US President Donald Trump has stepped back from his threat to impose new tariffs on a group of European countries, saying he has reached a basic understanding, or “framework,” for a future deal connected to Greenland. The sudden change came just days after he warned that strong trade action was on the way, a move that had unsettled European capitals and rattled financial markets.
Earlier in the week, Trump had announced plans to impose a 10% tariff from 1st February on imports from Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands and Finland. He had also warned that the rate could rise to 25% from June.
Trump slaps 10% tariffs on Denmark, France, others from Feb 1 over #Greenland issue
— IndiaToday (@IndiaToday) January 17, 2026
The US President warned that the tariff would rise to 25 per cent from June 1, 2026, if no agreement is reached on Greenland.https://t.co/nfE5znUW37
These threats were linked to the European countries support for Greenland remaining an autonomous territory under Denmark. The announcement sparked strong criticism from European leaders, who said they would not be pressured, and raised concerns among economists about the impact on global trade.
Writing on his Truth Social platform, Trump stated that the tariffs would not be implemented. He explained that the decision followed a “very productive” meeting with Mark Rutte, the Secretary General of NATO.
According to Trump, the talks led to an understanding on the “framework of a future deal” involving Greenland, though he did not share any concrete details.
Speaking at the Davos economic forum, Trump claimed the arrangement would last “forever” and would benefit both the US and its partners. In an interview with CNBC, he said the idea was still complex and would be explained later. He added that discussions were continuing on a US missile defence shield, which could partly be based in Greenland.
A Nato spokesperson said talks among allies would focus on Arctic security and preventing Russia and China from gaining any economic or military foothold in Greenland. However, Rutte struck a careful tone, saying that while the meeting was positive, there was still a lot of work ahead.
Denmark’s foreign minister, Lars Lokke Rasmussen, welcomed Trump’s statement that he would not use military force to take Greenland and that he would pause the trade dispute. He said these were encouraging signals, but did not offer details on any agreement.
Reports in the New York Times suggested that Nato officials had discussed possible compromises, including the idea of limited US-controlled areas in Greenland. This immediately drew criticism from Greenlandic and Danish politicians.
Greenlandic MP Aaja Chemnitz Larsen said Nato had no authority to negotiate Greenland’s future, insisting that decisions about the island must involve its people. Danish lawmaker Sascha Faxe also dismissed Trump’s claims, saying there could be no real deal without Greenland at the table.
Trump’s decision to back down came as markets reacted nervously to his tariff threats. Wall Street had its worst day since October, something the president later acknowledged. He even joked that the market dip was due to “Iceland”, apparently meaning Greenland.
Despite easing trade tensions, Trump made clear he still wants negotiations over Greenland, saying the US needs it for global security. He repeated that the US would not use force but would rely on economic and diplomatic pressure.
His retreat on tariffs followed a move by the European Parliament to suspend ratification of a US-EU tariff deal, showing that Europe was prepared to push back.
