Fitch warns US-Greenland tariff threats heighten Europe risks
Fitch notes: "The threat of Greenland-related US tariffs on European allies and European retaliatory measures will be subject to intense discussions and implementation remains highly uncertain. But it signifies a serious upsurge in transatlantic tensions, increasing pressure in Europe to raise defense spending, posing risks to trade and growth, and weakening deterrence against future Russian aggression."
The agency adds that initial responses from EU officials indicate that European leaders aim to avoid a cycle of retaliation or further erosion of US commitment to European defense, though some view the Trump administration’s actions as crossing a line.
US President Donald Trump says on Saturday that the United States will impose 10% tariffs on goods from Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands, and Finland starting Feb. 1, rising to 25% in June, unless a deal is reached for what he calls the “complete and total purchase of Greenland.”
European leaders reject the tariff threat and emphasize solidarity with Denmark. On Sunday, the eight countries issue a joint statement condemning the US measure and reaffirming their commitment to Arctic security and national sovereignty, as stated by reports.
Fitch notes that it remains uncertain whether the tariffs will actually be implemented, warning that such measures could also raise prices for US consumers.
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