Trump's claim isn't too far off from the subsidy Denmark pays to Greenland, but it's off by $150 million. Moreover, his characterization of the subsidization as a "loss" misrepresents Greenland's economic value, and drastically overstates the importance of the subsidy to Greenland.
Danish subsidies to Greenland
Denmark currently pays an annual subsidy to Greenland, currently under the provisions of the 2009 Act on Greenland Self-Government. Section 5 of the Act reads
- (1) The [Danish] Government shall grant the Greenland Self-Government authorities an annual subsidy of DKK 3,439.6 million, but see section 8 (1). The amount is indicated in 2009 price and wage levels. (2) The subsidy shall be adjusted annually in accordance with the increase in the general price and wage index of the Finance and Appropriation Act for the year concerned. (3) The subsidy shall be paid in advance in the form of a monthly payment of 1/12. (4) Subject to agreement with Naalakkersuisut, the Minister for Finance may lay down rules on changed dates for disbursement.
To check the CIA Factbook number, I looked at an government publication of Greenland's statistics (published by Greenland's government). In the Økonomi ("economy") subsection of the Nøgletal ("key figures") section (pages 37-38), the table lists
Bloktilskud 3.722,4 kr. (2017) og 3.822,9 kr. (2018) millioner i tilskud fra Danmark
"Bloktilskud" means "block grants/subsidies", so that in 2018, Denmark gave Greenland 3.8229 billion Danish kroner in aid. Based on current exchange rates, this comes out to $553 million (United States dollars).
$553 million is close enough to $700 million that Trump isn't too far off. So Denmark does subsidize Greenland - but to the tune of about $553 million per year, not $700 million. Moreover, the government statistics do not imply that Denmark is "carrying" Greenland; the total subsidy is equivalent to only 25.5% of Greenland's GNP of $2.17 billion.
Tor-Einar Jarnbjo noted that Denmark also pays some additional management costs, supposedly under the 2009 Act, and that these bring the total amount paid by Copenhagen closer to Trump's figure. I unfortunately have not been able to find more detail information on these costs (yet), and not for recent years.
It's also notable that Section 8 of the Act provides for Denmark to gain some of the profits from Greenland's mineral resources (which I'll discuss below):
- (1) If revenue from mineral resource activities in Greenland accrues to the Greenland SelfGovernment authorities, cf. section 7, the Government’s subsidy to the Self-Government authorities shall be reduced by an amount corresponding to half the revenue which, in the year concerned, exceeds DKK 75 million. (2) With effect from 1 January the year after the commencement of the Act, the amount of DKK 75 million referred to in subsection (1) shall be adjusted annually in accordance with the increase in the general price and wage index of the Finance and Appropriation Act for the year concerned. (3) Calculation pursuant to subsection (1) shall take place the subsequent year with a view to payment the following year.
The language doesn't seem to indicate that Denmark could make a net profit from the natural resources (primarily oil off Greenland's coast), but it does mean that the subsidies could drop even more drastically than they are planned to decrease with time.
The benefits of Denmark keeping Greenland
In terms of imports and exports, Greenland imported $787 million in 2018, exporting $603 million. The primary trading partners are Denmark and Sweden, although the rest of the EU also trades with Greenland. Denmark's relationship with Greenland, therefore, may be beneficial from a trading standpoint, gaining it money compared to a scenario where the US (or another country) owns Greenland. This is another thing that has to be considered when determining what Denmark gets out of the present setup.
That said, Trump's implication, of course, is that this subsidy is a waste of money for the Danish government. This is nonsensical, as Denmark is merely paying money to maintain an asset. Now, valuing that asset is extremely difficult; the Washington Post writes
So when The Washington Post asked the experts at the Arctic Institute to take a crack, Marc Jacobson, a senior fellow there, put it bluntly: “I’m not aware of any who would be capable” of doing that sort of calculation.
The Post tried several different ways of evaluating what Greenland is worth, and came up with values between $200 million and $1.7 trillion. The latter figure is close to an estimate by Jason Barr based on putative values of Greenland's land. However, land isn't what makes Greenland valuable; instead, its resources do. A fairly comprehensive 2014 report by the Brookings Institute reached several conclusions:
There is an unknown amount of oil in around Greenland, although exploitation of that is years in the future.
The same holds for precious metals (gold, iron, rare earth elements, etc.):
Greenland is widely believed to hold excellent potential for a host of natural resources, including zinc, lead, gold, iron ore, heavy and light rare earth elements, copper and oil. Considering that only a small fraction of this massive island has been properly explored, in the coming years more data gathering and analysis would be helpful to assess the full potential of Greenland.
Large-scale mining is possible in Greenland, especially if Chinese companies take interest.
. . . because of the slowdown in investments in new mining activities, it is less certain that Greenland will be able to get major mining projects off the ground on the ambitious schedule that it announced in its mineral and energy resource strategy in 2014. We do believe however that eventually large-scale mining will take place in Greenland.
A true estimate of the value of Greenland is impossible until we can determine whether these future developments will occur and how much natural resources Greenland holds. New commodities like river sand are opening up for trade. The crux of the Brookings report is that Greenland has the potential to make a lot of money in the future. Even if Denmark is, at this minute, losing money by owning Greenland, it is impossible to say whether it will reap many more benefits in the decades to come, if development opens up.