The European Union stands ready to respond to President-elect Donald Trump should he try to use tariffs to try to push Denmark to sell Greenland.
Newsweek reached out to the Trump transition team and the Department of Commerce on Thursday afternoon for comment.
Why It Matters
Trump at a press conference last week told reporters that the U.S. needs Greenland “for national security purposes,” claiming that “people really don’t even know if Denmark has any legal right to it, but if they do, they should give it up, because we need it for national security purposes.”
Trump then said he would “tariff Denmark at a very high level” if the country refused to let the U.S. buy Greenland, which is an autonomous island in the Arctic Circle.
What To Know
Should Trump push for tariffs against Denmark, he faces potential complications with actually enforcing them. The EU created a mechanism to handle economic coercion after China tried to push Lithuania to abandon the Taiwan Representative Office that it opened in the nation’s capital of Vilnius.
China viewed the choice to allow the name Taiwan instead of Taipei as a violation of the One China Principle, which Beijing uses to enforce its claim over Taiwan. Beijing responded with condemnation to Vilnius, followed swiftly by coercive economic action, according to analysis by the Center for Strategic and International Studies (CSIS).
Those measures included cutting Lithuania from China’s customs system, effectively blocking all bilateral exports and imports, followed shortly after by informal secondary sanctions, such as telling a German car company that sourced its parts in Lithuania that it could not clear Chinese customs.
All of this wrangling led to the creation of the Anti-Coercion Instrument (ACI), which the European Commission touted as a tool “providing the EU with the means to deter and respond to economic coercion, and thereby better defend its interests and those of its Member States on the global stage.”
So while foreign powers can implement actions against member states of the European Union, the union itself would ultimately have the power to respond on Denmark’s behalf, making any tariffs—especially those deemed coercive—effectively a declaration against the EU rather than just Denmark.
The ACI “gives the EU a wide range of possible countermeasures when a country refuses to remove the coercion,” including “the imposition of tariffs, restrictions on trade in services and trade-related aspects of intellectual property rights, and restrictions on access to foreign direct investment and public procurement.”
“The Regulation provides a legal framework for responding to coercion and sets down the means for the EU to investigate and take decisions,” the Commission wrote in a press release in 2023. “It includes timeframes and procedures for stakeholders affected by coercion to contact the Commission and hold a stakeholder consultation before taking countermeasures.
“The ACI likewise provides a framework for the EU to request a third country to repair the injury caused by its economic coercion.”
Should the tariffs fail to achieve the desired effect—many analysts have determined U.S. tariffs against China failed during the first Trump administration—it could lead to unintended consequences, per the CSIS analysis.
In the face of China’s coercive effort, Lithuania solidified its support for Taiwan and tightened Lithuania’s cooperation in the semiconductor market, which in turn hurt China since it could not import the vital parts that Vilnius produced.
The CSIS analysis also argued that “Beijing’s bullying behavior as not only contributed to a precipitous decline in its favorability rating around the world, but it has also often failed to achieve its intended policy objectives.”
What People Are Saying
Olof Gill, spokesperson for the European Commission, told Newsweek: “If necessary, the EU stands ready to defend its legitimate interests. The EU is committed to maintaining the closest possible partnership with the U.S. The Commission and EEAS engage the U.S. interlocuters and stakeholders on a bipartisan basis.
“We believe that transatlantic cooperation is critical to enhancing security and promoting growth in a contested geopolitical environment. The EU and the U.S. have the largest bilateral trade and investment relationship in the world, supporting more than 16 million jobs and accounting for 42 percent of global GDP.
“Leveraging our positive relationship allows us to enhance growth, maintain technological leadership and boost resilient supply chains. The European Commission has prepared for all possible outcomes of the US presidential election in November.”
Danish Foreign Minister Lars Lokke Rasmussen told Reuters in a statement: “We fully recognize that Greenland has its own ambitions. If they materialize, Greenland will become independent, though hardly with an ambition to become a federal state in the United States.
“I don’t think that we’re in a foreign policy crisis. We are open to a dialogue with the Americans on how we can possibly cooperate even more closely than we do to ensure that the American ambitions are fulfilled.”
What Happens Next
Trump cannot do anything about Greenland or Denmark until January 20, when he takes office following his inauguration. He will also need to appoint his Cabinet, then direct his new secretaries of commerce and state to look at the means of implementing a tariff and the impact it could have.
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