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December 7th, 2012

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Greenland’s parliament today ended months of heated debate by passing a controversial law that will relax a number of regulations for companies establishing mines and other raw materials operations in the Danish self-governing territory.

“We believe this law gives Greenland a stronger hand when negotiating with companies seeking to begin operations here,” Naaja Nathanielsen, a spokesperson for the governing IA party, wrote in a press release after the law was passed. 

The law, which will allow companies to pay foreign workers lower wages than Danish law currently permits, passed with 13 members of the 31-member legislature voting in favour. The remaining 18 MPs abstained from voting.

In recent years, mining companies have increasingly cast their glance towards Greenland and its treasure-trove of raw materials, which includes rare earths, iron, gold, uranium and rubies. There is also evidence to indicate it sits on some of the world’s largest untapped oil reserves. 

The law was expected to be passed by parliament last month, but the final reading was delayed until today in order to give legislators more time to listen to concerned groups. 

In addition to the law’s wage provisions, critics were concerned that it had been rammed through parliament without sufficient debate. 

Even though the Self-Rule government reacted to public uncertainty about the effects of the law by promising to give residents a greater say in the decision-making process, opposition-leading Siumut maintained its resistance, saying it had been tailored to the needs of foreign companies. 

“Given all the dissatisfaction and concern there is about the emergence of the mining industry, it’s all the more difficult to understand why this bill needed to be voted on so quickly,” Siumut MP Per Berthelsen said.

Siumut MPs all abstained from voting today, and during the final debate, party representatives pledged that if it regains power in the 2013 general election, it will call for a new vote on the law.

The newly established Greenland chapter of anti-corruption group Transparency International urged the island’s parliament to adopt a go-slow attitude.

“This law will have an enormous impact on Greenland’s future. We can’t afford to rush a decision through parliament without involving the entire population through a democratic process,” said Anders Meilvang, the head of Transparency Greenland.

Proponents of the law argue it is necessary to relax regulations in order to make it easier to attract mining companies to invest in mining operations in Greenland’s harsh Arctic environment. 

Establishing such operations would require first building basic infrastructure, such as roads, power plants and port facilities. Greenland, with a population of 55,000, would be unable to provide the necessary labour to establish such facilities. It is estimated that a planned aluminium smelter alone would require over 5,000 temporary foreign workers to build.