Undersized: Could Greenland be the newIceland? Should it be?
As Greenland moves away from Denmark and acquires more autonomy, this column asks whether it might be too small. In assessing the relationship between country size and economic performance, it warns that small states have more volatile GDP, more volatile consumption, and more incompetent civil servants.
Greenland’s population of about 60,000 make it as about the same size as Bismarck, North Dakota. It is blessed with natural resources such as rich deposits of minerals, and oil and gas reserves are believed to lie below its ice cap. It is protective of both its fishing industry and its long tradition of killing appealing marinemammals. Greenlandic, an Eskimo-Aleut language, is spoken by few outside its borders.On 1 May 1979, this miniscule country began its move toward autonomy when the Danish parliamentgranted Greenland home rule. Greenland swiftly distanced itself from Europe by exiting the EU in 1985 – the only country ever to have done so. The goal was to avoid the EU’s Common Fishery Policy (the ban onseal skin products also played a role). Greenlanders approved a referendum on greater autonomy on 25 November 2008 and on 21 Jun 2009 Greenland expanded its sovereignty by assuming authority over its judiciary, policing, and natural resources, leaving only finances and foreign affairs in Danish hands. TheDanish queen attended a celebration at the parliament in Nuuk, and Greenlandic became the country’sofficial language.
Can a country be too small?
Although it is not yet heavily involved in international banking, Greenland’s progression towardindependent statehood is strikingly reminiscent of Iceland’s experience (especially its desire to maintain itsown culture and protect its natural resources at the cost of isolation from the rest of the world and its wish tolimit its economic relationship with Europe). This raises questions – does the recent experience of Icelandsuggest that a country can be
small to be a nation state, and what are the costs and benefits of beingisolated from the rest of the world?The answer to these questions is relevant not only for Iceland and Greenland but also other tiny countriesthat have gained sovereignty in recent decades; since 1990, 33 new countries have been formed and, as seenin Figure 1, many are very small.
. Country size (population in millions)