A new U.S. tariff targeting Brazil took effect on July 22, while Washington’s other trading partners brace for a fresh volley of duties as President Donald Trump’s temporary global levies expire this week.
The 25-percent Brazil tariff followed a year-long U.S. investigation, with Washington accusing the Latin American giant of unfair trade practices.
This has drawn sharp pushback, although Brazil’s Vice President Geraldo Alckmin told a press conference on July 20 that Brazil will seek to resolve the issue through negotiations instead of retaliating.
Various products like beef, coffee and aircraft parts will be exempted from the levy, and roughly half of Brazil’s exports to the United States would remain excluded from the duty, estimates Valentina Sader of the Atlantic Council think tank.
Nonetheless, the move comes as Trump makes a renewed push to use tariffs as leverage, sparking fears of retaliation and heightened tensions.
Officials could be “using Brazil as an example to send a broader message about its priorities and negotiating approach,” Sader told AFP.
While the U.S. Supreme Court struck down many of Trump’s tariffs in February, dealing a blow to his ability to impose new duties at will, Washington has moved to rebuild his trade agenda using other powers.
Trump on July 20 also announced a 100-percent tariff on generic drugs from August 2028, a day after ordering a 50-percent duty on many Canadian goods to take effect in 30 days.
A broader sweep is yet to come, with officials in June proposing tariffs of between 10 percent and 12.5 percent targeting 60 trading partners over alleged failures to act against forced labor.
Analysts widely expect the duties over forced labor to replace the temporary 10-percent global tariff, expiring tomorrow, that Trump imposed after his Supreme Court setback.
“We expect to see some action soon,” U.S. Trade Representative Jamieson Greer told CNBC.
Greer added on July 20 that new action over labor concerns will cover a majority of U.S. trade, though it could reignite trade tensions.
The lower 10-percent tariff rate would hit U.S. imports from partners including Canada, the European Union, Mexico, Taiwan and the United Kingdom. They were found to have taken some steps against forced labor.
Goods from over 40 other economies like China, India and Japan face a 12.5 percent levy.
The EU has said that it considers tariffs imposed on these grounds “unjustified.”
A separate tranche of U.S. investigations targeting 16 economies over excess industrial capacity is ongoing and could lead to further duties.
Washington’s planned 50-percent tariff on Canadian goods comes amid ongoing talks over a North American free trade pact.
Washington recently declined to extend the accord as-is, and Greer is scheduled to be in Mexico today for discussions linked to a joint review of the U.S.-Mexico-Canada Agreement (USMCA).
