Trump’s Greenland Tariff Threats Drag Asia Markets Lower

Asia-Pacific stock markets opened lower on Tuesday as President Donald Trump's threats to slap tariffs on several European nations over their stance on Greenland rattled investors. The moves came after Trump said over the weekend he would impose a 10% tariff starting February 1 on goods from Denmark, Norway, Sweden, France, Germany, the Netherlands, Finland, and the United Kingdom unless Denmark sells Greenland to the U.S. He plans to raise that to 25% by June 1.

Background

Trump has pushed for U.S. control of Greenland for years, calling it a matter of national security due to its location in the Arctic and its mineral resources. Greenland is a self-governing territory of Denmark, and its leaders have rejected the idea multiple times. Last week, European NATO allies announced plans to send troops to Greenland for military exercises to boost security there. Trump sees this as opposition to his goal.

The tariff announcement followed a meeting in Washington between U.S. Vice President JD Vance, Secretary of State Marco Rubio, Danish Foreign Minister Lars Løkke Rasmussen, and Greenland's representative Vivian Motzfeldt. That talk set up a working group to discuss the issue, but Trump did not back down. He made the tariff threat public during a speech on rural health care on Friday.

In Greenland, people protested over the weekend. Crowds marched in the capital, Nuuk, under the banner 'Stop Trump.' Greenland's Prime Minister Jens-Frederik Nielsen said his people choose Denmark over the U.S.

European leaders reacted quickly. U.K. Prime Minister Keir Starmer called the threats 'completely wrong' after talks with Danish Prime Minister Mette Frederiksen, European Commission President Ursula von der Leyen, and NATO Secretary-General Mark Rutte. Italy's Giorgia Meloni said the tariffs were a mistake and that Europe's troop plans aimed to counter other threats, not the U.S.

Denmark's Rasmussen said the troop deployments were to improve Arctic security, not to block the U.S. He called Trump's wish to take Greenland 'totally unacceptable.' Von der Leyen said Europe stands united, and Greenland's future is for Danes and Greenlanders to decide.

Key Details

Tariff Targets and Timeline

The tariffs target eight countries: Denmark, Norway, Sweden, France, Germany, the U.K., the Netherlands, and Finland. They hit all goods sent to the U.S. The 10% rate starts February 1. It jumps to 25% on June 1. Trump ties this directly to Denmark agreeing to sell Greenland.

Asia markets felt the heat early Tuesday. Tokyo's Nikkei 225 fell 1.2% in morning trade. Hong Kong's Hang Seng dropped 0.8%. Sydney's ASX 200 shed 0.9%. Seoul's Kospi was down 1.1%. Traders pointed to fears of wider trade fallout. European exporters to the U.S. could face higher costs, hurting supply chains that link to Asia.

U.S. futures pointed lower too, with Dow Jones futures off 0.4%. Investors worry the tariffs could spark retaliation and slow global growth.

U.S. Pushback

Even some Republicans spoke out against Trump. Nebraska Rep. Don Bacon called it 'appalling' and 'embarrassing.' He said Denmark is a close friend and NATO ally. Bacon argued Congress should take back control over tariffs.

"This is appalling. Greenland is a NATO ally. Denmark is one of our best friends… so the way we’re treating them is really demeaning and it has no upside." – Rep. Don Bacon

North Carolina Sen. Thom Tillis called it 'beyond stupid' and bad for U.S. businesses and allies. A bipartisan group of U.S. lawmakers, including Sens. Jeanne Shaheen and Tillis, visited Copenhagen recently. They urged working with Denmark on Arctic security without force or buyouts.

Alaska Sen. Lisa Murkowski said the moves play into Russia's hands and harm U.S. leadership. Senate Minority Leader Chuck Schumer said Democrats plan a bill to block these tariffs.

Trump has not ruled out military force to get Greenland. He told reporters he needs it for security and that NATO should help.

What This Means

The tariff threats add pressure on already tense trade relations. Europe relies on U.S. markets for cars, machinery, and farm goods from the listed countries. Higher tariffs mean pricier exports, which could lead to job cuts and slower economies there. Asia feels it through linked supply chains—think auto parts from Germany going to Japan factories, or tech components routed via Europe.

Greenland holds rare earth minerals key for batteries and electronics. U.S. firms want access without owning the land outright. Allies offer cooperation on mining and defense under current treaties. Tariffs risk pushing them away.

Global markets now watch for retaliation. Europe could hit back with duties on U.S. goods like whiskey, motorcycles, or soybeans. That would hurt American farmers and makers. NATO ties strain too—dividing allies when Russia and China eye the Arctic.

Investors shift to safe assets like gold and U.S. Treasuries. Oil prices dipped as trade fears grew. Central banks may need to step in if growth slows. The Federal Reserve watches closely, as tariffs act like tax hikes that cool spending.

In Asia, export-heavy economies like South Korea and Japan brace for ripples. Companies with U.S. sales, from Samsung to Toyota, see shares slip. Broader risk sentiment sours, pulling money from stocks to bonds.

Trump's team pushes ahead with health care plans and rural investments, but Greenland overshadows them. Meetings continue, but no quick fix in sight. Markets expect more volatility until leaders talk it out.