European capitals closed ranks to push back against President Trump’s bid to control Greenland, but the Continent’s dependence on the U.S. for security, exports and technology means decoupling from its ally isn’t an option.
The reliance puts Europe at a disadvantage in a world of great power competition and weakens its hand in negotiations with Trump on everything from trade to Greenland and Ukraine.
For decades, Europe has relied on the U.S. for security, Russia for energy and China as a growing export market. Now it depends on the U.S. for all three.
Today, the European Union sends about one-fifth of its exports to America, its biggest international market, and relies on the U.S. for about one-quarter of its natural-gas supplies. The largest U.S. military base in Germany has more soldiers than the biggest German base there.
It isn’t just energy, trade and security. Europe relies on U.S. technology and financial services. Visa and Mastercard control around two-thirds of card spending in Europe. Around 80% of German companies say they rely on U.S. digital technologies and services, according to a recent survey by the Berlin-based digital lobby group Bitkom.
“These dependencies around technology, around security, around finance and the dollar, that’s the glue that’s now keeping together the Western bloc,” said Neil Shearing, chief economist at Capital Economics in London. “What’s become clear is that the U.S. has enormous leverage over that relationship.”
The EU sent roughly $640 billion worth of goods to the U.S. in 2024, accounting for about 21% of its total goods exports, up from around 18% in 2019, according to EU data. That is almost as much as the combined value of goods the bloc exported to the U.K. and China, its second- and third-biggest export markets. The U.K. is almost as reliant, sending roughly 16% of its goods exports to the U.S.
Europe has become deeply dependent on American tech companies for everything from office-productivity software to data centers. While the continent boasts a stable of tech startups in countries including the U.K. and France, many of them are in turn often dependent on American tech giants for things like cloud services and artificial-intelligence chips.
The EU has sought to diversify its trading partners over the past year in an effort to curb its reliance on the U.S. It announced a sweeping free-trade deal with India on Tuesday and earlier reached a landmark agreement with four South American countries.
Leaders in Europe and Canada point to new alliances among middle powers as a way to break the dependency, but those partnerships would likely still lean heavily on the U.S. for defense, finance and access to advanced technologies, Shearing said.
Europe isn’t without leverage in its relationship with the U.S. While American consumers could perhaps live without Champagne and buy luxury cars from Asian automakers, Europe supplies critical industrial goods such as parts for F35 jet fighters, said Clemens Fuest, president of the Ifo think tank in Munich.
But Europe’s consensus-based governance makes it ill suited for the new world of great-power competition, said Moritz Schularick, president of the Kiel Institute for the World Economy, a German economic think tank. Europe “is easy to divide and rule,” he said. “It will always be the player in the room that you can read very well.”
Europe’s relationship with the U.S. has been the bedrock of the Continent’s postwar prosperity. Especially in Germany, where the U.S. helped to build institutions and businesses, many politicians and business leaders are reluctant to let go.
“We should try for deals with other markets, but there is no alternative to the U.S.,” said Claus Paal, an entrepreneur in the southern German city of Stuttgart who said his clients are almost exclusively American.
“It’s so much easier doing business with the U.S.” than countries like India, Paal said, noting advantages ranging from less bureaucracy to shared business models and research and development.
Stuttgart is the capital of Baden-Wuerttemberg, a German state that borders France and Switzerland and is ground zero for Trump’s trade war. The state, home to German industrial giants such as Porsche and Mercedes-Benz, exports more goods to the U.S. than any other, worth around €35 billion—equivalent to $42 billion—in 2024. Robert Bosch, founder of the eponymous auto parts giant, trained in the U.S. in the late-19th century. American money and expertise helped to nurture the region’s car industry after World War II.
Nevertheless, the state has deepened its economic ties with the U.S. in recent years. The regional utility recently started receiving two million tons annually of liquefied natural gas from Louisiana under a 20-year deal. Stuttgart is home to several U.S. military bases housing around 28,000 Americans.
The state was among the places hardest hit by last year’s tariffs, according to calculations by Ifo.
Paal, who runs the Stuttgart chamber of commerce, said he watched tariff threats over Greenland with growing concern. The threats make it impossible for businesses to plan and make investments, he said. The state’s exports to the U.S. contracted by 6% annually over the past two years.
Georg Schild, a history professor at Tübingen University, near Stuttgart, remembers watching annual exercises by the U.S. military every fall when he was growing up in West Germany in the 1960s. Germans of Schild’s generation, he said, felt that they were finally on the right side of history as part of the U.S.-led West. They eagerly adopted U.S. consumer culture.
“We never challenged American supremacy,” Schild said. “We want the Americans to be here, we love them, and they’re turning their backs on us. And that is difficult for us to understand.”
Write to Tom Fairless at tom.fairless@wsj.com and Kim Mackrael at kim.mackrael@wsj.com