Europe is potentially facing the “entire breakdown” of its relationship with the United States over Donald Trump’s “dark and grim” territorial desires on Greenland, Simon Harris says.
Leaders of several European Union states are preparing to mount a diplomatic blitz over the next 48 hours to try to convince the US president to walk back his threats to seize Greenland and levy fresh trade tariffs on countries opposing his plans to “buy” the Danish territory.
When Mr Trump was asked how far he would be willing to go to acquire Greenland, during a White House press briefing on Tuesday evening, he said: “You’ll find out”.
Speaking to The Irish Times in Brussels, the Tánaiste said the threat facing Europe “couldn’t be more grave”. The Minister for Finance said the fact the current dispute was really about territory was a “dark and grim situation”.
“There’s no point being flippant here … This is an existential moment. The next few days really will be crucial in terms of the future of the EU-US relationship,” Mr Harris said.
[ Greenland crisis: Advocates for caution may come under pressure at key EU summit ]
“You’re not simply talking about a tariff, you’re talking about an entire breakdown in the relationship.”
The Fine Gael leader was speaking after leaving a meeting of EU finance ministers on Tuesday.
Here, Government leaders have been presented with a range of scenarios on the economic hit Ireland could face, including that growth would be reduced by 1.5 per cent of modified domestic demand over four years, with 60,000 fewer jobs created.
But the Department of Finance has cautioned the Government that modelling the outcome with a high degree of confidence was not possible due to the range of unpredictable scenarios.
European capitals have been scrambling to co-ordinate a response to the fresh threats of tariffs Mr Trump said he would raise on trade coming from Denmark and seven other European countries on February 1st unless the US is allowed to take control of Greenland.
A summit of EU leaders on Thursday evening might not take any immediate decisions, Denmark’s prime minister, Mette Frederiksen, said.
However, Ms Frederiksen said she expected EU leaders to lay the groundwork for a response should Mr Trump’s threatened tariffs actually come into effect next month.
While the impact of higher tariffs on the Irish economy was difficult to model, the trade disruption would be very damaging, Mr Harris said. He repeated calls for dialogue between European capitals and Washington.
Mr Harris said Ireland would be part of any European response, rowing in behind Denmark and Greenland’s sovereignty.
[ This crisis is not ultimately about Greenland. It’s about something much bigger ]
A package of tariffs hitting €93 billion of US trade is seen as the most likely way the EU will initially retaliate in the event talks fail.
Ireland remains cautious about the EU turning to stronger measures, such as its anticoercion instrument, which would allow the bloc to target US companies operating in Europe.
The anticoercion instrument was “such a significant tool” that just simply talking about its use would hopefully make people “stop and reconsider” their approach, Mr Harris said.
The “laws of economic gravity” may also come into play and put pressure on the US to change course, he said.
The Government hopes that diplomatic efforts bear fruit without resorting to what one minister described as a “much harder line” being pursued by some other European capitals.
Nonetheless, despite wariness about the consequences of a rapidly escalating exchange of measures, the same person said there needed to be a “level of self-respect” in Europe’s approach to countermeasures if diplomacy fell short.
The Coalition is cool on the idea of curtailing Ireland’s St Patrick’s Day programme to communicate its displeasure to Washington, a step which is said not to be on the cards.
Ministers are concerned about the long-term effects of what some in Cabinet fear will be a lasting disruption to trade and geopolitical norms.