Greenland’s freshwater reserves are ‘frozen capital’ as water becomes security issue

Water is a finite resource and is increasingly a national security issue, analysts told CNBC.

Water demand is expected to exceed supply By up to 40% in 2030, according to a 2023 landmark report on water economics. At the same time, climate change is affecting weather patterns, and areas once abundant with water become dry. As a result, more water needs to be transported to ensure access.

Fresh water is used for everything from manufacturing to agriculture, and demand for it is expected to increase as the population grows Hungry AI data centers are built.

With water increasingly viewed as a strategic asset, market watchers are looking to Greenland’s freshwater reserves as a potential resource. The Danish territories themselves have recognized the strategic potential and have long looked to capitalize on the assets.

“The possibilities for access to water are multiple, as clean fresh water can be used as drinking water and water for food production, for example, but also as bulk water for factories and farms or to contribute to bulk water supplies,” according to a statement issued by the Greenlandic government on it. Website. “There are many possibilities.” CNBC has reached out to officials in Greenland for further comment.

Resource nationalism He said it had become a “defining” geopolitical play – and that included water. “So water has inherently become a strategic asset.”

“In my view, right now, countries that don’t have it as a strategic asset are better off in the long run” because it forces them to innovate, Ramos added. He pointed to the Middle East and its investments in technologies such as desalination, which turns seawater into drinking water, and Israel, which recycles most of its water.

The United States, South America and Canada have historically had an abundance of water but are facing new levels of water stress, putting them in a difficult position, Ramos said.

It is certain that half the world’s population experiences water scarcity for at least one month per year, casting doubt on public health and food security. It is worth noting that China Strengthening water infrastructure. investment To reach about $182 billion alone in 2025 As part of the country’s national water network strategy, according to a government statement. The Eastern Power suffers from an unequal distribution of water, as is the case in the United States. The United States has its own water strategy, while the European Commission has its own water strategy She instigated a “water resilience” plan..

“Greenland’s freshwater reserves are enormous 10% of all reserves on Earth“It can mostly be understood as frozen capital, not readily available supplies,” Nick Kraft, senior water, agriculture and responsible investment analyst at Eurasia Group, told CNBC.

“Greenland’s water is a strategic asset and a niche business opportunity, but it is not a practical near-term solution to global water pressure or demand,” he said.

However, some hope to tap into the meltwater as climate change accelerates. Notably, Arctic Water Bank, a startup, plans to do just that Build a dam to capture meltwater And exported internationally. It is unclear what happened to the company, but no dam was built. Another company, Inland Ice, bottles it as high-purity drinking water, Kraft said. Five companies You currently have active licenses for 20 yearsincluding the Greenland Water Bank, which is He is said to be related to Ronald LauderBillionaire Estée Lauder heir.

“The authorities have put forward ambitious proposals such as building a dam to export water,” Kraft said. “But the real-world record is clear: what has actually happened so far has been small, niche exports, while many larger export ideas have been widely announced and then stalled.”

Exporting water is not easy because of its weight, Eric Swingedo, a University of Manchester professor who covers the intersection of resources and governance, told CNBC.

“The cost is enormous,” he said. “There have been attempts to transfer water in large quantities [overseas]; “None of them were viable in any way.”

It is common to transport water by land, whether via canal systems or massive infrastructure networks. However, they have been shipped in emergency situations, notably to Barcelona in 2008 and 2024 during a severe drought.

“In reality, it is very difficult to make money from water – very difficult,” Swingedo said. “Despite 20 years of attempts to privatize water, it has not had much success.”

While some of the geopolitical tensions relate to water Conflicts — China plans to build the largest dam in the world He raised concerns about India and Bangladesh, for example – Swingedo said friction within the countries was likely to arise due to unequal distribution of water.

He added: “I am sure that part of the ongoing uprising in Iran has to do with the massive drought that Iran has been experiencing for some time, and it makes life in Iran very difficult.”

The country is It is experiencing its sixth year of droughtSome cities face regular interruptions in access to water.

When asked if it was in the government’s interest to secure water resources to prevent civil unrest, Swingido said, “Not all states are the same.”

“So the Iranian state has systematically neglected to provide these basic infrastructures, with the consequences that we know of, and they have done so for geopolitical reasons. They are putting all their money in the military, and that is the choice they had originally,” he added.

Swingedo called on governments to focus more on water provision as a public service.

“Water is increasingly being treated as a strategic asset – closer to critical infrastructure than a commodity – as climate variability and demand growth turn water insecurity into a national security issue,” Kraft added. “This will likely bring more headlines about water’s export potential, but I don’t think there is anything substantive.” [will] Change until the end of the contract.”

“Even if Greenland’s fresh water is not being exported on a large scale anytime soon, it is still of geopolitical importance.”