Such bafflement has stirred much speculation about what the Chinese tycoon and perhaps the Chinese authorities are up to. A proposal by the Zhongkun Group to renovate a small landing strip in the Grimsstadir area and buy 10 aircraft led to anxious talk of a Chinese air base. The area’s relative proximity to deep fjords on Iceland’s northeast coast near offshore oil reserves fueled speculation about a Chinese push for a naval facility and access to the Arctic’s bountiful supplies of natural resources. Far-fetched rumors about Chinese missiles and listening posts led to worries about military personnel pouring in disguised as hoteliers and golf caddies.

Image In Grimsstadir, snow often falls from September to May. Credit... The New York Times

Mr. Huang could not be reached for comment: he was off climbing a mountain, his company said. In response to written questions, Xu Hong, a vice president at the company, dismissed speculation of a military purpose or other ulterior motives as “the guesswork of post-cold-war thinking.” Ms. Xu said Grimsstadir had been chosen because “there is market demand in China” for peace and quiet. “Most Chinese now don’t like to travel to dirty, noisy places,” she said.

Mr. Skarphedinsson scoffed at a widely held belief here that Mr. Huang is leading a plot by Beijing to secure a strategic foothold in Iceland, a NATO member that is entirely bereft of military muscle. Iceland also sits astride what will become important shipping lanes as ice-choked Arctic waters warm.

China has openly declared its interest in shipping routes through the Arctic and in using Iceland as a future transport hub, Mr. Skarphedinsson said. But these goals, he added, have been hurt, not helped, by the cloud of suspicion generated by Mr. Huang.

“One thing the Chinese Communist Party never failed at since Mao is public relations, but the P.R. in this venture has failed miserably,” Iceland’s foreign minister said.

Beijing’s keen interest in Iceland, nearby Greenland and the wider Arctic region is well known. China is negotiating a Free Trade Area accord with Reykjavik, its first with a European nation, and last year it sent its prime minister at the time, Wen Jiabao, for a two-day visit. A Chinese icebreaker, the Snow Dragon, stopped off last year as part of a push by Beijing to gain entry as an observer to the Arctic Council, a body comprising the United States, Canada, Russia, Iceland and Nordic states in or near Arctic waters.