Lula stated that Brazil will implement retaliatory tariffs on the U.S. if Trump increases import taxes by 50% concerning the trial of Bolsonaro. He emphasized the application of Brazil's reciprocity law if negotiations fail. The risk of a tariffs war between Brazil and the U.S. increases, similar to previous conflicts with China. Brazilian Senate and Chamber leaders expressed support for Lula's stance, emphasizing the importance of protecting Brazilian sovereignty and jobs against unilateral U.S. pressures from tariffs linked to political matters.
Lula said he will trigger Brazil's reciprocity law approved by Congress earlier this year if negotiations with the U.S. fail. "If there's no negotiation, the reciprocity law will be put to work. If he charges 50 (% tariffs) from us, we will charge 50 from them," Lula told TV Record in excerpts of an interview that will be fully aired later in the day.
The president of Brazil's Senate, Sen. Davi Alcolumbre, and Chamber of Deputies Speaker Hugo Motta, a pair of moderates who have recently been at odds with Lula, agreed that the reciprocity law gives Brazil "the means . . . to protect our sovereignty. We will be ready to act with balance and firmness in defense of our economy, our productive sector, and the protection of Brazilian jobs."
Trump's tariffs letter to Brazil opened up a new front in his trade wars, with the U.S. leader directly using import taxes to interfere with another nation's domestic politics.
Trump has already tried to use tariffs to ostensibly combat fentanyl trafficking and as a negotiating tool to change how other nations tax digital services and regulate their economies.
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