Containers are unloaded at the Port of Newark container terminal in Newark, New Jersey. Photographer: Kena Betancur/Bloomberg
A trade deal between the United States and European Union (EU) is on hold after the European Parliament decided to freeze a ratification vote in response to President Donald Trump’s escalating threats to seize Greenland. The Parliament’s trade committee postponed the vote indefinitely, casting doubt on whether the pact will ever get across the finish line.
The deal has been swept into the deepening crisis between the EU and U.S. over Greenland, which has brought the trans-Atlantic alliance to the brink of rupture. Trump is currently vowing to slap tariffs on several European countries until he is allowed to buy the island, a Danish territory.
“By threatening the territorial integrity and sovereignty of an EU member state and by using tariffs as a coercive instrument, the U.S. is undermining the stability and predictability of EU–U.S. trade relations,” said Bernd Lange, chair of Parliament’s trade committee, in a statement. “We have been left with no alternative but to suspend work” on the trade deal “until the U.S. decides to re-engage on a path of cooperation rather than confrontation.”
The tariff threat, which Trump made over the weekend, prompted EU lawmakers to reconsider their expected ratification vote on the U.S. trade deal, which was struck with Washington last July. The agreement set a 15 percent tariff on most EU goods in exchange for a pledge to erase all tariffs on U.S. industrial goods and some agricultural products. The pact was partially implemented but still needs Parliament’s approval to be finalized.
At the time, the EU concessions were seen as an effort to avoid a full-blown trade war with Trump and to maintain U.S. security guarantees for the continent as Russia waged its war in Ukraine.
But the U.S. president’s Greenland ultimatum has turbocharged long-running European criticism that the pact gave away too much, even prompting proponents to say that final approval should be withheld for now. Trump has said that an additional 10 percent tariff on imports to the United States from eight European countries will go into effect on February 1, and the tariff rate will rise to 25 percent in June, unless he gets a deal for the “purchase of Greenland.”
Today’s decision by the European Parliament was expected after senior lawmakers from the Parliament’s largest political groups proposed a delay on Saturday, following Trump’s tariff announcement.
Manfred Weber, leader of Parliament’s largest group, the center-right European People’s Party, said on Wednesday that “for us as EPP, and I think for all parliamentarians, it’s clear there will be no ratification, no zero-percentage tariffs access to the EU for U.S. products, until we have clarified the question of reliability.”
EU leaders will gather in Brussels tomorrow to discuss their response to Trump’s aggression. Options under consideration include counter tariffs on €93 billion ($109 billion) worth of U.S. goods and the possible deployment of the so-called anti-coercion instrument, which allows the bloc to curb investments into the EU and impose more fees and tariffs.
“Europe prefers dialogue and solutions—but we are fully prepared to act, if necessary, with unity, urgency and determination,” European Commission President Ursula von der Leyen, the EU’s top executive, told EU lawmakers this morning.
Even before Trump’s Greenland saber rattling, the EU–U.S. trade deal faced a rocky path in the Parliament. A group of EU lawmakers opposed the deal from the start, and criticism mounted after the U.S. extended a 50 percent metals tariff to hundreds of additional products. The U.S. then demanded changes to EU tech rules in exchange for rolling back the expanded tariffs, drawing further ire from opponents.
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