Europe finds itself back in a new, and more severe, tariff fight in World Economy News 21/01/2026 Greenland by all means On Saturday, President Trump announced an extra 10% tariff on Germany, France, the UK, Netherlands, Finland, Sweden, Norway and Denmark as of 1 February until a deal on Greenland is reached. The tariffs would be increased to 25% by 1 June, if no deal is reached by then. As has been the case before, it is not exactly clear how this will work out as there has been no official communication from the White House, yet, just Trump’s announcement on social media. This marks the latest escalation in what has become one of the most critical sources of tension between two allies: the US and the EU. President Trump has repeatedly ramped up his claims on Greenland. In his social media post, Trump stressed that he wanted a deal “for the complete and total purchase of Greenland” and criticised the eight European countries now subject to tariffs for putting “so much at risk, despite all that we have done for them”. The new tariff announcement effectively reopens the trade war between the EU and the US, despite a temporary truce reached in late July. This next phase brings higher stakes and a far tougher approach and serves as a painful reminder, not only of how the relationship between the US and Europe has changed, but also that tariffs have become a multi-purpose policy tool. The rationale for higher tariffs is now even more political and less economic than in the first half of 2025. What’s next? As so often over the last year, things can change very quickly. At the same time, however, last week’s talks in Washington showed that Denmark and Greenland have no interest at all in selling Greenland to the US. While there are many ways to strengthen Greenland’s role in Western security, including through NATO and EU–US cooperation, much will depend on whether the US government’s claim on Greenland is merely a maximalist bargaining position or a genuine ultimate demand. With so many uncertainties in a fast-moving environment, here are just a few considerations from our side that should be taken into account when analysing the next tariff tensions. • The announced tariffs will probably fall under the International Emergency Economic Powers Act (IEEPA) tariffs that are currently subject to a forthcoming rule by the US Supreme Court. If the Supreme Court rules against all earlier IEEPA tariffs, Trump’s latest announcement would be void, and he would have to find other tariffs. Something that would take more time. • The broader trade deal between the US and the EU from last summer hangs in the balance again. The president of the largest party in the European Parliament, Manfred Weber from the EPP, has indicated that they would not vote in favour of ratifying the deal, which means that the EU levying 0% tariffs on US products will not be voted on given the threats regarding Greenland, according to Weber. The vote in Parliament is actually scheduled for this week. European officials also suggested over the weekend that any European commitment included in the trade deal should be put on hold for now. • Related to the ratification of the European tariff commitments in the US-EU trade deal was the suspension of European tariffs on US products, amounting to €93bn. These tariffs were prepared last summer in reaction to President Trump’s ‘Liberation Day’ but were suspended for six months when the US-EU deal was negotiated. These six months will exp