NUUK, THE capital of Greenland, is on edge. “I am scared of an invasion,” whispers Anthony, who works in a hardware shop nestled near the city’s harbour. “I don’t want Greenland to become a war zone.” The shopkeeper at a nearby hunting store says locals are stocking up on ammunition. “People are frightened,” says Casper Frank Møller, the owner of a tour company. “People here are talking to their families about moving to Denmark.”
Greenlanders may take some comfort in President Donald Trump’s announcement on January 21st that he had agreed to “the framework of a future deal with respect to Greenland”. What that means for his ambition to make the island part of the United States remains unclear. Earlier that day Mr Trump said, “I don’t have to use force, I don’t want to use force, I won’t use force.” Yet he insisted that control of the island was critical to America’s national security—and again spoke of ownership.
In Nuuk, before his speech, Greenlanders were eager to explain how little interest they had in being bought by America. A poll a year ago found that 85% of them rejected the idea—and attitudes seem only to have hardened since. Mr Trump is “trying to rule the world like he owns everyone”, sighed Thomas Nuka, as he knotted a fishing net. Indigenous people in America, he added, fare especially badly—a big concern since he, like around 90% of Greenlanders, is Inuit.
On the face of things, the views of people like Mr Nuka should carry weight. The roughly 56,000 Greenlanders are largely self-governing, although Denmark still plays a part in foreign policy and defence. Danish law gives Greenlanders the right to declare independence; by extension, they would presumably be free to become part of the United States should they desire to. But Mr Trump’s determination to acquire Greenland, by hook or by crook, sets no store by the views of Greenlanders. Instead, he has justified it both on the grounds that it make will America safer and with the claim that Greenlanders will be more prosperous under American rule. Both assertions are doubtful, at best.
Mr Trump’s military arguments are vague. He has said that Russian and Chinese warships are “all over the place” around Greenland and that Denmark is incapable of defending the territory with just “two dog-sleds”. More specifically he argues that owning Greenland is essential for his mooted “Golden Dome”, a system intended to protect America from missiles. Yet the Trump administration’s new national-security strategy, released in December, makes no mention of Greenland at all. (It did include a woolly call to protect America’s “access to key geographies” in the western hemisphere.)
Although Russia’s armed forces are preoccupied with the war in Ukraine, a Danish intelligence assessment finds that “its core capabilities in the Arctic remain largely intact”. Like NATO, it closely monitors the sea lanes between Greenland, Iceland and Britain. But there is no sign of anything more untoward. “We haven’t had a Chinese warship in Greenland for a decade or so,” says Denmark’s foreign minister, Lars Lokke Rasmussen.
In fact Russia has welcomed Mr Trump’s predation of Greenland, mischievously likening it to its own seizure of Crimea from Ukraine in 2014. It presumably sees far more benefit in the widening rift in NATO that Mr Trump’s moves are causing than it would in any Greenlandic adventure of its own. In any case, Mr Trump himself has invited a greater Russian presence in the Arctic by using his peace plan for Ukraine to call for joint Russo-American mining projects in the region.
Chinese ice-breakers and research vessels do indeed prowl Arctic waters, presumably for military as well as civilian purposes. But they focus mainly on the seas around Alaska, which rather undermines the argument that American sovereignty would serve as a deterrent to such activity near Greenland. Chinese and Russian naval and coast-guard vessels are far more active in the Bering Sea, which narrowly separates Russia from Alaska.
Between 2020 and 2025 Norad (a joint American and Canadian air-defence command) counted 95 Russian and Chinese intrusions in the North American air-defence identification zone. Of these, 91 were around Alaska and four were near Canada. None was from the GIUK gap. In 2024 a joint patrol by Russian and Chinese nuclear-capable bombers came within 140 nautical miles of Alaskan territory, unnerving the Pentagon. “We need a more persistent presence around Alaska. That’s really where the most concerning activities have been taking place recently,” says Heather Conley of the American Enterprise Institute, a think-tank.
Although great-power competition in the Arctic is intensifying, American officials admit the danger in Greenland is not imminent. Yet they insist they need to secure it against future threats because of its strategic location. The polar ice-cap offers a hiding place for nuclear-missile submarines from Russia—and, in time, China.
Denmark is, however, increasing its forces in Greenland. In October it said it planned to spend DKr27.4bn ($4.26bn) to buy Arctic ships, a patrol aircraft, radar systems and drones, as well as a new military headquarters. It also plans to buy 16 more F-35 jets from America, costing another DKr29bn. And it is strengthening a special-forces unit that patrols Greenland’s Arctic wilderness using the most sensible form of transport, dog-sleds.
What is more, there is nothing to stop America from bolstering its own forces in Greenland. Denmark has promised it almost free rein in that respect. It used to have 17 bases on the island; it now has only one, an early-warning station at Pituffik (see map). Golden Dome will rely on a network of sensors around the world and in space. Pituffik is an important node, both for tracking missiles and communicating with satellites. (The European Space Agency is building its own satellite ground station in Kangerlussuaq.)
America has plans to beef up its Arctic forces, but they rely in large part on co-operation with the very allies it is alienating: it is building new ice-breakers with Finland, for example. In the meantime, the base at Pituffik is resupplied by a Canadian ice-breaker. Mr Trump’s push to take control of Greenland may actually harm rather than improve America’s security.
By the same token, talk of the economic benefits of a takeover, for Greenland and America, is far-fetched. Tourism and fishing are already thriving industries and once-high unemployment is now negligible. Investment is booming.
Even so, Greenland remains a financial drain on Denmark, which sends the island’s government almost $700m a year, equal to roughly 20% of Greenland’s GDP. This is largely because Greenlanders are among the most subsidised people in the world. The majority of housing is owned by the government; health care is free. Of the 29,000 or so people who work, 12,500 are employed by the state. The unemployed receive benefits equal to 90% of the minimum wage. In effect, three-quarters of the population rely on the state.
All this makes the notion that America might buy off Greenlanders with a one-off payment implausible. Denmark’s subsidies come to more than $10,000 per person every year. The offer of $100,000 for every resident mooted by some American officials therefore amounts to less than ten years of Danish welfare.
Although Mr Trump explicitly said in Davos that America needs Greenland for reasons of national security rather than its minerals, others in his administration have cited the island’s rich endowment of rare earths and other valuable resources. Yet the odds of a mining bonanza are low. Glaciers cover about 80% of the island, making exploration and development of mines costly and difficult. Greenland’s transport infrastructure is meagre: no two towns are connected by road, limiting mining to coastal areas accessible by ship.
During the 20th century no fewer than 18 mines shut down, often because of high costs or logistical problems. Today the island has just two working mines. Nalunaq is a gold mine that was shut in 2014 and reopened in 2024 because of a surge in the bullion price. The other, White Mountain, produces anorthosite, an input for fibreglass and paint. It has faced all manner of challenges. In its early phase the mine had to hire workers from Britain, Denmark and elsewhere, which was expensive (though around 80% of its staff are now local). “Everything is complex,” says Martin Hannes, the boss of Lumina, which runs White Mountain. “Transportation, particularly in winter, is almost impossible.”
The island’s two big rare-earth projects have been plagued by difficulties before even starting operations. The owners of Kvanefjeld, a rare-earth project on Greenland’s southern tip, have spent more than $100m developing the site since 2007. In 2019 they applied for a licence to begin mining. Greenland’s government has blocked it over fears that it could release uranium into farmland and fjords nearby.
The operators of Tanbreez, another prospective rare-earth mine nearby, say they will have spent $290m on the project before operations start in 2027. America’s government-run Export-Import Bank is mulling a $120m loan for the project. Once in operation, it may be costly to run: unlike rare-earth mines elsewhere, its deposits are contained in eudialyte, a crimson mineral from which it is tricky to extract the rare-earth elements. Nobody currently processes the stuff commercially.
Getting a mine running in the Arctic can cost between two and nearly three times as much as an equivalent project at lower latitudes, according to estimates from 2016 by MinEx Consulting, an Australian outfit. For example, just to the west of Greenland, on Baffin Island in Canada’s Nunavut territory, is the Mary River mine, which has been producing iron ore since 2014. Yet it reportedly had losses of $310m between 2016 and 2019.
Climate change may make some logistics easier, such as by leading to longer ice-free seasons at sea. But it will also cause problems. Other than in the very south, much of Greenland’s coast is covered by permafrost, which is soil that remains frozen all year. Thawing permafrost is giving miners trouble in other countries. In 2020 a diesel tank owned by Norilsk Nickel, a Russian mining giant, collapsed when the ground beneath it gave way, releasing 21,000 tonnes of fuel into rivers and lakes.
Greenland’s oil and gas may seem appealing. But extracting the stuff will be difficult. The biggest resources, which are estimated to hold the equivalent of more than 30bn barrels of oil, are in eastern Greenland, where conditions are extremely inhospitable, even by Greenlandic standards. Oil giants that once explored Greenland, including Shell, Equinor and ExxonMobil, have all left.
This suggests that even if America were able to gain ownership of Greenland, it could expect very little financial return. At the same time, it would be taking on liabilities. A change in Greenland’s status could well lead to a rupture in NATO, leaving America lumbered with all the costs of defending it. The expense of running its single existing base, Pituffik, will probably come to around $4bn over the next decade. Any big expansion of defence infrastructure would be expensive because of the difficulties involved in building in the Arctic.
Perhaps the closest comparable construction project to building a new Arctic base is the Mary River mine, for which the transport infrastructure alone cost $1.25bn. One American official reckons it would cost $20bn-30bn to build and maintain five bases in Greenland. Add to that the roughly $10bn in present-value terms it would cost to continue Denmark’s generous payments to the population over the next 30 years, taking ownership of Greenland looks like a decidedly poor financial deal. These costs, although unnecessary, would be affordable for an economy as big as America’s, but the harm a takeover would do to America’s security and standing in the world would be incalculable.
The closer you look at what Mr Trump no doubt views as the property deal of the century, the more it seems like many of his hotel and casino projects in the 1990s and 2000s: flashy at first glance, but so laden with debt and hidden costs that they soon became fiascos. ■