Trump Imposes Tariffs on Sweden Over Greenland Dispute, Sparking Political and Economic Tensions

On January 17, 2026, former U.S. President Donald Trump announced a 10% tariff on Sweden and several other European countries, effective February 1, 2026, in a move directly linked to the geopolitical dispute concerning Greenland's sovereignty. The tariffs are set to rise to 25% starting June 1 and will remain in place until a complete purchase agreement for Greenland is achieved.

Trump framed the tariffs as a response to military deployments and diplomatic visits by NATO allies, including Sweden, to Greenland—a Danish autonomous territory—which he claimed risks global security. He cited alleged security threats posed by Russia and China interested in Greenland, asserting that Denmark’s defense of the territory is inadequate. Trump warned that these countries’ actions create a "dangerous situation for peace and the planet's survival."

Sweden’s Prime Minister Ulf Kristersson strongly rejected Trump's actions, stating, "We will not be blackmailed," and affirming that decisions regarding Greenland belong solely to Denmark and Greenland themselves. Prime Minister Kristersson also revealed that Sweden was coordinating a joint response with other affected European nations.

Former Prime Minister Carl Bildt criticized the tariffs as a violation of EU-US relations with potentially severe consequences for ongoing trade negotiations, warning they could be detrimental to the US-EU trade agreement. Karin Karlsbro, vice-chair of the European Parliament's trade committee, echoed these concerns, indicating that the tariffs undermine conditions for further trade progress and that the EU must prepare to respond robustly.

Economic experts voiced apprehension about the broader impact, with SEB’s Robert Bergqvist warning of a possible escalation into a global trade war involving the EU. Sweden’s economy could be affected, particularly industries like automotive and pharmaceuticals, given that the U.S. accounts for about 9% of Swedish exports. However, economic commentators cautioned against immediate consumer panic but acknowledged the seriousness of the situation.

This tariff escalation represents a sharp turn from typical trade disputes into contested territorial claims, highlighting increasing geopolitical friction. The U.S. and several European countries, including Sweden, remain at odds over Greenland’s strategic importance and sovereignty, setting the stage for continued diplomatic tensions and potential economic fallout.