Trump Reverses Greenland Tariff Threat, Markets Surge After Davos NATO Framework
Updated (2 articles)
Trump Announces Immediate Tariff Cancellation at Davos President Donald Trump publicly withdrew his threat to impose tariffs on eight European allies, including a plan to pressure Denmark over Greenland, during his Davos appearance. He also pledged not to pursue any military seizure of the territory. The reversal followed a discussion with NATO Secretary‑General Mark Rutte about a broader security framework. [1][2]
U.S. Equities Recover Around One Percent After Announcement Following the announcement, the S&P 500, Dow Jones Industrial Average and Nasdaq each climbed roughly 1.2%, erasing the market’s largest losses since October. Analysts noted the rally reflected investor relief that the tariff threat had been removed. The rebound helped restore confidence in U.S.–European trade relations. [1][2]
NATO Framework Redefines Arctic Security and Greenland Policy Trump described a ‘future Arctic security deal’ that would be negotiated with NATO, mentioning the Golden Dome missile‑defense program as a possible component. NATO’s Rutte affirmed the alliance would stand with the United States if attacked, while Denmark’s foreign minister Lars Løkke Rasmussen welcomed the tariff cancellation and called for talks respecting Danish sovereignty. The proposed framework signals a shift from coercive measures to collaborative defense planning. [1][2]
European Leaders Express Skepticism Over U.S. Rhetoric European governments remained wary, with several nations declining invitations to join the Board of Peace initiative that expanded beyond its original Gaza ceasefire focus. Critics warned that Trump’s earlier rhetoric could strain NATO unity and U.S. diplomatic credibility. Analysts acknowledged the damage but argued it could be repaired through careful relationship management. [1]
Greenland Authorities Issue Crisis Handbook Amid Uncertainty Greenland’s government released a crisis handbook advising residents on how to respond to potential disruptions, and many Nuuk citizens, such as Tony Jakobsen, stocked up on supplies. The preparation reflects cautious optimism after the tariff retreat but underscores lingering uncertainty about future U.S. actions. [2]
Sources (2 articles)
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[1]
AP: Markets rally after Trump backs off Greenland tariffs at Davos: Highlights market rebound, Trump’s pledge not to seize Greenland, and growing European skepticism, including Board of Peace refusals.
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[2]
AP: Trump cancels Greenland tariffs after Davos push, pursues Arctic security deal: Focuses on the tariff cancellation, details of the proposed Arctic security framework with NATO, Danish response, and Greenland’s crisis handbook for residents.
Timeline
Oct 2025 – Global equity markets suffer their steepest weekly decline since October, reflecting investor anxiety over Trump’s earlier threats to impose tariffs on eight European allies to force a Greenland transfer. [1]
Jan 21, 2026 – Trump announces at Davos that he cancels the planned Greenland tariffs, citing a newly‑agreed “framework of a future Arctic security deal” with NATO and hinting that talks will later cover the Golden Dome missile‑defense program. [2]
Jan 21, 2026 – NATO Secretary‑General Mark Rutte pledges that the alliance will stand with the United States if attacked, while Danish Foreign Minister Lars Løkke Rasmussen welcomes the tariff cancellation and urges respect for Denmark’s sovereignty over Greenland. [2]
Jan 21, 2026 – Greenland’s government publishes a crisis‑handbook and urges residents to prepare for possible disruption; Nuuk locals such as Tony Jakobsen begin stockpiling supplies, reflecting cautious optimism amid the diplomatic shift. [2]
Jan 22, 2026 – At a Davos appearance, Trump tells attendees he will not pursue military action to seize Greenland and backs off tariff threats, prompting the S&P 500, Dow and Nasdaq to each climb about 1.2% and partially recover earlier losses. [1]
Jan 22, 2026 – Trump discusses a NATO framework with Secretary‑General Mark Rutte, saying the agreement could satisfy U.S. goals and lay groundwork for future Arctic security cooperation. [1]
Jan 22, 2026 – European governments voice growing skepticism toward the U.S. initiative and several nations decline invitations to join the Board of Peace, a project that began with a Gaza ceasefire focus but has since expanded. [1]
Jan 22, 2026 – Security analysts warn that Trump’s rhetoric risks straining NATO unity and U.S. diplomacy, but they argue the damage is repairable if relationships are managed carefully. [1]