Greenland plans office in Beijing to boost trade ties with China

Denmark and the United States have been concerned about China’s interest in Greenland. Above, Nuuk port. (Reuters)
Updated 18 July 2018
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Greenland plans office in Beijing to boost trade ties with China

  • China could be potentially involved in the financing and construction of three airport expansions on the huge island
  • Greenland with a population of only 56,000 is rich in mineral resources but the development of its industry has been slow

COPENHAGEN: Greenland plans to open a representative office in Beijing to boost trade ties with China, the Arctic island’s new minister for foreign affairs was quoted as saying by state broadcaster KNR on Wednesday.
Denmark and the United States have been concerned about China’s interest in Greenland, a self-ruling part of the Kingdom of Denmark. Their most notable area of concern is China’s potential involvement in the financing and construction of three airport expansions on the huge island.
“We are planning to have a representative in China in order to continue strengthening trade with the country,” said minister for foreign affairs Vivian Motzfeldt, according to KNR.
The idea is not new, but it has not been discussed publicly at government level since 2014.
She did not set a timeline for when the office may be set up. Greenland already has foreign representations in Copenhagen, Brussels and Washington, and will open a fourth in Reykjavik later this year.
Beijing laid out ambitions in January to form a “Polar Silk Road” by developing shipping lanes opened up by global warming and encouraging enterprises to build infrastructure in the Arctic.
Greenland, with a population of only 56,000, is rich in mineral resources but the development of its industry has been slow, leaving its economy reliant on fishing.
A defense treaty between Denmark and the United States dating back to 1951 gives the US military almost unlimited rights in Greenland, where it has an air base at Thule.


Profit at world’s biggest miner BHP jump, but warns on costs, savings

Updated 5 min 27 sec ago
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Profit at world’s biggest miner BHP jump, but warns on costs, savings

  • The world’s biggest miner said it expected its strong momentum to continue into the medium term
  • BHP paid out a record final dividend of $0.63 a share, up from $0.43 a year ago, on the back of free cashflow of $12.5 billion
MELBOURNE: Global miner BHP posted a 33 percent jump in annual underlying profit and a record final dividend on Tuesday, but flagged a delay in future savings as well as cost pressures at some of its operations.
The world’s biggest miner, which has been focusing on simplifying its business and driving returns to shareholders, said it expected its strong momentum to continue into the medium term.
However, BHP Chief Executive Andrew Mackenzie said the miner was “a little more apprehensive” on the short-term outlook, given trade ructions between China and the United States, and analysts flagged concerns over rising costs.
For the year ended June 30, underlying profit, which excludes one-time gains and losses, rose to $8.93 billion from $6.73 billion, just below an estimate of $9.27 billion according to 15 analysts polled by Thomson Reuters.
BHP paid out a record final dividend of $0.63 a share, up from $0.43 a year ago, on the back of free cashflow of $12.5 billion from a strong operating performance and higher commodity prices. “A pretty solid result really. I think largely in line with what the market expected,” said portfolio manager Andy Forster of Argo Investments in Melbourne. “Definitely the cash flow was strong, the dividend probably a bit stronger than what we expected.”
However, a cut in productivity gains expected in fiscal 2019 — to $1 billion from a previously promised $2 billion — “slightly took the gloss off the results,” he added, although the miner pledged to make the additional savings in 2020.
BHP also noted some cost creep due to geotechnical issues at its Queensland coal operations, rising fuel costs, and pockets of inflation in labor.
“The dividend was better than expected, but the slight fiscal 2018 (earnings) miss and fiscal 2019 cost guidance is likely to cause us to take down estimates modestly,” broker Clarkson Platou said in a report
Shares in BHP fell 1.8 percent in afternoon trading, compared with a 1 percent fall in the broader Australian market and a 0.8 percent dip in rival Rio Tinto.
Including one-time charges, BHP’s profit fell 37 percent to $3.71 billion.
These included a $2.8 billion post-tax charge from the sale of BHP’s US shale oil and gas assets in July which ended a disastrous seven-year foray into shale.
BHP said that it would not make a decision on how to return profits from the sale to investors until it was finalized.
The company also took a $650 million charge for the 2015 Samarco dam failure in Brazil that killed 19 people.
Total revenue rose 20 percent to $45.81 billion. Revenue from iron ore mining, BHP’s biggest division, edged up 1.3 percent, while copper surged by nearly 60 percent backed by higher production from its Escondida mine in Chile.
Revenue from its petroleum division grew 14.5 percent on surging oil prices.
BHP said it cut net debt to $10.9 billion, at the lower end of its $10-15 billion target.