An unprecedented diplomatic and economic crisis has erupted as US President Donald Trump demanded the acquisition of Greenland and threatened to impose significant tariffs on several European allies who opposed his plans. Trump announced a 10% tariff on goods from eight European countries – Denmark, Finland, France, Germany, the Netherlands, Norway, Sweden, and the UK – starting February 1, escalating to 25% by June 1, unless a deal for Greenland was reached. He declared that the deal “will be done!!!”, linking his aggressive stance to a perceived snub for the Nobel Peace Prize, stating he no longer felt an “obligation to think purely of Peace” after not receiving the award for allegedly stopping eight wars. Trump asserted that Greenland was vital for US national security, claiming Denmark could not protect it from Russia and China, and that NATO should support the US given his contributions.

European leaders swiftly condemned Trump's threats, prioritizing diplomacy but preparing robust countermeasures. British Prime Minister Keir Starmer emphatically ruled out retaliatory tariffs, deeming them “wrong” and detrimental to the British economy. He called for “calm discussion” and underscored Greenland’s right to self-determination, while emphasizing the critical importance of maintaining a strong UK-US security relationship despite disagreements. Starmer, however, did not believe Trump was genuinely considering military action. Chancellor Rachel Reeves canceled an appearance at the London Stock Exchange due to the market downturn triggered by Trump’s threats, joining Starmer at a press conference to address the crisis.

The European Union held emergency summits and ambassadorial meetings in Brussels to coordinate a unified response. Options discussed included reviving a €93 billion package of counter-tariffs, previously suspended, which would automatically kick in on February 7 if not renewed. Additionally, the bloc considered activating the Anti-Coercion Instrument (ACI), often dubbed the “trade bazooka,” a powerful tool designed to counter economic blackmail that has never been deployed. Senior figures, including German Finance Minister Lars Klingbeil and French President Emmanuel Macron, supported the ACI’s deployment, calling Trump’s actions a “textbook case of coercion.” Furthermore, leaders of the European Parliament’s main political groups called for a freeze on the EU-US trade deal, which was designed to reduce tariffs on industrial goods, effectively putting it “on ice.”

Reactions from other European nations highlighted deep concern. Greenland's Prime Minister Jens-Frederik Nielsen declared, “We will not be pressured. We stand firm on dialogue, respect, and international law,” echoing protests across the territory with banners reading “Greenland Is Not For Sale.” Danish Prime Minister Mette Frederiksen unequivocally stated, “Europe will not be blackmailed.” Spain’s Prime Minister Pedro Sánchez warned that a US invasion of Greenland would be the “death knell” of NATO and would legitimize Russia’s actions in Ukraine. Dutch Finance Minister Eelco Heinen deemed Trump’s tariff threats “unnecessary and irresponsible,” urging de-escalation, while Ireland’s Deputy Prime Minister Simon Harris called for “cool heads” in discussions.

The crisis also sent ripples through global financial markets. Stock markets across Europe, including the FTSE 100, CAC 40, DAX, IBEX 35, and STOXX 600, experienced significant drops. Shares in European carmakers and luxury goods sectors declined, while safe-haven assets like gold and silver reached new highs as investors moved away from riskier assets. Experts warned of potential economic havoc, including a projected £6 billion cost to UK exporters and the risk of a recession. Despite the widespread condemnation, US Treasury Secretary Scott Bessent defended Trump's use of economic leverage as a means to avoid a