The Greenland Gambit: Unilateral Tariffs and the Case for Multilateral Governance
The early weeks of 2026 have witnessed a dramatic escalation in transatlantic tensions, as President Donald Trump announced sweeping tariffs on several European nations—most notably Denmark and Finland—over the ongoing Greenland dispute. Citing the need for “The Golden Dome” missile defense system and expressing concerns over Arctic security, the administration has weaponized trade policy to pressure sovereign nations into a territorial sale. While the administration frames these measures as a tool for national security and economic reciprocity, this unilateral approach highlights a growing crisis in global governance. To ensure a balanced and stable global economy, the authority to regulate international trade and impose tariffs should reside not with individual superpowers, but within a empowered multilateral framework, ideally overseen by the United Nations and its associated bodies.
The Greenland Tariff Crisis of 2026
On January 17, 2026, the White House announced a tiered tariff structure targeting eight NATO allies: Denmark, Finland, Norway, Sweden, France, Germany, the United Kingdom, and the Netherlands. Starting February 1, 2026, imports from these nations will face a 10% tariff, which is scheduled to rise to 25% by June 1, 2026, unless a deal is reached for the “Complete and Total purchase of Greenland.”
The administration’s logic is twofold:
- Strategic Necessity: The U.S. argues that Greenland is vital for modern offensive and defensive weapons systems, claiming Denmark’s “token force” cannot protect the island from Russian or Chinese encroachment.
- Economic Leverage: President Trump has asserted that the U.S. has “subsidized” European security for decades and that tariffs are a legitimate way to “get back” what is owed by forcing a land deal that has been sought for over 150 years.
However, this strategy has been met with fierce resistance. In Nuuk and Copenhagen, protesters have rallied under the banner “Greenland is not for sale,” while European leaders have warned of a “downward spiral” that could dismantle the post-World War II security architecture.
The Perils of Unilateralism
The use of tariffs as a tool of geopolitical coercion creates profound instability. When a single nation uses its market power to dictate the territorial or political decisions of others, it undermines the Most-Favored-Nation (MFN) principle—the bedrock of the World Trade Organization (WTO)—which requires equal treatment for all trading partners.
Unilateral tariffs often lead to:
- Inflationary Pressures: Increased costs for American consumers and businesses reliant on European imports.
- Supply Chain Disruption: Uncertainty that halts investment and shifts production to less efficient regions.
- Retaliatory Cycles: Counter-tariffs from the EU that harm U.S. exporters, particularly in the agricultural and manufacturing sectors.
The Case for United Nations Oversight
The Greenland crisis demonstrates why the “Tariff King” approach is unsustainable for global peace. Instead of trade being used as a weapon for territorial expansion, it should be a mechanism for mutual prosperity. This requires shifting the mandate for “corrective” tariffs to a global body like the United Nations.
While the WTO currently oversees trade disputes, its effectiveness has been hampered by the refusal of major powers to appoint judges to its Appellate Body. By integrating trade regulation more deeply into the UN system—specifically through the UN Trade and Development (UNCTAD)—the international community could establish a more equitable system.
Why the UN is the Right Venue:
- Global Balance: The UN is designed to consider the “benefit of all,” ensuring that trade rules aren’t written solely by the largest economies.
- Non-Coercive Dispute Resolution: If a nation faces a genuine trade imbalance, the UN could authorize limited, supervised tariffs based on objective economic data rather than political whims or territorial demands.
- Holistic Policy: The UN can align trade policy with other global priorities, such as environmental standards and human rights, preventing “race to the bottom” dynamics.
Conclusion
The imposition of tariffs on Denmark and Finland over Greenland is a stark reminder of the volatility of the current international order. When trade becomes a hostage to territorial ambition, the global economy suffers. Moving toward a system where the United Nations holds the authority to regulate tariffs would provide the “certainty” and “predictability” that investors and sovereign nations desperately need. For trade to be truly balanced and beneficial to all, it must be governed by the rule of international law, not the leverage of the loudest voice.