Brazil imposes new tariffs on Chinese imports

Despite the significant policy change, analysts suggest that a strong reaction from China is unlikely, highlighting the complex interplay between economic strategy and diplomatic relations.

Brazil aims for technological autonomy with a new AI investment initiative.

Brazil has imposed new tariffs on various imports from China, including a 35% tariff on fibre optic cables and a 25% increase on iron and steel products. The Foreign Trade Chamber Executive Committee (Gecex) justified these tariffs by citing a ‘significant increase in imports that harmed national production.’

Furthermore, most tariffs will remain in effect for approximately six months while the Ministry of Foreign Trade investigates alleged irregular trade practices. The tariff list encompasses a range of items, such as sodium chlorite, metal foils, nebulisers, tarpaulins, PVC laminates, and sewing thread, with a predominant focus on Chinese imports.

Notably, this move coincides with Chinese President Xi Jinping’s upcoming visit to Brazil to sign trade agreements as Brazil joins China’s Belt and Road Initiative. Additionally, Brazilian authorities had previously investigated possible dumping and irregular subsidies related to fibre optics and cables from China; however, the new tariffs are separate from that ongoing investigation.

Despite the significant changes in trade policy, there is uncertainty regarding China’s response to the tariffs. However, analysts suggest an aggressive reaction is unlikely, indicating a complex interplay between economic measures and diplomatic relations.