Greenland Tariff Threat Sparks EU’s $108 Billion Retaliation Plans Against U.S.

By Michael Katz | Monday, January 19, 2026

The rift between the U.S. and Europe over Greenland is deepening as European nations weigh retaliatory tariffs and broader economic countermeasures against the United States. Regional diplomats convened an emergency meeting in Brussels on Sunday to discuss their response to President Donald Trump’s threat to escalate tariffs unless a deal is reached for the U.S. to purchase Greenland.

France has urged the European Union to activate its strongest economic countermeasure against American trade policy, according to reports. The administration announced Saturday that it would impose 10% tariffs on goods from Denmark, Norway, Sweden, France, Germany, Britain, the Netherlands, and Finland, effective February 1. These tariffs would increase to 25% on June 1 if no purchase agreement for Greenland—a semiautonomous territory of Denmark—is reached.

The European Union’s Anti-Coercion Instrument, a tool that could restrict U.S. companies from accessing EU markets—including barring them from bidding on government contracts—along with imposing trade restrictions and potential limits on U.S. investment, is under consideration. Reports indicate the EU might impose $108 billion in tariffs on the United States through this mechanism.

The European Parliament is likely to suspend its work on the EU-U.S. trade deal finalized in July after being set to vote on removing many import duties on American goods during January 26-27, though that approval could be delayed. French Finance Minister Roland Lescure stated Monday that the EU “must be prepared” to use its anti-coercion measure.

Germany, however, has shown hesitation in invoking the instrument. Carsten Nickel, deputy director of research at Teneo, noted: “The key question is whether the EU will contain the confrontation within a classic trade war or if calls for a harsher line prevail. France represents the latter camp, urging its partners to formally invoke the Anti-Coercion Instrument—but other member states, including Germany, are likely to remain cautious.”

National security advisers from multiple countries were expected to meet Monday at the World Economic Forum in Davos, Switzerland, with Greenland among the agenda items. President Trump is scheduled to address global business leaders in Davos on Wednesday, accompanied by several top U.S. officials, including Treasury Secretary Scott Bessent.