Trump says 57,000-person Greenland should be US territory, not Danish

President Donald Trump demanded Greenland be placed under US control and threatened to withdraw all American troops from Europe, deepening a rift with NATO allies.

Trump on July 7 said the Arctic island of 57,000 people "should be controlled by the United States" rather than Denmark, escalating a dispute that has strained ties between Washington and its NATO allies.

"Greenland doesn't help Denmark. Denmark doesn't spend money to really help Greenland, but it's an important part for the United States," Trump told reporters in Ankara before a meeting with Turkish President Tayyip Erdogan. He argued the island is "surrounded by China ships and Russian ships."

Trump said NATO allies' refusal to support his Greenland ambitions had damaged his relationship with the alliance. "We could remove all of our soldiers out of Europe," he said, citing Europe's changed circumstances over the past two decades. "If they're not careful with immigration and energy, you're not going to have a Europe anymore."

The threat to pull US forces would represent the most dramatic reshaping of transatlantic security since the Cold War. Denmark's Prime Minister Mette Frederiksen responded July 8 by declaring Greenland "not for sale" and affirming Denmark is "prepared to defend every inch of NATO territory, including our own."

A dispute with deep roots

The confrontation traces back to Trump's first term, when he first floated the idea of purchasing Greenland. Since returning to the White House in January, he has repeatedly pressed the issue, even suggesting potential military force. The US currently maintains one active military base on the island — Pituffik Space Base — down from about 17 facilities in 1945, reflecting the territory's strategic importance for missile defense and Arctic monitoring.

US Secretary of State Marco Rubio told Congress in June that Greenland is part of Denmark "for now" but confirmed the US is in talks with Copenhagen and Nuuk about using the territory for collective defense. "I think we'll have pretty good news at some point," Rubio said.

Greenland's government has pushed back against the pressure. Prime Minister Jens-Frederik Nielsen declined an invitation to the opening of a new US consulate in Nuuk in late May, and several hundred protesters gathered outside the facility carrying signs reading "No means no" and "Greenland belongs to the Greenlanders." Local officials have said progress has been made in talks but reiterated that the island belongs to its people and will never be for sale.

Gold, defense stocks, and the krone feel the strain

The escalating dispute introduces a new layer of geopolitical uncertainty for European markets. Defense stocks across the continent could benefit if NATO members accelerate spending commitments in response to the US threat. The Stoxx Europe 600 Aerospace & Defense index has already gained ground this year as European governments boosted military budgets following earlier US pressure.

Gold, a traditional safe haven, may attract inflows as investors hedge against transatlantic instability. The Danish krone could face pressure given Denmark's direct exposure to the dispute, though the currency's peg to the euro through ERM II limits downside. European bond markets could also see volatility if the threat of a US troop withdrawal raises questions about the continent's defense spending trajectory.

The last time a US president threatened a major troop reduction in Europe — during the Trump administration's 2019 NATO budget disputes — European defense shares rose about 15 percent over the following three months while the euro weakened 2 percent against the dollar. A similar scenario this time could see defense stocks rally further while the euro and European bonds face headwinds from the uncertainty, analysts said.

This article is for informational purposes only and does not constitute investment advice.