The storm over Greenland may have abated for now, but Europe’s relations with Donald Trump remain grim.
Europeans need to face facts: they cannot rely on the mercurial US president to protect them from Russia; indeed, he too poses a threat.
Now, then, is the time to accelerate plans to reduce Europe’s military, economic and technological dependence on Trump’s America and to build new partnerships with like-minded powers.
Greenland climbdown
Start with the good news. On a dizzying day in Davos on 21 January, Trump suddenly backtracked on his threats to use tariffs – and even potentially force – to seize Greenland from Denmark, a NATO ally.
Instead, he claimed that a vague “framework of a future deal” negotiated with NATO Secretary-General Mark Rutte could satisfy him. The US would expand its military and mining presence in Greenland and NATO its Arctic activities, while China and Russia would be excluded. America would also have first refusal on acquiring Greenland if it became available.
Now that Trump has backed down, compromise ought to be possible. Denmark was already offering him nearly all of the above; its only red line is not ceding sovereignty to the US against Greenlanders’ wishes. The EU has also rescinded its retaliation threats. But unfortunately, the truce may be only temporary, while the damage to the transatlantic relationship is enduring.
Mistrust and contempt
Trump disdains the US’s NATO allies. Even though they rallied to America’s side after 9/11 – 44 Danes died fighting in Afghanistan, roughly as many as American losses as a proportion of their respective populations – he dismisses their contribution.
Nor does he share mainstream European values: he despises the EU’s commitment to liberal democracy and international law, preferring the xenophobic nationalism of Europe’s far-right. And he views the EU itself as a conspiracy against the US, not least because its collective clout enables it to regulate American tech giants.
It would be foolish for Europeans to trust Trump to defend them. Like a mafia boss, he views NATO as a protection racket and Europeans as vassals to be extorted. Whenever he wants, he could revive his Greenland threats, strike a deal with Russia’s Vladimir Putin at Ukraine’s expense and abandon NATO.
Self-defence
Europe must therefore reduce its dependence on Trump as quickly as possible. It must urgently bolster its defences, judiciously disentangle its economy from the US and boldly diversify its global partnerships.
The top priority is defence. European leaders need to be upfront with voters. We are already, in effect, at war with Russia. Putin’s ambitions do not stop in Ukraine, and he is already attacking the rest of Europe through sabotage, cyberattacks, election interference, drone disruption, assassinations, nuclear threats and much else.
While fully replacing the US’s role in European defence will take years, big progress can be made quickly: witness how Ukraine upped its game within months of Putin’s full-scale invasion in 2022.
Europe could do three big things fast. First, spend much more, not by 2035, but right now. There is ample scope to borrow more for defence at European level. But if domestic tax rises or spending cuts prove necessary, so be it. The state’s first priority is to defend its citizens. Failing to rearm would be a false economy.
Second, invest massively in Ukrainian drone production. This would aid Ukraine’s defence and enable Europe to erect a drone wall along its long border with Russia.
Third, develop a joint nuclear deterrent among the NATO countries that surround the Baltic Sea. Sweden and Finland already have nuclear reactors and the scientific expertise to develop atomic weapons. France and the UK, Europe’s two existing nuclear powers, should also develop a nuclear deterrence strategy for defending the rest of NATO if the US won’t.
With a defence splurge, a drone wall and an enhanced nuclear deterrent, Europe could better defend Ukraine, deter Putin from further aggression and stand up to Trump’s blackmail.
Economic resilience
The next priority is to reduce Europe’s economic vulnerability.
International trade is a wonderful thing, but not when it is used as a weapon of coercion. As Canada’s prime minister Mark Carney rightly put it in Davos, “You cannot ‘live within the lie’ of mutual benefit through integration when integration becomes the source of your subordination ... when the rules no longer protect you, you must protect yourself.”
Fortunately, the EU is much less dependent on trade with the US than Canada. Its exports to the US total €822 billion, around 4.5% of GDP. And contrary to Trump’s claim that the EU has a huge trade surplus with the US, its surplus in goods is largely offset by a deficit in services. Overall EU imports are €774 billion, around 4.3% of GDP. So, if Europe could defend itself militarily, it could stand its ground economically too.
But the EU still ought to diversify away from the US, especially in critical sectors which Trump can use as leverage, such as technology, energy and finance. It needs to pour money into European venture-capital funds to invest in local tech start-ups while easing stifling regulation, and not allow promising businesses to be purchased by US tech giants.
It should accelerate the energy transition to reduce its dependence on foreign fossil fuels, not least American (and Russian) gas. And it should strengthen the euro’s geopolitical role as an alternative to the debased US dollar, not least by issuing more EU bonds.
Diversification
Reducing Europe’s dependence on Trump’s America does not mean going it alone. As Carney wisely put it, “collective investments in resilience are cheaper than everyone building their own fortress.” Europeans know this: it is the basis of the EU. But now this needs to be applied more widely.
The final priority is thus to develop and deepen partnerships that bypass America. The EU needs to build closer connections with like-minded powers, such as Canada, Japan and the UK, new ones with emerging powers such as India, and also cooperate with China on the likes of climate change.
A good start would be to provisionally implement the new trade deal with the South American countries of Mercosur, which the European Parliament has shamefully tried to delay.
Europe needs to become a fortress militarily, but remain open to trade with allies.
