US Proposes Up to 12.5% Tariffs on Brazil, Brazil Warns of Retaliation

The US government announced plans to impose tariffs of up to 12.5% on goods from several countries, including Brazil, citing 'forced labor'. This has triggered a strong backlash from Brazil, which has warned of retaliation using its congressional 'Economic Reciprocity Law', reigniting tensions in US-Brazil trade relations. According to Brazilian news site G1, the Brazilian government stated today that the International Labor Organization (ILO) has already recognized Brazil's efforts to combat slave and forced labor. It emphasized that customs and tax authorities have the legal authority to ban any goods involving forced labor from entering the country. Brazil's Ministry of Foreign Affairs said that while it reserves the right to retaliate, it hopes to avoid an escalation of tensions through negotiation. CNN Brasil reported that against this backdrop, Brazil is also extending an olive branch by preparing to withdraw its veto on the 'Global E-commerce Tariff Exemption Agreement' at the World Trade Organization (WTO) meeting in March. The agreement has been periodically extended since 1998. The US sought to make it permanent, but Brazil at the time only agreed to a two-year extension, causing the talks to collapse. Brazil is now considering accepting an extension of 4 to 5 years in exchange for US concessions on the tariff issue. The administration of US President Donald Trump argues that major trading partners have failed to effectively ban the import of goods produced with forced labor, putting American workers at an unfair competitive disadvantage, necessitating action. The new measures are being pursued under Section 301 of the Trade Act of 1974 and are expected to take effect after public hearings in July. International media generally view Washington's move as targeting not only Brazil but also part of a broader trade war strategy. BBC Brasil, citing The Guardian, noted that the US still maintains a trade surplus with Brazil, with US exports to Brazil increasing by nearly 11% last year, while Brazilian exports to the US declined. Argentina's Clarín reported that Brazilian President Luiz Inácio Lula da Silva criticized some opposition politicians for 'fueling US pressure' and has brought the issue into electoral politics. Overall, Brazil is attempting to mitigate the impact of the new US tariff offensive and maintain stability in the international market by pursuing a dual strategy of diplomatic compromise and legal retaliation, balancing national dignity and economic interests.