What will the EU do next, the trade bazooka?
Rising tensions and negotiations between the United States and the EU during the WEF meeting in Davos. Is Europe able to defend its interests?
January 21, 2026 | INTERNATIONAL POLITICS
Official photo of the EU-parliament
The US announces punitive tariffs as a result of the Greenland conflict
On Saturday, U.S. President Donald Trump announced a 10% punitive tariff on Norway, Sweden, France, Germany, the Netherlands, Denmark, and the United Kingdom, effective February 1. This followed the conflict between Europe and the United States over Greenland; last week, military personnel were sent from Europe to Greenland without this reportedly having been approved by the United States as a NATO ally.
Furthermore, in a message to Norway’s Prime Minister Jonas Gahr Store, Donald Trump wrote that he does not feel obligated to put peace ahead of the United States since he did not receive the Nobel Peace Prize. Store has not cooperated with the American president since his inauguration a year ago, despite a promise Store made back in November 2024, read more here.
European leaders have, in stronger terms than usual, spoken out against the American president without this appearing to affect the president’s position.
Trade bazooka
French President Emmanuel Macron has asked the European Union to consider deploying its strongest economic instrument, a regulation known as the Anti-Coercion Instrument (ACI). The regulation is an anti-coercion tool designed to protect the EU and its member states from economic coercion by a third country. The ACI, referred to in the press as the trade bazooka, was adopted by the EU in 2023 and has not previously been used.
The question is whether the ACI will have any effect on the American president; it is possible that it will contribute to further escalation of the situation. Society and Politics has, in previous articles, see links below, commented that Donald Trump appears to be pursuing a strategy in which he plans to bypass the EU to achieve his goals. This means that he views each country as an independent state with which he wishes to negotiate, regardless of the EU.
Trump's Board of Peace
Just a few days ago, Donald Trump presented plans for his peace committee, the National Committee for the Administration of Gaza (NCAG). He has invited a number of heads of government to participate in the committee, to which Norway’s Prime Minister Store has given a preliminary no.
At the time of writing, it is unclear who has accepted and who has declined, but among others, Israeli Prime Minister Benjamin Netanyahu is said to have accepted. It is expected that those who have so far accepted will sign during the meeting in Davos.
It remains to be seen how the American president will use his peace committee, but it is likely that in this way he will continue his policy of placing trade and military security in the same negotiating basket. Standing outside the council may therefore have major consequences, read more here.
Will the EU stand united?
The EU has stood united in its protests against the United States in the Greenland conflict, but the road ahead may become more difficult. Implementing the trade bazooka appears unwise; as mentioned, it could lead to an escalation of the conflict, which may be precisely what the American president wants.
If the situation escalates, there is a likelihood that the EU will fracture, and that some countries will choose to enter into bilateral agreements with the United States. In the worst case, the conflict could become so tense that Donald Trump declares the EU a security risk; then the road to war may be short—either as a result of confrontation with the United States or an invasion by Russia/China.
SOURCES
ABC News
Macron urges the EU to consider a trade “bazooka” in response to US tariff threatsPolitico
EU moves closer to using its trade bazooka against the USEuropean Union
The Anti-Coercion Instrument (ACI)BBC
Trump says he will “100%” carry out Greenland tariff threat as EU vows to protect its interestsThe Guardian
Trump threatens a 25% tariff on European allies until Denmark sells Greenland to the USBBC
Trump ties Greenland demands to the Nobel Prize in message to Norway’s leaderCNN
European leaders face a new level of public embarrassment as Trump ramps up the insults
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