No more military action, no more tax hikes! Trump stages "Greenland TACO" at Davos.

U.S. President Trump made a dramatic turnaround at the Davos World Economic Forum, shifting within just a few hours from threatening military action and imposing tariffs to seeking a negotiated solution on the Greenland issue. This sudden pivot stems from days of behind-the-scenes mediation by European leaders, ultimately leading to the formation of a preliminary framework agreement involving Arctic security, mineral resources, and military bases.

When European leaders arrived in the Swiss Alps on Wednesday afternoon, they were still panicking over Trump's Greenland ambitions, which could trigger a transatlantic conflict. But by sunset, Trump had explicitly stated he would not use force to seize Greenland and had cancelled the previously promised tariffs on European countries. After meeting with NATO Secretary General Mark Rutte, he announced that a "framework for a future agreement" had been formed regarding the world's largest island.

This shift relieved European leaders facing economic turmoil and threats to NATO stability. Just days before, Trump had refused to rule out the possibility of using military force to acquire Greenland. According to Xinhua News Agency, on the early morning of the 20th, Trump posted a photo on social media showing him meeting with European leaders in the White House Office, with a map on a display board behind him where, besides the mainland United States, Canada, Greenland, and Venezuela were all covered by the U.S. flag. Last weekend, he warned that if an agreement to acquire Greenland could not be reached, he would impose a 10% tariff on eight countries starting next month, rising to 25% in June.

According to The Wall Street Journal on Wednesday, this shift was the result of several days of behind-the-scenes dialogue between Trump, his advisers, and European leaders. The European side maintained solidarity in opposing Trump’s move for Greenland, employing incentives such as enhancing Arctic security commitments and warnings about the dangers to America of a deep NATO breakdown.

Framework Agreement Emerges

According to European officials familiar with the discussions, the negotiations are expected to focus on several core areas. These include a potential agreement between the United States and Denmark on the stationing of troops at the Greenland base, and expanded European efforts in Arctic security. The U.S. may gain the right of first refusal for investments into Greenland's mineral resources—this veto power is designed to prevent Russia from developing the island's wealth—in exchange, Trump would withdraw his tariff threats.

In an interview with reporters, Trump described the framework as "really great," but provided few details. He said he assumed Denmark, which controls Greenland, had been informed about the potential agreement. White House press secretary Karoline Leavitt said in a statement: “If this agreement is reached, President Trump is very hopeful that it will happen, and the U.S. will be able to realize all its strategic objectives in Greenland at extremely low cost.”

The White House declined to comment on details of the proposed framework, and a Trump administration official said the scope of negotiations had not yet been determined. A NATO spokesperson said that Trump and Rutte "discussed the critical significance of Arctic security for the U.S. and other NATO member states" on Wednesday. Talks on the proposed framework will focus on how NATO members can cooperate to secure the Arctic, while more specific negotiations between Denmark, Greenland, and the U.S. will aim to ensure "Russia never gains an economic or military foothold in Greenland."

24 Hours: From Hardline to Compromise

According to the Wall Street Journal, Trump sent early signals of willingness to reach an agreement during a one-hour speech at the World Economic Forum on Wednesday. He stated he would not deploy troops to seize control of Greenland, a sharp contrast to his refusal days earlier to rule out military action. "I don’t have to use force," he said, "I don’t want to use force. I won’t use force."

But Trump also sharply criticized longtime allies in his speech, describing Europe as vastly different from its earlier days and heading in the wrong direction, accusing Denmark of ingratitude, claiming Switzerland would not exist as a country without U.S. support, and mocking French President Macron for wearing aviator sunglasses at the event. He implied that NATO member states have an obligation to support U.S. acquisition of Greenland, since the U.S. plays the central role in upholding the transatlantic alliance. "We pay so much and get so little in return," he said.

"We want a chunk of ice to protect the world, and they won’t give it," Trump said about his desire to obtain Greenland from Denmark. "You could say yes and we’d be very grateful. Or you could say no and we’d remember."

Trump’s speech in the crowded main conference hall of global elites was met with a lukewarm reaction, drawing some light applause but also many confused stares and nervous laughter. On Wednesday evening, Trump posted on Truth Social that he would delay imposing tariffs in order to negotiate on the Greenland issue.

Marked Divergence in Interpretations

U.S. and European officials drew mutually contradictory lessons from the Greenland incident. U.S. officials believe Trump’s hardline stance forced European officials to come to the negotiating table, after months of refusing to compromise on Trump’s bid for control of Greenland. European officials meanwhile believe that maintaining a unified front in opposition helped convince Trump to agree to a deal that did not involve acquiring the territory.

Some of Trump’s advisers privately worry that his tough rhetoric has made it harder to reach an agreement with Denmark. In recent days, government officials have discussed compromise proposals, granting the U.S. usage rights to mineral resources and military base land. Some of the president’s outside allies expressed concern after Tuesday’s sharp stock market drop caused by Trump’s tariff threats related to Greenland.

Danish Foreign Minister Lars Løkke Rasmussen said: "Today’s ending is better than the beginning." The leaders of the 27 EU countries are scheduled to hold an emergency summit in Brussels late Thursday. Although they no longer need an immediate plan to deal with a trade war, they now must assess the damage to transatlantic relations.

Davos Tensions Spill Over

In Davos, tensions sometimes appeared behind the scenes. According to attendees, European Central Bank President Lagarde walked out while U.S. Commerce Secretary Lutnick was delivering a speech at Tuesday’s dinner, which some participants saw as a sign of rising transatlantic tensions. At a closed-door dinner for invited VIPs, Lutnick attacked Europe’s energy policy and criticized what he described as the continent’s declining competitiveness on the world stage.

Some dinner guests applauded Lutnick’s emphasis on America’s strength relative to Europe, while others booed. A spokesman for the European Central Bank said by email on Wednesday morning: “No comment.” A spokesman for the Commerce Department said, “During Minister Lutnick’s three-minute speech, nobody hurriedly left. Only one person booed, and that was Al Gore.” Former U.S. Vice President Gore responded that he listened to Lutnick’s speech and “did not interrupt him in any way.”

Canadian Prime Minister Carney said during a speech earlier this week in Davos: “We are reminded every day that we live in an era of great power competition. The rules-based order is fading. The strong can do as they please; the weak must endure whatever they must.”

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