EU scrambles to avert Trump Greenland tariffs, prepares retaliation
Trump promised on Saturday that, starting February 1, he would impose a wave of increased tariffs on EU members Denmark, Sweden, France, Germany, the Netherlands and Finland, as well as Britain and Norway, until the US is allowed to buy Greenland, a step that major EU states condemned as blackmail.
EU leaders are set to discuss options at an emergency summit in Brussels on Thursday. One option is a package of tariffs on 93 billion euros ($107.7 billion) of U.S. imports that could come into effect automatically on Feb. 6 after a six-month suspension.
The other is the heretofore unused “Anti-Coercive Instrument” (ACI), which could restrict access to public procurement, investments or banking activities, or restrict trade in services in which the US has a surplus in the bloc, including digital services.
According to an EU source, the tariff package appears to have garnered wider support as an initial response than anti-repression measures; So the picture is currently “very mixed”.
DIALOGUE IN DAVOS
European Council President Antonio Costa, who chairs EU summits, said in a social media post that his consultations with EU members showed their strong determination to support Denmark and Greenland and their readiness to defend them against any pressure.
Danish Foreign Minister Lars Lokke Rasmussen, who visited his Norwegian counterpart in Oslo, said that Denmark will continue to focus on diplomacy, referring to the agreement between Denmark, Greenland and the United States to establish a working group on Wednesday. “The United States is also more than the US president. I was just there. There are checks and balances in American society, too.”
The EU’s dialogue efforts are likely to be the main theme of the World Economic Forum in Davos, where Trump will deliver the opening speech on Wednesday for the first time in six years.
“All options are on the table, talks with the US in Davos and leaders will meet from now on,” an EU diplomat said, outlining the EU’s plan.
The eight targeted countries are currently subject to the United States. Tariffs of 10% and 15% sent small numbers of military personnel to Greenland as disputes with the United States escalate over the future of Denmark’s vast Arctic island.
“Tariff threats undermine transatlantic relations and lead to a dangerous decline,” they said in a joint statement published on Sunday, adding that they were ready to engage in dialogue based on the principles of sovereignty and territorial integrity.
In her written statement, Danish Prime Minister Mette Frederiksen stated that she was encouraged by the consistent messages coming from the rest of the continent and said, “Europe will not be blackmailed.”
The tariff threat has unsettled global markets with the expectation that the euro and sterling will lose value against the dollar and return to volatility.
QUESTION MARKS OVER US TRADE AGREEMENTS
A source close to French President Emmanuel Macron said he was pressing for ACI to become operational. Irish Prime Minister Micheal Martin said there should be no doubt that the EU would retaliate, but it was “a bit premature” to activate the yet-to-be-used tool.
Italian Prime Minister Giorgia Meloni, who is closer to the US President than some other EU leaders, called the tariff threat “a mistake” on Sunday, adding that she had spoken to Trump a few hours earlier and told him what she thought.
Asked how the UK would react to the new tariffs, Culture Secretary Lisa Nandy said allies should work with the US to resolve the dispute.
“Our position in Greenland is non-negotiable… It is in our collective interest to work together and not start a war of words,” he told Sky News on Sunday.
But tariff threats are calling into question the trade deals the US made with the UK in May and the EU in July.
Limited agreements have already faced criticism for their lopsided nature, with the United States required to maintain broad tariffs and eliminate import duties on its partners.
The European Parliament appears determined to suspend its work on the EU-US trade deal. A vote on repealing many EU import duties was due on January 26-27, but Manfred Weber, chairman of the European People’s Party, the largest group in parliament, said late Saturday that approval was not possible for now.
German Christian Democrat lawmaker Juergen Hardt also told Bild newspaper that boycotting the World Cup, which the USA will host this year, could be a last resort “to bring President Trump to his senses about Greenland.”
