Greenland’s freshwater reserves are ‘frozen capital’ as water turns into safety subject

Water is a finite useful resource — and more and more a nationwide safety subject, analysts informed CNBC. 

Water demand is predicted to outpace provide by as a lot as 40% in 2030, based on a 2023 landmark report on the economics of water. On the similar time, local weather change is affecting climate patterns and as soon as water-abundant areas are working dry. Because of this, extra water must be moved round to make sure entry.

Freshwater is utilized in every thing from manufacturing to agriculture, and demand is ready to extend because the inhabitants grows and thirsty AI information facilities are constructed.

As water is more and more seen as a strategic asset, market watchers wish to Greenland’s freshwater reserves as a possible useful resource. The Danish territory has itself acknowledged the strategic potential and has lengthy regarded to capitalize on the asset.

“The potential for water is manifold, since clear, contemporary water can be utilized as ingesting water and water for meals manufacturing, for instance, but in addition as bulk water for factories, farms or a contribution to bulk water provide,” based on a press release from the federal government of Greenland on its web site. “There are lots of potentialities.” CNBC reached out to Greenland officers for additional remark.

Solely about 3% of the world’s water is freshwater, offering the premise for appropriate ingesting water, and a good smaller quantity of that may be readily accessed.

“Traditionally we’ve simply continued to drill down water tables deeper and deeper, however now we’re on the level the place the aquifers can not replenish themselves. It takes a very long time for the floor water to percolate down,” stated Noah Ramos, an analyst who covers innovation at Alpine Macro with experience in water expertise. He added that merely drilling deeper can now not be “relied on.” 

Useful resource nationalism has grow to be a “defining” geopolitical play, he stated — and that features water. “So water has inherently grow to be a strategic asset.”

“In my opinion, proper now, the nations that do not have it as a strategic asset are higher positioned in the long term” as a result of it forces them to innovate, Ramos added. He pointed to the Center East and its funding in applied sciences like desalination, which converts seawater into ingesting water, and Israel, which recycles most of its water. 

The US, South America, and Canada have traditionally had ample water however are going through new ranges of water stress, placing them in a sticky place, Ramos stated. 

To make certain, half of the world’s inhabitants experiences water shortage for at the least one month a 12 months, throwing public well being and meals safety into query. Notably, China is bolstering its water infrastructure. Funding hit round $182 billion alone in 2025 as a part of the nation’s Nationwide Water Community technique, per a authorities launch. The jap energy has uneven distribution of water, as does the U.S. The U.S. has its personal water technique, whereas the European Fee has instigated a “water resilience” plan. 

Nearly all of the world’s freshwater is locked up in glaciers and ice caps, primarily in Antarctica and Greenland; every year as much as 300 billion tons of water soften from the Greenlandic ice sheet, per the territory’s authorities.

“Greenland’s freshwater reserves, an enormous 10% of all reserves discovered on Earth, can largely be understood as frozen capital, not a available provide,” Nick Kraft, senior analyst engaged on water, agriculture and accountable investing at Eurasia Group, informed CNBC.

“Greenland’s water is a strategic asset and a distinct segment enterprise alternative, however it’s not a sensible near-term repair for world water stress or demand,” he stated. 

Nonetheless, some are hoping to capitalize on the meltwater as local weather change accelerates. Notably, Arctic Water Financial institution, a startup, deliberate to construct a dam to seize meltwater and export it internationally. It’s unclear what occurred to the corporate, however no dam has been constructed. A distinct firm, Inland Ice, bottles it as premium high-purity ingesting water, to Kraft’s level. 5 companies at the moment have energetic 20-year licenses, together with Greenland Water Financial institution, which is reportedly related to Ronald Lauder, the billionaire Estée Lauder inheritor.

“Authorities have entertained proposals as bold as constructing a dam for water export,” Kraft stated. “However the real-world monitor file is telling: what’s really occurred to this point has been small, premium boutique exports, whereas many larger export-at-scale concepts have been introduced after which stalled.”

Exporting water is not simple resulting from its weight, Erik Swyngedouw, a College of Manchester professor who covers the intersection of sources and governance, informed CNBC. 

“The associated fee is gigantic,” he stated. “There have been makes an attempt to bulk water transport [overseas]; none of them have been viable in any form of method.”

It’s common to maneuver water by land, be it by way of canal programs or large infrastructure networks. Nevertheless, it has been shipped in emergency conditions, notably to Barcelona in 2008 and 2024 throughout extreme drought.

“It is really extraordinarily tough to earn a living from water — very, very tough. Regardless of 20 years of makes an attempt to denationalise water, it has not been an important success,” Swyngedouw stated. 

Whereas some geopolitical tensions have concerned water disputes — China’s plans for the world’s largest dam sparked considerations from India and Bangladesh, for example — Swyngedouw stated it’s extra doubtless that intra-state frictions would come up because of the inequitable distribution of water. 

“I am certain that a part of the rebellion that is occurring in Iran has to do with the large drought that has been occurring in Iran for some time now, and makes life in Iran extraordinarily tough,” he added.

The nation is experiencing its sixth 12 months of drought, with some cities going through common interruptions to water entry.

When requested whether it is in a authorities’s curiosity to safe water sources to stop civil unrest, Swyngedouw stated that “not all of the states are the identical.”

“So the Iranian state has systematically uncared for the availability of those primary infrastructures, with the implications that we all know, and it has achieved that for geopolitical causes. It’s placing all its cash within the army, that is mainly the selection that they had,” he added. 

Swyngedouw referred to as for higher emphasis by governments on provisioning water as a public service. 

Kraft added: “Water is more and more handled like a strategic asset — nearer to essential infrastructure than a commodity — as local weather volatility and demand development flip water insecurity right into a nationwide safety subject. This may doubtless carry extra headlines on its water export potential, however I do not suspect something materials [will] change by means of the top of the last decade.”

“Even when Greenland’s freshwater will not be exported at scale anytime quickly, it nonetheless issues geopolitically.”