By Mikkel Schøler, CEO of Sikki
Greenland has been the focus of rapid economic development since Kim Kielsen took over as President of the social democratic party Siumut [in Greenlandic], and as Prime Minister of Greenland in 2014. Now, almost six years later to the day, Greenland finds itself at a crossroads, as Mr Kielsen has been removed [in Danish] as head of Siumut.
This places the country’s ambitious airport construction projects and mining projects into question. Will the new party president, Erik Jensen, be able to form a coalition behind him? Or will Mr Jensen’s elevation lead to an election and different coalition?
On Sunday, 29 November, the Greenlandic government coalition, led by Siumut, held their tri-annual general assembly meeting in the capital city of Nuuk. Due to COVID-19 considerations, the assembly had been postponed from July.
Most of the 71 delegates from across Greenland were assembled in Nuuk, as the country is largely free of COVID-19 cases, though a few of the delegates had to participate digitally due to other considerations.
Prime Minister Kielsen was challenged by two other candidates: a former member of Kielsen’s government, Mr Jensen, and President of the Greenlandic Parliament, Vivian Motzfeldt.
The vote revealed a divided party. After the first round of ballots, Erik Jensen gathered 35 votes, Kim Kielsen 29 and Vivian Motzfeldt seven. As per party bylaws, Mr Jensen and Mr Kielsen had to face off in a second round, as no candidate had a fifty percent majority. Mr Jensen needed just one extra vote in the second round, all but ensuring his win. In the second round, Mr Jensen received 39 votes to the PM’s 32.
The current coalition overseen by Prime Minister Kielsen has focused on improving Greenland’s financial performance. Two new international airport facilities are under construction, and a third regional airport is planned for southern Greenland with capacity to connect to the world via Keflavik, Iceland.
Under Mr. Kielsen, Greenland’s GDP has risen more than 45% during 2014-19. Unemployment has been more than halved and two mines have been opened, with another scheduled to go into operation next year.
The Kvanefjeld Mining project in southern Greenland, which is currently overseen by an Australian firm (Greenland Minerals) in partnership with a Chinese company (Shenghe Resources), has the potential to be a world-class source of rare earth elements (REEs) and uranium. However, this project may be in doubt now that Kielsen has been ousted.
Investors may be holding their breath, and so will much of Greenland. There is also the question of how Greenland’s relations with Denmark may shift in light of ongoing questions about potential Greenlandic independence from the Danish Kingdom. Political upheaval is an everyday occurrence in Greenland, but the overall political course has been steady across changing coalitions in the country’s 41-year political history.
Inuit Ataqatigiit (IA) [in Danish], Greenland’s main opposition party, with left-wing socialist roots, opposes uranium mining in the country, claiming that even if a mine adheres to Greenland’s rather strict environmental legislation, the mine would never be safe for the populations living in the area.
If IA claims power in the coming months, Greenland could be poised to do a 180º turn on the country’s mineral extraction policy
While the vote showed a divided party, Erik Jensen won the party presidency. The short-term situation with Siumut has been decided.
For a time in the late 1980s and early 90s, Lars-Emil Johansen supplanted Jonathan Motzfeldt as party president for Siumut, with Motzfeldt remaining as prime minister. For now, Mr. Kielsen will stay on as Prime Minister until he either calls a general election, (the most recent was held in April 2018), steps down or faces a vote of no confidence against him.
The question now is, what does the future hold for Greenland?