DCSIMG

How global warming is good news for Greenland's economic climate

RARELY a month goes by without another scientific survey proclaiming that Greenland's ice sheet is melting faster than previously thought. But for the 56,000 people who live on the giant Arctic island, climate change is now being seen as an opportunity rather than a threat: a passport to prosperity, perhaps even independence.

The self-governing Danish territory didn't miss the chance to promote itself on the world stage this week when diplomats from Denmark, Norway, Russia, Canada and the United States gathered in the town of Ilulissat, halfway up the west coast, to discuss competing claims for territory in a region believed to contain a quarter of the world's un-discovered oil and gas reserves.

"We are the first ones to notice climate changes, so it's important people co-operate with us," said Greenland's prime minister, Hans Enoksen. "We live in the Arctic and are daily users of the natural world, so we feel it's important we take the natural world and animal life into consideration in our decisions."

Few could deny Greenland's Inuit understand the effects of global warming better than anyone on the planet. They have had a front-row seat to see the glaciers retract and the sea ice thin, altering a traditional way of life that has existed for 3,000 years. But global warming is also heating up the economy.

The fishing industry, which accounts for almost all of its exports, remains strong. Having opted out of the European Union in 1979, Greenland is not restricted by fishing quotas, and stocks remain healthy. This gives Royal Greenland, the state-owned seafood company, a monopoly in Arctic waters, which are home to some of the world's finest quality fish.

Tourism is the biggest growth industry, while rising temperatures could soon leave most of the Arctic ice-free in the summer, opening up the Northwest Passage and cutting thousands of miles off the shipping route from Europe to Asia.

But the key to Greenland's future lies under the seabed. Producers have drilled just six wells – and only once since the 1970s – but record oil prices and declining reserves elsewhere have persuaded at least half a dozen companies to take the plunge.

Cairn Energy, the Edinburgh-based oil exploration company, controls or has a stake in six of ten blocks of territory leased by the Greenland government and will be at the forefront of the search off the west coast. It plans to conduct seismic testing soon to determine the size of its reserves. And Greenland is preparing to cash in.

On and off, it has been under Danish control for more than 400 years, officially becoming part of the kingdom of Denmark in 1953 before opting for devolution in 1979. But potential oil revenues have raised the prospect of Greenland being able to go it alone in 15 to 20 years.

"The development of the oil industry is one of the most important components in Greenland's effort to establish a self-bearing economy," Kim Kielsen, Greenland's minister of mines and petroleum, has said.

In the shorter term, the country is relying on the rapidly expanding eco-tourism market. Business is already booming in Ilulissat, where hotels are now booked up a year in advance and unemployment is 0 per cent.

Hotel Arctic, which hosted this week's North Pole conference, opened a new five-star wing this month, and local politicians hope to extend the airport and attract a hotel chain.

Located 200 miles north of the Arctic Circle, the town of 5,200 people, and almost as many sled dogs, welcomed 27,000 tourists last year, and several thousand more dropped in from cruise ships. Most visitors are drawn by the fastest-moving and most productive glacier in the world, which now moves at up to 40 metres a day and empties spectacularly into Disko Bay. The ice fjord joined the Unesco world heritage list in 2004.

 
 
 

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