2019-08-24 The Economist Latin America

40 Europe The EconomistAugust 24th 2019

2 6%.Thatcouldyieldanuncompromising-

lyright-wing,nativist,Euroscepticgovern-

mentwithMrSalviniatitshelm.

AlthougheuofficialsseetheLeague’s

economic policies as marginally better

thanthose ofthem 5 s, it is“considered

worseforeverythingelse”,saysMujtaba

RahmanoftheEurasiaGroup,a consultan-

cy.TheLeagueopposeshumanitarianef-

fortstorescuemigrantscrossingtheMedi-

terranean.ItisclosetoRussia(oneofMr

Salvini’sassociateswasrecentlycaughton

tape discussing funding from Kremlin-

friendlyoilinterests).Anditisopposedto

theeurozone’s3%caponbudgetdeficits.

MrSalvinihaspromisedthat,if elected,he

willintroducebigtaxcutsinanattemptto

revive Italy’s stagnantgrowth.With Eu-

rope’seconomyslowing,a no-dealBrexit

loominganda newcommissionjustenter-

ingoffice,a victoryfortheLeaguecouldbe

a perfectstormfortheeu. Marketsmaybe

sanguine, but Italy’s politics could yet

wreakhavocintheeurozone. 7

M

ost danesthought it was a joke when

Preisdent Donald Trump said Ameri-

ca might buy Greenland, a self-governing

island that forms 98% of Danish territory.

Denmark’s prime minister, Mette Frederik-

sen, dismissed the idea as “absurd”. When

Mr Trump reacted by calling her “nasty”

and cancelling a visit to Copenhagen, his

would-be hosts were stunned. But many

Greenlanders were not.

“I knew from the start this was to be tak-

en seriously,” says Aleqa Hammond, a for-

mer prime minister of Greenland. It was

not the first time an American president

had suggested such a purchase. In 1946

Harry Truman offered $100m for Green-

land ($1.3bn in today’s money).

Today the island has only 57,000 inhab-

itants, yet it is of growing strategic impor-

tance, as Russian submarines reappear in

the Arctic and China dreams of a “polar silk

route” through newly ice-free seas. Den-

mark is responsible for Greenland’s exter-

nal affairs and defence. natomembership

once allowed Greenlanders to sleep easy,

but since Mr Trump has undermined that

alliance, their security is less certain.

Greenland’s feisty legislators, including

Kim Kielsen, the current prime minister,

all agree that the island’s sovereignty is not

for sale. But they are flattered that outsid-

ers are interested, and insist on their right

to parley with all comers. As Ms Hammond

says: “If Mr Trump wants to discuss Green-

land, let him come here, not to Denmark.”

As Mr Trump observed, Danish taxpay-

ers send Greenland more than $600m a

year in subsidies. But that dependence

does not deter the island’s politicians from

pursuing their own bargains. Last year Mr

Kielsen found Chinese contractors for an

upgrade to the island’s airports. That terri-

fied nato, and Denmark pressed Green-

land to find Danish contractors instead.

One of the parties in Mr Kielsen’s coalition

marched out in protest. Greenlanders who

want independence say that widening the

range of economic partners could wean

them off Danish aid.

Aqqaluk Lynge, a veteran leftist, said the

spat with Mr Trump might make Danes and

Greenlanders appreciate one another

more. It might, for example, remind Danes

who moan about subsidising their Arctic

cousins not to take them for granted.

Today Greenland exports mostly sea-

food. When Mr Trump joked that he did not

want to build a skyscraper with his name

on it in Greenland (see picture), he was

surely telling the truth. The real economic

opportunity is that vanishing glaciers are

opening up its mineral resources, includ-

ing rare earths and possibly oil and gas. Mi-

nik Rosing, a Greenland-born geologist,

noted the irony in a man who once called

global warming a “hoax” coveting territory

that owes its rising value to melting snows.

Yet he also thinks a more tactful American

leader might persuade Greenlanders to up-

grade their links with the United States at

the expense of their Danish ones.

Perhaps. But were they ever to decide to

become part of America, which for now

seems highly unlikely, they would get a

culture shock. Not only do Greenlanders

have Nordic ideas about social welfare;

they also ban private ownership of land. 7

How Greenlanders feel about Donald

Trump’s talk of buying their land

Presidential rudeness

Arctic antics

It ain’t easy being Greenland

V

ital almeidais on the hunt for work-

ers. The boss of Ciclo Fapril, a firm that

makes metal components for foreign

manufacturers, needs to hire 200 staff by

the end of the year to meet new orders. But

luring workers—even unskilled ones—to

Agueda, a rural town in central Portugal, is

proving difficult. To attract more, he is run-

ning open days, setting up internships and

building relationships with local schools.

This is a far cry from the state of affairs

just over a decade ago, when the global fi-

nancial crisis struck. Many of Mr Almeida’s

neighbours, also metal-bashers, were

forced to close down. He weathered the

drought by closing the factory on Friday af-

ternoons and freezing pay.

As southern Europe was racked by the

crisis, joblessness rose dramatically. Un-

employment rates in Spain and Greece ex-

ceeded 25%; youth rates neared 60% (see

chart). Populations shrank as many left

home in search of better fortunes abroad.

These trends have reversed since 2015,

when economic recovery took hold. In the

euro area nearly 8m jobs have been created,

one for every 20 adults of working age. The

unemployment rate has returned to pre-

crisis levels, even as the pool of available

workers has grown. Older people are work-

ing longer: nearly two-thirds of 55- to 64-

year-olds in the euro zone are in the labour

market, compared with less than half in

2007. In southern Europe, net migration
      has turned positive.
      Even so, the labour-market recovery in
      the south has further to go. Unemployment
      rates are above pre-crisis levels in Greece,
      Italy and Spain; youth rates are still
      30-40%. Part of the explanation is anaemic
      economic growth. In Greece and Italy, out-
      put is still below pre-crisis peaks.
      But in Spain, despite an impressive eco-
      nomic recovery, 1m more people are still
      out of work than in 2008. Comparisons
      with the years immediately before the cri-
      sis are tricky, because Spain was enjoying a
      construction boom and unemployment
      may have been unsustainably low. But
      Marcel Jansen of Fedea, a think-tank in Ma-
      drid, also points the finger at under-
      performing job centres and schools.
      Nearly 40% of Spain’s unemployed
      have been jobless for over a year, and need
      well-designed programmes to get them
      back into work. But the country’s employ-
      ment services are run by regional authori-
      ties with little central co-ordination. In

AGUEDA AND MADRID

Why southern Europe’s labour markets

are still fragile

European unemployment

Work in progress

1