Trump will reimpose steel and aluminum tariffs on Brazil and Argentina, opening new trade war fronts
The White House says Brazil and Argentina are “presiding over a massive devaluation of their currencies which is not good for our farmers and is so very unfair. They must be taught a lesson.”
The surprise announcement came after it appeared as though the White House was preparing to dial back its adversarial trade approach in the lead up to next year’s election.
In Brazil, the news of steel tariffs stunned officials, who for nearly a year have sought to develop closer ties with the United States, particularly Brazilian President Jair Bolsonaro. Nicknamed by some as the “Trump of the Tropics,” Bolsonaro has repeatedly praised Trump, mimicked his rhetoric, and even tried to install his son as the ambassador to the United States.
But on Monday, Bolsonaro appeared taken by surprise. “I’m going to speak with Paulo Guedes,” he told several reporters outside the presidential palace, referring to the country’s finance minister. “Aluminum? I’m going to speak with Paulo Guedes now … If necessary, I’ll call Trump. I have an open channel with him.”
Trump’s tweets referenced Wall Street’s gains — “U.S. Markets are up as much as 21% since the announcement of Tariffs on 3/1/2018,” he wrote — suggesting he’s not too concerned about a market blowback if he ratchets up trade tensions.
Monday’s directive marks the latest twist in Trump’s trade war, which has become a major fixture of his foreign and economic policies. Trump has said he looked to clinch a trade deal with China this year, but those talks have unraveled on multiple occasions. Trump is now focused on a partial trade deal, which he has referred to as “Phase One” and which would include large purchases of U.S. farm products by Beijing.
The next potential deadline that could bring the United States and China to the table comes Dec. 15, when Trump’s next round of tariffs is scheduled to impact about $160 billion in Chinese goods. A deal could make those levies disappear, according to sources familiar with the talks.
Earlier in Trump’s presidency, in March 2018, top steel suppliers including Brazil, South Korea and Japan complained that the Office of the U.S. Trade Representative had yet to establish a process for countries to apply for tariff exemptions just days before tariffs on foreign-made steel and aluminum were scheduled to take effect. At the time, Brazil was the No. 2 steel supplier to the United States. In 2017, the U.S. imported 34.6 million metric tons of steel from 85 countries.
Still, Trump and Bolsonaro have shared a particular bond that spans their shared antagonism of the news media to massive fires in the Amazon rainforest. Recently, Trump pledged to take Brazil’s side as Bolsonaro said the powerful Group of Seven countries were criticizing his government’s response to the fires. When French President Emmanuel Macron announced in August that G-7 member nations had approved a $22 million emergency aid package to help combat the fires, the Trump administration did not give its support, saying that any solution should be done in consultation with Brazil.
Trump later praised Bolsonaro for “working very hard on the Amazon fires and in all respects doing a great job for the people of Brazil.” |
