Much hyped Chinese-Icelandic joint research center facing bankruptcy

By Elías Thorsson July 30, 2024
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Icelandic officials said they would “never, ever” have been able to construct the observatory without China’s investments. (Melody Schreiber)

The Icelandic Regional Development Institute has demanded a forced sale of the property Kárhóll in Reykjadal in the Þingeyjarsveit municipality, along with the building on the property, which houses the Chinese-Icelandic research center for Northern Lights reports Icelandic newspaper Morgunblaðið. The property is owned by the nonprofit organization Aurora Observatory.

A loan amounting to 120 million ISK that was taken to finance the construction of the building on the property is in arrears and now stands at nearly 180 million ISK.

The center opened in 2018 to much fanfare, with the ribbon cutting ceremony being attended by Chinese and Icelandic dignitaries, including the Chinese ambassador to Iceland, then Minister of Education, Science and Culture Lilja Dögg Alfreðsdóttir and former President Ólafur Ragnar Grímsson.

“In the years to come, we have a lot of plans and dreams that we could realize if we work together,” Zhijan Jin, the Chinese ambassador to Iceland told Arctic Today at the time.

Ólafur Ragnar Grimsson, the former president of Iceland; Lilja D. Alfreðsdóttir, Minister of Education, Science and Culture in Iceland; Zhijan Jin, the Chinese ambassador to Iceland; and Huigen Yang, director of the Polar Research Institute of China, spoke at the observatory’s grand opening. (Melody Schreiber)

In an interview with Morgunblaðið, Ólína Arnkelsdóttir, chairwoman of the board of Aurora Observatory, stated that the matter is in progress, but she is hopeful that the auction will not take place. She said that various research activities are conducted in the building, involving Rannís, the academic community, and Chinese collaborators. The house is not fully completed, and the financial difficulties are due to the construction costs exceeding the budget.

The first hearing in the case will be on August 23, according to information from the Icelandic Regional Development Institute.