US President Donald Trump announced the introduction of 50% tariffs on all imports of goods from Brazil. The decision came in response to a public conflict with Brazilian President Luiz Inacio Lula da Silva, who previously called Trump an “unwanted emperor.” About this informs Reuters.
Trump announced the new restrictions in an official letter, where he noted that the tariffs are partly related to Brazil’s attitude toward former President Jair Bolsonaro, who is currently on trial on charges of attempted coup d’état.
“The tariffs are being imposed because of Brazil’s insidious attacks on free elections and Americans’ fundamental rights to free speech.” Trump’s letter says.
The announcement of the new tariffs caused a major reaction in Brazil’s financial markets, with the national currency, the real, depreciating by more than 2% against the US dollar, and the shares of major companies such as aircraft maker Embraer and oil corporation Petrobras plummeting.
In response, Lula held an emergency meeting with government officials and announced that Brazil would impose mirror restrictions. He denied Trump’s accusations of unfair trade, stressing that it is the United States that has a positive trade balance with Brazil.
The new tariffs will take effect on August 1, replacing the previous tariff of 10%. The US remains Brazil’s second-largest trading partner after China, so such a move could have significant economic implications for both countries. A particular blow may fall on the food industry of the United States, because about a third of all coffee consumed by Americans is imported from Brazil, as well as more than half of orange juice.
“This move affects not only Brazil, but the entire American juice industry, which employs thousands of people and has used Brazil as a major supplier for decades.” – noted Ibiapaba Netto, executive director of the Brazilian association CitrusBR.
In addition to the customs dispute, Trump has directed the US Trade Representative to open an investigation into alleged unfair digital trade practices by Brazil. He also accused the country’s Supreme Court of censoring social networks. In turn, Lula said that the cases against Bolsonaro should be dealt with exclusively through the judicial process, and not because of external pressure or political statements.
