Arctic North America. 1
Greenland is in many ways fortunate. We are a part of North America. We are so geographically, but we are also North American through our indigenous culture and language, which we share with Inuit across Arctic Canada and Alaska. At the same time, we are closely linked through the North Atlantic region to our close friends and partners in Scandinavia and Europe, with whom we share a common recent history, much of our social and legislative structure of today, and a Scandinavian model of the welfare state. But despite Greenland s fortunate position in the world today, there are a number of reasons I am concerned for our future. One of my main continuing concerns, is the fact, that despite Alaska, Arctic Canada and Greenland s geographical closeness, our shared Inuit heritage and the close cooperation between our respective capitals, there continues to be very little cooperation and economic exchange between Greenland and the rest of North America. Why is this a problem for Greenland? Our lack of cooperation and economic exchange with our North American neighbours is basically a big problem for Greenland, because whether we like it or not, the socio-economic structures connecting Greenland with the rest of the world are changing, and not necessarily for the better. Just to take a recent example. The CETA Agreement adopted by Canada and the European Union last year. We are basically situated right between the two trading blocks of North America and the European Union. We have a preferential trading regime and economic relationship only with the European Union to our East. An agreement like CETA is good - no doubt - both for Europe and for Canada, but it also clearly exposes the vulnerable situation we in Greenland are in. We rely for more than 90% of our exports on our fisheries. But many of our products are also produced in Canada. And many at a lower cost. The CETA agreement will basically mean much 2
harder competition for us in our very important European markets, without any new or additional advantages for us. The CETA agreement is just one example. The European Union is in these years concluding and aiming to finalise many more such free trade agreements with other regions of the world, which will further expose our vulnerable economic situation. Our lack of trade with the rest of North America is paradoxical. Greenland s capital Nuuk is only 500 miles away from Iqaluit in Nunavut. In my home region of Qaanaaq in the far North of Greenland we are only 200 miles away from Grise Fiord in Nunavut. The same as the distance from here to New York City. In comparison Nuuk is more than 2000 miles away from Copenhagen. Traditionally across the ice between Grise Fiord and Qaanaaq in my home region, there used to be frequent travels and trading. We have friends and relations across the region because of these historical links. But today there are no trading links between Greenland and the rest of North America. No commercial flights. No container shipping routes. No landing of fish by Greenland trawlers in Canada. Last year a new broad government coalition was formed in Greenland. The new coalition brings together mandates of 80% of the electorate. The central theme which brings together this very broad coalition, is a shared desire to substantially speed up Greenland s work towards achieving the economic foundations necessary for Greenland to achieve its independence from Denmark. Since 2009, when Greenland successfully negotiated the terms of its future independence from Denmark, with the Danish State, we have been working towards the goal of Greenland s independence. This is why in 2010 Greenland assumed full legislative and executive powers regarding minerals and oil and gas resources in Greenland. Seen from Nuuk, the lack of attention to inter-regional economic development in the North- American Arctic has been due in part, to a general lack of attention paid by Washington, Ottawa and Copenhagen to our Arctic regions. Partly, it is of course very much also related to the very different historical experiences of our regions. 3
Why am I concerned for the future? One day Greenland will be an independent state. This is agreed between Denmark and Greenland through an Act adopted by almost unanimous parliaments in both Greenland and Denmark. An independent Greenland will amongst other things require complicated negotiations on our future defense arrangements with the United States and with NATO. But what worries me is not our future defense arrangements, it is the current lack of interest in Greenland here in the United States and also partly in Canada. This lack of interest translates into very low levels of economic and trade links of Greenland with the rest of North America. Why is this a problem which the United States and Canada should also be concerned about? I think it is a problem, because the population in Greenland besides from our traditional close relationship with Denmark, really does look west. We look west to our friends and neighbours in the United States and Canada. But if nobody in the United States and Canada are looking east to Greenland, Greenland will in trade, mining, fishing, transport and tourism work increasingly with partners from further afield. It is already a fact, that for our fisheries exports and Greenland is the world s largest coldwater prawn exporter markets in Japan and China are becoming central, in our mining sector, some of our biggest mining projects are coming onstream with Chinese investments, and for the rare-earth elements projects, the consumers we will be providing for, these will no doubt also be Chinese. 4
In economic terms this is how the world works. Investors work where they see opportunities and markets will get the products they demand. But I am concerned, that the security relationship through Denmark with the United States which has been in existence since 1941, and Canadian concerns over the evolution of the Greenland-Denmark relationship, as a possible example for Canada s own northern regions, may have led to an overcautious approach both in Ottawa and Washington D.C. towards Greenland. I am concerned if this means trading, investing, shipping and travelling between Greenland and the rest of the world becomes easier to other destinations than to our closest neighbours. I am concerned if Greenlandic companies cannot operate and grow and develop with neighbours both to the East and to the West. The way I see it, in order to achieve a viable economic future for our country, Greenland has to be effectively integrated into the existing North American economy, in addition to our present close links with Europe. Without such an integration, our economy will not be able to develop in a healthy balanced manner. For the past three hundred years, all shipping, transport and later airlinks from Greenland have gone to Europe through Denmark. None have gone to our neighbors - Canada or the U.S. - to the West. We are changing this now. Last year, our Royal Arctic Line which is owned by the Government of Greenland concluded an ambitious joint venture agreement with Iceland s shipping company Eimskip which combined with our major container-port construction in Nuuk which will be completed this year, will enable Greenland s shipping links to go both East to Iceland and to the main ports in Europe, as well as West to Canada and the United States. Once fully implemented, Greenland will be linked through Iceland for shipping directly to and from Halifax, Argentia and St. Anthony in Canada and Boston and Portland in the United States. 5
During these years, Greenland and Iceland are establishing cooperation in a number of areas, that will radically change Greenland s access to the rest of the world and the rest of the world s access to Greenland. Iceland s Air Iceland has over the past five years opened up Greenland to air transport from the whole world through Keflavik International Airport. Starting from nothing, Air Iceland today serves 6 destinations in Greenland. Before this the only international connection to Greenland was through Copenhagen in another continent across the Atlantic. What in my opinion needs to be done next? In Greenland we have vast resources of minerals and offshore oil and gas. In the minerals sector, which is the most promising new sector to supplement our reliance on high-quality seafood exports, it is Canadian - and Australian companies that are pioneering developments. One of our main two global seafood companies - Royal Greenland - is actively looking to invest in the Canadian seafood sector. Our companies in this sector are big players, with Greenland being the largest cold-water shrimp exporter in the world. In 2015, my Government also negotiated a decision to radically upgrade Greenland s airport infrastructure, which will allow Greenland to trade, travel and develop like other regions of the world. In the Arctic, many of our primary barriers are physical. Once, our container-port in Nuuk and the joint venture agreement between Royal Arctic Line and Eimskip is fully implemented, Greenland will be physically linked to North America for trade in goods at a level never experienced before. Similarly, with the upgrade of our airport infrastructure over the coming years, it is only a matter of time, before we reestablish our airlink to Canada or the United States. The sooner this happens, the better. 6
Physical links create opportunities. But creating links is also about more than physical infrastructure. We need to talk more together. This is why in 2014, Greenland opened its diplomatic Representation to the United States in Washington D.C. In 2015 our Representation became accredited also to Canada. This year we have expanded our budget to increase our staff at the Representation to work even more effectively to create permanent links. Our Representation in Washington D.C. is our second Representation overseas, with our first Representation to the European Union in Brussels celebrating its 25 th anniversary this year. In 2013, Iceland opened its consulate in Nuuk, Greenland. This was a very significant development for us, since Iceland s Consul-General is the first permanent diplomatic presence posted in Greenland since the end of World War II. Last year, I called on the incoming US administration, to look afresh at our region. Look at the economic potentials that our Arctic regions hold. In Greenland we are open for business. And why not envisage having an American or a Canadian permanent diplomatic presence in Nuuk to help develop the potentials for more trade? In terms of new sectors of interest for greater cooperation in the North American Arctic, the Greenlandic minerals sector is important. The first ruby and sapphire mine is now coming onstream. We will probably also see the first loads of the industrial product anorthosite shipped to customers this year, in a project where the European Investment Bank is co-financing. Other mining projects are also near handing in applications for the extraction of minerals. Greenland has an abundance of clean fresh drinking water, ice and biological resources, and we now have legislation in place, which will form a good framework for initiatives to export clean fresh water, ice and biological resources. 7
In all areas we are open to partners from abroad. During my time as Minister, I have ensured a number of new credit facilities which are now available to investors in Greenland: The Danish Growth Fund, which is active in financing business projects in Greenland. Partly on its own and partly in cooperation with the government owned Greenland Venture and private banks. The fund s strategy is to play an active role in Greenland like they already do in Denmark. The fund will in particular focus on Tourism, Mineral resources and Fishing and processing The Danish Export Credit Fund, which is owned and guarantied by the Danish State. The Danish Export Credit Fund can provide guaranties and credit facilities for projects where Danish suppliers also participate. The Export Credit Fund has outstanding guaranties amounting to 8 billion USD. In addition to these: The Nordic Investment Bank, which emphasises projects in the Arctic region in its current investment strategy, has established an Arctic credit facility amounting to 500 mio. EUR to facilitate investments in the Arctic region. The new Arctic credit facility will mainly focus on infrastructure projects and renewable energy projects. The European Investment Bank has expressed an interest to explore the possibilities to participate in infrastructure projects in Greenland. EIB financing of the Hudson Resources mining project White Mountain near Kangerlussuaq in Greenland is currently under appraisal for an amount of 14 million EUR Greenland has many similarities to Alaska, the Northwest Territories, Yukon Territory or Nunavut. But there are also big differences. First of all, of course is our relationship with our federal capital. Our relationship with Copenhagen is not similar to relationships with Ottawa or Washington D.C.. 8
Since 2009 Greenland has taken over competence over most areas of economic activity in Greenland, and Greenland also represents itself externally in those areas. More importantly, Greenland is not tied to Denmark. On the contrary the shared goal of both Denmark and Greenland is to achieve Greenland s independence. In addition to being Greenland s Minister responsible for Foreign Affairs, I am also Greenland s Minister for Industry, Labour, Trade and Energy. And my key message for our meeting today is the following: We want increased cooperation with Canada and with the United States. For 20 years we have cooperated on common Arctic issues, in particular on issues of science, health and environmental protection, within the framework of the Arctic Council. Greenland has been involved from the very beginning and it was our Premier who at that time signed the Ottawa Declaration. Greenland intends to continue and strengthen our active engagement on the Arctic Council. But one aspect that the Council does not cover is industrial and commercial cooperation. But what is in it for Canada and the United States? In the coming years, there will be a number of major infrastructure investments taking place in Greenland, our tourism sector is under very rapid development, we have a number of important mineral projects being developed right now and we are planning to extend our hydropower sector even further. The potential for exporting drinking water and extending hydropower in Greenland is huge. Already today more than 70% of the power produced by our national utility company is powered from hydro. Our inland ice cap contains a staggering 10 % of the total fresh water resources in the world, and hydropower in Greenland could in the future be utilized in energy intensive activities such as in the production of aluminium, steel, copper as well as in the chemical industry. 9
My Government would like to see more companies from Canada and the United States work in Greenland. We already have a number of Canadian companies actively and successfully involved in the mining sector, but we want more. I also want Greenland s companies to be more active in Canada s Arctic region for the benefit of both Canada and Greenland, but this requires proper air and sealinks, and changing the trade, veterinary and tariff regulations to allow for actually increasing our trade. With these words, I wish you a useful debate. Qujanaq Thank you. 10