If there is one thing Donald Trump understands it is freehold versus leasehold. You don’t grow up in the hardened world of New York real estate and not know the difference between landlord and tenant.
That’s what may well lie behind his shock decision to disapprove of the Chagos Islands deal. Under the arrangement, carefully negotiated by Keir Starmer and blessed by Trump, the Indian Ocean islands, which host the strategically important US-UK military base at Diego Garcia, will be handed to Mauritius. Diego Garcia is then leased back at a cost of up to £34bn for the next 100 years.
It seemed like a fair compromise at the time. They got what they wanted; the UK, and its US partner, got what they wanted. Smiles and handshakes all round.
As for the fact that the US did not own Diego Garcia outright, that didn’t really matter. Or rather, it did not concern Trump enough. For him, it was an isolated little place stuck in the middle of the sea, faraway. Yes, it was midway to China on the map but that was all, and crucially as well, it does not hold any mineral deposits. There was not much to detain the US president – they could have it. In real estate developer’s terms, it was a bit of a blighted site, of little use to anyone.
That, though, was without the Danish territory of Greenland which lies just off the North American continent. For reasons best known to him, Trump has become fixated on the giant Arctic island. Is it because Greenland sits at the top of the world and is huge? Cover that with the stars and stripes and America is not only great again but greater in size as well.
Or is it because Greenland is nearer Russia and holds some critical security position? China is said to be circling also, or at least that’s what Trump’s agents tell him. Throw into that, the torpor of Europe where defending themselves and the US is concerned, even though the latter has been paying them fistfuls of dollars over the years, and you can see where this is going.
Or is it because underneath that melting tundra (Trump gets climate change when it suits him) there are vast natural resources and rare earths to be mined? That’s what he’s told, by his billionaire business supporters who know about these things. He’s not allowing China to grab them, no way.
It could be one or two or three or all of those reasons, probably all. In any event, he is desperate to make America bigger by adding Greenland.
He desires it outright, because as he knows, you can’t develop a plot of ground that doesn’t belong to you – tenants don’t build towers. In that scenario, Chagos has become a problem. It sticks out like a sore thumb, a precedent that the Brit lawyer, Keir Starmer, and his French sidekick, Emmanuel Macron, could seek to follow with Greenland. In which case, to hell with Chagos and Starmer’s effective sale or gift and leaseback. It’s ‘an act of GREAT STUPIDITY and total weakness’.
Chagos has left Trump weakened on Greenland, it’s a vulnerability, and he does not like it. He is trying to head it off before Chagos is held up as the blueprint for Greenland. It shows how keen he is to land Greenland; that he is prepared to go this far – as indeed he is by threatening tariff increases for those who oppose him.
But his U-turn also underscores his fragility. If Starmer does not succumb and the Chagos bargain remains, then Trump could struggle to impose his will. It was Starmer’s transaction, not Trump's, the UK's, not the US's.
That then boils down to Starmer’s willingness to confront Trump, to not back down. The omens here are not promising. The UK Prime Minister has played what has been lauded as a skilful game with Trump, of not riling him and generally complying with his wishes, albeit with concessions and special treatment here and there. Given the intemperate nature of Trump’s language in his Chagos posts, this appears to be all or nothing – he is seeking the deal’s ditching. That’s it, no ifs and buts.
Starmer could agree to the climbdown – and if we know one thing about this Premier, he is not averse to climbing down – because it has not been formally ratified, it still has to pass through the House of Lords. So Starmer could pull the plug and do Trump’s bidding.
Politically, he may be aided in that by the opposition of the Tories under Kemi Badenoch and Nigel Farage’s Reform UK to the proposed handover to Mauritius. Starmer could scrap it and silence their protests. Yes, they would shout that he’d followed their lead and he had changed his mind, but he is used to that. It would shut them up and prevent them from siding with Trump.
To do that, however, would gift him absolutism over Greenland. The only tactic Europe would have left would be retaliatory tariffs and the threat of safeguarding the territory militarily, challenging Trump to invade and destroying what is left of Nato. Perhaps that is what Trump realised, that Starmer’s trump card as it were, was Chagos, which might explain why the UK leader did not rush with the others to shout “tariffs”, that he was keeping in his back pocket Chagos as an example of how a Greenland accord would look.
So, Trump has picked Starmer’s pocket and nabbed his card. It’s tricky for Starmer. Does he abide by Trump’s wishes and end the Chagos agreement here and now, and shore up Trump’s Arctic railroading, or does he stick with it and weaken Trump over Greenland, link arms with Europe and incur the American president’s wrath?
Starmer has a lot of pondering to do.
