Trump Drops Greenland Tariff Threat After NATO Talks In Davos

U.S. President Donald Trump has stepped back from threats to impose tariffs over Greenland, saying a framework for a deal has been reached that could ease a dispute with Denmark and avert a sharp rupture in transatlantic relations, according to Reuters.

Speaking on Wednesday during a trip to Davos, Switzerland, Trump ruled out the use of force and said Western allies were close to an agreement over the strategically important Arctic territory, home to about 57,000 people. The shift followed weeks of rhetoric in which Trump had threatened tariffs on U.S.-bound exports from eight European countries as leverage, reported Reuters.

After meeting NATO Secretary General Mark Rutte on the sidelines of the World Economic Forum, Trump said allies could reach a long-term arrangement that addressed U.S. security concerns, including missile defence and access to critical minerals, while limiting Russian and Chinese influence in the Arctic.

“It’s a deal that everybody’s very happy with,” Trump told reporters. “It’s a long-term deal. It’s the ultimate long-term deal. It puts everybody in a really good position, especially as it pertains to security and to minerals.”

“It’s a deal that’s forever,” he added.

Rutte later said the question of Greenland’s status did not arise in his discussions with Trump. “That issue did not come up anymore in my conversations tonight with the president,” Rutte said in an interview on Fox News’ Special Report with Bret Baier. He said Trump was focused on how allies could protect the Arctic region amid growing Chinese and Russian activity.

Earlier on Wednesday, Trump had delivered a lengthy speech that included scolding remarks and dismissive threats towards countries unsettled by his push to seize territory from a NATO ally. European diplomats told Reuters that the president’s change in tone did not resolve underlying tensions but helped cool an open rift as allies continued private discussions.

It remained unclear what kind of agreement could satisfy Trump’s earlier calls for outright “ownership” of Greenland, which its residents and leaders have repeatedly said is not for sale. A NATO spokesperson said negotiations between Denmark, Greenland and the United States would continue, aimed at ensuring Russia and China “never gain a foothold – economically or militarily – in Greenland,” according to Reuters. No date or venue was announced.

Trump said Vice President JD Vance, Secretary of State Marco Rubio and envoy Steve Witkoff would be involved in further talks. Russian President Vladimir Putin, quoted by Russian news agencies, said developments in Greenland were of “absolutely no consequence” to Moscow.

In a post on his Truth Social platform, Trump said the United States and NATO had “formed the framework of a future deal with respect to Greenland and, in fact, the entire Arctic Region,” adding that “based upon this understanding, I will not be imposing the Tariffs that were scheduled to go into effect on February 1st.” Reuters noted that the reversal was the latest instance of Trump stepping back from major policy threats ahead of self-imposed deadlines in his second term.

Denmark said the issue should be handled through quiet diplomacy rather than public exchanges. “What is crucial for us is that we get to end this with respect for the integrity and sovereignty of the kingdom (of Denmark) and the right of the Greenlandic people to self-determination,” Foreign Minister Lars Lokke Rasmussen told public broadcaster DR. He said he had spoken with Rutte but did not disclose details. Greenland’s government did not respond to requests for comment.

Trump also acknowledged that financial markets had been unsettled by his earlier threats and again ruled out military action. “People thought I would use force, but I don’t have to use force,” he said at the World Economic Forum. “I don’t want to use force. I won’t use force.”

The change in stance helped lift U.S. equities. The S&P 500 index rose 1.16%, its biggest one-day percentage gain in two months, after sharp losses earlier in the week linked to Trump’s hawkish comments on Greenland, Reuters reported.

Trump’s remarks dominated his Davos visit. He criticised European governments on issues ranging from energy and immigration to trade and defence, casting himself as a defender of Western values. “We want strong allies, not seriously weakened ones,” he said. “I love Europe and I want to see Europe go good, but it’s not heading in the right direction.”

While taking force off the table over Greenland, Trump highlighted U.S. military power, citing recent operations including the removal of Venezuela’s President Nicolas Maduro earlier this month. He described Denmark as “ungrateful,” downplayed the territorial dispute as a “small ask” over a “piece of ice,” and argued that U.S. control would not threaten NATO. He also mistakenly referred to Greenland as Iceland on several occasions.

“No nation or group of nations is in any position to be able to secure Greenland other than the United States,” Trump said. “You can say yes, and we will be very appreciative, or you can say no, and we will remember.”

Trump also criticised Britain over North Sea oil production, Switzerland over its trade surplus, France’s pharmaceutical policies, Canada’s relations with the United States, and NATO’s burden-sharing. His comments were met largely with silence and occasional nervous laughter from the audience.

According to Reuters, sources familiar with the matter have said Trump’s push on Greenland is linked to a desire to build a legacy by expanding U.S. territory on a scale not seen since Alaska and Hawaii became states in 1959.

Trump was expected to meet Ukrainian President Volodymyr Zelensky on Thursday and was seeking support from dozens of leaders for a proposed Board of Peace initiative aimed at resolving global conflicts, a move diplomats have warned could undermine the United Nations, Reuters reported.

(With inputs from Reuters)