Greenland’s hopes of a mining boom are shrouded in uncertainty as voters on the ice-capped Arctic island decide Friday who will replace a local government that collapsed after its leader admitted to using taxpayers’ money for private trips.
The fall of Premier Aleqa Hammond’s government last month came at a bad time for the semi-autonomous Danish territory, which needs foreign investments to kick-start the mineral exploration that many Greenlanders hope will pave the way for independence.
Greenland has governed its own affairs since 1979 but its economy depends on an annual grant of 3.6 billion kroner ($600 million) from Denmark. Since gaining self-rule, the island’s local politics have been plagued by corruption, nepotism and other scandals. A former premier took a leave of absence to get a grip on his alcohol problem while another was accused of sexual abuse.
“No doubt that the tumultuous climate in Greenland is not the best to attract investors,” said Jakob Janussen, a political scientist from Greenland working at Aarhus University in Denmark. “When there are problems, investors stay away.”
Most of Greenland, the world’s largest island, is covered by a massive ice sheet three times the size of Texas. The 57,000 residents live on the coast, in Inuit settlements or small cities, including the modern capital, Nuuk.
The giant island’s iron ore, zinc, gold, diamonds, rare earths and other minerals are expected to become more accessible as the ice sheet melts due to global warming, but no exploitation licenses have been issued.
Hammond, Greenland’s first female premier, stepped down Oct. 1, after admitting she used government funds to pay for private airline tickets and hotel stays in Greenland for herself and her family. Her center-left government collapsed shortly after, prompting Friday’s elections a year-and-a-half earlier than planned.
While the recurring scandals underscore that Greenland is still a young democracy, the fact that Hammond had to resign over what would previously have been considered a minor misstep shows the political system is maturing, said analyst Ulrik Gad Pram of the University of Copenhagen.
“What was accepted in the past is no longer acceptable,” he said.
Still, the political crisis wasn’t good for business. The natural resources minister had to cancel a trip to China, where investors have been eyeing mining opportunities in Greenland.
In January, an independent report concluded that Greenland’s goal of having several large mines operational by 2040 was “unrealistic” because there is no infrastructure, work force or legislation needed for large mines.
A ban on uranium mining was removed under Hammond’s government to allow exploitation of a southern Greenland mine with rare earth elements – key ingredients in smartphones, weapons systems and other modern technologies. Uranium is often found mixed with rare earth metals.
That ban could be re-introduced if the main opposition group, Inuit Ataqatigiit, or IA, wins the election.
Hammond’s social-democratic Siumut party or the left-leaning IA may emerge as winners, opinion polls show. However, both need backing from smaller parties to be able to control a majority of the 31 seats in the local parliament.
Greenland’s Parliament speaker Lars-Emil Johansen said Inuits are proud to have created an Arctic nation with its own constitution, political structures, flag and national anthem over the past 35 years.
“You have to remember that we still are a pretty new democracy,” he said. “Yes, there are things we have to learn but I am very proud of what we have achieved.”