Greenland’s tourism nears limit, mining difficult as budget turns red

By Elías Thorsson September 26, 2025
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A view of the old city of Nuuk, Greenland, March 29, 2025. REUTERS/Leonhard Foeger/File Photo

Greenland’s tourism boom, driven by new international flight routes, is running into hard capacity limits just as the public budget swings into deficit, the Economic Council warns in its new outlook. In the summer high season there is effectively full utilization of flight seats, hotel beds and tour capacity, leaving little room for further growth without new investment. The Economic Council of Greenland (Økonomisk Råd) is an independent advisory body established by the government that publishes regular analyses to inform policymakers and the public.

Foreign ownership and investment needed

Despite rapid growth since 2022—including a 25% jump in cruise tourism in 2024—tourism still accounts for only about 5% of value added. To move the needle, the Council says Greenland needs more lodging and experiences and a longer season beyond the few summer months.

Additionally, the Economic Council again criticizes the new tourism legislation requiring two-thirds local ownership. The report states that the restriction on foreign ownership in the tourism industry could risk hampering investment in the kinds of experiences demanded by an attractive travel destination.

New airports help but won’t solve the bottleneck on their own. Nuuk’s international airport opened in November 2024, while new airports in Ilulissat and Qaqortoq are scheduled to come online in 2026. Even with those upgrades, additional beds and products are needed to absorb demand and spread visitors more evenly across the year.

The first direct scheduled flight from Newark in the U.S. to Nuuk prepares to land at the airport in Nuuk, Greenland, June 14, 2025. Mads Claus Rasmussen/Ritzau Scanpix/via REUTERS

Mining: costly, risky and reliant on foreign capital

The Council stresses that meaningful mining activity isn’t realistic without outside investors and that Arctic conditions make projects expensive and tricky. Infrastructure is sparse and often must be built project-by-project, which raises costs and political questions while limiting broader spillovers to the economy. High construction and operating costs, market risks and geography have made viable business cases rare; foreign capital and expertise are therefore crucial.

There are exploitation licenses for several large mineral projects, but the license holders have not secured financing. At present there is only one active mine—anorthosite extraction near Kangerlussuaq Fjord—while the Nalunaq gold mine in South Greenland is expected to reopen, supported by high gold prices. Exploration remains the main activity: in 2023 there were about 100 exploration permits and exploration investment totaled 340 million kroner (USD 53.1 million).

Exploration helicopter on top of the Nalunaq Mountain. (Amaroq Minerals)

Public finances, in plain red

Greenland’s main budget has flipped from the surpluses expected last year to deficits: 257 million kroner (USD 40.2 million) in 2024 and 130 million kroner (USD 20.3 million) in 2025. A broader measure (DAU) shows a 420 million kroner (USD 65.6 million) shortfall in 2025. The cash buffer is shrinking fast—from 695 million kroner (USD 108.6 million) at end-2024 to about 345 million kroner (USD 53.9 million) by end-2025—leaving less room to handle surprises without borrowing. The Council links the swing to higher health and pension costs, lower tax revenues and smaller dividends from state-owned companies.