Participants take part in a demonstration to show support for Greenland in Copenhagen, Denmark, January 17, 2026.
Tom Little | Reuters
European countries are reportedly considering retaliatory tariffs and wide-ranging punitive economic countermeasures against the United States after President Donald Trump threatened to impose new export taxes and deepened rifts over Greenland.
President Trump announced Saturday that eight European countries could raise tariffs starting at 10% on February 1 and rising to 25% on June 1 if Washington fails to reach a deal that would allow Denmark to acquire mineral-rich Greenland, a semi-autonomous territory.
The proposed tariffs would target Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland. The tariffs will be in addition to existing export duties to the United States, which currently stand at 10% for the UK and 15% for the EU.
Diplomats from the region held an emergency meeting in Brussels on Sunday afternoon to discuss responses to Trump’s threat to increase tariffs, with France reportedly urging the EU to use its “anti-coercion measures” (ACI), its strongest economic countermeasure against the United States.
On January 17, 2026, protesters wave Greenlandic flags and demonstrate in front of the U.S. Embassy in Copenhagen, Denmark, with slogans such as “Hands Off Greenland” and “Greenland for Greenlanders.”
Null Photo | Null Photo | Getty Images
This much-vaunted measure is seen as a nuclear option when it comes to economic countermeasures, as the EU could restrict US suppliers’ access to the EU market, exclude them from participating in regional public tenders, impose import and export restrictions on goods and services, and potentially impose restrictions on foreign direct investment into the region.
Despite being seen as a “big bazooka” to President Trump’s tariff strategy, the tariffs have never been used, and regional leaders have already said they want to advance talks with the United States in the coming days to resolve rifts over Greenland.
The Financial Times reported that the EU is considering imposing tariffs worth 93 billion euros ($108 billion) and is also considering using the ACI.
Meanwhile, Reuters reported that the European Parliament is likely to suspend work on the EU-US trade deal signed last July. The parliament was scheduled to vote on January 26 and 27 to eliminate many EU import duties on US goods, but approval could be delayed, Reuters reported.
French Finance Minister Laurent Lescure said on Monday in comments translated by Reuters that the EU “must be ready” to use anti-coercion mechanisms.
While France has been proactive about ACI, Germany has been one of the countries that has tended to shy away from its use.
“The key question to watch is whether the EU will try to limit the conflict to such a more ‘classic’ trade war, or whether calls for a tougher line will prevail,” Kirsten Nickell, deputy director of research at Teneo, said in an emailed comment.
“On behalf of the latter camp, France called on member states to formally activate the EU’s so-called anti-coercion measures… (but) other EU member states, including Germany, will remain cautious.”
Nickel noted that the reasons for this rift are multifaceted, including factors such as France’s traditional advocacy of a more independent European role in continental security and its lower dependence on exports compared to other countries such as Germany.
Will the fight continue for months to come?
European leaders were quick to react to President Trump’s threat of surprise tariffs, with British Prime Minister Keir Starmer commenting on Saturday that “it is completely wrong to apply tariffs to allies in the pursuit of collective security for NATO members,” and French President Emmanuel Macron calling it “unacceptable.”
Nevertheless, leaders are expected to use this week’s World Economic Forum in Davos, Switzerland, as an opportunity to attempt dialogue with President Trump, who will address the forum on Wednesday.
President Donald Trump attends a bilateral meeting with European Commission President Ursula von der Leyen during the 50th Annual Meeting of the World Economic Forum (WEF) in Davos, Switzerland, January 21, 2020.
Jonathan Ernst | Reuters
Economists have warned that this spring is likely to be similarly dominated by a thorny debate over Greenland, just as it was last year, when months of wrangling ensued before a trade deal was signed between the US and the EU.
“My basic view is that the Feb. 1 (tariff) deadline will be extended as diplomatic measures are implemented,” Mohit Kumar, chief European economist at Jefferies, told CNBC on Monday.
“Having said that, I think this is different from the normal TACO (Trump always chickens out) trade. For Greenland, Europe’s position is very clear: it’s not for sale, it won’t tolerate invasion… But what Trump has shown is that he wants Greenland. I don’t know that the problem will be resolved that quickly. So I think the uncertainty around tariffs will be for months, maybe even quarters.”
“It’s negative for Europe. Growth will fall,” he warned, with regional indexes expected to be weaker as they move closer together, leading to a potentially frantic market for European stock exchanges on Monday.
