Greenland Is Of Major Importance To the U.S. – Here’s Why

Introduction

Greenland holds a strategic position in the 21st century, not just due to its geography, but also because of its abundant and largely untapped natural resources, which are of increasing strategic importance, especially to the United States.

This original, unedited analysis by Spencer Wright, an investment advisor representative with Halbert Wealth Management, Inc. and a contributor to Forecasts & Trends, explores Greenland’s significant economic potential, as well as its key military importance.

Strategic Significance: The Arctic Resource Race and Militarization

The Arctic region is undergoing a transformation, leading to increased accessibility and growing competition for its resources. Greenland, positioned at the heart of this transformation, holds resources critical to the United States. It’s important to note that the strategic importance of Greenland to the U.S. is not a new phenomenon.

Historical Precedent: Greenland as a U.S. Protectorate: During World War II, with Denmark under Nazi occupation, Greenland became a de facto U.S. protectorate. The U.S. military established a significant presence on the island, building air bases and radar installations. This historical context underscores the long-standing strategic value the U.S. has placed on Greenland, particularly in times of geopolitical tension.

Geopolitical Positioning and Resource Access: Greenland’s proximity to North America places it within a zone of strategic interest for the United States. Access to Greenland’s resources is vital for reducing U.S. dependence on other nations, some of which may be geopolitical rivals.

Militarization of the Polar Region and the GIUK Gap: The strategic importance of Greenland is amplified by the increasing militarization of the Arctic and its role in controlling critical maritime passages.

1. Increased Military Presence: Nations like Russia, the United States, and Canada are enhancing their military presence in the Arctic, including the deployment of submarines, surveillance systems, and the establishment of Arctic military bases.
2. Strategic Competition: The opening of new shipping routes and access to resources has intensified strategic competition among these nations. Greenland’s location makes it a crucial vantage point for monitoring and projecting power in the region.
3. The GIUK Gap: Historically, Greenland has played a vital role in the strategic context of the GIUK (Greenland-Iceland-United Kingdom) gap. This maritime area is critical for naval operations, particularly for tracking and controlling the movement of submarines between the North Atlantic and the Arctic Ocean. Greenland’s position as a key part of this strategic chokepoint enhances its military significance.
4. U.S. Strategic Interests: The U.S. has a strong interest in maintaining its military presence and influence in Greenland to protect its strategic interests, counter potential threats, and ensure freedom of navigation, with a keen eye on the importance of the GIUK gap in naval strategy.

Critical Mineral Resources: Greenland possesses significant reserves of minerals deemed critical to the U.S. economy and defense.

1. Rare Earth Elements (REEs): These are essential for manufacturing high-tech products, including electronics, renewable energy technologies, and military equipment. Securing a stable supply of REEs is a priority for the U.S. to maintain its technological edge and reduce reliance on potentially adversarial suppliers.
2. Other Minerals: Greenland also holds reserves of zinc, iron ore, and other minerals that are important for various industries. Access to these resources can bolster U.S. industrial capacity and reduce vulnerabilities in supply chains.

Potential Energy Resources: While still under exploration, Greenland may hold significant oil and gas reserves. Developing these resources could offer the U.S. a potential alternative energy source, although environmental considerations remain a key concern.

Economic Potential: Resource Development and U.S. Investment

The United States’ strategic and economic interests are driving its investment in Greenland’s natural resources. This investment is largely motivated by the desire to reduce dependence on China for critical minerals and to strengthen US influence in the Arctic region. Developing Greenland’s resources presents both economic opportunities and challenges.

Mineral Extraction: Greenland’s economy could be significantly impacted by mineral extraction. As a result, the U.S. and Greenland have signed a mining agreement that reflects their mutual strategic interest in ensuring dependable access to essential minerals. This agreement also paves the way for U.S. companies to take part in mining projects and secure critical resources.

Infrastructure Development: Developing Greenland’s resources requires significant investment in infrastructure, including ports, roads, and energy facilities. The U.S. has a strategic interest in supporting infrastructure projects that facilitate resource extraction and transportation, enhancing its access to these vital materials.

Geopolitical Dynamics and U.S. Influence: The increasing interest in Greenland’s resources has geopolitical implications.

• Competition: The U.S. faces competition from other nations, including China, for access to Greenland’s resources. Maintaining a strong presence and fostering relationships with Greenlandic authorities are crucial for the U.S. to secure its interests.
• Concerns about Undue Influence: China’s growing interest in Greenland, including potential involvement in research projects, airport refurbishment, and even the possibility of acquiring an abandoned Danish naval base, has raised concerns among Western powers, especially the United States, about China’s expanding influence in this strategically important region.
• Denmark’s Role: The U.S. must navigate its interests while respecting Denmark’s sovereignty over Greenland and the increasing autonomy of the Greenlandic government.

Conclusion

• The strategic importance of Greenland’s natural resources to the United States is increasing. The island’s critical minerals, potential energy sources, and other resources align with U.S. goals for economic security, technological leadership, and a strong Arctic presence.
• Greenland’s historical role as a U.S. protectorate during World War II and the growing militarization of the polar region, especially its significance within the GIUK gap, further highlight the island’s enduring strategic importance.
• It is in the U.S.’s best interest to maintain a mutually beneficial partnership with Denmark to ensure a continued presence in Greenland. What final form this partnership might take is anyone’s guess.