Trump plans takeover - 23 critical raw materials: Why Greenland is so important for Europe's ecological transition

Greenland's mineral deposits are highly lucrative, and not just for Trump's USA. The EU has also long recognized the potential of the ice island's rare earths, among other things. They are central to ecological change in Europe.

US President Donald Trump has once again justified his interest in taking over Greenland with national security . But observers assume that, in addition to all the military speculation, there is also an economic reason behind his desires: Greenland's extensive deposits of critical raw materials. How important such natural resources are to Trump is shown not least by his courting of raw materials in Ukraine.

Critical raw materials (CRM) are materials with great economic importance and at the same time a high supply risk. These include the much-discussed rare earths (REE), which are 17 metals , which in turn are grouped together as nine heavy and eight light rare earths. They are found in all kinds of everyday items such as smartphones, laptops and televisions. Depending on the design, these electrical devices require yttrium, praseodymium, terbium and dysprosium, among others.

Rare earth metals are particularly important for the green transition: they are used in electric cars and wind turbines, among other things. These products require strong permanent magnets, which in the case of electric cars can contain up to several kilograms of neodymium and praseodymium, depending on the size of the motor.

Germany has a powerful industry, but only a few critical raw materials. German companies are therefore just as dependent on supplies from abroad as companies in other EU countries. This is particularly evident in the case of rare earths: on the one hand, the EU is a world market leader in the manufacture of car engines and wind turbines, for example, but on the other hand it covers its demand for rare earth magnets almost exclusively with imports from China, which in turn is the absolute world market leader in this area.

Such dependence makes the EU vulnerable to geopolitical tensions: it would have a major problem if China were to reduce or even stop supplies for political or strategic reasons - for example in the course of a tariff dispute. This would be fatal, especially with regard to EU climate policy and digitalization.

Now, as is well known, Trump cares little about the climate, but he does care about big money and also about curbing any leadership role played by China - and that is where resource-rich Greenland, which is part of the Kingdom of Denmark, comes into play. "I think Trump is more interested in the rare earths than in having a military in Greenland," says former Greenland Finance Minister Maliina Abelsen, who is now chairwoman of the supervisory board of the fishing group Royal Greenland.

The EU has also long since set its sights on raw materials. Almost a year ago, Commission President Ursula von der Leyen opened an EU office in the capital Nuuk and signed two cooperation agreements with a total volume of 94 million euros - part of which is to be invested in value chains for energy and critical raw materials.

An agreement on raw materials was reached at the end of 2023, which is intended to position Greenland as a strategic raw material supplier for the ecological transition in Europe. This does not just involve rare earths, but also copper, graphite and lithium, for example: In total, the EU has identified 34 critical raw materials that are necessary for the green and digital transition - and 23 of them can be found in Greenland, says mineral researcher Jakob Kløve Keiding from the Geological Survey of Denmark and Greenland (Geus).

The potential in Greenland is considered to be extremely high for several of these. "Some of the Greenland rare earth deposits are among the largest in the world," says Keiding. The Kringlerne and Kvanefjeld sites in southern Greenland alone contain many millions of tons of unused rare earth elements. Other large deposits of REE and other raw materials can be found in the southwest and east of Greenland.

It is obvious that these mineral resources are of immense value. It is difficult to estimate exactly how high this value is, says Keiding. All he can say is: "They are worth nothing as long as they remain in the ground."

This brings Trump's USA and von der Leyen's EU back into play. It is not the mere extraction of raw materials that brings in the big money, but rather the later steps in the value chain - and the know-how for this is mainly in China, says Keiding. Both the USA and the EU are working to catch up. "People have realized that China practically has a monopoly and controls the market."

Greenland is currently largely dependent on fishing and a Danish financial subsidy of more than 500 million euros per year. The income from mining licenses and taxes alone could mean a new economic mainstay for the island of 57,000 inhabitants. "98 percent of our exports currently come from fishing," says former minister Abelsen. The mineral sector, like tourism, can contribute to a broader economy - which Greenland in turn needs for the much-discussed possible independence from Denmark.

Yes, in the form of risks for the sensitive Arctic environment, but also for the local people, for example through radioactive byproducts. In Greenland, these downsides even decided the last parliamentary election in 2021: At that time, there was a public dispute over an Australian mining project to extract rare earths and uranium in southern Greenland. The left-wing IA party won the election by positioning itself against the project. Six months later, uranium mining was banned.

Another problem is the harsh Arctic conditions and high operating costs. "We are a remote place, which is why it is so expensive to mine minerals in Greenland. That is why we are often the last option considered," says Abelsen. "But as we run out of rare earths, it is obviously becoming more attractive to look towards Greenland again."