Brazil Initiates Consultations for Retaliatory Actions Following New US Tariffs

President Luiz Inacio Lula da Silva has committed to invoking Brazil's "Reciprocity Law" in order to safeguard the Brazilian economy from recent US tariffs. Following the implementation of 25 percent tariffs on various Brazilian exports, the Brazilian government announced on Thursday that these new US measures are "unjustified and arbitrary," pledging to "continue to defend its position in all appropriate forums."

This development marks the initial phase of the reciprocity process, which may lead Brazil to implement retaliatory steps, such as tariffs on US imports. The preliminary stage entails further diplomatic discussions with US trade authorities. Earlier in July, the US applied a 25 percent surcharge on specific Brazilian imports—including sugar, clothing, paper, and steel—citing unfair trade practices. Additionally, the US imposed a 12.5 percent tariff on Brazil and several other nations, pointing to alleged lax enforcement of forced labour bans.

While a final decision is pending, potential retaliatory measures under consideration by Brazil involve imposing taxes or fees, removing exemptions, decreasing import tariffs, or restricting the import of American goods and services. A source indicated to the Reuters news agency that further actions could extend beyond tariffs, potentially including the suspension of pharmaceutical and agricultural patents. The US currently maintains a trade surplus with Brazil, exporting $26.5bn in goods and services while importing $17bn thus far in 2026, based on figures from the US Census Bureau.

Throughout Donald Trump's presidency, the US has consistently pursued sweeping import tariffs driven by concerns over trade deficits with global partners. In April 2025, the White House unveiled a minimum 10 percent tariff on nearly every country, known as the "Liberation Day" tariffs. Although those measures were struck down by US courts, this latest wave of tariffs is widely viewed as a successor designed to withstand legal challenges within the US court system.