{"id":91728,"date":"2024-11-06T11:33:13","date_gmt":"2024-11-06T14:33:13","guid":{"rendered":"https:\/\/murray.adv.br\/?p=91728"},"modified":"2024-11-06T11:33:15","modified_gmt":"2024-11-06T14:33:15","slug":"brazil-u-s-trade-likely-to-see-election-impact","status":"publish","type":"post","link":"https:\/\/murray.adv.br\/en\/brazil-u-s-trade-likely-to-see-election-impact\/","title":{"rendered":"Brazil-U.S. trade likely to see election impact"},"content":{"rendered":"\n

Concerns rise over Trump\u2019s victory and increase in import tariffs<\/strong><\/em><\/p>\n\n\n\n

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11\/06\/2024 <\/h6>\n\n\n\n
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Bilateral trade between Brazil and the United States is expected to face potential challenges as Donald Trump returns to power. Experts believe that while specific measures against Brazil are unlikely under a new U.S. administration next year, Mr. Trump\u2019s victory could drive up import tariffs overall. A key concern with the former president\u2019s campaign is his proposal to raise tariffs, which could impact global trade volumes or trigger currency devaluations. Some fear a \u201cspiral of tariffs and retaliations,\u201d though it remains uncertain what parts of Mr. Trump\u2019s platform are campaign rhetoric versus actual policy intentions.<\/p>\n\n\n\n

Experts believe the U.S.-China relationship will remain marked by intense geopolitical competition, with Brazil striving to balance relations. While trade protectionism could harm intra-company exports due to U.S. investments in Brazil\u2014the largest among foreign investors\u2014the U.S.-China rivalry could continue to benefit Brazil\u2019s agricultural exports, though increased protectionism is not viewed as ideal for global trade.<\/p>\n\n\n\n

\u201cPolitically, it would be preferable for the Lula administration if Kamala Harris won, given the president\u2019s previous endorsements of her,\u201d said Jos\u00e9 Augusto de Castro, president of the Brazilian Foreign Trade Association (AEB). From a trade perspective, he points to Mr. Trump\u2019s campaign pledge to raise import tariffs by at least 10% across the board and 60% on Chinese goods. \u201cSuch measures could curb global growth, impacting commodity consumption and reducing trade. But we must remember that the world is transitioning, and many factors will need adjusting.\u201d<\/p>\n\n\n\n

Sergio Vale, chief economist at MB Associados, suggests that a blanket tariff increase proposed by Mr. Trump could affect Brazil through currency devaluation. \u201cThis type of competitive tariff policy could lead to currency depreciations worldwide.\u201d<\/p>\n\n\n\n

Mr. Vale observes that this is already happening to some extent. \u201cThe recent depreciation in currencies reflects concerns over a potential Trump administration, as markets weigh the risk factors such a government could pose for U.S. fiscal and economic policy.\u201d Mr. Trump\u2019s victory, he adds, could keep these concerns around exchange rates alive, \u201cgiven his signaling of economically challenging policies.\u201d<\/p>\n\n\n\n

Mr. Vale expects no direct measures against Brazil under a Republican administration, \u201cdespite the political disagreements likely to arise with the Lula administration.\u201d However, the U.S.-China rivalry is unlikely to change regardless of the election outcome, as Livio Ribeiro, partner at BRCG and researcher at the Funda\u00e7\u00e3o Getulio Vargas\u2019s Brazilian Institute of Economics (Ibre-FGV), explains: \u201cThis is a state-to-state confrontation, not merely a clash between administrations.\u201d<\/p>\n\n\n\n

\u201cTrump brings more noise,\u201d Mr. Ribeiro said. \u201cHe\u2019ll likely push policies perceived as aggressive from the start, like general tariffs and specific taxes targeting China. But in the end, it\u2019s mostly noise rather than substantial change in frequency.\u201d<\/p>\n\n\n\n

On Mr. Trump\u2019s proposed general tariff, Mr. Ribeiro explains that if the measure is uniformly applied, it would raise the cost of U.S. imports globally. \u201cThe real risk here is getting caught in a cycle of tariffs and retaliations\u2014a non-trivial concern. But we need to separate Trump\u2019s noise from what his administration will actually implement,\u201d Mr. Ribeiro pointed out.<\/p>\n\n\n\n

Welber Barral, a partner at BMJ and a former foreign trade secretary, notes that certain Brazilian industries are still affected by Mr. Trump\u2019s policies from his first term, including steel, aluminum, and copper. According to Mr. Barral, a general tariff hike could also impact Brazilian exports of manufactured goods.<\/p>\n\n\n\n

Another factor, according to Mr. Barral, is that Brazil competes with the U.S. in exporting agricultural goods to China. He points out that during Mr. Trump\u2019s previous term, tensions with China led to increased Chinese purchases of Brazilian agricultural products, such as soybeans.<\/p>\n\n\n\n

\u201cProtectionism isn\u2019t good for anyone. In the end, everyone loses, though effects vary across supply chains. Trump\u2019s main challenge is his unpredictability.\u201d<\/p>\n\n\n\n

Political scientist Hussein Kalout suggests that Mr. Trump\u2019s victory would likely strain Brazil\u2019s current administration. The Republican agenda contrasts sharply with President Lula\u2019s priorities, and Mr. Trump\u2019s return could end today\u2019s aligned perspectives between the Brazilian government and the U.S., according to Mr. Kalout, former secretary of strategic affairs under the Temer administration, a researcher at Harvard, and adviser to the Brazilian Center for International Relations (CEBRI).<\/p>\n\n\n\n

\u201cTrump has shown a preference for an international policy agenda that conflicts with Brazil\u2019s current stance. His is a climate-skeptic, anti-multilateralist agenda that opposes reforms in international organizations, particularly the WTO [World Trade Organization],\u201d Mr. Kalout points out.<\/p>\n\n\n\n

Mr. Trump\u2019s presidency could accelerate inflation and halt the recent trend of falling U.S. interest rates, impacting foreign capital flows to emerging markets like Brazil. Former Brazilian ambassador to China and CEBRI adviser Marcos Caramuru suggests that if Mr. Trump enacts the import tariffs he\u2019s proposing, it \u201cwould disrupt the global economy, potentially driving export companies to invest in the U.S. The impact of his policies could be more significant than Biden\u2019s.\u201d<\/p>\n\n\n\n

Mr. Caramuru adds that Mr. Trump\u2019s proposed high tariffs, combined with limited foreign labor availability, would drive up U.S. inflation. \u201cAs a result, interest rates may stop falling, and more capital could shift to the U.S., affecting emerging markets like Brazil.\u201d<\/p>\n\n\n\n

*By Marta Watanabe, Camila Zarur, Paula Martini \u2014 S\u00e3o Paulo and Rio de Janeiro<\/p>\n\n\n\n

Source: Valor International<\/p>\n\n\n\n

\nhttps:\/\/valorinternational.globo.com\/\n<\/div><\/figure>\n","protected":false},"excerpt":{"rendered":"

Concerns rise over Trump\u2019s victory and increase in import tariffs 11\/06\/2024 Bilateral trade between Brazil and the United States is expected to face potential challenges as Donald Trump returns to power. Experts believe that while specific measures against Brazil are unlikely under a new U.S. administration next year, Mr. Trump\u2019s victory could drive up import […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8106],"tags":[25609],"class_list":["post-91728","post","type-post","status-publish","format-standard","hentry","category-murray-news","tag-brazil-u-s-trade-likely-to-see-election-impact"],"yoast_head":"\nBrazil-U.S. trade likely to see election impact - Murray Advogados<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/murray.adv.br\/en\/brazil-u-s-trade-likely-to-see-election-impact\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Brazil-U.S. trade likely to see election impact - Murray Advogados\" \/>\n<meta property=\"og:description\" content=\"Concerns rise over Trump\u2019s victory and increase in import tariffs 11\/06\/2024 Bilateral trade between Brazil and the United States is expected to face potential challenges as Donald Trump returns to power. 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