What's happened
As of January 27, 2026, President Trump has imposed escalating tariffs on imports from eight European nations opposing US plans to acquire Greenland, starting at 10% in February and rising to 25% in June. European countries, including Denmark and its allies, have condemned the move, threatening retaliatory tariffs and considering the EU's anti-coercion instrument. The dispute centers on US security claims and Greenland's sovereignty, with diplomatic tensions peaking at the World Economic Forum in Davos.
What's behind the headline?
Strategic Leverage and Transatlantic Tensions
President Trump's tariff threats are a calculated coercive tactic aimed at pressuring European allies to acquiesce to US ambitions over Greenland. The move disrupts longstanding transatlantic trade agreements and challenges NATO solidarity, as the US targets close allies like Denmark, France, Germany, and the UK.
The Geopolitical Stakes
Greenland's strategic location in the Arctic is critical amid rising global competition, particularly involving China and Russia. Trump's insistence on ownership rather than leasing reflects a desire to cement US military and economic influence in the region.
European Response and Risks
Europe faces a dilemma: retaliate with tariffs and risk a damaging trade war, or seek diplomatic solutions while preserving unity. The EU's Anti-Coercion Instrument, dubbed the "trade bazooka," offers a powerful but politically sensitive tool that could escalate the conflict.
Forecast and Consequences
The standoff will likely persist through early 2026, with potential for escalating tariffs and diplomatic friction. The dispute risks undermining NATO cohesion and transatlantic economic ties, while exposing Europe's strategic vulnerabilities and dependence on US security guarantees.
Impact on Global Trade and Security
Markets have reacted negatively to tariff threats, signaling broader economic risks. The dispute underscores the fragility of alliances when national interests collide and highlights the need for Europe to develop more robust strategic autonomy.
What the papers say
The New York Times' Jim Tankersley captures Trump's aggressive stance, quoting him saying, "We probably won't get anything unless I decide to use excessive strength and force... but I won't do that," while simultaneously threatening economic retaliation against European countries opposing the Greenland acquisition. Treasury Secretary Scott Bessent, also quoted by Reuters and the New York Times, downplays the risk of escalation, expressing confidence that "leaders will not escalate and that this will work out in a manner that ends up in a very good place for all."
France 24 and The Independent highlight European leaders' firm opposition, with French President Emmanuel Macron stating Europe "will not bow to bullies" and advocating use of the EU's anti-coercion mechanism. The Independent details Europe's potential responses, including retaliatory tariffs worth €93 billion and the unprecedented deployment of the EU's "trade bazooka." Meanwhile, Business Insider UK reports on the specific tariffs targeting Germany, the Netherlands, Finland, and France, emphasizing the economic stakes with $365 billion in US imports from these countries.
The Times of Israel and Politico provide insight into the diplomatic dynamics, noting Italy's Giorgia Meloni calling Trump's tariff threats "a mistake" and the coordinated EU efforts to respond. Analysts quoted by The Independent and SBS warn that a trade war would harm both sides, with European economists suggesting alternative leverage such as a FIFA World Cup boycott to pressure Trump.
Overall, the sources reveal a complex interplay of US assertiveness, European resistance, and the high geopolitical and economic stakes surrounding Greenland's future.
How we got here
The US, under President Trump, has sought to purchase Greenland from Denmark, citing national security concerns amid geopolitical competition with China and Russia. European countries oppose the sale, affirming Greenland's sovereignty. In response to European military deployments to Greenland and opposition to the US acquisition, Trump announced tariffs on imports from eight European nations, escalating tensions and prompting EU discussions on retaliation.
Go deeper
- What are the EU's options to respond to US tariffs?
- Why does the US want to acquire Greenland?
- How could this dispute affect NATO and transatlantic relations?
Common question
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More on these topics
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Donald John Trump is an American politician, media personality, and businessman who served as the 45th president of the United States from 2017 to 2021.
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Greenland is the world's largest island, located between the Arctic and Atlantic oceans, east of the Canadian Arctic Archipelago. It is an autonomous territory within the Kingdom of Denmark.
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The European Union is a political and economic union of 27 member states that are located primarily in Europe. Its members have a combined area of 4,233,255.3 km² and an estimated total population of about 447 million.
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Scott K. H. Bessent is an American hedge fund manager. He is the founder of Key Square Group, a global macro investment firm, and worked as a financier for George Soros.
Bessent has been a major fundraiser and donor for Donald Trump. He was an economic ad
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Denmark, officially the Kingdom of Denmark, is a Nordic country in Northern Europe. Denmark proper, which is the southernmost of the Scandinavian countries, consists of a peninsula, Jutland, and an archipelago of 443 named islands, with the largest being
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The United States of America, commonly known as the United States or America, is a country mostly located in central North America, between Canada and Mexico.
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Sir Keir Rodney Starmer KCB QC MP is a British politician and former lawyer who has served as Leader of the Labour Party and Leader of the Opposition since 2020. He has been Member of Parliament for Holborn and St Pancras since 2015.
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Emmanuel Jean-Michel Frédéric Macron is a French politician who has been President of France and ex officio Co-Prince of Andorra since 14 May 2017.
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Giorgia Meloni (Italian: [ˈdʒordʒa meˈloːni]; born 15 January 1977) is an Italian politician who has served as Prime Minister of Italy since October 2022. She is the first woman to hold the office and the head of the third-longest government in the h
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Ursula Gertrud von der Leyen is a German politician and the president of the European Commission since 1 December 2019. She served in the federal government of Germany from 2005 to 2019 as the longest-serving member of Angela Merkel's cabinet.
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Davos (UK: , US: ; German: [daˈfoːs] or [daˈvoːs] ; Romansh: ; Old Italian: Tavate) is an Alpine resort town and municipality in the Prättigau/Davos Region in the canton of the Grisons, Switzerland. It has a permanent population of 10,832 (2020). Dav
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Central Europe is the region comprising the central part of Europe. Central Europe occupies continuous territories that are otherwise sometimes considered parts of Western Europe, Southern Europe and Eastern Europe.