Brazil launches formal process to explore retailation against US tariffs

Brazil has taken a major step in its escalating trade dispute with the US by officially launching a formal review into possible retaliation against steep US tariffs. Under authorisation from President Lula, the Foreign Ministry has instructed the country’s trade board, Camex, to assess using a newly passed reciprocity law to impose countermeasures potentially including tariffs of its own.Until now, Brazil had restricted its response to consultations at the WTO. Camex has 30 days to complete its assessment. If the law is deemed applicable, a government working group will then determine which sectors to target. Meanwhile, Brazil intends to notify the U.S. of the process imminently.

The move comes after the U.S. slapped a 50% tariff on a wide range of Brazilian exports excluding major items like aircraft and orange juice under the Trump administration, citing what it called unfair trade practices and domestic legal disputes involving former Brazilian President Jair Bolsonaro. Brazilian officials have publicly expressed frustration over the lack of prior negotiations.
Amid the rising tension, Brazil has already unveiled a substantial aid package for exporters affected by the U.S. tariffs and created multi-billion real credit lines for businesses seeking new markets or struggling with operating costs. Despite these retaliatory steps, President Lula says he is “in no rush” and continues to express openness to dialogue.