President Donald Trump is threatening to impose additional tariffs of 10% on goods from eight European nations starting Feb. 1 if Denmark does not agree to sell Greenland to the U.S. Those tariffs will rise to 25% on June 1.
Trump has repeatedly argued that U.S. control of Greenland is vital to stave off Russian and Chinese interest in the Arctic region.
USTR Says U.S. Action on Tariffs is Justified
U.S. farmers are concerned about rising trade tensions with the European Union, but U.S. Trade Representative Jamieson Greer calls the president’s recent actions justifiable.
“So, I would say that that is an appropriate use of tariffs,” Greer says. “I have, as you noted, gone over the economic rationale for all of this in the United States, and in other countries as well, there’s a long history of using tools that are at the nexus of economics and national security.”
Greer adds the EU is not upholding their end of the recent trade and tariff framework.
“Europeans have not lowered a single tariff for us,” he says. “The reality is, if you look at the trade agreement as drafted, the joint statement, it doesn’t solve every problem, nor was it intended to.”
He further points to specific trade issues hurting U.S. agriculture.
“There are things that are not addressed in the trade agreement,” he continues. “It doesn’t fix all of the agricultural issues we have with Europe. Some of them it does. It doesn’t fix the regulatory issues, which are hugely problematic.”
Europe Threatens Retaliation
In response, Annie Genevard, agriculture minister of France says the EU is considering retaliatory tariffs on U.S. goods including agriculture of up to $93 billion euros.
“In this escalation of tariffs, he [Trump] has much to lose as well, and so will his own farmers and his own manufacturers,” she says.
The EU is looking to implement a never-before-used range of economic counter-measures known as the “Anti-Coercion Instrument,” according to Genevard.
“In any case, we need to approach this with a certain degree of force,” she says. “It’s clear that with Donald Trump, it’s no longer about the law, it’s about force.”
The market is also fearful this action could derail the current trade frameworks struck with the EU and other countries or cause them to sell U.S. treasuries. Plus, China could retaliate against the U.S. or use this to justify a takeover of Taiwan.
U.S. Farmers Concerned With Trade Tensions and Tariffs
Farmers with Tariffs Cost U.S., a campaign highlighting the impact tariffs are having on rising input costs and lower farm profitability, stated in a news conference the tariffs could hurt U.S. grain exports, and their use to leverage purchasing Greenland is unprecedented.
Benjamin Peterson, farmer with E. L. Peterson Ranch in Montana says he doesn’t understand how Greenland presents a national security risk.
“We have a military base there already,” Peterson says. “If we need to bolster it up, so what? Do it, but this it doesn’t make sense. And no, it’s not justified, and it will have an impact exclusively on the grain markets.”
Peterson says there are also long-term repercussions that could keep countries from doing business with the U.S.
“The long-term fact is it makes us an unreliable trading partner, and unreliable trading partners mean they don’t want to work with us — not just now, that means ever,” he says.
