Photo: Patrick Gage via Flickr
Huang Nubuo, one of China’s richest individuals, is making moves to buy 200 square miles of Icelandic wilderness for $10 million, claiming that he wants to build a luxury hotel and resort, complete with golf course and nature reserve. The Icelandic government will decide in two or three weeks whether the deal will be approved.Experts are already speculating if this land deal is really a step towards closer ties between these two governments for future business deals on Arctic shipping and natural resources.
It’s no secret that China has long been exploring shorter shipping routes between Shanghai and Europe. Icelandic authorities have even disclosed that Chinese discussed using Iceland as a trans-Arctic shipping port.
An Arctic shipping route would shorten the trip from Shanghai to Hamburg by 4,000 miles and greatly reduce piracy risks on the sea. Experts agree that there is already more than enough reason to believe that China has a clear strategic agenda regarding Arctic shipping routes.
There is also a great deal of speculation of oil and gas wells along with rare earths on the ocean floor in the arctic. China’s growth and economy are still heavily dependent on imported crude oil. This has already created conflicts over the South China Sea, but new ties with Iceland and the prospect of Arctic oil could be a solution to their energy problems.
China’s newest deep sea sub also goes where no other country can, and is primed for scouting rare earths and other valuable minerals. Closer business ties could become a critical advantage when China faces energy security issues and natural resource constraints.
Despite all the speculation, the majority of Iceland’s residents support the sale. Huang says he is ready to invest $200 million towards building the resort, and the locals are desperate for the money after the economic collapse of 2008. And, as of right now, there is no hard evidence proving that Huang has any motives other than building a luxury resort to attract tourists and make a profit.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.