Greenlandic economy - Economic growth halted and growing government deficit

Analysis - November 2020 - No. 23

Authors Bjerregaard, Søren
Subject Greenlandic economy; Other countries; International Economy; Other economic analyses
Type Analysis
Year 2020
Published 12 November 2020
The coronavirus pandemic has ended years of solid growth. Travel restrictions have left their mark on tourism and other sectors heavily reliant on foreign visitors. The important fisheries industry is less affected by the global economic downturn, and fisheries risks are particularly associated with lower fish and shellfish prices in the world market. Additional expenditure related to emergency flights, relief packages, etc. is putting a strain on central government finances. Therefore, the outlook is for an increase in government debt, albeit from a low level. For a number of years, growth in public consumption has exceeded budgeted levels. To ensure a sustainable balance between government revenue and expenditure, public sector efficiency measures will be needed going forward.