Greenland faced a dramatic financial situation that forces the government to carry out massive budget cuts. The authorities announced the request to save 864 billion Danish kronor over the next 4 years, equivalent to around EUR 115 billion.
Minister of Finance and erstwhile Prime Minister Mute B. Egede identified the main causes of the crisis. "At the same time, we note a halving decrease in state corporate income and little taxation revenue. As the population grows older, social spending (also) increases" - he stressed in his statement, besides pointing to smaller profits from fishing.
Social benefit reforms
The government has announced a tightening of the social benefits rules, including a simplification in unemployment benefit, which will refuse to accept the proposed work. Pension reforms and measures to increase income and seal the taxation strategy are besides planned.
"Health care will be affected as small as possible" - declared Egede. In Greenland, social services are highly costly due to the dispersed population of tiny fishing settlements available only by air or sea.
Dependence on Denmark and independency plans
Denmark feeds about 40 percent of the Greenland budget through targeted grants, besides ensuring interior safety and the presence of armed forces. This financial dependence complicates the island's independency aspirations, which gained importance after U.S. president Donald Trump's statements about the request to take over Greenland.
In the spring of the parliamentary elections, the politician organization was victorious, which advocates independency from Denmark, but only after economical independency was achieved. The government coalition is besides formed by the left-wing Inuit Ataqatigiit group, the Social Democratic Siumut and conservative Atassut.
Structural challenges
Greenland does not have its own doctors, and for abroad personnel, surviving in harsh climatic conditions is not attractive. Experts, like prof. Torben M. Andersen, inform against uncertain future due to dependence on fishing, Danish transfers, falling population and hard geography.
Nuuk's fresh global airport is expected to represent a tourism improvement strategy in the face of the crisis. There were besides suggestions that the US could offer more financial support than the current Danish subsidies.
Sources used: "PAP", "businessinsider.com.pl" Note: This article has been edited with the aid of Artificial Intelligence.
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