President Donald Trump’s latest bid to pressure Denmark over Greenland has widened into a trade confrontation with key European partners, prompting the European Union to prepare a slate of retaliatory measures and consider deploying its never-used Anti-Coercion Instrument (ACI), sometimes dubbed a “trade bazooka.”
On Saturday, Trump said the United States would impose a 10% tariff from February 1 on imports from Denmark, Sweden, France, Germany, the Netherlands, Finland, Britain and Norway, with the rate rising to 25% from June 1 if no agreement is reached—linking the demands to Washington’s push to secure control over mineral-rich Greenland. EU officials and diplomats described the tactic as economic blackmail aimed at a NATO ally’s territory.
European representatives convened an emergency round of talks on Sunday as leaders weighed both immediate tariff retaliation and broader countermeasures. According to Reuters, EU policymakers are considering reviving and repurposing a previously prepared counter-tariff package worth €93 billion (about $108 billion) in U.S. goods—measures first drawn up during last summer’s U.S.-EU tariff standoff and later delayed as talks continued.
France has urged the bloc to go further by activating the ACI, which entered into force in late 2023 and is designed to deter and respond to economic coercion against the EU or its member states. The instrument can, as a last resort, enable restrictions beyond goods tariffs—potentially touching areas such as market access and other economic levers—though EU officials caution it could take time to implement.
The stakes are significant given the volume of transatlantic commerce. U.S. goods trade in 2024 totaled roughly $236.1bn with Germany, $147.7bn with the UK, $122.3bn with the Netherlands, and $103.3bn with France, according to U.S. Census Bureau figures.
The dispute lands as U.S. partners accelerate diversification: Canada this week announced a tariff-cutting trade reset with China, while the EU and South America’s Mercosur bloc signed a long-negotiated free trade agreement that still requires ratification.
