by Daniel Ortwerth, CFA | PDF
Shortly after he became president again in January, Donald Trump surprised the world with statements about buying or annexing Greenland, by force if necessary. In early May, he reiterated this position, saying Greenland was needed for national security. Trump had initially proposed acquiring Greenland in his first term, but even that was not the first time the United States expressed such an interest. In 1946, at the beginning of the Cold War, President Truman secretly offered to buy Greenland from its owner, Denmark. On each occasion, Denmark has rejected the idea, but the repeated US overtures reveal that Greenland is important for reasons tied to the core interests of a global superpower.
This report explores the main reasons why Greenland is getting so much attention. It begins with a review of the military value of Greenland, continues with considerations of its evolving potential role in global trade, and further delves into the island’s prospects as a natural-resources play. Ultimately, we show how Greenland serves as a lens through which to view strategic developments in the broader Arctic region. As always, we conclude with investment implications.