The 50% tariffs imposed on part of Brazilian exports to the United States took effect this Wednesday (6). The measure, signed last week by U.S. President Donald Trump, affects 35.9% of goods sent to the U.S. market, representing 4% of Brazilian exports. About 700 Brazilian products were excluded from the steep tariffs.
Coffee, fruits, and meats are among the products that will now pay a 50% surtax. Excluded from this tax are orange juice and pulp, fuels, minerals, fertilizers, and civil aircraft, including their engines, parts, and components, wood pulp, cellulose, precious metals, energy, and energy products.
The steep tariffs imposed on Brazil are part of the new White House policy, inaugurated by Donald Trump, to raise tariffs against trading partners in an attempt to reverse the relative loss of competitiveness of the American economy to China over the last decades.
On April 2, Trump started the trade war by imposing customs barriers on countries according to the size of the deficit the United States has with each nation. Since the US has a surplus with Brazil, the lowest rate of 10% was imposed in April.
However, in early July, Trump raised the tariff to 50% against Brazil in retaliation for decisions that, according to him, would harm U.S. big techs and in response to the trial of former President Jair Bolsonaro, accused of leading a coup attempt after losing the 2022 election.
Experts consulted by Agência Brasil assess that the measure is political blackmail aimed at targeting the BRICS, the bloc of emerging powers that Washington has viewed as a threat to U.S. hegemony in the world, especially due to the proposal to replace the dollar in trade exchanges.
Lula
In a speech on Sunday (3), President Luiz Inácio Lula da Silva emphasized that he does not want to challenge the United States, but that Brazil cannot be treated as a “banana republic.” The president also said that the country will not give up using alternative currencies to the dollar.
The Brazilian government also reported that the contingency plan to assist companies affected by the steep tariffs will be implemented in the coming days, with credit lines and possible contracts with the federal government to replace any losses in exports.
Negotiations
After the confirmation of the tariff imposition last week, the U.S. Treasury Department contacted the Ministry of Finance to start negotiations on the tariffs, at the same time that Trump announced he is willing to talk personally with President Lula.
Already this week, Finance Minister Fernando Haddad said that rare earths and critical minerals can be the subject of negotiation between Brazil and the United States. These minerals are essential for the technology industry, and it is one of the main reasons for the dispute between Beijing and Washington.
“We have critical minerals and rare earths. The United States is not rich in these minerals. We can make cooperation agreements to produce more efficient batteries,” said Haddad in an interview with a television network.
Still according to the Finance Minister, the coffee sector believes it can benefit from an agreement with the US to exclude the product from the list of tariffed goods. On the same day that Trump signed the steep tariffs, China authorized 183 Brazilian companies to export coffee to the Asian country.
Source: Agência Brasil