Speach at Future Greenland

Speech delivered by Minister for Fisheries and Hunting Mr. Karl-Kristian Kruse on behalf of The Premier of Greenland Mr. Kim Kielsen

Future Greenland Conference 2017:
“Capital, Competence and Capacity”

 

(The spoken words apply)

Increased growth and employment in the private sector is decisive in safeguarding the foundation for future welfare and prosperity. Growth and employment must be boosted not in one, but in multiple, sectors. This will make Greenland less vulnerable to changes in a single sector, such as altered export prices or volumes in the fisheries.

At the same time, we need to boost development in the fisheries, which continue to be our most important trade and industry sector. Earnings from the fisheries must not only generate revenue for Greenland. It is also important to maximise the socio-economic return from our resources, whether these are fish or minerals for example. As an economy, we need to get more out of our marine resources. This is why, in the future, the fish we catch should ideally be processed here in Greenland. There is therefore a need for new, visionary approaches to achieving that.

For generations, the fisheries have been Greenland’s most lucrative industry. Yet, over the years, we have not managed to create enough fishing industry training schemes. As a country that for so many years has had fishing as its primary occupation, we should have developed production and processing methods to maximise utilisation of the raw materials. We must work with industry to create training schemes that can help to ensure that we make far better use of the raw materials. We should be more advanced in processing our raw materials than is presently the case.

Dynamising trade and industry

A more dynamic trade and industry will create better conditions for citizens, and boost the economic activity that creates jobs and revenue for society.

The development of more leading industries will promote more balanced development in Greenland. The necessary trade and industry development will not happen without action. It will require new investment and systematic improvement of the framework conditions with a view to strengthening our competitiveness.

In recent years, the Government of Greenland has therefore worked actively to modernise and improve the framework conditions for operating businesses in the interests of future development, growth and welfare. This has been achieved by simplifying a number of the legal statutes and rules that govern trade and industry, but also by an amendment to the Competition Act, for example, in order to achieve more liberal competition on the market and thereby better terms for both businesses and consumers.

The cooperation initiated in 2014 between the Danish Minister for Industry, Business and Financial Affairs and the Greenland Government has identified 12 recommendations informed by productive and close dialogue with trade and industry. A number of these recommendations have already been realised and some are still in the implementation phase. A crucial aspect of the modernisation programme is that, over a number of sessions, the Parliament of Greenland has passed a bill to modernise the business and companies legislation and the financial legislation. It is important for investments and competitiveness that our trade and industry legislation is in line with international standards. This increases confidence and credibility in investing in Greenland.

And have we succeeded? Yes, we have. As an example, I would mention that we have issued a number of tourism concessions which attract international investments in experiential tourism. And this means that, after some years of stagnation in this sector, we are now seeing an upturn in our tourism industry. Tourism could ultimately become one of Greenland’s leading industries – just look at Iceland.

Another example is that we are now fully in the process of building new airports. The 2200-[twenty-two hundred]metre landing strips in Nuuk and Ilulissat and the 1500-[fifteen hundred]metre landing strip in Qaqortoq are scheduled to come into operation by the end of 2021. Can we attract financing for the landing strips? Here again, we have every confidence that the answer is Yes. In our talks with banks in Europa and Asia, the recurring question is typically: When do we get to look at the financing proposals for the new airports? Kalaallit Airports expects to be ready to present the project to potential investors later this year.

Yet another initiative with great untapped potential is Greenland’s access to additional sources of financing. In collaboration with the Government, Greenlandic companies have now been granted access to financing from EKF, Denmark’s official export credit agency; the Danish Growth Fund, which is the Danish state’s investment fund; the NIB and the EIB.

The Danish Growth Fund has already engaged in financing trade and industry ventures in Greenland; partly in isolation and partly together with Greenland Venture and the banks. The CEO of the Danish Growth Fund has stated that the Fund’s strategy is to ultimately play the same role in Greenland as it does in Denmark. He indicated three main areas of particular potential: Tourism, Raw materials, Fisheries and fish processing.

In 2015, the Government of Greenland initiated talks with the European Investment Bank with a view to securing access to the EIB’s lending facilities for raw materials projects in Greenland. In Greenland, the EIB is now co-financing the Hudson Resources’ White Mountain mine project at Kangerlussuaq.

Similarly, in 2015, the Nordic Investment Bank set up a new Arctic lending facility of 500 million Euros to stimulate investment in the Arctic Region. The loans are primarily aimed at infrastructure projects, renewable energy projects and the like.

Thus, in the opinion of the Greenland Government, the recommendations of both the Taksøe Report and the joint report with the Danish Ministry of Industry, Business and Financial Affairs regarding access to new financing schemes, have been fulfilled through the significantly improved frameworks for investment now made available.

The population – Greenland’s Number One resource

Other factors also influence our economy. We know that, happily, more people in Greenland will be living longer. This will raise costs in the health and care sector in the years ahead. To be able to afford this, we need to reduce expenditure and generate increased revenue in the public sector. This means adopting and carrying out reforms. Equally, it is crucial to create new jobs in the private sector. The initiatives I have mentioned will be instrumental in achieving this.

Regardless of whether the aim is a strong welfare economy, independence, or trade and industry growth, the Number One resource is the nation’s population. We need the people of Greenland on board. The population has to generate the results.

This makes it imperative to raise the general level of education and training, and creating good conditions for coming generations to grow up in. Many good initiatives have been set in motion and progress is being made. But there is still a long way to go, and this is a mission to accomplish as a nation, across the home rule government, municipalities, the business community, wage-earners and in daily family life – we have many tasks ahead.

Within the Greenland Government we will continue to work for more young people to gain a training. The Government is especially taken up with future prospects for the young because there are far too many unemployed persons under the age of 30. Far too many in this group are distanced from the labour market because they have not completed secondary education, are unskilled workers or lack work experience. 

At our Majoriaq job and educational advisory centres, citizens can find an all-round solution that offers new routes to self-support. This applies both to job-seekers and those in need of upskilling to find the right job or training.  The Government of Greenland is deeply committed to its large-scale reforms of the labour market. This is why we decided to grant additional financing to the Majoriaq centres for advisory services, upskilling and on-the-job training.

The implementation of the Majoriaq centres and the joint, intensified labour market measures are important initiatives – not only for young unemployed persons. At present, we have far too many citizens who ought to be able to take up work, but who are, in fact, not in a position to contribute to the labour market and who are therefore on public benefits. We must jointly give these citizens good framework conditions for changing their circumstances and improving their lives.

The Greenland Government takes a very serious view of groups on the labour market who are caught in poverty and debt traps. In response to the situation, the Government has recently decided to initiate a pilot project in Narsaq to actively assist in preventing these problems.

It will be essential to balance expenditure and revenue in the public sector budgets of national and local government in the coming years. This also makes it essential to stem new expenditure on service improvements. In that respect, I am very pleased that a solid majority in the Greenland Parliament in 2016 backed the Government’s sustainability and growth plan, and our bill for a new and improved Public Sector Budgeting and Accounting Act. These are vital instruments in ensuring that we have a stable and sound public sector economy for the long term too. They are also instruments that underpin the Government of Greenland’s ambition to use the annual finance acts for investing strategically in our common future.

I would like to thank the Greenland Business Association for arranging this prominent and impressive event. You have invited many interesting guests from outside Greenland, who will be able to offer new and fresh contributions to the debate on growth and development.

On my own behalf, I wish that such conferences, which happen when the people have decided to work for independence, will provide more tools for our work.

Thank you!