President-elect Donald J. Trump has threatened tariffs on many international locations for many different reasons.
On Monday, he discovered a brand new goal for his favourite financial device. Mr. Trump stated he would “tariff Denmark at a really excessive stage” if it refused to permit Greenland — a North American island that’s an autonomous territory throughout the Kingdom of Denmark — to turn into a part of america.
“They need to give it up, as a result of we want it for nationwide safety,” Mr. Trump stated of Greenland.
Denmark, which has a smaller inhabitants than Texas, will not be an enormous buying and selling associate for america. The nation — a U.S. ally and a NATO member — despatched america greater than $11 billion worth of goods in 2023, only a tiny slice of greater than $3 trillion of imports. The USA, in flip, sends Denmark greater than $5 billion in items, together with industrial equipment, computer systems, plane and scientific devices.
However regardless of its small dimension, Denmark, which handles Greenland’s international and safety affairs, is residence to some merchandise which can be very well-loved in America, items that would turn into costlier if Mr. Trump follows by means of with heavy tariffs. In line with the Observatory of Economic Complexity, a commerce knowledge platform, roughly half of Denmark’s current exports to america are packaged medicines, insulin, vaccines and antibiotics.
That’s largely as a result of the nation is residence to Novo Nordisk, the maker of Ozempic and Wegovy, the favored weight-loss medicine. The corporate is so essential to the Danish economic system — it has recently accounted for half of Denmark’s non-public sector job development and the entire nation’s financial development — that some have branded Denmark a “pharmastate.”
Novo Nordisk is increasing its U.S. production to fulfill the soaring demand for its GLP-1 weight loss products. The corporate doesn’t specify publicly how a lot of its merchandise are exported, nevertheless it produces medicine in Denmark and america for the U.S. market.
A spokesperson for Novo Nordisk stated in a press release that they had been following the state of affairs intently however wouldn’t touch upon hypotheticals and hypothesis.
Gilberto Garcia, the chief economist at Datawheel and a member of the Observatory of Financial Complexity staff, stated that Denmark’s exports of immunological merchandise, which incorporates medicine like Ozempic, have been “rising exponentially.”
Denmark can be the main provider to america of listening to aids, he stated.
Past medicines, Denmark additionally sends america medical devices, fish fillets, pig meat, coal tar oil, petroleum and baked items, amongst different merchandise, in line with the OEC.
And notably, for a lot of kids (and adults) Denmark is residence to Lego Group, the world’s largest toymaker.
It’s not clear how a lot Lego exports immediately from Denmark to america — the corporate serves a lot of the U.S. market from a manufacturing facility in Mexico, in addition to a brand new carbon-neutral facility in Virginia. It additionally manufactures the toy bricks in factories in Hungary, the Czech Republic, China and Vietnam, in addition to Denmark. Lego didn’t reply to requests for remark.
However Lego, like different multinational corporations which have world provide chains shuffling uncooked supplies and merchandise all over the world, might see its enterprise disrupted by tariffs. Mr. Trump has threatened to place levies on merchandise coming into america from Mexico, China and different international locations globally, along with Denmark.
Mr. Trump’s threats to assert Greenland got here in a rambling information convention by which the president-elect additionally urged retaking the Panama Canal and making Canada an American state, all statements that riled international leaders.
Mr. Trump argued on Tuesday that U.S. possession of Greenland was a nationwide safety difficulty, given the paths charted by Russian and Chinese language ships.
“Greenland belongs to the folks of Greenland,” Denmark’s prime minister, Mette Frederiksen, said in a press release. “Our future and battle for independence is our enterprise.”
On Wednesday, a spokesman for the European Fee referred to as Mr. Trump’s feedback about seizing Greenland as “hypothetical.” When requested about tariff threats, the spokesman stated that the European Fee had been making ready for all attainable implications of a Trump presidency on commerce in Europe.
Jacob Funk Kirkegaard, a senior fellow in Brussels on the Peterson Institute for Worldwide Economics, stated that few politicians in Europe take what Mr. Trump says actually.
“That is an outrageous demand,” Mr. Kirkegaard stated of Mr. Trump’s threats to take Greenland. “The one means you may logically consider it’s that by making this outrageous demand, Trump goes to get some concessions he in any other case wouldn’t have gotten.”
Mr. Kirkegaard stated that ought to Mr. Trump comply with by means of together with his menace to implement tariffs on Denmark, he might anticipate an E.U.-wide response. “This concept that he can strain Denmark as a single member state of the E.U., to supply coverage concession by threatening tariffs, goes to ask retaliation from the entire E.U.”
Mr. Trump put tariffs into impact on quite a few international locations and tons of of billions of {dollars} of products in his first time period. However different tariff threats by no means materialized, and it’s not clear what number of of his new threats he’ll comply with by means of on.
On Tuesday, the president-elect additionally reiterated a menace to place “very severe tariffs” on Mexico and Canada, complained in regards to the U.S. commerce deficit with Canada and the European Union, and floated an thought to rename the Gulf of Mexico “the Gulf of America.”
