European Lawmakers Suspend U.S. Trade Deal Amid Greenland Tariff Tensions

The European Union’s legislative body on Wednesday halted work on formally approving a major trade deal reached last summer with the United States, citing escalating tensions over President Trump’s demands regarding Greenland.The move was announced shortly after Mr. Trump, during a speech at the World Economic Forum in Davos, Switzerland, declared that America would not use military force to seize the Arctic territory. Yet he did not withdraw his threat of imposing a 10 percent tariff on European goods starting Feb. 1 if his demands to acquire Greenland were not met.Bernd Lange, the chairman of the European Parliament’s international trade committee, described the president’s assurance regarding military force as “a small positive element,” but emphasized that work on the trade pact could not continue under current conditions.“Given the continued and escalating threats, including tariff threats, against Greenland and Denmark, and their European allies, we have been left with no alternative but to suspend work” on the deal, Mr. Lange said. “Until the US decides to re-engage on a path of cooperation rather than confrontation,” no steps to move the deal forward would be taken.In a post on X, Mr. Lange added: “Our sovereignty and territorial integrity are at stake. Business as usual is impossible.”The dispute threatens a massive economic relationship. As of 2024, trade in goods and services between the U.S. and the E.U. is worth $1.5 trillion annually.The announcement follows Mr. Trump’s statement on Saturday that he would hit seven EU countries, plus the United Kingdom, with tariffs if the United States was not allowed to control Greenland. Mr. Lange noted that Mr. Trump is “using tariffs as an instrument of political pressure” to acquire the territory, describing it as “an attack against the economic and territorial sovereignty of the European Union.”The suspended trade agreement, often referred to as the “Turnberry deal,” was reached in July during a visit by European Commission President Ursula von der Leyen to Mr. Trump’s golf club in Scotland. The core of the pact involved capping American tariffs on most EU imports at 15 percent, while removing tariffs on items such as generic pharmaceuticals. In exchange, the EU agreed to lower tariffs on specific US goods, aiming to assist American agricultural and industrial companies. “In politics as in business, a deal is a deal,” Ms. Von der Leyen said Tuesday in Davos. “When friends shake hands, it must mean something.”Mr. Lange said Wednesday that “there was a breaking of the Scotland deal by President Trump,” and warned that as long as the tariff threat remains, “there will be no possibility for compromise.”European leaders from the 27 bloc nations are set to meet Thursday to discuss a coordinated response. This could include a retaliatory package worth nearly $110 billion affecting exports ranging from Boeing airplanes to Kentucky bourbon. The bloc is also reportedly considering deploying its “Anti-Coercion Instrument,” sometimes called the E.’s trade “bazooka.”The economic weapon was originally proposed in 2021 to counter Chinese economic coercion. It allows the European Commission to target foreign goods with wide-ranging restrictions, such as lifting intellectual property protections or banning market access to the Eurozone.“This was created exactly for such a case when a foreign country [uses] tariffs and investment for political and coercive pressure,” Mr. Lange said, confirming the Committee on International Trade would discuss using the bazooka.

European Lawmakers Suspend U.S. Trade Deal Amid Greenland Tariff Tensions

European Lawmakers Suspend U.S. Trade Deal Amid Greenland Tariff Tensions

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