In a bold move, U.S. President Donald Trump recently announced a significant 50% tariff aimed at Brazilian goods. This announcement coincides with his strong criticism of the trial involving former Brazilian President Jair Bolsonaro, which he labeled an “international disgrace.” Trump conveyed these sentiments in a letter addressed to Brazilian President Luiz Inacio Lula da Silva, emphasizing that “this trial should not be taking place.”
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The U.S. president also signaled that Washington would initiate an investigation into Brazil’s trade practices. Bolsonaro has denied any involvement in an alleged coup attempt to regain power from Lula, a situation that prosecutors claim failed due to a lack of military support.
After losing the October 2022 elections, Bolsonaro transitioned from being Brazil’s far-right leader to a focal point of international scrutiny.
Trump’s tariff will take effect on August 1, mirroring similar deadlines that many other nations face. “It’s time we address trade relationships that are far from reciprocal,” he stated as he embarks on a campaign to secure more bilateral trade agreements.
Interestingly, Brazil had not previously been among the countries facing threats of higher tariffs, as the United States currently enjoys a goods trade surplus with Brazil.
Escalation Threats
The message sent to Lula is one of over 20 letters Trump has issued in recent days, detailing tariff rates and showcasing Washington’s determination to forge new trade pacts. On Wednesday alone, letters were dispatched to leaders in the Philippines, Sri Lanka, Brunei, Algeria, Libya, Iraq, and Moldova, outlining duties ranging from 20% to 30%, set to take effect on August 1.
The tariffs announced now mirror previous proposals made back in April, although some countries received slightly lower rates this time. Trump had earlier imposed a 10% levy on nearly all trade partners but held off on escalating rates for many nations. The initial deadline for these increased duties was set for Wednesday but was later postponed to August 1.
In his recent communications, Trump maintained that the tariffs are warranted due to trade relationships that lack mutual reciprocity. The letters encouraged other nations to consider manufacturing products in the United States to avoid such duties, while cautioning leaders against retaliatory measures.
Other nations that received similar letters include key U.S. allies like Japan and South Korea, alongside countries such as Indonesia, Bangladesh, and Thailand.
Potential EU Deal on the Horizon?
Analysts have noted that Asian countries have predominantly been targets thus far. However, the spotlight is now on negotiations with major partners, particularly the European Union (EU), who have yet to receive these letters. Trump’s administration faces mounting pressure to reveal more trade agreements.
Currently, the U.S. has only finalized agreements with Britain and Vietnam, in addition to a temporary reprieve from tit-for-tat tariffs with China. Trump hinted that the government is “probably two days off” from sending the EU a letter detailing updated tariff rates for the bloc. According to an EU spokesman, the bloc is eager to strike a deal with the United States “in the coming days” and has shown readiness to reach an agreement in principle.
Apart from the tariffs targeting various goods, Trump has also introduced sector-specific duties on steel, aluminum, and automobiles since returning to the White House in January. Recently, he announced that new levies on copper and pharmaceuticals are forthcoming, with proposed rates as high as 50% for copper and a staggering 200% for pharmaceuticals. In this latter case, however, manufacturers will be given time to relocate their operations to the United States.
As the landscape of international trade continues to evolve, the world watches closely for the implications of these new tariffs and trade dynamics.
Edited By Ali Musa
Axadle Times International – Monitoring.
