In a significant development, US President Donald Trump signed an executive order on Wednesday to impose 50 per cent tariffs on Brazil, setting a legal rationale that Brazil's policies and criminal prosecution of former President Jair Bolsonaro constitute an economic emergency under a 1977 law.
Trump had threatened tariffs on July 9
Earlier, the US President had threatened to impose tariffs on July 9 in a letter to President Luiz Inacio Lula da Silva. But the legal basis of that threat was an earlier executive order premised on trade imbalances being a threat to the US economy. But America ran a $6.8 billion trade surplus last year with Brazil, according to the US Census Bureau.
A statement by the White House stated that Brazil's judiciary had tried to coerce social media companies and block their users, though it did not name the companies involved, X and Rumble.
Donald Trump appears to identify with Bolsonaro, who attempted to overturn the results of his 2022 loss to Lula. Similarly, Trump was indicted in 2023 for his efforts to overturn the results of the 2020 US presidential election.
Lula left an event about animal rights early on Wednesday after Trump's move, saying he needed to defend “the sovereignty of the Brazilian people in light of the measures announced by the President of the United States.”
Not all goods imported from Brazil would face a tariff
The order would apply an additional 40% tariff on the baseline 10% tariff already being levied by Trump. But not all goods imported from Brazil would face the 40 per cent tariff: Civil aircraft and parts, aluminium, tin, wood pulp, energy products, and fertilisers are among the products being excluded.
The order said the tariffs would go into effect seven days after its signing on Wednesday. Also, on Wednesday, Trump's Treasury Department announced sanctions on Brazilian Supreme Court Justice Alexandre de Moraes over alleged suppression of freedom of expression and Bolsonaro's ongoing trial.
De Moraes oversees the criminal case against Bolsonaro, who is accused of masterminding a plot to stay in power despite his 2022 defeat. On July 18, the State Department announced visa restrictions on Brazilian judicial officials, including de Moraes.
(With inputs from AP)
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