Keep ice cool: How Europeans should respond to Trump’s Greenland tariff threats
Rather than panicking or posturing, European leaders should prioritise EU unity, pinpoint their leverage and consider buying time
On January 17th, Donald Trump announced that US imports from six EU countries (Denmark, Finland, France, Germany, the Netherlands and Sweden) and two other European states (Norway and the UK) would from February face additional tariffs of 10% until the US could enact the “complete and total purchase of Greenland.”
European policymakers should keep five principles in mind as they respond to Trump’s threats:
- Make unity the priority
Greenland and Denmark are the primary targets of US threats to annex Greenland, so they should determine the level of confrontation with the US. Now is not the time for individual EU governments to indulge in posturing for domestic political purposes. Trump could double down on his threats if he spots hints of European disunity over Greenland.
- Avoid self-harm
US tariffs are a tax on American firms and consumers: US importers, rather than exporters outside the country, absorb 96% of tariff costs. This data point has two implications. There is no good reason for the EU to be afraid of US tariff threats (despite tariffs, US imports from the EU rose by 7% year on year in the first ten months of 2025). And EU retaliatory tariffs on imports from the US would amount to self-harm, as EU firms and consumers would bear the brunt of such measures.
- Ditch moot threats
Efforts to engineer a sell-off of the $2.8trn in US Treasuries held in European NATO countries would provoke a sharp depreciation of the US dollar against the euro. This would be an own-goal at a time when many EU exporters fear a strong euro more than US tariffs. That some economists close to the White House have called for Washington to pressure Europeans to accept such a sell-off further suggests that it may not be in Europe’s best interests to proceed with such a plan.
- Home in on Europe’s leverage
To gauge the scope of their leverage, Europeans should take a closer look at the services side of the transatlantic trade balance. The bloc’s biggest asset in the field is obvious: market access for US social media platforms. For the likes of Meta (the parent company of Facebook, Instagram and WhatsApp) and X, the EU is a major marketThreatening to curb market access for such platforms could therefore prove to be a powerful tool.
- Consider buying time
Trump could conceivably change his mind over the urgency of the Greenland issue at any moment
It may be sensible to buy time in responding to Trump’s new tariff threats. Firstly, the US Supreme Court could rule many of Trump’s tariffs illegal in the coming days—making those threats moot. Secondly, polling shows that 92% of Americans oppose the use of military force to take control of Greenland. Pressure from the US Congress could force Trump to make a U-turn. Thirdly, Greenland is not even mentioned in the administration’s new National Security Strategy published in December. This suggests that Trump could conceivably change his mind over the urgency of this issue at any moment.
In any case, US tariff threats over Greenland target just six EU countries, meaning that they would not be hard to circumvent within the Single Market (Belgium borders France, Germany and the Netherlands). This too shows that European leaders would be well-advised to remain cool-headed when dealing with Trump’s latest tariff threats, which are unlikely to be the president’s last.
The European Council on Foreign Relations does not take collective positions. ECFR publications only represent the views of their individual authors.
