How will the dispute over Greenland unfold?

Why does Trump want to seize Greenland?

The Trump administration regards obtaining Greenland as a "national security priority" for the United States, and may be motivated by three considerations: advancing geopolitical strategy, strengthening resource control, and shaping political legacy.

As early as 2019, Trump first proposed the idea of purchasing Greenland. Since the start of his second term in 2025, Trump has repeatedly stated in public that he wants to acquire Greenland. In January 2026, according to Xinhua News Agency, Trump explicitly stated, "Obtaining Greenland is a national security priority for the United States." There may be three considerations underlying Trump’s proposal.

First, at the strategic level, Greenland is located in the northeast of North America, guarding maritime routes connecting the North Atlantic and the Arctic Ocean, and is a key part of NATO's anti-submarine warfare system known as the "Greenland-Iceland-UK Gap." The U.S. has a base in the island's northwest, Pituffik (formerly Thule) Air Base, which is the Arctic outpost of the North American Aerospace Defense Command. In recent years, as global climate change intensifies and geopolitical competition heats up, the strategic importance of the Arctic region for shipping and military deployment has increased significantly. Controlling Greenland is of major strategic value to the U.S. for monitoring Arctic military activities and controlling Arctic sea routes.

Second, at the resource level, according to a 2023 research report from the University of Greenland and the Greenland Self-Government's Mineral Resources Department (MMR), 22 out of the 34 critical raw materials recognized by the EU have moderate to high resource potential in Greenland, including rare earths, copper, zinc, nickel, and others. Seizing Greenland may help the U.S. strengthen its critical mineral supply chain.

Third, at the political level, Trump regards promoting U.S. territorial expansion as part of his "America First" diplomatic strategy and a way to build his political achievements. Apart from Greenland, Trump has also claimed he wants to "make Canada the 51st state of the U.S." and "take back control of the Panama Canal."

What hurdles must Trump overcome to "take" Greenland?

Although there are theoretically various approaches such as signing cooperation agreements, purchasing, and military intervention, obstacles exist on both legal and public opinion fronts.

1) In terms of legal procedures, Greenland's 2009 Self-Government Act stipulates that any significant sovereignty change must be approved by the local parliament and put to a referendum. In the U.S., whether through a "Compact of Free Association" (COFA, referencing the 1982 agreements with Marshall Islands and others), land purchase (e.g., 1917 purchase of the Virgin Islands, 1867 purchase of Alaska), or annexation (e.g., 1845 annexation of the Republic of Texas, 1898 annexation of the Republic of Hawaii), congressional participation is required. For example, a resolution to purchase overseas territory must be passed by a two-thirds Senate majority, and payment executed through a joint appropriations bill led by the House and passed by both chambers.

2) Regarding public opinion, Greenland’s Premier and Denmark's Prime Minister have repeatedly clearly opposed U.S. annexation, and currently no political party on the island advocates joining the U.S. In January 2025, a poll by Danish polling agency Verian found that 85% of Greenlanders oppose joining the U.S. In America, according to NBC News on January 8, 2026, several Republican lawmakers, including House Speaker Mike Johnson and Senate Majority Leader John Thune, oppose using force to seize Greenland. CNN, on January 7, 2026, aggregated polling data from Pew, Quinnipiac, Reuters/Ipsos, and Marquette Law School, showing that over 50% of Americans oppose acquiring Greenland.

If the U.S. uses force to seize Greenland, what would it mean for the EU and NATO?

If the U.S. launches military action toward Greenland, it could fundamentally undermine the EU security framework and NATO’s collective security commitments.

1) For the EU, although Greenland is not a formal member, it is an overseas territory (OCT) of the EU. Given Greenland's close ties to Europe, leaders of multiple European countries have expressed opposition to the U.S. seizing Greenland. According to Xinhua, on January 6, 2026, Denmark, France, Germany, Italy, Poland, Spain, and the UK issued a joint statement stressing that Greenland belongs to its people and only Denmark and Greenland can decide their own affairs. If the U.S. uses force to seize Greenland, it could trigger the EU’s Treaty of Lisbon Article 42 collective defense mechanism, but since Greenland is not an official EU member, applicability is uncertain. Currently, while the EU supports Greenland’s sovereignty, it has not provided a clear security commitment. If the EU fails to take effective action, it could damage the foundations of EU cooperation and integration.

2) For NATO, while Greenland has a high degree of autonomy, its defense and foreign affairs are handled by Denmark, making it part of NATO. According to Article 5 of the North Atlantic Treaty, an armed attack against any member is regarded as an attack against all; if the U.S. uses force against Greenland, it may paralyze NATO's core mechanism.

If Greenland's status remains unchanged, what options does the U.S. have to strengthen its interests there?

The U.S. still has multiple options under current frameworks, such as upgrading diplomatic channels, expanding defense agreements, and strengthening resource development to bolster its interests on the island.

1) On the diplomatic front, the U.S.-Greenland Joint Committee annual dialogue was initiated in 2004. The U.S. could upgrade the strategic positioning and frequency of this dialogue to express its concerns.

2) On the security front, the U.S. and Denmark signed the Greenland Defense Agreement in 1951 and the Denmark-U.S. Defense Cooperation Agreement in 2023, both giving the U.S. high freedom to carry out military operations in Greenland and Denmark. Building on this, the U.S. could negotiate with Denmark and Greenland to reinforce its military presence by upgrading bases and deploying more troops.

3) On resources, the U.S. signed an MOU with Greenland in 2019 for joint mineral development, and in 2024 Greenland joined the U.S.-led mineral security partnership. Both sides could extend the MOU for deeper collaboration, and in critical minerals such as rare earths, the U.S. could boost control by directly investing or subsidizing American companies developing local projects.

If the U.S. takes substantial action over Greenland, what are the potential impacts on various assets?

Gold may benefit from rising risk aversion, dollar credibility may suffer further, European assets may come under general pressure, and commodities may see little change.

1) For safe-haven assets, gold could strengthen because of geopolitical uncertainty, with the degree depending on whether the U.S. employs moderate negotiation or direct military force to seize Greenland.

2) For dollar assets, dollar credibility may continue to suffer; U.S. stocks in defense, mining, port infrastructure, and shipping could benefit relatively.

3) For European assets, given the serious negative impact on U.S.-Europe trust and European security, European assets may come under general pressure, whereas European defense stocks may benefit from accelerating defense autonomy.

4) For commodities, although Greenland has potential in energy and mineral resources, development prospects are still uncertain, so commodity price responses may be muted.

Source: CITIC Securities Research

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