Xinhua News Agency, Brussels, January 19 (Reporters: Kang Yi, Zhang Zhaoqing)  On the local time of January 17, US President Trump issued a bombshell statement via social media, announcing additional tariffs on imports from eight European countries including Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland, to force European parties to accede to his core demand of "purchasing Greenland". The move triggered strong collective backlash from Europe, with the European Union activating an emergency coordination mechanism to prepare retaliatory measures. The global steel supply chain is now facing dual risks of trade flow restructuring and sharp price fluctuations.

I. US Unilateral Escalation: Tariffs to Rise in Phases, "Island Purchase" as Core Bargaining Chip

The tariffs do not explicitly specify particular product categories, but cover the core export sectors of Europe to the US. Among them, steel products, as an important part of US-EU trade, have become one of the most directly impacted areas. Sources from the US Department of Commerce revealed that the US may refine the tariff list targeting European advantageous export categories such as steel, automobiles and machinery in the follow-up, to further strengthen the pressure effect. In his statement, Trump bluntly stated that the US has long granted trade preferences to European allies, and now Denmark needs to make a "reasonable return" on the Greenland issue, otherwise economic pressure will continue to escalate.

II. Trigger of the Friction: Arctic Military Exercise Intensifies Greenland Sovereignty Dispute

The direct cause of this US-EU trade friction is the recent "Arctic Endurance" military exercise participated by eight European countries. It is reported that Denmark previously launched the military exercise in Greenland, its autonomous territory, aiming to strengthen Europe's security control and interest claims in the Arctic region. Subsequently, seven countries including France, Germany, the United Kingdom and Norway announced the dispatch of troops to participate. Although the total number of troops is only 37, it was interpreted by the US as a "blatant provocation" to its Arctic strategic interests.

As the world's largest island, Greenland enjoys a high degree of autonomy, but its defense and foreign affairs are still under the control of the Danish central government. At present, the US operates the Thule Air Base on the island, which is an important military fulcrum in the Arctic region. Since taking office in 2025, Trump has repeatedly publicly expressed his intention to purchase Greenland, even threatening to use military means if necessary. This demand that violates the principle of state sovereignty has been firmly rejected by Denmark and many other European countries, and this joint military exercise has become an excuse for the US to escalate trade pressure. In his statement, Trump accused the eight European countries of having "unclear motives" for sending troops to Greenland, claiming that they are "undermining the strategic balance in the Arctic region".

III. Europe's Collective Retaliation: EU Activates Emergency Mechanism, Prepares €93 Billion Retaliation List

The US unilateral tariff coercion quickly triggered strong backlash from European countries. On January 18, permanent representatives of the 27 EU member states held an emergency meeting at the EU headquarters in Brussels, officially launching an inter-member emergency coordination mechanism to discuss countermeasures. The meeting made it clear that the EU is accelerating the sorting out of a list of US imports to the EU worth €93 billion, planning to impose equivalent tariffs on them, and at the same time does not rule out additional retaliatory measures such as restricting the access of US enterprises to the EU market and suspending some trade cooperation projects. The relevant list can be finalized and announced as soon as before February 1.

The European Parliament also released a tough signal simultaneously. Several major political groups clearly stated that they will shelve the approval process of the US-EU trade agreement reached last July. The agreement originally stipulated that the US would impose a 15% tariff on most EU imports to the US, but now this arrangement has been completely stranded due to the new US threat. Manfred Weber, Chairman of the European People's Party, emphasized that the US act of seeking territorial interests through tariff coercion has broken through the bottom line of trade cooperation. The European Parliament will never support the previous trade agreement, and the tariff preferences for relevant US products must be suspended immediately.

In addition, many members of the European Parliament called for the immediate activation of the EU's "Anti-Coercion Instrument (ACI)", known as the "trade nuclear bomb", to form precise retaliation against the US through tough measures such as imposing punitive tariffs, implementing market access restrictions, and suspending patent authorization and technical cooperation. Valérie Hayer, Chairman of the Renew Europe Group, stated bluntly that the US move seriously violates international law and the basic norms of ally relations, and the EU must respond with the toughest stance to safeguard its own sovereignty and trade interests.

IV. Steel Industry Chain Bears the Brunt: Trade Flow Restructuring, Rising Risks of Price Fluctuations

In this trade friction triggered by geopolitical games, the global steel industry has become the core area directly impacted. Europe is an important steel production and export region in the world. Steel products from countries such as Germany, France and the United Kingdom have long relied on the US market. The additional tariffs this time will directly increase the cost of European steel exports to the US, compress the profit margins of enterprises, and force European steel enterprises to accelerate the adjustment of their global export layout.

Industry analysts pointed out that if the US tariffs are implemented as scheduled, European steel enterprises may shift a large-scale of production capacity originally destined for the US market to emerging markets in Asia, Africa and other regions. This will trigger a major restructuring of global steel trade flows, further exacerbating the imbalance between oversupply and undersupply in some regional markets. At the same time, if the EU launches retaliation against US steel and related upstream and downstream products exported to Europe, it will further disrupt the division of labor in the global steel industry chain, pushing up the price fluctuation range of core raw materials such as iron ore and scrap steel, as well as finished steel products.

Affected by this, the stock prices of leading European steel enterprises such as ArcelorMittal and ThyssenKrupp have fluctuated slightly. The market is worried that the continuous escalation of trade friction will erode the profitability of enterprises and drag down the overall recovery process of the industry. In addition, the Arctic region where Greenland is located is an important global reserve of mineral resources, including iron ore, nickel ore and other core raw materials for steel production. The escalation of this dispute may affect the development and transportation of local resources, further increasing the fragility of the global steel supply chain.

V. US-EU in a Deadlock: Sharp Differences in Negotiation Demands, Adding Worries to Global Economic Recovery

At present, the US and the EU are still in a serious deadlock, and no substantial progress has been made in diplomatic negotiations. The European side made it clear that it will maintain a wait-and-see attitude until February 1, and decide the start time and intensity of retaliatory measures according to whether the US actually implements the tariff measures. At the same time, it is actively linking with cross-party forces in the US to try to promote the Trump administration to revoke the tariff decision.

The US side, however, insists on its core demand unchanged, only stating that it is willing to hold negotiations with the eight European countries, but the bottom line of "purchasing Greenland" will not be loosened at all. White House spokesperson revealed that Trump has called media such as Reuters, emphasizing that "Greenland's strategic value to the US is irreplaceable", and tariff pressure is a "necessary means to achieve the goal".