U.S. President Donald Trump has backed away from using tariffs or military force to push his controversial plan to acquire Greenland from Denmark, easing fears of a major transatlantic rift. After weeks of threats, he dropped the tariff idea and hinted that a preliminary agreement over the Arctic territory could be reached instead.
Trump’s bid to gain control of Greenland, a Danish territory and key NATO outpost, had alarmed European allies who saw it as a direct challenge to an alliance that has underpinned Western security since World War Two. Following talks at the World Economic Forum in Davos with NATO Secretary General Mark Rutte, Trump voiced optimism about a deal that would secure a U.S. missile defence site and access to critical minerals while countering Russian and Chinese influence in the Arctic.
European stock markets steadied on the news, with the pan European STOXX 600 rebounding after earlier losses linked to trade war fears. But officials said many details of any potential agreement remain unclear, including how far Washington might go without challenging Danish sovereignty over Greenland.
Danish Prime Minister Mette Frederiksen welcomed a more constructive tone but insisted that Denmark’s territorial integrity was non negotiable. Defence Minister Troels Lund Poulsen reiterated that Denmark would not give up sovereignty and that any cooperation must respect that red line.
Some NATO leaders warned against premature optimism, stressing that divisions over trade and security could still resurface. Germany’s Vice Chancellor Lars Klingbeil said it was good that talks were ongoing but urged Europeans not to “raise hopes too quickly”.
In Greenland’s capital Nuuk, residents expressed relief that talk of taking the island “by force” had eased, but said they remained cautious given Trump’s shifting rhetoric. Russia’s President Vladimir Putin said Greenland’s ownership was not a concern for Moscow, while China rejected claims that it posed a threat to the island.
The Greenland dispute comes as NATO grapples with the war in Ukraine and worries that a U.S.–Europe split could weaken support for Kyiv. Ukrainian President Volodyr Zenski is due to meet Trump in Davos amid continued Russian airstrikes that have left many parts of Ukraine facing power shortages.
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