After the unilateral decision of the United States of Taxing in 50% Brazilian productsPresident Luiz Inacio Lula da Silva (PT), said he will respond to US impositions based on Reciprocity Lawsanctioned by him in April this year and approved by the National Congress with broad support from parliamentarians.
A determines proportional criteria in case of commercial barriers to Brazilian products, that is, based on legislation, Brazil offers citizens and governments abroad the same treatment they give to the Brazilian country, whether in the commercial scope, in the granting of visas, in the economic or diplomatic area.
According to the law, it is possible for Brazil to adopt measures in responses to possible foreign actions that “negatively impact competitiveness
Brazilian international “.
The article was presented in April 2023, but gained strength from the inauguration of US President Donald Trump, who has imposed a series of harder economic measures, such as 25% of steel and aluminum imports at the beginning of his term and now 50% to Brazilian products.
The law allows the adoption of contracted in the following cases:
- if countries and economic blocks interfere with the sovereign choices of Brazil;
- If countries and economic blocks violate, or be inconsistent with trade agreements that Brazil is a party;
- and if countries and economic blocks configure unilateral measures based on more costly environmental requirements than Brazilian protection standards.
How can Brazil apply reciprocity in the case of a 50%tariff?
The application of reciprocity in cases of commercial tariffs can occur in three ways:
- Direct retaliation through tariffs: When Brazil imposes equivalent rates on US products, reaching US strategic sectors, such as agribusiness.
- Multilateral actions: Brazil can resort to the WTO (World Trade Organization) to contest tariffs, which can result in an articulation with other countries, also taxed by the US, according to Lula.
- Review of Commercial Exemptions: The country can review bilateral agreements that benefit the US, whether in the tax, logistics or consular field.
As a reaction to Trump’s tariff, the Lula government will use proportional commercial retaliation through a decree, according to Vice-President and Minister of Development, Industry, Commerce and Services, Geraldo Alckmin.
“The National Congress approved the reciprocity law, which determines: if there is a tariff there, there will be fare here. Regulation, which is by decree, leaves tomorrow or until Tuesday,” said Alckmin on Sunday (13).
