The European Union has suspended the final approval process for a major trade agreement with the United States following renewed tariff threats by President Donald Trump linked to Greenland, escalating tensions between Brussels and Washington.
According to officials familiar with the decision, the European Parliament and relevant EU institutions have paused work on the ratification and implementation of the deal that was provisionally agreed last summer. The move comes after President Trump warned that the United States could impose new tariffs on European goods if Denmark and the EU continue to block U.S. strategic and economic interests related to Greenland, the semi-autonomous Danish territory.
Trump’s remarks, which revived his long-standing interest in Greenland’s strategic location and mineral resources, were interpreted in Brussels as a direct economic threat and a breach of the spirit of cooperation underpinning the trade agreement. EU lawmakers and trade officials reportedly expressed concern that proceeding with the deal under such pressure would set a precedent of negotiating under coercion.
The stalled agreement was designed to ease transatlantic trade frictions by reducing tariffs, improving market access for key industries, and strengthening regulatory cooperation. It was also seen as a step toward stabilising economic relations after years of disputes over steel, aluminium, digital taxes and subsidies. However, EU officials now say trust is a prerequisite for progress, and Trump’s tariff warnings have undermined confidence in the process.
Denmark has firmly rejected any suggestion of negotiating Greenland’s status, stressing that the territory is not for sale and that decisions concerning its future rest with the people of Greenland themselves. EU leaders have largely rallied behind Copenhagen, viewing the issue as one of sovereignty and regional security rather than trade.
The European Commission has not formally withdrawn from the agreement but has indicated that no further steps will be taken until there is clarity on U.S. intentions and assurances that trade policy will not be weaponised over unrelated geopolitical disputes. Some lawmakers have also called for a broader review of the bloc’s trade strategy with the United States under Trump’s second term, citing growing unpredictability.
In Washington, the White House has defended the president’s stance, arguing that Greenland’s strategic importance to U.S. national security and access to critical minerals justifies a tougher negotiating position. Administration officials insist that trade remains a powerful tool to advance American interests globally.
The standoff injects fresh uncertainty into transatlantic economic relations at a time when both sides face slowing growth, geopolitical instability and competition from China. Analysts warn that a prolonged freeze could hurt exporters on both sides and reignite a cycle of retaliatory trade measures if rhetoric escalates into action.
For now, the E.U.’s decision sends a clear signal that approval of the deal will remain on ice unless tensions ease and diplomatic ground is restored.
Trump threatens tariffs against nations opposing Greenland takeover
