President Trump escalated his hyperaggressive push to have the United States take control of Greenland, sparking outrage among European allies and threatening to splinter the NATO alliance that has been a cornerstone of the global order for nearly 77 years.
Ahead of a scheduled speech to the World Economic Forum in Davos, Switzerland, on Wednesday, Trump told reporters today that he has a lot of meetings scheduled about Greenland and expressed optimism that the standoff will work out to everyone’s benefit.
“I think things are going to work out pretty well, actually,” Trump said during a lengthy and winding press briefing at the White House, later adding, “I think that we will work something out where NATO is going to be very happy and where we’re going to be very happy, but we need [Greenland] for security purposes.”
Asked how far he’ll go to get Greenland, Trump responded: “You’ll find out.”
Trump’s latest tariff threat: Greenland is a semi-autonomous territory of Denmark, which is a NATO ally. Trump’s extraordinary pursuit of the Arctic island, including the possibility of acquiring it “the hard way,” has inflamed tensions with longstanding European partners. Trump ratcheted up those tensions on Saturday by announcing that he will impose new 10% tariffs in February on eight European countries — Denmark, Finland, France, Germany, Norway, the Netherlands, Sweden and the United Kingdom — until a deal is reached for the United States to buy Greenland. He added that the tariffs would climb to 25% if no deal is reached by June 1.
European leaders quickly condemned Trump’s tariff threat and set out to formulate a response and consider countermeasures, including the possible use of retaliatory tariffs and a so-called anti-coercion instrument, colloquially referred to as a “trade bazooka,” that could curb or block U.S. access to European Union markets or impose export controls, among other measures.
Tense texts: In a weekend text message made public on Monday by the Norwegian government, Trump linked his push to take over Greenland to his being denied the Nobel Peace Prize. “Considering your Country decided not to give me the Nobel Peace Prize for having stopped 8 Wars PLUS, I no longer feel an obligation to think purely of Peace, although it will always be predominant, but can now think about what is good and proper for the United States of America,” Trump wrote to Norway’s prime minister, Jonas Gahr Støre. (Norway’s government does not award the peace prize.)
Trump also questioned why Denmark controls Greenland before adding: “I have done more for NATO than any other person since its founding, and now, NATO should do something for the United States. The World is not secure unless we have Complete and Total Control of Greenland.”
Trump on Tuesday followed up his tariff threat by publishing private text messages he received from French President Emmanuel Macron and NATO chief Mark Rutte. “I do not understand what you are doing on Greenland,” Macron told Trump in one message. Rutte said he would use his media engagements in Davis to highlight Trump’s work in Syria, Gaza and Ukraine before adding: “I am committed to finding a way forward on Greenland. Can’t wait to see you."
Europe shifts away from US: European Commission President Ursula von der Leyen used her own speech at Davos to warn that Trump’s threats are a “mistake” and that the two sides should abide by the trade deal they reached last July. “In politics as in business, a deal is a deal. And when friends shake hands, it must mean something,” she said.
She added that fracturing the U.S.-European friendship “would only aid the very adversaries we are both so committed to keeping out of the strategic landscape. So our response will be unflinching, united and proportional.”
Von der Leyen also reiterated that the sovereignty and integrity of Greenland and the Kingdom of Denmark are non-negotiable, even as Europe is willing to work with the United States on Arctic security — and is preparing its own security strategy as it looks to strengthen its ability to stand on its own in areas “from security to economy, from defense to democracy.”
Congressional criticism: Some U.S. lawmakers also pushed back against Trump’s tariff threat and his pursuit of Greenland.
“There is no need, or desire, for a costly acquisition or hostile military takeover of Greenland when our Danish and Greenlandic allies are eager to work with us on Arctic security, critical minerals and other priorities under the framework of long-standing treaties,” Democratic Sen. Jeanne Shaheen and Republican Sen. Thom Tillis, the co-chairs of a bipartisan Senate NATO Observer Group, said in a weekend statement. “Continuing down this path is bad for America, bad for American businesses and bad for America’s allies. This kind of rhetoric also further helps adversaries like Putin and Xi who want to see NATO divided. Our allies deserve better, and so do the American people who have made their opposition to this flawed policy resoundingly clear.”
Markets also made their displeasure clear, with stocks suffering their worst losses since October and the dollar sliding against the euro. “The fact that the dollar is falling while the euro is rising on the crisis says global investors at the margin are looking to reduce or hedge their exposure to a volatile and unreliable US,” Krishna Guha, vice chairman at Evercore ISI, said in a note cited by CNN.
At Davos, Treasury Secretary Scott Bessent urged calm and called on European leaders not to escalate against the United States. “Sit back, take a deep breath, do not retaliate, do not retaliate,” he said. “The president will be here tomorrow and he will get his message across.”
Europe’s other leverage? Bessent reportedly also said he did not think European countries would retaliate against Trump’s threats by selling off U.S. debt. He criticized the media and dismissed a report from Deutsche Bank that noted that Europe “owns a lot of treasuries.”
“For all its military and economic strength, the US has one key weakness: it relies on others to pay its bills via large external deficits,” Deutsche Bank analyst George Saravelos reportedly wrote. “Europe, on the other hand, is America’s largest lender: European countries own $8tn of US bonds and equities, almost twice as much as the rest of the world combined. In an environment where the geoeconomic stability of the western alliance is being disrupted existentially, it is not clear why Europeans would be as willing to play this part.”
What’s next: The world will be watching Trump’s big speech at Davos, and U.S. talks on the sidelines of the conference. European leaders are reportedly set to gather after Davos for an emergency discussion about transatlantic relations. Meanwhile, the Supreme Court is set to rule any day on the constitutionality of Trump’s reciprocal tariffs, and the court decision could add another complication to the president’s trade battles.