Published September 9, 2011


 A Chinese gentleman wants to buy a big tract of land in the Northeast, and a central weakness of Icelandic politics is revealed. It is all about opinion. A government minister comes on television and starts talking about the Chinese who are buying up all the land in the world. The President enters the stage—he is extremely anti-EU and he says that all good people should be welcome in Iceland, not only Europeans. And so it goes back and forth—with everybody arguing.
But the aforementioned, China-fearing minister is incidentally the one who has to determine whether the Chinese gentleman should be allowed to buy this land. He should be looking at laws, rules and regulations, not fantasising about Chinese world domination. And the President fails to mention that Iceland is a part of the European Economic Area, and thus has adopted a large chunk of EU legislation. This stipulates that Europeans can buy land in Iceland and that Icelanders can buy land in Europe. There is no such agreement with China, no reciprocity—basically Icelanders are not allowed to buy land in China.
But this is the way politics work in Iceland. There are a lot of opinions, a lot of moulding facts to one’s purpose, a fertile ground for conspiracy theories, a frustrated nation that can easily be played upon by demagogues, propagandists and political adventurers—but very little objectivity.
Our Nobel Prize winning novelist, Halldór Laxness, once wrote that Icelanders are almost immune to sensible arguments, preferring to fight over things that have little to do with the matter at hand and dwell on absolute trivialities.
There is even a certain aversion to facts. The last government before the crash spent enormous efforts to try to disprove that the tax burden of the lower classes had actually gotten heavier while the rich were paying less and less.
Before that, then-Prime Minister Davíð Oddsson actually closed down the National Economic Institute, because its findings differed with his own opinions. Thus, there was no independent authority to monitor the economy, only people with different interests—and opinions. This proved to be rather fateful when the economic system totally overheated and then blew up.
In this way everything is politicised and subjected to political haggling. The arguments about the Icelandic agricultural system—which is heavily subsidised and very archaic—have gotten to the point where the Minister of Agriculture claims that high tariffs are actually beneficial for the general consumer. An association of young farmers took out ads in the media claiming that EU membership would be harmful to Iceland to the extent that young people from here would have to serve in a EU-army. A lot of time goes into debating nonsense like this—in some ways the media are to blame for not sieving out the more outrageous claims.
The latest debate is between the government and the opposition. The government claims that the country is on the road to recovery, pointing to statistics from the IMF—which has just left the country, less than three years after the meltdown of October 2008. The opposition seems to believe that the country is totally on the skids with no investment and people fleeing en masse to Norway. There is also a debate between the government and the president—a sort of a subtext to the whole thing—about who saved the country. In a place where politics are so partisan and the independent sources of information are so weak, this makes for a very hard tangle for the general public to unravel.
Another instance is a plan recently put forward on how to utilise the nation’s natural energy resources, waterfalls and geothermal areas. This has been long in the making—many have cited it as a sort of a settlement that would allow us to harness our resources, free from strife. But as soon as the document was published it was evident this would not happen. Those who are on the side of industrialisation claimed it was far too restrictive, that this would destroy plans for energy plants that had been many years in the making. Preservationists on the other hand claimed that this would destroy far too many natural wonders. So the same fight continues, nothing has been settled, one almost wonders whether the much-awaited plan is worth the paper it is written on.
So, even if Iceland seems peaceful on the surface, the political debate is very quarrelsome and exhausting—sometimes it seems actually degrading to participate in it. Blogs have not necessarily made things better—they are often foul tempered and prejudiced. Citizens’ initiatives, which flourished for a while after the crash, have come to little fruition. Trust in politics is minimal, but ideas about how to do things differently are not welcomed. For example, the interest in proposals by a constitutional committee suggesting democratisation and openness is strangely muted.
Some politicians actually thrive well in this atmosphere. It is strangely easy to manipulate public opinion. This does not seem to be the time for reason or level-headedness, so it is the masters of political gamesmanship who thrive, men like President Ólafur Ragnar Grímsson and former Prime Minister Davíð Oddsson, who know every political trick in the book, but who might both be seen as lacking in sincerity.
But back to the Chinese gentleman, Mr. Huang Nubo. He is buying what is the largest or second largest farm in Iceland. But that does not tell the whole story. The farm, Grímsstaðir, is far in the mountains of the Northeast, in a desolate area, desert-ified by the overgrazing of sheep, an unusually cold place for Iceland—with temperatures sometimes sinking below minus 30°C. The place also has no special natural beauty. But in Grímsstaðir Huang wants to build a luxury resort, mostly for Chinese tourists, and even a golf course.
This is surely an interesting plan, but many have wondered: what is he really after, beside cold and solitude. These can actually be found in the deserts north of Beijing, which might not be so different from the landscape around Grímsstaðir.
So all sorts of speculation takes off. Even the respected Financial Times publishes an article linking this to nascent Chinese imperials, stating that this might be linked to plans to gain foothold in the North-Atlantic. Here we enter the realm of James Bond’s ‘Dr. No,’ wrote The Independent. Grímsstaðir is a landlocked place, as far from any harbour as you can get in Iceland, so it is a bit hard to link this to imperialistic intentions, except if the plan was to turn it into a military installation at the touch of a button. We can picture this: Peaceful Chinese tourists with their cameras, suddenly turning into agents of world domination.
There we have an old motive all over again: The Yellow Peril. It is easy to fantasise about it. But China has been sending delegations to Iceland for many years and inviting lots and lots of Icelandic politicians and luminaries over. Our president has been especially active in this regard; he has gone to China six times in the last five years, but he almost never goes to Europe. But really not much has come out of this—except rather clichéd talk about the Chinese being very clever and thinking in the long-term (the way they manage their economy actually disproves this, with environmental catastrophes spreading all over China and a bubble economy that cannot possibly last).
Iceland does not have very much to sell to China, and of course the distances are long. There have been negotiations on a free trade agreement between the countries, but due to trade imbalances and the way the Chinese do business this is difficult to finalise.
So Huang’s offer to buy this large tract of land came as a surprise. Instantly the affair became very politicised, it in fact caused a minor political explosion in the beginning of September. Interior Minister, Ögmundur Jónasson, was very sceptical; it was he who said that we must be wary of Chinese buying up all the land in the world.
President Ólafur Ragnar answered saying that Iceland should be open to all good people—and that China had been friendly to us when all failed during the crises of 2008.
In an interview with Financial Times, he accused Europe of being downright hostile at the time and the US of having had zero interest. The President has always played up the possibility of doing business with Asia as an alternative to joining the EU. But the fact of the matter is that China made a currency exchange agreement for 500 million dollars after the crisis, whereas Iceland received an European funded bailout package from the IMF worth at least 2,1 billion dollars.
Huang seems like a likable enough man. He is a part time poet, an adventurer who has climbed seven of the highest mountain peaks in the world, including Mount Everest, and ventured to both of the Poles. He has friends in Iceland, one of whom was a roommate of his during studies in Beijing. His company, Zhonkun Investment Group, specialises in tourism and real estate. He is one of the richest men in China, and he donates liberally to charity. But, of course, he was once a party apparatchik, working in the Ministry of Propaganda. No one in China gets anywhere without the approval of The State.
So what would he build in the remote northeast? It has to be mentioned that there is actually very little foreign investment in Iceland. Foreigners are not allowed to invest in the fishing industry, they have not really invested in tourism, they are hardly tolerated in the energy sector (as seen in the Magma-affair)—mainly the investments have been in large aluminium plants which could actually multiply in the next years, especially if the Left Green party were to leave government.
Huang’s plans seem like an intriguing alternative. He has found a place that Icelanders rarely visit. There is a powerful glacial river running through the land—but Huang will not be allowed to harness its energy. He could not start sheep farming, for the land is overgrazed. Otherwise there doesn’t seem to be much to do in Grímsstaðir, besides maybe enjoying bright summer nights or looking for the Aurora Borealis during winter.
In his latest book, French writer Michel Houellebecq draws up an interesting vision of the future. Europe is quite peaceful and prosperous, but it has been turned into a theme park for Chinese and other Asians who visit its museums, music halls, cathedrals and ruins. It might be interesting to view Huang’s plans in this context…

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