US President Donald Trump has pulled back from his threat to slap heavy tariffs on several European countries. He now says there is a possible “framework” for a future deal linked to Greenland, following a “very productive” meeting with Nato’s secretary general.
Just four days ago, Trump had threatened that the US would impose tariffs on eight European nations for supporting Greenland’s status as an autonomous territory under Denmark. But on Wednesday, he changed course.
Trump steps back from Greenland tariff threat
Trump said the United States will not impose 10% tariffs on Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands and Finland from February 1, as earlier announced. Over the weekend, he had even warned that these tariffs could rise to 25% from June 1.
Posting on his Truth Social platform, Trump said the tariffs would no longer go ahead because of an “understanding” reached during talks. “Based upon this understanding, I will not be imposing the Tariffs that were scheduled to go into effect on February 1,” he wrote.
European Union leaders had warned that they were ready to use the bloc’s anti-coercion instrument, often called the “trade bazooka”. This tool would have allowed the EU to respond with strong trade sanctions if Trump went ahead with his tariff plan.
A complex deal over Greenland
After meeting Nato secretary general Mark Rutte on Wednesday, Trump claimed that a deal over Greenland was taking shape. However, he did not explain what the deal involved.
Speaking at the World Economic Forum in Davos, Switzerland, Trump said the deal would be in place “for ever”. “We have a concept of a deal. I think it’s going to be a very good deal for the United States, also for them,” he told CNBC. “It’s a little bit complex, but we’ll explain it down the line.”
According to CNN, a key part of the proposed Greenland framework includes reopening and renegotiating a decades-old agreement on the US military presence on the island.
That agreement dates back to 1951, when the United States and Denmark signed a treaty allowing American military forces to stay in Greenland permanently. Most of those bases were closed after the Cold War ended. But as Trump has pushed harder on Greenland, Denmark has said it would be open to allowing more US military resources on the island.
Denmark reacts positively
Denmark’s foreign minister Lars Løkke Rasmussen said Trump’s comments were encouraging, especially his assurance that the US would not use force.
“Trump said that he will pause the trade war. He says: ‘I will not attack Greenland.’ These are positive messages,” Rasmussen told Danish public broadcaster DR.
Several European countries welcomed Trump’s decision to drop his threat of tariffs against allies who supported Denmark and Greenland. Sweden’s foreign minister Maria Malmer Stenergard said it was good news that Trump had stepped back. “Good that Trump has now backed away from tariffs on those of us who have supported Denmark and Greenland,” she wrote on X. Italian Prime Minister Giorgia Meloni also welcomed the move, saying dialogue between allied nations must continue.
Hours before backing down on tariffs, Trump had said during a long and often rambling speech in Davos that the US would not use military force to take Greenland. “We want a piece of ice for world protection, and they won’t give it,” Trump said. “We’ve never asked for anything else.” He also defended tariffs, telling world leaders: “You’re all party to them – in some cases, victims to them. But in the end, it’s a fair thing, and most of you realise that.”
Markets wobble, then recover
Wall Street suffered its worst day since October on Tuesday, the first trading day after Trump’s Greenland tariff threat. Trump claimed credit for recent record highs but admitted markets dipped this week “because of Iceland”, seemingly confusing Iceland with Greenland.
After Trump announced he would not impose the tariffs, markets bounced back. The S&P 500 closed up 1.2%, while the Dow Jones rose 1.2% to finish at 49,077.23, edging closer to the 50,000 mark.
White House says Greenland deal details will come later
The White House said on Wednesday that the details of the Greenland deal announced by President Donald Trump are still being worked out and will be shared only after everyone involved agrees on them. “If this deal goes through, and President Trump is very hopeful it will, the United States will be achieving all of its strategic goals with respect to Greenland, at very little cost, forever,” White House press secretary Karoline Leavitt said in a statement.
NATO officials have also discussed another idea, allowing the United States to build new military bases in Greenland on land that would be treated as sovereign US territory, CNN reported.