Trump and Greenland
So, just how do you set about buying another country? And is it a good idea?
Donald Trump is reportedly considering buying Greenland from the Danish government, but would such a purchase be possible?
The 850,000 sq mile land mass has a population of just 55,877, equivalent to the Worcestershire town of Kidderminster.
However, its rich resources make it ideal for mining oil and minerals, while its location in the north of the Atlantic Ocean is highly strategic.
Can you even buy a country?
The purchase of Greenland would be complicated by its political standing. The country is part of the Kingdom of Denmark but has its own government, manages all internal affairs and retains any money generated from the mining of its resources. The Danish government is responsible for foreign affairs and defence.
Any deal is likely to cost the American government billions of dollars, although it is unclear how an outright purchase would be structured. The agreement of both the Danish and Greenlandic governments would likely be required.
Experts believe a more likely outcome is that the American government will agree to an extensive investment programme in the island to secure it as a military base and exploit its natural resources.
Rod Mcillree of Bluejay Mining, which operates in Greenland, said: “Any deal needs to be inclusive of what the Greenlanders want, and the only way I see the mechanics of this working is through massive infrastructure developments. It is hard to understand how the mechanics of purchasing Greenland outright would work.”
Is it a good time to invest in Greenland?
The growing involvement of the US could signal a boom in the country’s economy. Mark Bilsland, of Greenland Gas and Oil, which owns the largest oil concession on the island, said: “It is an attractive country because of its onshore mining potential.
“If it were to come to pass, it’s going to be great news for companies in Greenland.”
A handful of companies that operate in Greenland are listed on stock markets around the world, although investment in small private companies carries considerable risk.
Investors may prefer to put cash into more general funds that invest in mining or oil and gas, as increased production in the country could boost the wider sector.
Has anyone ever bought a country before?
While transfers of land on this scale are relatively uncommon, the short history of the US is littered with purchases from other countries.
Legend has it that when Dutch traders first landed in what is now New York in the 17th century, they bought Manhattan for $24 from native tribes. The exact price was 60 guilders, which in today’s money is nearer $1,000.
In 1803, America purchased Louisiana from France for $15m and in 1819 acquired Florida from Spain.
In the Mexican Cession of 1848, the United States paid $15m to its neighbour for what is now California, followed by $10m to purchase parts of Arizona and New Mexico. In 1867 it bought Alaska from Russia for $7.2m.
Its most recent purchase was in 1917, when it snapped up the Danish Virgin Islands for $25m in gold.
Can I buy a country?
Individuals can also purchase land and many multimillionaires choose to buy their own islands. Perhaps the most famous person to do so is Richard Branson, who purchased Necker Island, part of the British Virgin Islands, in 1978.
Many nations offer whole islands for sale, such as the Central American country of Belize, which markets its islands to overseas investors. Smaller islands are available for about $100,000, with prices rising to more than $20m for the most desirable locations.
However, in each case the island remains under the jurisdiction of the country’s government, with land owners expected to adhere to local laws and pay taxes.
For the people of Greenland, extensive investment by the US could see the island transformed.
Bilsland said: “It’s a fairly sleepy place. Nuuk, the capital, has a population of about 20,000, which is the size of a very small town in the UK.
“But if Trump buys Greenland, he will want to make something of it. They’d want to see a return for it and make its resources work harder.”