January 31st, 2013

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Greenland’s Self-Rule government gathered last week to discuss statements by the opposition in the Danish parliament about the development of the Greenlandic mining industry.

We took note that a number of parties in the Danish parliament are in favour of a state-owned company that would finance the development of mining operations in Greenland.

Denmark and Greenland are both supporters of open, fair and transparent international trade. Denmark and Greenland have pledged to uphold these three principles as signatories to a number of international agreements. Most recently, Greenland has entered into a letter of intent with the EU in which both sides agree to respect the principle of open and free trade. That includes an agreement not to enter into exclusive agreements with any country.

The Self-Rule government welcomes Danish investment in Greenland’s mining industry. And two Danish companies – DONG and Maersk – are in fact already actively taking part in the search for oil and gas off Greenland’s coasts.

One fundamental principle the Self-Rule government has established is that all investments in Greenland’s mining industry are made in a competitive, market-based environment. Provided they abide by this principle, Danish investment firms and mining companies are welcome to become active in Greenland. For us, it makes no difference what proportion of the company’s shares are owned by the state, and what proportion are owned by private investors.

The Self-Rule government would also like to underscore that should a decision to set up a state-owned Danish company be made, Greenland will not call for a proposed ‘time-out’ on the development of its mining industry to wait for the company to come online. Doing so would wreck our reputation in the eyes of the companies that have already sunk hundreds of millions of kroner into their own mining operations at the invitation of Greenland and the Danish state.

The Greenlandic parliament recently passed a law relaxing certain regulations for mining companies establishing operations in Greenland. The Danish and the Greenlandic governments agree that this law does not put the Kingdom of Denmark at odds with the rulings of the International Labour Organisation (ILO). Specifically, the ILO’s core conventions on the right to organise and the right to engage in collective bargaining remain intact under the terms of the new mining law.

The law sets a requirement that foreign employees working in Greenland are offered acceptable wages and working conditions. The law states that foreign employees may not earn less than Greenland’s minimum wage, which is far higher than most western European countries.

Conditions such as these are essential if we are to make sure that Greenland’s mining operations and related activities can compete with similar operations abroad. The statements coming out of Copenhagen only serve to cast doubt on the stability of Greenland’s mining sector and undermines the joint Danish-Greenlandic policy that has been in place for decades.

Even if we establish state-owned companies, it doesn’t eliminate the necessity to ensure that Greenlandic mining operations can compete globally. Projects that turn a profit only with the help of subsidies are not sustainable.

In addition, there is something that hasn’t been considered in the proposal to create a state-owned mining company: the customer. It’s not enough to just dig minerals up. Someone needs to buy them at competitive prices. Any Danish company that engages in mining operations will face the same commercial requirement.

The Self-Rule government believes that changes to immigration regulations that would permit companies operating in Greenland to hire foreign labour should not be held hostage by politicians in Copenhagen. This is too important for Greenland. The Self-Rule government is calling on Danish lawmakers to respect Copenhagen’s agreements with Nuuk and accept the decisions made by Greenland’s democratically elected legislature. We urge the Danish parliament to pass the required changes to immigration regulations.

The proposal to create a new mining company owned by the Danish state was not something that was discussed with the Self-Rule government ahead of time. Why not? Not doing so is in all likelihood a violation of the Self-Rule agreement between Denmark and Greenland, grants Greenland responsibility for its domestic affairs. It’s not as if there hasn’t been a good opportunity. During the past month, the Self-Rule government has met with representatives of all the parties in the Danish parliament – with the exception of Dansk Folkeparti – to discuss the details of the mining law and its importance to Greenland.

The author is the premier of Greenland