A view of houses in the old town of Nuuk, Greenland, March 27, 2025.<\/p>\n
Leonhard Foeger | Reuters<\/p>\n
Donald Trump<\/a> is interested in annexing Greenland, an Arctic island offering a wealth of untapped mineral resources<\/a>. <\/p>\n But as the U.S. president dialed up the rhetoric about America annexing the self-governing Danish territory, sparking a backlash from international leaders, a report detailed the challenges facing its economy.<\/p>\n Published Tuesday, a report by S\u00f8ren Bjerregaard, head of securities and balance of payments at Danmarks Nationalbank, warned that there were “major challenges ahead” for Greenland’s economy. <\/p>\n The Arctic island’s economy \u2014 largely driven by the fishing industry \u2014 expanded by 0.8% in 2025 and is expected to grow a further 0.8% this year, down from 2% in 2022. According to the Danish central bank, the slowdown is likely to continue.<\/p>\n “The Greenlandic economy is slowing down, with modest growth and serious challenges for public finances,” Bjerregaard wrote.<\/p>\n “This is partly because the expansion of infrastructure in the form of airports is nearing completion, and planned major projects in energy supply and other areas have not yet begun.”<\/p>\n He added that at the same time, vital shrimp stocks were declining, while public finances “deteriorated surprisingly sharply in 2025.” Part of the pressure on public finances was arising from a decrease in dividends from government-owned firms. <\/p>\n “Liquidity in the Greenland Treasury fell to a critically low level in the second half of the year,” Bjerregaard said, noting that legislation set to be rolled out this year contains urgent fiscal tightening measures. <\/p>\n “More fiscal challenges lie ahead, with a declining and ageing population putting further pressure on the economy,” he added.<\/p>\n Greenland’s population, which stood at 56,699 in the final quarter of 2025, is expected to shrink 20% by 2050, as the territory struggles to attract migrants to replace emigrating residents<\/a>. <\/p>\n Trump ‘very serious’ about acquiring Greenland<\/p>\n In an interview with NBC News on Monday, Trump said he was “very serious” about acquiring the Arctic island. A day earlier, he told reporters that the U.S. needs Greenland to bolster its national security.<\/p>\n He was speaking after Washington launched a military operation in Venezuela that led to the capture of the country’s president, Nicolas Maduro.<\/p>\n Trump later told The Atlantic that America “absolutely” needs Greenland<\/a>, with the president telling the magazine that countries aside from Venezuela could be subject to U.S. intervention.<\/p>\n Trump has long floated the idea of taking Greenland. In early 2025<\/a>, he said the U.S. would assume control “one way or the other.”<\/p>\n Officials in Greenland, Denmark<\/a> and across the European continent<\/a> have rejected<\/a> the notion that the U.S. can make any claim on Greenland.<\/p>\n