Donald Trump Threatens 50% Tariff on Brazilian Goods, President Lula Warns of Retaliation Under Economic Reciprocity Law
On July 9, US President Donald Trump announced he would impose tariffs up to 50% on imported goods from Brazil – the largest economy in Latin America. This move marks an escalation of trade tensions between the two countries, with the stated reason being to counter trade practices that Washington considers unfair from Brazil's side.
Along with the tariff announcement, Trump also demanded a comprehensive investigation into Brazil's trade activities, implying that tariffs could be even higher if more serious violations are discovered. The US President simultaneously accused his Brazilian counterpart – Luiz Inácio Lula da Silva – of using political tools to pressure former President Jair Bolsonaro, a close ally of Trump. Trump emphasized that if Brazil takes retaliatory actions, the US would not hesitate to immediately respond with additional tax measures.
In response to this statement, President Lula warned that any unilateral action from the US would be countered under Brazil's "Economic Reciprocity Law" – a law that allows corresponding measures if a trade partner causes damage to national interests. Lula also emphasized that the Brazilian government would not permit any external interference in the country's internal affairs.
Currently, Brazil is not on the US tariff warning list published last April, and Brazilian goods are still subject to a minimum 10% tariff. However, raising the tariff to 50% could adversely affect the US economy, as the latest figures show the US is exporting around $6.8 billion to Brazil. This means many US companies, especially in industrial and agricultural sectors, could be the first to suffer if a trade war erupts.
