EXPORT AND IMPORT QUOTAS
Figure 1 shows the import and export quotas.
Figure 1
Development in the Export and Import Quotas of Greenland
Source: Statistics Greenland
The ratios are calculated as the exports and imports relative to the gross domestic product (GDP). The level of the quotas is a measure of the dependence of Greenland on the outside world. Greenland has a unilateral production and a diversified demand. Therefore intensive trade with the outside world is necessary.
Up until 1990, the export quota was at around 45 per cent. Since then the export quota has been gradually reduced and in 2007 it was at approximately 17 per cent. The declining export quota is due to a growing production and falling shrimp prices, shrimp being the most important export article of Greenland.
The import quota was high up until 1985 in which year it reached a climax of 72 per cent. The quota then decreased until 2001. Up until 1985, the high import quota was partially due to major investment programs and inflated oil prices on world markets. The first oil crisis in 1973-1974 increased world market prices on crude oil by several hundred per cent within a few days. In 1970-1980 when the second oil crisis occurred, the prices rose again. This meant that the oil-dependent countries without oil production saw a sudden shift in the import value of oil despite a stable consumption of oil. After 1985 the declining import quota is primarily due to a slowdown of the domestic activity but also to the creation of Nuuk Imeq Ltd, a local producer of drinks.
Import and Export Key Figures
Apart from fishing and catch-related production, only few goods are produced in Greenland. As a consequence all goods used for consumption in households, businesses, and institutions are imported.
Figure 2
Imports by Goods Category in 2009
Note: The figures for 2008 are provisional.
Source: Statistics Greenland
Imports by goods category can be seen in Figure 2. The majority of goods, almost 67 per cent, is imported from Denmark. Goods from other countries also figure in the total imports from Denmark, however. More details on imports by country can be found in Table 3.
The majority of the exports of Greenland consists of fish and shellfish amounting to 88 per cent. This unilateral export structure renders the economy particularly dependent on international price developments. In recent years, gold and olivine have begun to be of some importance to the exports of Greenland.
Figure 3
Exports by Goods Category in 2009
Note: The figures for 2009 are provisional.
Source: Statistics Greenland
In 2009, the total exports to Denmark amounted to 87 per cent. A significant proportion of the exports of fish and shellfish went to Denmark for further processing and subsequent export to other countries, primarily Japan and Great Britain.
Figure 4
Development in Exports of Unshelled Shrimp by Amount and Average Price. 1981=100
Note: The figures for 2006, 2007, 2008, and 2009 are provisional.
Source: Statistics Greenland
Figure 5
Development in Exports of Shelled Shrimp by Amount and Average Price. 1981=100
Note: The figures for 2006, 2007, 2008, and 2009 are provisional.
Source: Statistics Greenland
The development in the index values for the average price per kilo and the volume of exports of unshelled and shelled shrimp respectively is shown in Figures 4 and 5, 1981 being index 100.
The price for unshelled shrimp has fallen considerably after 1989, approximately 75 per cent. The amounts of shrimp have risen by 223 per cent since 1981.
The price for shelled shrimp has undergone more steady decrease, particularly since 1990. This is mainly due to the catch of Iceland at Flemish Cap; these shrimps were sold at low prices so that the world market price on shrimp dipped in 1994. Conversely, the quantities have risen by 458 per cent since 1981.
International Comparisons
Figure 6 shows that Greenland is heavily dependent on imports from the outside world just as the other Nordic countries. Greenland is in line with the Faroe Islands and has an import quota of about 55 per cent. The high ratio of Iceland is strongly linked to the boom which the country experienced in 2005. Norway has the lowest import quota which is explained by its access to oil resources.
Figure 6
Import Quotas for the Nordic Countries in 2005
Sources: Statistics Denmark and Statistics Greenland
Figure 7
Deficits and Surpluses on the Balance of Payments in the Nordic Countries in 2006
Source: Statistics Greenland
Figure 7 shows the balance of payments in a number of Nordic countries in 2006. All the listed countries have a surplus on the balance of payments except Iceland. Greenland has a significant surplus compared to the other Nordic countries, which is mainly caused by the current transfer incomes. Without these - especially the block grant - there would have been a significant deficit on the balance of payments.