The European Union has a trade coercion instrument against Trump’s tariffs, the trade bazooka, and there is increasing pressure to use it in response to threats of buying or invading Greenland, a semi-autonomous territory belonging to the Kingdom of Denmark.
French President Macron is one of the advocates for using the trade bazooka, while Italian leader Meloni claims that Trump’s tariffs are a “mistake,” according to EuroNews. Meloni stated that she spoke with the American president by phone on Sunday.
European Commission President Ursula von der Leyen and European Council President António Costa have already stated that European leaders will decide in a coordinated manner on their next steps after the Trump administration threatened to impose a new 10% tariff on all products from eight European countries, including Denmark, Germany, and France. Furthermore, Trump threatened that more retaliatory measures could be taken until an agreement is reached for the “complete and total purchase of Greenland.”
Denmark leads the group targeted by US tariffs, which includes Sweden, Finland, France, Germany, the Netherlands, and the United Kingdom. The group released a joint statement saying that tariff threats undermine the transatlantic relations and risk a dangerous downward spiral”
The eight stated their “full solidarity” with Denmark and intensified their efforts to strengthen security in the Arctic, stating that a joint exploration mission by European forces, which drew the ire of the White House, does “not pose a threat to anyone.”
EU ambassadors have an extraordinary meeting scheduled for 5 pm on Sunday, January 25th, where they are expected to discuss the use of the trade bazooka, a coercive tool against the US should the White House follow through on its threat to impose new tariffs starting February 1st.
Euronews cites a source close to the Élysée Palace who reveals that French President Emmanuel Macron is expected to ask the EU to explore all available tools, including the bloc’s coercive instrument. According to the same source, Paris considers Trump’s statements an unacceptable threat from the US.
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The EU 27 have responded to Donald Trump’s forceful positions with diplomacy, attempting to achieve results by trying to appease their long-standing partner.
The European Commission, led by von der Leyen, was accused of allowing an humiliation by the Trump administration last summer when the EU and the US signed an agreement that tripled tariffs on European products to 15%, while reducing tariffs on US industrial goods to zero.
According to the Brussels leadership, the disparities in the agreement were the price to pay for US involvement in Ukraine and for global stability, allowing much-needed clarity for businesses and helping to ease transatlantic tensions. Now, faced with yet another attempt at intimidation by Trump, the reactions of the 27 are geared towards considering retaliatory measures.
The Prime Minister of Sweden, Ulf Kristersson, a Danish neighbour and ally, made it clear that the bloc would not be “blackmailed.” Macron echoed this sentiment, stating that the EU would not be intimidated by threats.
What is the trade bazooka?
The bazooka is an anti-coercion instrument adopted in 2023 to combat political blackmail through trade. Its use would allow the EU to restrict the participation of third countries in public tenders, limit trade licenses, and block access to the single market.
Former EU commissioners Paolo Gentiloni and Cecilia Malmstrom, who created the anti-coercion instrument during Ursula von der Leyen’s first term as head of the EC, have no doubt that the EU should implement the trade bazooka.
“This constant threat of tariffs is becoming ridiculous. It’s time for Europe to take a stand. There are countermeasures, including the anti-coercion instrument. Greenland is not for sale,” Malmstrom declared in a post on the social network X.
