The Latest: Trump says a Greenland deal 'framework' is reached and cancels tariff threat

DAVOS, Switzerland (AP) — U.S. President Donald Trump said Wednesday he is dropping his threat to impose tariffs on several European countries, citing what he described as a new framework with NATO on Arctic security. The abrupt about-face comes shortly after he told the World Economic Forum in Davos that the U.S. would not use force to pursue control of Greenland.

Asked how long the deal will last, Trump was clear it’s long term. “It’s a deal that’s forever,” he said. “It’s what’s called an infinite deal.”

In his earlier speech, Trump reaffirmed his ambition to secure “right, title and ownership” of Greenland and urged NATO allies not to stand in the way, warning that refusals would carry consequences for the alliance.

Trump's address at the annual meeting of the elite in Switzerland tried to focus on his efforts to tame inflation and spur the economy back home. But his more than 70-minute address focused more on his gripes with other countries.

European Commission President Ursula von der Leyen on Tuesday called Trump’s planned new tariffs on eight EU countries over Greenland a “mistake” and questioned Trump’s trustworthiness. French President Emmanuel Macron said the EU could retaliate by deploying one of its most powerful economic tools, known colloquially as a trade “bazooka.”

Here is the latest:

Putin thanked Trump for the invitation and said Russia’s Foreign Ministry is going to study the proposal and consult with “strategic partners.”

Putin emphasized his country’s special relationship with the Palestinian people and suggested sending $1 billion to the Board of Peace from frozen Russian assets.

Trump has explained inviting Russia to the board by saying he wants all nations involved, especially those with powerful leaders.

Trump acknowledged that, “I have some controversial people. But these are people that get the job done. These are people that have tremendous influence.”

The U.S. stock market rebounded after Trump called off Greenland-related tariffs that he had threatened to impose on Europe.

The S&P 500 rallied 1.2% Wednesday after Trump said he reached the framework of a deal about Greenland. The index recovered about half the ground it lost a day earlier.

The Dow Jones Industrial Average also rose 1.2%, as did the Nasdaq composite. Treasury yields eased in the bond market. They also got some help from a calming of government bond yields in Japan.

Russian President Vladimir Putin late on Wednesday said Trump’s bid to acquire Greenland from Denmark “doesn’t concern us at all.”

Speaking at the Security Council meeting, Putin pointed out the United States’ past experience of acquiring land from other countries, like Russia and Denmark, and drew parallels between Greenland and Alaska, which the U.S. bought from Russia in the 19th century.

“If you compare this with the cost of the United States acquiring Alaska, then the price for Greenland would have been, well, somewhere around $200-250 million,” Putin suggested. “If you compare it with the price of gold at that time, this figure would have been higher, probably close to $1 billion. Well, I think that the United States can afford this figure.”

Putin said that Denmark “always treated Greenland as a colony, and treated it quite harshly, if not cruelly.”

“But it certainly doesn’t concern us. I think they’ll figure it out among themselves,” the Russian leader concluded.

Financial markets aren’t the only ones breathing a sigh of relief after Trump rescinded his threat to impose new tariffs on European allies for their defense of Greenland and Danish sovereignty.

A number of U.S. officials had also been concerned about Trump’s hardline stance and bellicose rhetoric toward Greenland, Denmark and other NATO allies because they feared it could harm other foreign policy goals.

These officials thought the fixation on Greenland and taking it at any cost was distracting from and complicating the president’s effort to form the Board of Peace, which is supposed to be announced on Thursday on Davos, Switzerland.

Many European countries, which were already skeptical of the proposed board’s broad global mandate, had reacted even more negatively to the concept after Trump’s tariff threat.

The U.S. officials spoke on condition of anonymity to discuss concerns being floated inside the administration.

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By Matthew V. Lee in Washington.

Canadian Prime Minister Mark Carney met Wednesday with NATO Secretary General Mark Rutte, with both agreeing on the need to speed up new investment along the alliance’s northwestern flank, Carney’s office said.

He noted that Canada was already planning to quadruple defense spending over the next decade, including major investments to strengthen the country’s Arctic sovereignty.

The meeting came ahead of Rutte’s talks with Trump, who then announced they’d reached what the president called a framework agreement with NATO on Arctic security.

Carney said in a speech at Davos on Tuesday that middle-power countries need to stop pretending the rules-based order is still functioning and urged them to rally together against threats from great powers.

“The deal is going to be put out pretty soon,” Trump said in a brief exchange with reporters on the sidelines of Davos forum. “It gets us everything we needed to get.”

As he departed the World Economic Forum for the day, Trump said his newly agreed-upon framework of a deal with NATO’s chief is “a great deal for everybody.”

He told reporters everyone would be happy with the deal, which relates to Greenland and the Arctic. While he said people are still working out the details, he emphasized it would be “really fantastic for the U.S.A.”

President Donald Trump walks down stairs after a meeting during the Annual Meeting of the World Economic Forum in Davos, Switzerland, Wednesday, Jan. 21, 2026. (AP Photo/Markus Schreiber)

Asked how long the deal will last, Trump was clear it’s long term.

“It’s a deal that’s forever,” he said. “It’s what’s called an infinite deal.”

It’s not the first time Trump has threatened tariffs, only to back away.

In April, after first saying he would slap massive tariffs on nations from around the world — prompting a sharp negative market reaction — Trump eased off. He bristled at suggestions he had chickened out, saying, “It’s called negotiation.”

Trump also moderated what had been aggressive posturing on Greenland on Wednesday when he said he wouldn’t take the territory by force. The U.S. stock market is steadying following those remarks.

Trump says he and NATO Secretary General Mark Rutte agreed to “the framework of a future deal” on Greenland and the Arctic region that will take his Feb. 1 threat of tariffs off the table.

The announcement on his Truth Social platform came soon after he said in a speech at the World Economic Forum in Davos that he was backing off his threat of using military force to seize the Danish territory, which he says is crucial to U.S. national security.

Trump said further discussions are being held related to Greenland and his plans for a “Golden Dome” to protect the United States from long-range missiles. He added that further information will be available as discussions continue.

Trump declined to name a reasonable price for the United States to buy Greenland during a meeting in Davos with the NATO secretary general.

“There’s a bigger price, and that’s the price of safety and security and national security and international security having to do with many of your countries,” Trump responded when asked by The Associated Press how he would calculate a reasonable offer for the strategic land mass. “That’s really the price. It’s a big price.”

Trump responded ambiguously when asked to elaborate on his earlier comment that “we will remember” if Denmark refuses to sell Greenland to the U.S.

“You’ll have to figure that out for yourself,” he told a reporter.

The NATO leader said he tells the organization’s members that Trump is “completely committed” but has “one irritant” that Europeans were not paying the same amount for their defense as the U.S. was.

“We solved it and this is crucial also because we need the money to protect ourselves,” Mark Rutte, secretary general of NATO, said at Davos.

Mark Rutte, secretary general of NATO, sought to shore up Trump’s confidence that his allies would stand with him in a crisis.

He also reminded Trump that NATO allies went to Afghanistan to fight on America’s behalf after the 9/11 attacks – and some soldiers never came home.

“You can be assured, absolutely, if ever U.S. will be under attack, your allies will be with you,” Rutte told Trump.

Trump said he appreciated the compliment and hoped it was true.

“I mean, he’s a good man, he’s never lied to me before,” Trump said of Rutte in response to a reporter’s question. “I just, you know, when I see what’s happening with Greenland, I wonder.”

After a reporter asked Trump about Danish leaders’ rejection of his comments about acquiring Greenland, the U.S. president said “I don’t like getting it secondhand.”

In a speech at Davos earlier Wednesday, Trump insisted that he wants to “get Greenland, including right, title and ownership,” but said he would not use force to do so.

A Danish government official told The Associated Press afterward that Copenhagen is ready to discuss U.S. security concerns in the Arctic. But the official, who was not authorized to comment publicly and spoke on condition of anonymity, underscored the government’s position that “red lines” — namely Denmark’s sovereignty — must be respected.

The reporter’s question came as Trump sat down for a bilateral conversation with Mark Rutte, secretary general of NATO.

President Ilham Aliyev of Azerbaijan hailed an “excellent speech” and recalled how he has credited Trump for helping Azerbaijan to find peace with Armenia, its neighbor in the Caucasus.

He also said Azerbaijan will be part of Trump’s Board of Peace, “because we think that President Trump is a person who you can trust, and we are trusting him, and we will be part of the Board of Peace.”

Asked about Trump’s prospects of helping wrest peace in Ukraine, Aliyev said: “He fixed our case, but unfortunately, still he has to work on that.”

President Donald Trump arrives to address a meeting of Global Business Leaders at the Annual Meeting of the World Economic Forum in Davos, Switzerland, Wednesday, Jan. 21, 2026. (AP Photo/Evan Vucci)

Trump told a room of business executives they’ve gotten a lot richer during his first year back in office.

The president spoke to a wealthy audience at the Davos economic forum in Switzerland as Republicans back home press him to focus on affordability, a top concern for Americans getting squeezed by higher prices ahead of the midterm elections.

“I don’t even ask anybody how you’re doing now,” Trump said of his conversations with business executives. “It’s like everybody is making so much money.”

Even his enemies are doing well, he added.

“A couple of people in the room, I can’t stand them. And they’ve become very rich. There’s nothing I can do about it,” Trump said to laughs.

Ebba Busch, the deputy prime minister of Sweden, said she heard “a mix of irrational and rational arguments at the same time” from Trump.

“Europe needs to toughen up. We need to hold the line,” she told reporters in Davos. “We will not be bullied or blackmailed to letting go of territory that is, in this case, Greenland’s and Denmark’s.”

Republican House Speaker Mike Johnson said Trump’s tariffs policies have been working, bringing trillions of dollars into the U.S. during the president’s first year.

“I have no intention of getting in the way of President Trump and his administration, and how they’ve been using this very effectively,” Johnson said at the Capitol.

But a top Democrat, Rep. Ted Lieu of California, said the costs of tariffs are being passed on to American households.

“This is how ludicrous Donald Trump’s idea is,” Lieu said at a press Capitol conference. “He’s saying ‘If I don’t get my way on Greenland, I’m going to punish the American people even more.’”

“How dumb is that?” Lieu said. “We’re asking the president: Focus on America, not on Venezuela or Greenland.”

U.S. Sen. Lindsay Graham, a Republican from South Carolina, said Trump made a strong case Wednesday for acquiring Greenland legally.

“Taking Greenland by force is off the table, it was never a good idea,” Graham said, adding, “He’s convinced me.”

He emphasized that any deal involving Greenland must be approved by the Senate, which would not support using force.

Graham expressed his willingness to support a legal purchase of Greenland and said he aims to be “Trump’s biggest champion” in bringing Greenland under American control, which he argued would be for the benefit of NATO.

Following Trump explicitly saying in his Davos remarks that he wasn’t considering military action to take Greenland, a Danish government official said Copenhagen remains ready to discuss how to go about addressing U.S. security concerns in the Arctic.

But the official, who was not authorized to comment publicly and spoke on condition of anonymity, underscored the government’s position that “red lines” — namely Denmark’s sovereignty — must be respected.

President Emmanuel Macron’s office is disputing Trump’s assertion in Davos that he successfully pressured the French leader to increase prescription drug prices.

“It’s being claimed that President @EmmanuelMacron increased the price of medicines. He does not set their prices. They are regulated by the social security system and have, in fact, remained stable,” Macron’s office said in a post on X. “Anyone who has set foot in a French pharmacy knows this.”

It included a GIF of Trump speaking overlaid with the words, “FAKE NEWS!”

The president said while in a meeting with the Egyptian president that there will be “a lot” of countries represented on his Board of Peace.

“Some need parliamentary approval but for the most part, everybody wants to be on,” he said.

Gavin Newsom, Governor of California, talks to the media after the speech of President Donald Trump during the Annual Meeting of the World Economic Forum in Davos, Switzerland, Wednesday, Jan. 21, 2026. (AP Photo/Markus Schreiber)

“And there was boorish parts of it, but those were not even that consequential, including name-checking people he likes and people he didn’t like,” Gov. Gavin Newsom said. “Honestly, I was just a little disappointed.”

The Democratic governor, a frequent critic of Trump who’s eying a 2028 presidential run, has made himself available repeatedly to media this week in Davos.

“For a European audience, that may have been a new speech. My God, there wasn’t anything new about that speech for the American audience,” he said.

Referring to Trump’s comment that he won’t use military force to wrest Greenland for the United States: “I don’t think military force was ever real.”

Trump’s top adviser on artificial intelligence, David Sacks, told a Davos crowd that “child safety has to be part of a larger regulatory framework” for AI but he warned against overregulating the technology.

Sacks acknowledged “horror stories” of AI chatbots that he says contributed to children harming themselves. But he also said billions of people, including many teenagers, are using AI without problems and it is “less addictive, more a utility,” when compared to social media.

“There’s been a little bit of a transference of the concerns that people have about social media onto AI and some of that transference is justified and some of it may not be,” Sacks said in a conversation with Salesforce CEO Marc Benioff.

Sacks called efforts across the 50 U.S. state governments to regulate AI a “little bit of a knee-jerk reaction” and one of the “great threats to innovation in the United States right now.”

The CEOs of Visa, Cisco, Salesforce, JPMorgan Chase and Amazon are among the high-profile figures gathering outside Trump’s upcoming Davos event with global business leaders.

Sports will also be represented there, with Baltimore Orioles owner David Rubenstein and FIFA president Gianni Infantino spotted among the expanding group.

While the spotlight is on Trump, some of the world’s most pressing issues are also being debated at Davos, including the war in Sudan, now approaching its third year.

During a panel discussion Wednesday, humanitarian groups pushed for stronger international engagement to end the fighting as well as more aid to civilians.

International Rescue Committee President and CEO David Miliband called the crisis in Sudan an “avatar for the world disorder.” He said the conflict has been internationalized — several outside powers reportedly arm and finance the warring sides — and said civilian deaths outnumber fighters killed.

Hanin Ahmed, head of the local aid initiative Emergency Response Rooms of Sudan, said the humanitarian situation is deteriorating across the country, including in areas not controlled by the Rapid Support Forces, citing food insecurity, lack of income due to prolonged job losses, and disease outbreaks.

The U.S. stock market is bouncing back from its worst day since October, although some signs of fear remain on Wall Street about Trump’s desire to take Greenland.

The S&P 500 climbed 0.7% on Wednesday after Trump said in his speech that he would not use force to take “the piece of ice.” The potential de-escalation in rhetoric around Greenland helped the index recover some of its 2.1% drop from the day before and pull closer to its all-time high set earlier this month.

The Dow Jones Industrial Average was up 353 points, or 0.7%, as of 10:15 a.m. Eastern time, and the Nasdaq composite was 0.7% higher.

Treasury yields also held steadier in the bond market, a day after jumping in a potential signal of worries about higher inflation in the long term. They got help from a calming of government bond yields in Japan. The value of the U.S. dollar was also mixed against the euro, Swiss franc and other currencies after sliding the day before.

But some nerves seemed to remain in the market, and the price of gold rose another 2.1% and topped $4,800 per ounce for the first time.

▶ Read more about Wall Street’s reaction to Trump’s speech

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AP World Economic Forum: https://apnews.com/hub/world-economic-forum