President Donald Trump said Tuesday he would not use military force to acquire Greenland but reiterated the United States is best positioned to oversee the territory, challenging U.S. allies and straining relations with Denmark.
In a keynote speech at the World Economic Forum, Trump focused on the U.S. economy and inflation while criticizing what he called Europe’s weakening trajectory. “I love Europe and I want to see Europe go good, but it’s not heading in the right direction,” he said.
“We want strong allies, not seriously weakened ones.”
Trump said he believed Denmark had been ungrateful regarding negotiations over Greenland, an autonomous territory under Danish rule, and dismissed European objections. He also referenced a recent U.S. military operation aimed at removing Venezuelan President Nicolás Maduro.
The president’s appearance drew high attendance, with business leaders including Michael Dell and Marc Benioff attending. His arrival in Davos was delayed by an electrical issue on Air Force One that forced a brief return to Washington.
On Thursday, Trump plans to discuss a new initiative called the Board of Peace, which he says will oversee a ceasefire agreement in Israel’s conflict with Hamas. According to a White House official speaking on condition of anonymity, around 30 foreign leaders are expected to join the board, out of approximately 50 countries invited.
Ahead of the forum, Trump threatened new tariffs on Denmark and seven other U.S. allies unless negotiations over Greenland advanced. He said tariffs would begin at 10% next month and rise to 25% by June, a move that could undercut U.S. efforts to curb living costs.
A text message obtained by European officials showed Trump linking his stance on Greenland to last year’s Nobel Peace Prize decision, writing to Norway’s prime minister that he no longer felt “an obligation to think purely of Peace.”
British Prime Minister Keir Starmer responded to Trump’s threats, saying in Parliament, “Britain will not yield on our principles and values about the future of Greenland under threats of tariffs.”
U.S. Commerce Secretary Howard Lutnick, speaking at Davos before Trump’s arrival, said the administration aimed to deliver a message that globalization is a “failed policy” for the West.
The S&P 500 fell 2.1%, the Dow Jones Industrial Average dropped 1.8%, and the Nasdaq composite declined 2.4% on Tuesday, amid investor concerns over new tariffs and rising tensions with Europe.
French President Emmanuel Macron indirectly addressed the developments, warning against policies based on “the law of the strongest.”
European Commission President Ursula von der Leyen stated the European Union’s response to any new tariffs would be “unflinching, united and proportional.” She said a U.S.-EU trade agreement reached in July 2023 should be honored. “In politics as in business — a deal is a deal,” she said.
Trump also intends to highlight housing affordability, a key concern for voters. He has called for buying $200 billion in mortgage-backed securities to lower rates and supports banning large financial institutions from buying homes.
Scott Lincicome, vice president at the Cato Institute, said the tariff threats could undermine investor confidence and raise interest rates, potentially worsening affordability.
According to a recent Associated Press-NORC Center for Public Affairs Research poll, about six in 10 U.S. adults said Trump’s policies have worsened the cost of living.
Home sales in the U.S. are at a 30-year low, with high prices and mortgage rates limiting access to the housing market.
Trump is expected to expand on the planned Board of Peace Thursday and address its potential global role, which may complement or compete with existing institutions such as the United Nations.
