Greenland faces election as turmoil threatens mining

Greenland’s parliament has voted to hold an election on 28 November after prime minister Aleqa Hammond took a temporary leave of absence over a spending scandal, and the opposition lured enough of the leader’s supporters to gain a majority in the 31-seat assembly.

Aleqa Hammond, the prime minister of Greenland, now faces an election. Picture: Getty

Polls show Sara Olsvig’s opposition party holds a good chance of winning and replacing Ms Hammond, who has been prime minister since April last year.

But the political turmoil is likely to paralyse the government at a critical juncture as international companies such as London Mining and Greenland Minerals and Energy consider opening iron ore and rare earth mines.

Prime minister Hammond escaped a no-confidence vote earlier this week but stepped down temporarily until the end of an investigation into her spending of public money on hotels and flights.

The opposition kept up pressure and four ministers in total stepped down from the government this week, including two from Ms Hammond’s Siumut party and two from junior coalition partner Atassut.

Atassut had left to join the opposition, according to Ms Olsvig, leader of the largest opposition party, the Inuit Ataqatigiit. Ms Olsvig said political horsetrading had dominated the day in the assembly with her party at one point being asked to join the coalition government while she negotiated with Atassut.

Greenlandic media said Ms Hammond had stepped down as leader of the Siumut party, but her status in government was unclear.

“When they [Siumut] invited us to negotiate a new coalition, my answer was that I didn’t know who their leader was or who the premier was,” Ms Olsvig said. She added a coalition with Siumut was out of the question also due to their “bad governance”.

Greenland is a self-ruling country within the Kingdom of Denmark and has a population of about 56,000.

Until Wednesday morning, all nine ministers had stood behind Ms Hammond’s argument that government should wait until an audit commission provides its conclusions on her spending, expected this month, before taking any action.

Greenland analyst Mikaa Mered said the turmoil was “driving Greenland towards political chaos that will be quite repellent to many investors from the mining, oil and gas and fishing sectors”.

Siumut mining and natural resources minister Jens-Erik Kirkegaard was one of two from the ruling party to resign.

He had been due to travel to China in three weeks to present Greenland’s mining potential and meet with several Chinese and Australian officials and investors to boost the sector’s interest in the vast Arctic country.

“That will obviously not happen, and it is quite a catastrophe since this journey was one of Greenland’s last chance to save London Mining’s Isua iron ore project,” Ms Mered said.

London Mining has one of the most advanced plans for a mine in Greenland, but its shares have fallen more than 70 per cent this week after it warned it did not have enough cash to operate its only existing mine in Sierra Leone.