March 27, 2018 / 8:15 PM / a month ago

Greenland shortlists Chinese company for airport construction despite Denmark's concerns

COPENHAGEN (Reuters) - Greenland’s state-owned Kalaallit Airports has shortlisted a Chinese construction company to help expand three airports despite concerns in the Danish government that Chinese involvement could upset its ally, the United States.

Kalaallit Airports said in a statement China Communications Construction Company (CCCC) had been shortlisted for the project with five other companies or consortiums - from the Netherlands, Canada, Iceland and two from Denmark.

Greenland is a self-ruling part of the Kingdom of Denmark.

The bidders had been selected based on their financial capacity as well as their technical and professional competence and their experiences with operating under conditions like the ones in Greenland, the company said.

It was not immediately available for further comment.

After the longlist had been made public, a high-ranking Danish government official in Copenhagen told Reuters on condition of anonymity: “We are deeply concerned. China has no business in Greenland.”

“Denmark has a big responsibility to live up to with regards to our closest ally, the United States,” the person said.

A defence treaty between Denmark and the United States dating back to 1951 gives the U.S. military almost unlimited rights in Greenland, the site of the Thule air base.

The air base, located 1,200 km (750 miles) north of the Arctic Circle, includes a radar station that is part of a U.S. ballistic missile early warning system.

In 2016, the Danish government on direct orders from Washington prevented a Chinese investor from buying a former marine station in southern Greenland, according to sources.

Greenland is strategically important for the U.S. military as the shortest route from North America to Europe goes via the Arctic island.

Chinese interest in Greenland comes after Beijing in January laid out ambitions to form a “Polar Silk Road” by developing shipping lanes opened up by global warming and encouraging enterprises to build infrastructure in the Arctic.

Beijing Construction Engineering Group (BCEG) [BJCEG.UL], which was among the 11 groups that had shown interest in the 3.6 billion Danish crowns ($595 million) project, has not been shortlisted.

The contract for work on two of the airport projects, in the capital Nuuk and the tourist hub in Ilulissat, will be awarded by the middle of the year. The third project, at Qaqortoq in southern Greenland, to allow direct flights from Europe and North America, be will awarded next year.

Reporting by Teis Jensen; Editing by Alison Williams

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