Developing Greenland’s mining industry and resource impacts

An article in Bloombergsbusinessweek (February 18,2013) describes Greenland, a country protected by Denmark and with a population of 57,000, as containing 1 billion ton iron ore and the 10.5 million ton rare earth deposits that are being eyed for development. Funding is being sought from Chinese investors, and the local labor is expected to be 10 % of the labor required, with all imported labor being paid the minimum wages of Greenland. But the rare earth deposits also contain uranium, so the ban on mining radioactive materials prevents its extraction. Worries about the Chinese controlling this rare earth source are driven by China’s 95 % current share of rare earth metals extraction, with the material being required by the alternate energy and electric vehicle industry. Should Greenland’s attempts to reduce its dependence on Denmark by using resources from China be considered a sovereign decision or a myopic decision that could hurt other countries ? Should rare earth metals extraction in Greenland, a projected $6.6 billion source, be nurtured as an alternative to China’s 95% share, and if so, how should it be structured to truly be a credible alternative source that is not controlled by the dominant provider ?

About aviyer2010

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