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Last Updated : Aug 23, 2019 07:56 PM IST | Source: Moneycontrol.com

Real estate deal of a lifetime | Why does Donald Trump want to buy Greenland?

According to Trump, Greenland has a price, in the same way that everything and everybody has a price.

Aakriti Handa @aakriti_handa

US President Donald Trump on August 21 postponed his meeting with Danish Prime Minister Mette Frederiksen to discuss the purchase of Greenland, after she said that the island country was not for sale.

While Frederiksen called purchasing Greenland “an absurd discussion”, a sulking Trump postponed his trip to Denmark.

He tweeted, “Denmark is a very special country with incredible people, but based on Prime Minister Mette Frederiksen’s comments, that she would have no interest in discussing the purchase of Greenland, I will be postponing our meeting scheduled in two weeks for another time.”

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Trump’s proposal to buy Greenland has been widely written off as unwelcome, with locals calling the idea “crazy” and “patronizing”.

Does Trump really want to buy a country?  

As disbelieving as it may sound, the purchase of Greenland by the US is actively being discussed in Donald Trump’s Oval Office.

If the deal does happen, Trump would be able to secure a landmass quarter the size of the US, and cement his name in history.

Besides, it wouldn’t be the first time that a US President will be buying off an entire country. In 1867, President Andrew Johnson had bought Alaska from Russia, and in 1803, Thomas Jefferson had secured Louisiana from the French.

Can Greenland be purchased?

“Strategically it’s interesting and we’d be interested, but we’ll talk to them a little bit. It’s not No 1 on the burner, I can tell you that,” Trump had told reporters last week.

Greenland is an autonomous region that effectively runs by itself. Denmark is its sovereign owner, which takes care of the island country’s defence and foreign policy.

So if the US goes ahead, Trump will have to buy Greenland from Denmark.

However, the Danish PM has said that Greenland cannot be sold because it did not belong to Denmark.

“Greenland is not Danish. Greenland is Greenlandic. I persistently hope that this is not something that is seriously meant,” she said.

In fact, on her visit to Greenland, Frederiksen said that she hoped it was time to leave the joke behind. She said, “Thankfully, the time where you buy and sell other countries and populations is over. Let’s leave it there. Jokes aside, we will of course love to have an even closer strategic relationship with the United States.”

Why Greenland?

One of the world’s most desolate places has now become an attractive proposition. Trump’s advisors believe that the multi-billion dollar purchase would challenge China’s dominance of the world’s industrial metals, as also it will help block Moscow’s military ambitions, given Greenland’s strategic location between US and Russia.

The proposal is not new and a similar offer was also made in 1946, when the US had offered Denmark $100 million to buy Greenland. There were even talks of swapping some parts of Alaska for bits of Greenland.

With Chinese Premier Xi Jinping’s aggressive foreign policy stance spooking US policymakers, and the realisation of Vladimir Putin’s military ambitions, the US has decided to buy the whole place outright, instead of leasing parcels of Greenland.

Real estate deal of a lifetime?

Greenland is a part of the Arctic and it is estimated that 13 percent of the world’s undiscovered oil reserves and 30 percent of its undiscovered natural gas lies under the Arctic, according to a BBC report.

In addition, the island country has some of the largest deposits of rare-earth metals including neodymium, praseodymium, dysprosium and terbium, along with uranium and the byproducts of zinc. Until now, China has been a benign supplier of such metals, which are used in the manufacture of mobile phones, computers and more recently electric cars.

Hence, the US is targeting Greenland Minerals, an Australian company operating on Greenland’s south-west peninsula since 2007. The company is believed to be sitting on over 100 million tonnes of ore and is expected to become of one the largest global producers outside China, The Guardian has reported.

Plus, the least densely populated country in the world has a lot of land to offer. Greenland is spread across 2.1 million square kilometres and only 56,500 people living on it.

For comparison, the UK has 67.5 million people, even though it's nearly nine times smaller in terms of land mass.

However, Trump’s real estate aspirations face a small stumbling block – 75% of Greenland is covered in a permanent ice sheet.

Has Washington put a price on it?

According to Trump, Greenland has a price, in the same way that everything and everybody has a price. The basis of his statement is his ability to spot the adversary’s weakness. Trump pointed out Greenland was costing Denmark about $700m a year in subsidies and that it was draining public finances.

If a price were to be put on the combined value of Greenland’s mineral and defense assets, it could be estimated to be around $1.1 trillion, The Financial Times reported.

 

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First Published on Aug 23, 2019 07:56 pm
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