June 14th, 2012

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Maliina Abelsen, Greenland’s finance minister, had reason to be pleased when she presented parliament with the final tally of the country’s expenditure and revenue in 2011. It turns out that Greenland had a surplus of 49 million kroner last year. 

The reason: oil exploration, just as it did in 2010, generated far more revenue than expected. Some 10 million kroner of this extra money has already been invested in the healthcare service as part of efforts to reduce waiting times for medical treatment. Another 14 million kroner has been spent on student housing in a number of towns. 

Abelsen’s figures show that oil and minerals are good for the country’s finances, despite the fact that not even a drop of oil has been pumped up to the surface yet. We can only imagine how much money projects such as the planned aluminium smelter in Maniitsoq, the iron mine in Isuakasia, and oil production off the west coast will bring in once they become fully operational. 

But there is a flipside to every coin – even those that are made of pure gold. 

Even though foreign mining companies have had their eyes on Greenland’s natural resources for years, we’re only just now starting the discussion about the impact this will have. Better late than never, though. 

Among those expressing concern is SIK, a trade union. For years, the union has fought to ensure that Greenlanders were paid the same wage as foreign employees recruited to work in Greenland temporarily. Now, though, the tables have been turned – mining companies want to hire workers from low-wage countries, including China, to build Greenland’s infrastructure and work in its mines, for less pay than Greenlanders would demand. Is it okay for us, now that the money has started to flow, to put other countries in the same situation we once found ourselves in?

Jess G Berthelsen, the SIK president, had a clear answer: “If SIK accepts this, we accept discrimination. We don’t accept discrimination, and we’re going to continue the fight for equal pay for equal work.”

Others, though, took a different view of the situation.

Michael Rosing, an MP for Demokraterne, questioned whether the term ‘social dumping’, which many have begun to use to describe the practice of importing low-wage workers, applied in this case.

“We don’t approve of social dumping, but when Chinese labourers would be getting paid three times as much as they would in their home country, then we question whether you can actually call this social dumping – even if it is far less than what a Greenlander would be paid for the same work.”

Rosing said that the focus should be on work conditions rather than wages. “The real problem emerges when Chinese workers don’t have the same rights as Greenlanders, or if they face lower standards for work safety or housing, or if they don’t have the right to speak out against an employer without risking being fired.”

Both points of view sound reasonable, but unfortunately they are mutually exclusive, and that puts Greenland at a crossroads. We can’t maintain the status quo. Experts have already told us that meeting the challenges the social welfare state will face in the years to come will require us to find new sources of income to replace Denmark’s 300 billion kroner annual block grant and to decrease our reliance on dwindling fishing stocks.

Mining is the most obvious choice, but it would also require Greenland to face reality. No matter how we approach the issue of social dumping, we’re going to wind up with difficult choices. 

We don’t have the manpower to build a smelter, an iron mine or oil rigs, yet at the same time the number of Chinese workers we’re going to need – even if they are here for only a couple of years – would have a profound impact on a country of just 56,000 inhabitants spread out over the world’s largest island. 

The debate in Greenland’s parliament failed to bring us any closer to a decision about whether we should accept aluminium producer Alcoa’s ultimatum that we allow the company to use under-paid Chinese workers if it is to build its smelter here, and some in parliament have begun to get cold feet as the deadline for an answer approaches. 

Those parties that oppose social dumping neglect to tell us how else we can build the mines or the infrastructure to support them. Likewise, those parties that say we should open this Pandora’s box haven’t said how we’re going to move on after we lose our innocence. 

We need to choose our steps carefully. Otherwise, we risk being run down by globalisation.

For a small nation on the edge of the Earth, hanging on to the tail of a dragon can be a dangerous business.

Sermitsiaq is a weekly newspaper/website based in Nuuk, Greenland.