Doing Business in Greenland St. John’s, February 18th 2014

by Inaluk Brandt by Ellen Arnskjold

Profile Ellen 39 Greenland experience: Greenland Business Association – Business Development 2008-2014 University of Greeland – External Lecturer Owner of Business 4 U: •  Arctic Business Network (ABN) www.arcticbusinessnetwork.com •  Greenland Oil Industri Association (GOIA) www.goia.gl •  Greenland Representation in Copenhgen: Course for new employees in Greenland

•  Marked analysis * strategy * matchmaking of business * professional secretariat services Member of Greenland Research Council Bachelor of Political Science Maaster of Theology MBA study ongoing

Profile Inaluk 38

•  Professional experience in Greenland 2006-2015

•  Government of Greenland – Ministry of Labour and Education 2006-2009 •  Permagreen – HR manager 2009-2012 •  Greenlands Business School, High School and Navigation Centre - teacher /

examiner •  Manager at Focus - project management, reports and analysis, strategies,

professional secretary services, workshop and conference facilitation 2012-2015

•  Bachelor of Biology •  Master of Biology combined with Religious studies •  Associate’s degree – HR managemen

Content •  Historical background: Relationship Denmark-Greenland

•  Greenland

Political System Economy Business Structure & Sector Activities Labour Market, Educational Level & Working Culture Stakeholders Understanding Media Transportation Tendering processes and related policies

•  Opportunities and suggestions

Map of Greenland

Facts about Greenland – Kalaallit Nunaat

•  Population: Greenlaenders 56.000 inhabitants 88.9 % born in Greenland

11.1 % born outside Greenland

•  Acres 2,166,086 km2 •  46 Nationalities •  Part of the Danish Kingdom •  Official language Greenlandic •  No landclames – state owned land

Comparison of size

Historical background: Relationship between Denmark & Greenland

Historical important years for Greenland •  Islandic Settlements in South West Greenland (Wedding at Hwalsey 1401) •  Inuit cultures

•  1721 Norwegian Missionary Hans Egede settled in Nuuk •  1815 Norway left the Danish Kingdom •  1864 Denmark lost the war to Germany •  1920 Greenland on the agenda in DK •  1940-45 WW2 cut connection to Denmark and close relations with USA •  1953 Amended to th Danish Kingdom until that point a colony •  1960’s Danish Policies G50 & G60 •  1972 Member of EU •  1979 Greenland Home Rule •  1985 Exit EU •  2009 Selfgovernment – Greenland Government

Thule Air Base US Military Base Establishted 50’s Operation Blue Jay WW2 – Blue West Six Crash of B-52 (Jan 21, 1968) Nuclear missiles onboard •  providing missile warning •  space surveillance •  space control to North American Aerospace Defense Command (NORAD) & Air Force

Space Command (AFSPC). •  Thule Air Base is also home to the 821st Air Base Group and is responsible for air

base support within the Thule Defense Area for the multinational population of "Team Thule.”

Operator: until 2016 Greenland Contractors (DK) - from 2016 Excillis (US)

Foreign Policy & Arctic Ambassadør Foreign Policy is a Danish Matter Defence Policy is a Danish Matter Arctic Defence Command in Nuuk (Danish fleet is patroling boarders)

Erik Vilstrup Lorentzen (former Ambassadør to Denmark in Canada - Ottawa)

Debate: colony or not? •  Classic definition: slavery •  Greenland: not the case by that definition What was the Danish/ Norwegian interests?

Missionary interest Commerce Defence

TODAY: Global Arctic agenda

Greenland – rising independent nation

…but it takes a lot to get there

Political System

Parlamentarism

Government Naalakkersuisut Parliament Inatsisartut Greenlandic & Danish Court Danish Monach, Queen Margrethe II

Greenland Government today

•  Election NOV 28, 2014

•  Siumut, Demokraterne and Atassut signed a coalition agreement for the period 2014 - 2018

Ministries:

The Premier: Kim Kielsen

Political focus

•  Reforms to the Fishery Sector •  Plan for Business Development initiatives •  Educational system •  Social initiatives

•  Investment in infrastructure

Economy

Economy GDP 11,5 billions 2012 FISHERY export of schrimps, halibut, cod TOURISM adventure tourism, cruise tourism, extreme tourism (Air Iceland 3 destinations, 1-day visits from Akureiry,

Island, new potential flight operators) EXPLORATION activities related to exploration within licensees

(Minerals and Hydrocarbon) EU OLT-status – 300 mio DKK/ year GRANT 3,6 billions DKK/ year (fix numbers 2009)

Export

Public income

Dødens GAB figur

Public income – public spending

Action needed

MULTIPLIER Greenland is a small economy – level of activity in one sector affects other sectors very quickly ”Status quo is not an option”

Business Structur & Sector Activities

Business structur Greenlandic companies are registered at the GER-register: www.ger.gl Size and types of companies: •  Many small one-man-companies: 73 % •  Few large limited companies: 4,2 %

•  Private limited companies, funds, : 15 % •  Other: 7,8 %

Business sectors

Sectors by turnover

Employment according to sector

Public owned companies •  Air Greenland (37,5 %) •  Housing INI (100 %) •  KNI A/S (100 %) •  Royal Arctic Line (100 %) •  Royal Greenland (100 %) •  TELE-POST Greenland A/S (100 %) •  Mittarfeqarfiit/ Greenland Airports (Nettostyret) •  Nukissiorfiit/ Greenland Energy (Nettostyret)

•  Nunaminerals •  Nunaoil

•  Arctic Base Supply •  Asiaq

International/Danish brands and companies in Greenland - examples

Greenlandic companies - examples

Sectors on shore Onshore � Offshore

•  Commerce •  Building & Construction •  Repairs & Renovation •  Service sector •  Engineering •  Consultancy •  Transportation •  Tourism •  Mining

•  Fisheries •  Maritime sector

COMMERCE Intro: the largest sector by income Banking

Bank of Greenland Bank Nordic

Food stores

KNI - Pisiffik – Dagrofa (DK) Brugseni – (link to COOP in DK)

Shops

BUILDING AND CONSTRUCTION Intro:

�  depending on public spending �  only little private construction work �  a lot of old buildings in bad shape �  rising focus on use of materials for sustainable & Arctic

adjusted building materials Larger players:

Permagreen (Greenlandic) Atcon (Greenlandic) Aarsleff (DK headquater) Adserballe (DK headquater) MTHøjgaard (DK headquater) Istak (Island based company)

REPAIR & RENOVATION Intro: ▫  many smaller companies are specialised for repairing and renovating ▫  depending on public spending ▫  shift in size of renovation assignments gives new players space ▫  rising focus on use of materials for sustainable Arctic adjusted building

materials

Buildings Machinery Cars

SERVICE SECTOR

Facility service Catering Cleaning

ENGINEERING Intro ▫  depending on public spending ▫  huge demand for engineering work & new management areas �  rising focus on use of materials for sustainable Arctic adjusted building

materials

CONSULTANCY Intro: local experts – some with partners &/or headquater in DK

Legal advise Economic advise Consultancy

TRANSPORTATON Infrastructure in remote areas… Large public operators:

Royal Arctic Line (goods) Air Greenland (persons and goods) Arctic Umiaq Line (persons)

Small scale private operators:

Blue Ice – South Greenland Martek – Nuuk ABC Charter – Nuuk Ilulissat Water taxi

Consession 2006-2022 Transportaion of goods until 2022 (RAL & Port of Aalborg, DK) •  Public service routes – not open for competition (Air Greenland) •  Open routes by air and by water – a few possibilities •  What happens in 2022?

Tourism Facts Potentials

Tourism numbers: 37.160 (2013)

•  Increase numbers of tourists

•  Increased marketing & branding •  Connection of air ports and habours •  Legal matters

•  Connections from new destinations •  Focus on investment

•  Education and professionalism

Where do tourists go?

Mining Current status Potentials

1854 Mining nation (Kryolit, Zink, Lead) 2015 Current status 40 companies (mostly Canadian & Australian junior mining companies) True North Gems Ruby Mine Tandbreez Rare earth Elements GME Rare earth Elements with Uranium Hudson Ressources Rare earth Elemen Ironbark Zink-Lead North American Nickel Nunaminerals

Increase of explorationlicenses 4500 estimated workspaces Challenges: Young adminisration Small group of experts Early fases of exoploration INVESTMENTS

Expenditure on mining exploration

Employement potentials

Fisheries Industry

Interest organisation: Greenland Business Association (GA)

Polar Seafood Royal Greenland Upernavik Seafood Polar Raajat Greenland Halibut

Interest organisation: KNAPK Topics of the agenda:

Quotas Seafood buyer

Classic debate:

Inshore (small fishermen) contra Offfshore (large trawlers)

Fishermen

Need of reforms Fishery Reform

•  Several attempts since 2009 – modernisation needed

•  Ownership (investments) •  Switch of generations

•  Challenges: •  Stable workforce •  New technologies needed

MSC certification Small fishermen more effective Focus on development:

Water use Reduction of energy use Disposal of waste Reduction of use of paper, plastic etc Reduction fo chemicals High quality products

Potentials

Farming

Potentials

South Greenland Sheep farmers Small scale production

Market interest hight for products Agro-turismus Challenges: Knowledge limited Infrastructure Stable supply Legal matters

Oil Exploration DONG Statoil Conocophilips ENI BP Husk Energy Cairn Energy Shell Nunaoil Maersk Oil Chevron Greenpex Tullow Oil

Expenditure on oilexploration

Maritime Sector Current description Potentials

•  Shipyards in larger towns

•  Arctic competences

Sailing routes to the NW and NE Polar Code Education – Greenland Maritime Center, Nuuk

Greenland Business Association - GA

•  Established 1966 by building and construction companies •  Since 1995 open for all kind of business •  9 branches •  350-400 members all over Greenland

•  Political influence – lobbying •  Negotiating agreements •  Legal advise for members •  Business Development

MEMBERSHIP: member or associated member

Greenland Business Association - GA

Official business strategies Naalakkersuisuts strategies:

Natural Ressources Strategy 2014-2018 Employment Strategy 2012-2017 National Tourismstrategy 2012-2015 New government coalition agreement 2014-2018 -  Infrastructure initiatives, development of fisheries, investments -  Generel business plan

Report on stronger collaboration between Danish and Greenlandic Companies Published Feb 4, 2015

Key focus areas: Potentials within mining and tourism Critics: lack of focus on exsisting businesses

Barrieres:

Legal adjustments Investments and finance adjustments Stronger collaboration

Public Business Development support

•  Regional Development Strategy (RUS) •  Economic support •  Public Business Counciling: ▫  Greenland Business ▫  Greenland Venture ▫  Visit Greenland ▫  Greenland Petroleum Services on a service contract ▫  Municipalities have local business councils for entreperneuers

Private business development initiatives

•  Preparations for potential rising mineral and oil-gas sector: course, education, ISO, Achilles, konferences and trade shows in and outside Greenland

•  Co-operations: joint ventures, partnerships

•  Network & clusters: international perspective ▫  www.arcticbusinessnetwork.com ▫  www.acrm.dk

“Growth and welfare – scenarios for the development of Greenland”

A few of the many questions the conference will seek to answer, are: ·         How do we set realistic goals for the development of society? ·         What will Greenland live on in the coming years? ·         How should we cooperate with Denmark – and the rest of the world? ·         How can we make Greenland an attractive country to invest in?

www.futuregreenland.gl

B2B-meetings May 5th

Speakers

Labour Marked Educational Level Working Culture

Employers & Employees organisations •  Associations: ▫  Grønlands Arbejdsgiverforening (GA) www.ga.gl ▫  Nusuka www.nusuka.gl

•  Unions: ▫  Sygeplejersker: Peqqissaasut Kattuffiat www.pk.gl ▫  Faglærte/ufaglærtes organisation: SIK www.sik.gl ▫  Lærerforbundet: IMAK www.imka.gl ▫  Finansforbundet ▫  NB: DJØF repræsentant ▫  Bat-kartellet www.batkartellet.dk ▫  Lægekredsforeningen www.lkf.gl ▫  Tjenestemændenes sammenslutning www.ak.gl ▫  Akademikernes sammenslutning www.asg.gl ▫  Fiskere og fangere: KNAPK www.knapk.gl

Public regulator

Greenland Government has responsibility of securing •  Employment initiatives • Workforce coming from abroad

Labour Market initiatives •  PKU: projekt kompetenceudvikling for ufaglærte

•  ILO: Internationale Arbejdskonvention

•  Handlingsplan for ledige 2012-2015

•  Vejlednings- og opkvalificeringscentre: Piareersafik

•  Udefrakommende arbejdskraft

•  Mobilitetsfremmende ydelser

Employement by sector

Working force

Working force without jobs

Greenlandic Working Culture

Generel approach: Bi-langual working culture Note:

The official language is Greenlandic, but you have to know how to manouvre in both the Greenlandic & the Danish culture. Especially if you look for partners in Greenland via Danish companies. English is emerging but still not dominant as in Island.

Understanding Media

Media in Greenland Online and printed news www.sermitsiaq.ag National Broadcasting Company KNR www.knr.gl Local stations e.g. Nuuk TV ww.nuuktv.gl

1.  Easy to influence the agenda – but no long debate 2.  Facebook reactions like elsewhere 3.  Important source – oppinions are formed by these media 4.  Ressourcer, deadlines, number of journalists

English media on Greenland

Professional media surveillance services

Marketing possibilities

Greenlandic Journalism Education: Bachelor degree at Ilisimatusarfik – University of Greenland All news have to be in both Greenlandic and Danish Language is a central tool in the general nation building process for Greenland Challenge is ressources – both money, personel, competences New PhD Naimah Hussain to study media in Greenland

Stakeholders in general

Government Parliament

Administration

Municipalities

Business Educational Institutions

Society

Municipalities

Qaasuitsup Kommunia

Northern Region

Qeqatta Kommunia

Middle Region

Kommuneqarfik Sermersooq

Vest & East Region

Kommune Kujalleq

South Region

Educational Institutions •  Ilisimatusarfik – University of Greenland (Nuuk) •  Artek – Arctic Engineers (DTU) – (Sisimiut+ Copenhagen) •  Sanilin - Mining School (Sisimiut) •  Business School (Nuuk, Qaqortoq) •  Technical School (Nuuk) •  Greenland Maritime Center (Nuuk) •  Leader Academy (Nuuk) •  Gymnasium (Aasiaat, Nuuk, Qaqortoq) •  Food Technology School (Narsaq) •  Social Education Collage (Ilulissat) •  Fisherman and hunters School (Uummannaq) •  Building and construction School, (Sisimiut og Nuuk) •  Iron and Metal School, Nuuk (er i dag slået sammen med bygge og anlægsskolen

under navnet kti), •  Art School (Nuuk) •  Acting School (Nuuk) •  Language School (Sisimiut) •  Nurses School (Nuuk)

Society – NGO’s •  ICC •  AVALAK • WWF •  Social focus:

▫  Foreningen Grønlandske Børn ▫  Red Cross ▫  Red Barnet ▫  Bedre Børneliv ▫  MIO

•  Transparency Greenland •  CSR Greenland

CSR Greenland: www.csr.gl

CSR Greenland blev stiftet i oktober 2010, mange vidste bare ikke at det hed CSR, dét som virksomhederne gjorde. Sagt enkelt så handler det om, at virksomheder ikke kan få succes, hvis samfundet ikke udvikler sig positivt. Samtidig har et samfund brug for succesfulde virksomheder for at sikre vækst og udvikling. Med andre ord handler CSR om at løfte i flok til gavn for alle. Motivationen var at adressere de store sociale udfordringer i Grønland, at få skabt gode og nyttige partnerskaber og dialoger på tværs af sektorer, og at forberede Grønlands erhvervsliv på at arbejde med de CSR-krav, som stilles til virksomheder, der gerne vil være leverandører til en begyndende råstofsektor CSR Greenland har fokus på At skabe opmærksom omkring CSR-dagsorden og-CSR temaer At opbygge kompetence i virksomheden omkring CSR i Grønland gennem kurser, At skabe et fora for erfaringsudveksling gennem netværk

How CSR is part of the work?

•  Spring clean up event – Cross Contry •  Sustainability focus in general •  Health at work •  Voluntary work

•  Growing number of companies with policies •  Financial Statements – include CSR

Transparency Greenland

• www.transparency.gl

Transparency International Greenland initiativ working on preventing corruption, informing and encourage to work in a more transparent way: “Korruption er misbrug af betroet myndighed for egen vindings skyld. Det skader alle, hvis liv, forsørgelse og lykke afhænger af integriteten hos mennesker i en autoritetsposition”

Qujanaq